4 Ways to Save on Pet Expenses in Hard Times

Sometimes I hit the jackpot in my quest to find old material about retirement and early retirement. Last week, for instance, I was reading Early Retirement Dude’s history of the financial independence movement when he mentioned a Life magazine photo essay about early retirement from February 1957. Say what?
Within minutes, I was reading the article via Google Books. Within an hour, I had ordered not just that issue of Life but three others with retirement articles. Within days, the magazines were on my doorstep. I’m telling you: We live in the future!
I spend a lot of time talking with people who have retired early or are otherwise financially independent. From a purely anecdotal point of view, I’d say most of these folks are well-adjusted. They work to maintain balance in life, and especially with their personal finances.
That said, I’ve noticed that a lot of retirees — early retired or otherwise — struggle to know how much they should spend. I believe this dilemma exists for a couple of reasons:
The general response to these two problems is to follow what has been dubbed the four-percent rule. Generally speaking, itâs safe to withdraw 4% from your portfolio every year without risk of running out of money. (There are a lot of caveats to this guideline. To learn more, follow that link to my Money Boss article — or wait for that story to migrate to Get Rich Slowly in a few days!)
The AAII Journal — the monthly magazine from the American Association of Individual Investors — has published two articles in recent months about the problem of spending in retirement. Let’s look at what they have to say.
Today’s article is from Chad Carson, who writes about real estate investing (and other money matters) at Coach Carson. I’ve always been intrigued by real estate investing but overwhelmed by how much info available. I asked Chad if he’d be willing to write an article that would help me (and other GRS readers) understand the basics of real estate investing. This is the result.
I got started in real estate investing right after college. Because a young adult can basically sleep in a car if he has to (my 1998 Toyota Camry with cloth seats was comfortable), I had little to lose by launching a business. Unfortunately, as a Biology major, I also knew very little about business or real estate. But I did know how to hustle and to learn. That helped.
Slowly, I learned to find good deals and to resell them for a small markup of profit (a.k.a. wholesaling). I also learned to buy, fix, and flip houses for a bigger profit (a.k.a. retailing). After a few years, my business partner and I began keeping some rental properties because we knew that was the path to generating regular, passive income.
While my early business might sound like an exciting HGTV house-flipping show, it’s not for everyone. I experienced radical ups and downs of cash flow, and there were many unpredictable outcomes. I learned a lot being a full-time investor, but there are actually easier ways to get started.
Most investors I know started with a full-time job. They became valuable at their job, earned good money, lived frugally, and started boosting their saving rate. With their extra savings, they began buying rental properties on the side.
I’m not saying you shouldn’t begin as a real estate entrepreneur like I did — you’ll know if you’re called to make that leap — but if you currently have a non-real estate job and you’re saving money, you’re already going down the easiest path.
The next step is to learn how to invest that money profitably and safely. I personally think real estate investing is one of the best ways to do that. I’ll show you why that’s the case in the next section.
I’ve yet to find a better way to describe the benefits of real estate than this. All you need to remember is the acronym I.D.E.A.L:
These IDEAL benefits are core reasons to invest in real estate. But as a Get Rich Slowly reader, I think you’ll appreciate another core real estate investing benefit: control!
I love J.D.’s message here at Get Rich Slowly: You are the boss of you! You can apply this lesson to so many parts of life, but it especially applies to your finances. Real estate investing fits very well with the GRS philosophy. Why? Because real estate gives you much more control than other more traditional investments.
I’m also a fan of low-cost index fund investing, for example, but do you have an impact on the returns of your stock portfolio? Not really. The 3500+ managers of the companies owned by the VTI total stock market index fund do impact your returns, but not you personally. You simply control when you buy, how much you buy, and when you sell.
But with a rental duplex, for example, your decisions directly affect its profitability (for better or worse!).
If this prospect of control excites you, then keep reading. But if your palms are clammy at the idea of hands-on investments, just focus on a different vehicle. That’s okay. There are options for everyone in this big investing universe!
To make things manageable, we’re going to break things down a little. As a baby, you learned to walk by taking tiny steps. You also fell down a lot, but with a diaper four inches from the ground, what’s the harm?!
