Tag Archives: Goals

Early Retirement Musings – Is It Worth It?

I have been thinking about early retirement a lot lately. Upon first glance, you might read that sentence as an indication that I am looking for an escape from my current day-to-day grind. On the contrary, I feel that Mrs. Superhero and I are in a good place at the moment. We enjoy our full-time careers in the classroom, and we feel invigorated by our side businesses in real estate and the music studio, respectively.

My thoughts on early retirement are admittedly impacted by a variety of influences. First and foremost, everyone in our family trees has opted for traditional retirements. On the other hand, nearly everything I read on a regular basis, from books and magazines to blog articles, touts the benefits of early retirement and financial independence.

What are my current thoughts about early retirement? I’m seriously pondering whether I am even interested at this point.

Retirement Basics

Any discussion of the pros and cons of early retirement should begin with a look at the purposes behind retirement at a basic level. Quite obviously, the cultural phenomenon of retirement exists because humans are not physically and mentally equipped to work forever. As a result, we work and save for four to five decades, on average, in order to survive when we are no longer able to support our basic needs through earned income.

To recap, the most basic life plan is as follows:

WORK 40-50 YEARS + SAVE MONEY = BASIC SURVIVAL AT AGE 65-70 

The above plan is a reality for an alarming cluster of the population. Yes, you can and probably should aim higher with your retirement goals. For example, you could save and invest more than is required to meet your basic retirement needs, allowing yourself to live a little in retirement. However, tomorrow is promised to nobody. Or you could save more and retire a bit earlier, say in your late 50s or early 60s.

So, we might describe the intermediate plan as follows:

WORK 30-40 YEARS + SAVE MORE MONEY = COMFORTABLE RETIREMENT AT 55-60

For a small number of renegades with their hearts and minds set on early retirement, even this sensible plan is insufficient. Thanks to mathematical breakdowns by Mr. Money Mustache and countless other bloggers, waves of people are targeting a much earlier retirement. How? They are aiming to increase their savings rate, as a percentage of net income, to figures which exceed 40 percent and approach 85 or even 90 percent!

Early retirement
The Shockingly Simple Math Behind Early Retirement (Credit: Mr. Money Mustache)

 

 

 

 

 

 

 

 

 

 

 

 

 

In order to reduce this table to a formula, we might proceed as follows:

WORK 3-20 YEARS + SAVE LIKE THE DICKENS = RETIRE EARLIER THAN EVERYONE ELSE

The most beautiful thing about the chart above is that it is not income sensitive in any way, shape or form. It applies to you whether you earn $40,000 per year or $4 million per year. Of course, it should be much easier to save when you have an inflated income. Yet, that pesky thing called “lifestyle” tends to get in the way.

In essence, we might say that early retirement is a largely a choice.

Early Retirement Pros and Cons

Now that it is apparent that early retirement is mathematically accessible for virtually everyone, let us examine the merits of such a plan.

Among many pros of early retirement, the following stand out:

*Opportunity to spend increased time with family and friends
*Freedom to travel
*Reduced stress and improved health
*More time to pursue other interests or even a new career

Obviously, early retirement is not without its cons, which include:

*Possible negative impact upon health (possible loss of health benefits, decreased physical activity)
*Possible boredom and/or depression
*Increased stress (more time to worry; constant fear that your nest egg may be insufficient)
*Limitations due to fixed income

As with virtually all matters of personal finance, the pros and cons are largely situation-dependent. For example, my Grandpa retired only a few years early and came out ahead in nearly every manner possible: he increased his earnings and kept busy by working side jobs, gained the freedom to spend time with his children and grandchildren, and took several vacations each year with my Grandma.

On the other hand, I know a person (who shall remain nameless) who would quite likely suffer an early death if he were to retire early. He would spend his days and nights wasting away in a recliner watching television, despite being of able mind and body. Quite likely, early retirement would be an early death sentence for this person.

Our Current Plan

Back in June, I established 30 goals as I approached my 30th birthday. Goal 5 stated, “Set a target date for early retirement and formulate a plan to get there.” I have been dragging my feet on this one ever since; as I said, I’m just not sure what I want to do at this point.

Strictly based upon Money Mustache’s chart above, Mrs. Superhero and I could likely retire somewhere in the neighborhood of 15-17 years, or 2031, given our current assets and savings rate. Since I am a proponent of stealth wealth, that’s about as specific as I’d like to get at this point in time. However, we could make some changes in current spending and investing plans and possibly retire in approximately 10 years. This would not be achievable without significant sacrifice and postponement of other significant goals.

All of which has led me to an important conclusion: I simply desire to achieve other goals more than I desire early retirement at this point in time. Among other goals that I feel will bring me and Mrs. Superhero greater joy than early retirement, starting a family ranks at the top of the list. Additional goals include:

*Fund college for our future children
*Travel with moderate frequency
*Give and support missionary work beyond our current ability to do so
*Finish our basement (which is currently unfinished)
*Possibly own a second home

If our pursuit of these goals brings us increased happiness and slightly slows our pursuit of early retirement by 5-10 years, I feel I am OK with that. I would rather retire slightly later than mathematically possible and achieve more in life rather than retire with unfinished business.

In closing, let us consider one of the oldest retirement clichés, which says, it is better to retire to something than to retire from something.


What are your current retirement plans? Do you aspire to retire early? If so, how do you hope to achieve early retirement?

 

Embracing the Grind

Happy Saturday, readers! Before diving into today’s post, I wanted to announce that FinanceSuperhero is being featured in the Making A Difference series at Canadian Budget Binder today. Special thank you to Mr. CBB for allowing me to participate!

If you found your way here thanks to Mr. CBB, please take a look around, leave a comment, or drop me an e-mail; I would love to hear from you!

While you’re here, check out the About page and the following popular articles:

Overcome FOMO (Fear of Missing Out) in 7 Steps

10 Tips for Self-Starter Entrepreneurs

Kicking Sallie Mae to the Curb: Goodbye, Student Loans!


Yesterday afternoon, after months of studying, I sat for my state of Illinois/national real estate broker test. I signed-up to take the 140 question multiple choice assessment at a rather inconspicuous H&R Block location in the Chicago suburbs. The good news: I passed the test and am all squared away to meet with my sponsoring managing broker on Monday morning.

The most remarkable aspect of my testing experience, believe it or not, had nothing to do with the test. As I waited in the lobby to check in and be wanded by the test proctor (yes, apparently that is a thing now), I struck up a conversation with a friendly young woman waiting to take a nursing exam.

In only a matter of five minutes, she shared that she was a newer mother and was taking her assessment in an effort to advance her career options. Surprisingly, she didn’t appear to be weary in any sense of the word. In fact, I sensed an uncommon aura of determination and resolve in her voice. Any lingering doubts I may have had about this young woman’s resolve were wiped away when she shared that she had literally stepped in human feces while in the parking lot, of course requiring her to clean off her sandal in the rest room.

In that moment, a thought occurred to me: $HIT HAPPENS; how you respond is everything.

I’ll never know with certainty whether this young mother passed her test, as I completed my assessment before anyone else did, but I believe I know the answer.

While most people in her situation would have been exhausted, irritated, or downright angry, this woman took everything in stride with a healthy balance of optimism and stoicism. Clearly, she was prepared to fight through any and all adverse circumstances in order to achieve her goals.

­

In contrast, the average person gives up far too easily. We are conditioned by our culture to seek and accept the path of least resistance. Furthermore, we whine and complain that life is so difficult and trying even in the absence of real difficulty, discomfort, or strife.

I am guilty of it from time to time, and chances are, you are, too.

Embracing the Grind

HOW TO STOP MAKING EXCUSES AND EMBRACE THE GRIND

­If you want to overcome adversity and achieve success, begin by changing your attitude. Stop whining and take action to get ahead. Envision what you want your circumstances to look like and figure out how you will make that vision a reality. This will require V-SMART Goals, a plan to achieve the goals, and accountability. Ask a friend to call you out every time look to give up and let adversity beat you down.