Well, you’re no longer a baby. Financially you do have a lot to lose. Your family, your hard-earned savings, your plans for financial independence, and your pride would all suffer if you made bad investments.
I get that. And that’s why we still need to take safe, baby steps. There’ll be plenty of time to run and grow faster once you’re more confident. But in the beginning, just strive to move forward steadily.
The seven baby steps below provide a simple path to follow. I’ve taken each of these steps personally. You can use them as a blueprint to help you move forward with your own real estate investments.
I’ll admit it: There are times that I think everything that needs to be said about personal finance has been said already, that all of the information is out there just waiting for people to find it. The problem is solved.
Perhaps this is technically true, but now and then — as this morning — I’m reminded that teaching people about money is a never-ending process. There aren’t a lot of new topics to write about, that’s true (this is something that even famous professional financial journalists grouse about in private), but there are tons of new people to reach, people who have never been exposed to these ideas. And, more importantly, there’s a constant stream of new misinformation polluting the pool of smart advice. (Sometimes this misinformation is well-meaning; sometimes it’s not.)
Here’s an example. This morning, I read a piece at Slate by Felix Salmon called “The Millionaire’s Mortgage”. Salmon’s argument is simple: “Paying off your house is saving for retirement.”
Now, I don’t necessarily disagree with this basic premise. I too believe that money you pay toward your mortgage principle is, in effect, money you’ve saved, just as if you’d put it in the bank or invested in a mutual fund. Many financial advisers say the same thing: Money you put toward debt reduction is the same as money you’ve invested. (Obviously, they’re not exactly the same but they’re close enough.)
So, yes, paying off your home is saving for retirement. Or, more precisely, it’s building your net worth.
But aside from a sound basic premise, the rest of Salmon’s article boils down to bullshit.
If you have more money than you need, you should start giving some of it away. That’s the lesson I learned about a year ago, when I took a gamble and donated $100,000 to a variety of charities, centered around the Effective Altruism movement. More on Effective Altruism: The Life You Can Save website, […]
Three years is the rule of thumb, but some will be relevant for longer, and a few can be discarded earlier.Three years is the rule of thumb, but some will be relevant for longer, and a few can be discarded earlier.
The post How long should you keep your tax returns? appeared first on Money Under 30.
Vanguard, the mutual fund company, recently published a free retirement planning guide for folks like me who aren’t interested in hiring a professional financial advisor. Vanguard’s Roadmap to Financial Security is a 32-page document intended to provide DIY investors with a framework for decision-making in retirement.
Here’s an excerpt from the intro to this retirement planning guide:
Know your taxes! I am a big fan of the philosophy: No one cares more about your money than you do. Even if a professional prepares your taxes every year, learn to do it yourself. Aside from what you’ll save in fees, here are two benefits of learning to prepare your taxes yourself:
Educate yourself. This is an excellent place to start â IRS tax tips.
Set up a meeting with your accountant/tax adviser.
My name is Zach, and I write at Four Pillar Freedom, where I tend to tackle financial topics through data visualization. While J.D. is on vacation, I offered to explore one of his favorite topics: the effects of saving rate versus investment returns.
Albert Einstein supposedly once said that compound interest is the eighth wonder of the world.But does data actually support this claim?
In this post, I explore the nature of compound interest, how long it takes to become an important factor in wealth accumulation, and whether or not it actually matters much for people who hope to achieve financial independence in a relatively short time.
What matters more: your saving rate or your investment returns?
Suppose your goal is to achieve a net worth of $1 million. If you invest $10,000 every year and earn a 7% annual return on your investments — which is a reasonable assumption for long-term stock market returns — you’ll accumulate $1 million in about 30.7 years.
The chart below shows exactly how long it would take to reach every $100,000 net worth milestone, using the assumptions of a $10,000 annual investment earning a 7% annual return:
Notice how each $100,000 net worth milestone takes less time to reach than the last. In fact, it’s mind-boggling to see that it will take youlongerto go from $0 to $100,000 than it will to go from $600,000 to $1 million:
The first $100,000 takes the longest to save because you don’t receive much help from investment returns early on. The time it takes you to go from $0 to $100,000 is mostly dependent on the gap between your income and your spending.