There are 24 hours in one day and 168 hours in one week. This gives you plenty of time get to work to change your circumstances. Time is the great equalizer.  It is an asset everyone possesses equally. However, for a variety of reasons, a quick look at the average person’s life reveals a troubling trend of laziness and wasted time (click the table for an enlarged view).

2015 Time Use Study

 

 

 

 

 

 

 

Highlights from the above table and overall study from the United States Bureau of Labor Statistics:

  • The average person spent 2.78 hours per day watching television
  • For persons who engaged in watching television (nearly 80 percent of those surveyed), that average was higher at 3.48 hours per day
  • Only 43.9 percent of those surveyed participated in work and work-related activities on a per day basis
  • According to Table 11, the average male spent only .26 and .31 hours per day reading on weekdays and weekends/holiday, respectively; for women, those figures weren’t much better, at .37 and .38 hours, respectively.

Volumes could be written about the above study, but even a cursory glance at the statistics reveals that Americans value their leisure time. To be clear, I am not criticizing leisurely pursuits. I have many hobbies myself and enjoy pursuing them as a means of relaxation and rejuvenation.

Over time, however, it seems that a cultural shift has occurred. Mindless leisure time, such as watching television, has become a replacement for the grind-it-out mentality adopted and embraced by previous generations.

My grandfather’s habits and work ethic provide a stark contrast to today’s average person. While other retirees spent mornings on the golf course and afternoons poolside and sipping an Arnold Palmer, Grandpa worked to keep himself busy, sharp, and boost his income. In his youth, Grandpa built his first home from the ground up; in retirement, he used these skills to build and rehabilitate small and mid-size utility trailers and sell them for large profit. It was not uncommon for Grandpa to unexpectedly come home with a newly-purchased, dilapidated trailer, even when he had two or three other projects in progress. He could not bear the thought of time gone to waste. Grandpa was focused on constant maximization. He embraced the grind!

In order to strike a reasonable balance between grinding out work and enjoying leisure pursuits, I recommend asking yourself the following questions:

  • What is most important to me?
  • What do I value most?
  • What is the purpose of my work?
  • What is the purpose of leisure activities in my life?
  • And my person favorite question – What is it time for now?

With any luck, these questions and the subsequent answers will help you to be a bit more like my new nurse friend. Keep persevering in the face of adversity, care for yourself, and learn to embrace the grind.


How do you balance time spent on work and leisure pursuits? What motivates you to keep grinding on?

Checking Up On My Goals

One month ago, I turned 30. Much to my surprise, I didn’t wake up the next day feeling like a stiff old man. In fact, I didn’t feel a day older than 20.

A day prior to this milestone birthday, I published a list of 30 goals I hope to achieve in the next year. Yesterday on Twitter, Staci – @Streamline365 – checked-in and inquired about my progress, which made me very happy. As I have written in the past, I have a strong desire to both help others with my blog while also seeking accountability for my actions and pursuit of my goals. So, thank you, Staci, for calling me out!

With that said, I offer a quick check-in on the progress toward goal achievement one month into my 30s.

INVESTMENT GOALS
1 – Max out both of our IRAs for 2016. $11,000 total investment.
PROGRESS: None to report, but that will change in September.
2 – Invest a minimum of $2,000 with Fundrise.
PROGRESS: I am going back and forth on which Fundrise option I wish to pursue, the Income or Growth eREIT. Both options, though different, are enticing. I had planned to dive in during the month of July, but a few unexpected medical and personal expenses proved to set us back in this regard. The current plan is to make a decision and pull the trigger in late August or early September.

Related Post: The Fundrise eREIT: Accessible Real Estate Investing for the Average Investor

3 – Grow my overall account value with Betterment.
PROGRESS: None to report.
4 – Increase our overall net worth by 50%.
PROGRESS: I have begun tracking our net worth on a more regular basis, so that counts as progress, I suppose. According to Personal Capital, our net worth rose by 1% in the past 30 days. Ho hum.
5 – Set a target date for early retirement and formulate a plan to get there.
PROGRESS: Mrs. Superhero and I have had several discussions about our retirement options and plans. More specifically, we have defined our vision of what early retirement will look like for us. I intend to write about this in the future. With any luck, we may be able to narrow down a specific target date in the next few months.

HEALTH GOALS 
7- Lose 10 pounds by September 1, 2016.
PROGRESS: In the midst of birthday and anniversary celebrations, I gained 4 pounds. Oops!
8- Run at least four times per week.
PROGRESS: I’ve been consistently running twice per week. Time to step it up!
9- Weight lift at least twice per week.
PROGRESS: None to report.
10- Implement Meatless Mondays on a regular basis. This will represent a health goal as well as a budgetary goal (decreasing our grocery budget).
PROGRESS: Success! I miss meat every Monday, but this goal has been a good one.

FITNESS/RUNNING GOALS
11 – Run an unsanctioned half marathon in the month of July. This will help me to have a target for getting myself back in excellent running shape after a year of inconsistent training.
PROGRESS: I have one more week to achieve this one. Chicagoland has been an inferno lately, so I might not be able to squeeze this one in.
12 – Run a sanctioned or unsanctioned marathon in August.
PROGRESS: This remains a big stretch goal. Time will tell
13 – Run a sanctioned marathon in October.
PROGRESS: I have looked into a few options and am narrowing them down based on my calendar.
14 – Begin training for and compete in the Artic Frog 50K scheduled for December 2016; definitely a stretch goal!
PROGRESS: Remains a big stretch goal.
15 – Run a 5:30 mile. I haven’t been able to do this since I was 18; my best has been hovering around 6:05 for  while now. Nothing like jumping in the time machine to prove I’ve still got it!
PROGRESS: Also a stretch goal.
16 – Shoot hoops in the driveway at least three times per week. Mrs. Superhero surprised me by taking me out to pick out a basketball hoop for our driveway as my birthday gift a few weeks ago. I intend to put it to great use.
PROGRESS: The basketball hoop has been my favorite birthday gift in years. I love getting out and shooting around, even if for a few minutes, as a break and a means to clear my head.

BLOG GOALS
17 – Reach 15,000 Twitter followers prior to turning 31.
PROGRESS: As of today, I have 4,177 followers.
18 – Boost my Alexa ranking into the top 200,000 globally. This is part of the Yakezie Challenge.
PROGRESS: As of 7/24/2016 – Global: 628,956. US: 80,587. I’m thrilled with this progress!
19 – Break into the top 100 on the Modest Money Top Finance Blogs List prior to turning 31.
PROGRESS: Currently sitting at 271.
20 – Continue to publish 2-3 new articles per week while also pursuing additional guest posting opportunities.
PROGRESS: Success. In the past few weeks I have been fortunate to guest post on Budgets Are Sexy and Distilled Dollar, and I have another guest post slated on Millennial Moola this week. Thank you to J. Money, Matt, and Travis for these great opportunities!

CAREER GOALS
21 – Decide what I want to do with the next chapter in my life.
PROGRESS: I anticipate completion of my real estate licensure very soon, and the new school year kicks off mid-August.
22 – Join a real estate brokerage and close my first real estate transaction in 2016.
PROGRESS: See above.
23 – Reach my commission goals for my current consulting role.
PROGRESS: None to report.
24 – Begin laying the groundwork for writing my first book.
PROGRESS: I’ve jotted down some foundational ideas.

BUDGET GOALS
25 – Reduce discretionary spending by 10%. We can learn to be happy with less. This will be a primary key to achieving our investment goals.
PROGRESS: We reduced our restaurant allotment for the month of July.
26 – Include Mrs. Superhero more in the formulation of our goals. To her credit, Mrs. Superhero is great at supporting my dreams when they are wise and shooting them down when they are stupid. I would like to be careful to involve her more when strategizing.
PROGRESS: Mrs. Superhero and I have scheduled more frequent budgeting sessions recently.

LIFESTYLE GOALS
27 – Visit Nashville, TN for vacation and do our “Debt Free Scream” on the Dave Ramsey Show.
PROGRESS: Tentatively planned for March 2017.
28 – Go on three vacations – one in the fall (hopefully Las Vegas), one in the spring of 2017 (see Goal 27), and one in the summer of 2017 – and plan them utilizing travel hacks and deal hunting techniques.
PROGRESS: Aiming for Las Vegas in October!

RELATIONSHIP GOALS
29 – Take Mrs. Superhero on one date each week. Sometimes this will be simple, and other times it will be more elaborate.
PROGRESS: Success. It has been the highlight of each week to spend dedicated time with Mrs. Superhero.
30 – Spend more quality time with my two nephews and new niece. Also, call my siblings to catch up on a monthly basis.
PROGRESS: Success. I’ve especially enjoyed bonding with my niece, who has to be the most adorable 4 month-old in the world!

Uncle FinanceSuperhero and Charlotte
Uncle FinanceSuperhero and Charlotte

How has your July progressed? Are you on track to meet your goals?

All About the Acronyms, Baby! (Keeping Up With the HENRYs?)

As winter turned to spring, I was enjoying a walk around my school when I bumped into one of my colleagues. Apparently, word had gotten around that my wife and I had paid off my student loans in record time, even though I had only told one person. The employee offered me her congratulations, and I politely thanked her.

“Must be nice that you and your wife are DINKS,” she continued.

“Excuse me?” I questioned, doing a very poor job at trying not to appear insulted.

“What? You know. . . DINKS. Double income, no kids,” she quickly responded.

With many of my employees, I had developed a reputation as “The Money Guy,” so you can imagine my embarrassment over having never heard of this term before.

“Ohhhh, right!” I said. “You’re right; it is pretty nice.”

THE BENEFITS OF BEING DINKS

Being DINKs is pretty nice, indeed. Among the many benefits Mrs. Superhero and I experience as a result of our status, I value

  • Healthy discretionary income within our monthly budget
  • Freedom to do what we want on our own time
  • The ability to cash-flow unexpected expenses rather than raiding our emergency fund
  • Time and resources to spoil our two dogs
  • The ability to focus on our careers and side hustles
  • Frequent travel opportunities (even if we often decline the opportunities as they arise)
  • The ability to focus on our marriage and enjoy time with each other

Please don’t misunderstand me. My wife and I love kids. We are both educators, and Mrs. Superhero operates a very large and successful private music studio in addition to her public school teaching career. We spend more time with kids than we do with each other. There is a part of both of us that cannot wait to have children of our own.

However, we are currently striving to make the most of our DINK status. We are in full-blown hustle mode in the present because we know that children will occupy our time in ways which we do not yet fully comprehend (this will be a good thing). We know that children will bring us immeasurable joy, and that joy will be an asset greater than lavish sums of money, yachts, lake houses, and luxury vehicles (having never possessed any of these things before, I’m making assumptions). Right now, time is our asset, and we are seeking to maximize it while we are DINKs.

There’s just one problem.

The DINK acronym strikes me as personally insulting, though not for the reasons you’re likely expecting.

A meme which is accurate for some people - just not us
A meme which is accurate for some people – just not us

EVERY DAY WE’RE HUSTLIN’

The above meme is admittedly hilarious, and for me and Mrs. Superhero, it’s pretty accurate. That is, until we get to the final slide.

While the “DINK Life” affords many couples the freedom to pursue a wide variety of leisurely pursuits, Mrs. Superhero and I live a different kind of lifestyle.

As I mentioned, my wife is a public school teacher. Even if we (erroneously and hilariously) assumed that she worked only 40 hours in her day job, that would be respectable. As a fellow teacher, I know several teachers who put in 40 hours or less and appear beaten to a pulp at the end of every school day. Not my wife.

When the school day ends and many teachers are heading home, Mrs. Superhero enjoys a brief intermission before the “side hustle” begins. On any given day, she teaches private piano, voice, and flute lessons in our home music studio for 2-4 hours. She is a wise, self-made entrepreneur who runs a home-based business with minimal overhead. She also seeks opportunities to employ her superior piano skills by accompanying musicians at a variety of contests throughout the year.

For those of you keeping score at home, that’s three “jobs.” She easily works over 65 hours per week.

Even though I write a sometimes-serious, sometimes-silly blog about my personal experiences with money, I hate talking about myself, so I’ll keep this section brief. I am a public school teacher by day, financial consultant by afternoon, and blogger by night. In a matter of weeks, I will also add part-time real estate broker’s agent to my work slate.

DINKsSide note #1: Can anyone comment on the legality of using my HSA funds to have a coffee IV port permanently installed in my left arm?

Side note #2: I used to try to fight my inner-workaholic, but now I have given up and chosen to embrace this tendency.

Scoreboard: Four “jobs” for me.

Our combined total: Seven “jobs.”

Since the acronym SINKs (single income, no kids) is already taken and is not eligible to denote “seven incomes, no kids,” I’m going to go ahead and coin a new term for those couples who have multiple income streams and no kids:

MINKs.

Multiple incomes, no kids.

I should probably trademark that one and put it on a T-shirt before someone else beats me to it.

OTHER ACRONYMS

This piece would be incomplete without a survey of other money-related acronyms. Here are a few of my favorites:

HENRYs – High earners, not rich yet

SINKs – Single income, no kids

SISSI – Single income supporting spouse’s interests

DINGO – Dual incomes, never go out

DINE – Dual incomes, never enough

MAID – Master (of) Arts, infinite debt

ERROR – Empty refrigerator, running on ramen

HAGGLE – Hired after graduation, got lucky everyone

(not writing the acronym because you, dear reader, are smart) – Financially unaware college kids

SHORT-TERM SACRIFICE FOR LONG-TERM GAINS

I am certain that many readers have completely misunderstood me and Mrs. Superhero by now. On the surface, it may appear to some that we are greedy, senselessly money-driven, and maybe even self-obsessed.

Over the years, I have learned that it is not actions alone, but the underlying motivations of one’s actions, which are deserving of scrutiny.

In this sense, I believe we pass the test.

My wife and I aren’t working and earning to inflate our current lifestyle, live it up in the present, and run the risk of burn-out. No, we are sacrificing in the short-term in order to build our ability to focus on what is truly important to us five, ten, and twenty years from now. In a culture which places the highest value on instant gratification, we are embracing the opposite.

Once in a while,  when it feels like I’m burning the wick at both ends, I like to hit the streets for an evening run and clear my head. Invariably, my thoughts drift and I begin to form visions of the future: our future kids playing in the yard, sending them off to college without any debt, walking my daughters down the aisle on their wedding days, and taking the entire family, grandchildren included, on a two-week getaway to Disney World. Those thoughts are the magical panacea for my weariness.

In the moment, those visions represent the future, but it is a future worth working for and waiting for, even when it is difficult. On the particularly tough days, I recall one of my favorite Zig Ziglar quotes:

It was character that got us out of bed, commitment that moved us into action, and discipline that enabled us to follow through.


Readers, what are your favorite money acronyms? Which one best describes your current situation? Do you have any suggestions for new money acronyms?

20 Budgeting Tips for Singles – A Bachelor’s (or Bachelorette’s) Guide

Last week, the state of Illinois finally passed what I would describe as a “Band-Aid” budget. While politicians largely celebrated this move and patted themselves on the back, their budget does very little to solve the gaping wound that is the state of financial chaos in which Illinois currently finds itself.

As I read the headlines and a few articles, I marveled at the difficulty the legislature faced in passing a budget. As you may or may not know, Illinois recently went an entire fiscal year without a budget. This standoff made previous budget delays (18 days in 1991, multiple delays of several weeks in the 2000s, and the bitter standoffs of recent years) look like small blips on the radar.

While Governor Rauner and Speaker Madigan set aside partisan gridlock long enough to pass a budget, public schools, state universities, and social service agencies are from celebrating. To the detriment of the citizens of Illinois, the finger pointing between Republicans and Democrats will surely resume and intensify in the next months.

Right around the time that Governor Rauner was delivering his press conference regarding the new budget, I sat down to review my planned budget for July 2016. Since September 2009, I have created a unique monthly budget using Gazelle Budget, the online software platform created Dave Ramsey’s team at Ramsey Solutions. That makes 71 unique budgets. It felt good to add yet another accomplishment to the mental list of ways in which I put the state of Illinois to shame.

MY FIRST BUDGET

As I often do when completing a budget, I took a look through the archives to see how Mrs. Superhero and I have come. My trek brought me back to September 2009, the month in which I created my very first budget.

In September 2009, I was a newly-employed, engaged bachelor, living independently for the first time in my life. Less than one week before the new public school year started, I accepted a job offer to teach music about 25 miles away from my university campus. With a week to prepare, I scrambled to locate housing, sign my contract, and prepare for a radical life change.

At the time, I had barely a tiny inkling of how to responsibly manage my money. I had recently read The Total Money Makeover in record speed, but I didn’t know the first thing about budgeting an “adult” paycheck. This was going to be the first time I had ever earned a paycheck which included a comma in the amount field!

After reading about Gazelle Budget (which is being replaced soon by EveryDollar), I purchased an 18 month membership, which included access to all three hours (ad free) of the Dave Ramsey Show podcast, for $89.95. Moments later, I created my first budget.

In all its glory, my very first monthly budget, from September 2009
In all its glory, my very first monthly budget, from September 2009

I began by projecting my total net income for the month, $2,357.29 in total. In that moment, I recall feeling pretty wealthy. I continued by inputting my desired charitable giving ($236 – 10%), rent ($400 – I rented a room in a two-bedroom condo from a friend-of-a-friend), food ($305 – for groceries and restaurants), and my debt obligations ($50 car payment and $200 credit card bill). From that point, I filled out the budget with an estimate of utilities, transportation (gas, car insurance, and routine maintenance), clothing (new work clothes and change for laundry), personal spending (spending money blow money Starbucks fund, books, gifts, hair cut, toiletries, and the Gazelle Budget subscription), and savings (emergency fund and honeymoon fund).

As you can see above, my projections for spending (middle column) were not entirely accurate when compared with my actual spending (leftmost column) at the end of the month. In fact, despite projecting a zero-based budget, I spent more money than I earned in September 2009.

This was hardly a Superhero effort.

On the other hand, the percentages of my categorical spending mimicked responsible spending.

Budget Percentages 1

Budget percentages 8-11
Categorical budgeted spending as a percentage of net income, September 2009

THE TROUBLE WITH PROJECTIONS

For the first full month of living on my own, I updated my budget on a daily basis. I kept a stack of receipts for all cash purchases and utilized internet banking to reconcile all other transactions. Yet despite my diligence, I was still brand-new to the process of budgeting.

As you can see below, I overspent considerably on food and personal spending; I had budgeted a combined $572.29, approximately 24% of my net income, but at the end of the month, I had spent a combined $761.58, approximately 32% of net income.

When I broke these spending figures down further, I discovered that I had spent $156.50 at restaurants and $80.77 at Starbucks.

Ouch.

My First Budget - Spending
20 TIPS FOR THE BACHELOR’S OR BACHELORETTE’S BUDGET

I chose to present the above figures for two primary reasons. First, I wanted to prove that it is possible to build and maintain a monthly budget as a single person. Second, I wanted to be fully transparent about my early mistakes.

Yes, creating a budget is not always easy. It isn’t the cool thing to do, especially as a young 20-something fresh out of college. Even at age 30, I can still recall the temptation to throw caution to the wind and live it up. Heck, I almost went out and leased a car!

However, I still recall one of the most powerful motivators for a 20-something single: the desire to prove one’s independence. Creating a budget is one of the best ways to set out to accomplish this goal and appear to be an adult. If you don’t manage your money responsibly, you will surely appear to be a child to you parents and extended family.

To win with money as a bachelor or bachelorette, follow these 20 tips.

20 BUDGETING TIPS FOR SINGLES - TW

1. Share costs with a roommate.

In my case, I avoided spending $1,000 per month for a one-bedroom apartment and spent $400 to rent a home in a two-bedroom condo. By sharing costs in this manner, I avoided spending 40% of my net income on housing costs.

Housing is by far the biggest budget buster for the average bachelor or bachelorette. Spending within this category can be a difference-maker.

2. Gather an accurate picture of your monthly debt obligations.

When you are just starting out, you will feel the temptation to delay examining your debts, particularly if your student loans are still in deferment. Avoiding your debts will not make them go away, so gather this information, including total principal, interest rates, minimum payments, and loan terms for each debt. If you’re unsure or unclear about any debts, contact the appropriate customer service department right away. Also, you should check your credit report; remember, this can be done free of charge once per year with each of the major credit reporting bureaus.

3. Prepare your own meals and cook at home as much as possible.

As a single young adult, preparing your own meals will accomplish two goals: you will save money, and you will not gain weight eating low nutrition/high calorie fast food. As an added bonus, you will be able to host your dates for dinner and impress them with your fine culinary skills. They’ll expect Ramen, and you’ll blow them away with shrimp creole!

Ladies, don’t forget, the way to a man’s heart is through his stomach.

4. Maintain a college lifestyle, at least in terms of spending.

When your first paycheck rolls in, you will immediately experience the temptation to buy everything in sight. If you establish an unreasonable level of spending out of the gate, you will set yourself up for failure. As much as possible, continue to live a college lifestyle (i.e. behave as if you are poor), within reason, of course.

5. Do not go out and buy a new (or new to you) vehicle.

You need to get used to living on a budget first in order to determine what you can or cannot afford in a new vehicle. Don’t allow pride and vanity to influence your decision-making process. If your current vehicle gets you from point A to B, it’s a keeper – at least for a few months.

6. Invest in a decent coffee maker with a timer function and brew your own coffee at home.

I learned this the hard way when at the end of my first budgeted month I had spent $80.77 on coffee on my way to work. I had a decent Mr. Coffee coffeemaker, but it didn’t have a timer feature. If I happened to be running late to work in the morning, I resorted to a quick Starbucks stop, which cost me significant money without adding any perceived value (neither happiness-wise nor nutritionally speaking).

Nothing beats the sweet aroma of morning coffee, especially when you brew it yourself and save money in the process

Mr. Coffee
Nothing beats the aroma of freshly-brewed coffee in the morning – and it saves you money!

7. Stay in.

Fortunately, I did a good job of this. My wife-to-be and I enjoyed cooking dinner at my condo and watching reruns of The Office. I know that many single people will feel the temptation and be pulled into the expensive night life scene, but do so within reason. Invite friends or your significant other back to your place, where food and drinks are cheap.

8. Find affordable dates with Groupon and Restaurant.com . I’m not even sure if Groupon and Restaurant.com existed back when I was a bachelor, but taking advantage of them today is a key part of our dining out experience. With either platform, you can purchase certificates for what is usually a fraction of the value, which allows you to realize significant savings and still enjoy a night out. The most common Restaurant.com offer is $10 for a $25 gift certificate. Check out the Restaurant.com offerings in your area by following the link and entering your zip code.

9. Build an emergency fund as quickly as possible.

As a young single person, building an emergency fund is the definition of adulting. Without an emergency fund, you will face unexpected expenses and be forced to swipe your credit card. Or worse yet, you may have to beg your parents for a loan or a gift.

10. Begin charitable giving right away.

While I have always given 10% to charity and missions organizations, I know this isn’t for everyone. If you’re not a natural giver, start small. Even $1 or $10 per month will benefit worthwhile organizations. If you’re not into structured giving, pay it forward and purchase the coffee or meal for the driver of the vehicle behind you in the drive-thru.

I strongly believe that regular, consistent giving is a key to winning with money. The act of giving teaches you that money is not an asset to be horded, stockpiled, wasted, or worshipped, but a tool to help yourself and others.

11. Strive to create a zero-based budget every month.

Remember, you will fail at this at first. Over and over and over. However, I found comfort in a Dave Ramsey quote during my initial months of struggle with my budget:

Adults devise a plan and stick to it. Children do what feels good. -Dave Ramsey

12. Accept that your budget projections will rarely be perfect.

On a related note, embrace your budget mistakes as they occur. Be willing to adjust your budget several times during the first several months.

13. Share your budget with a friend who is wise with his or her finances.

Accountability is helpful for everyone. It is part of the reason why I write this blog. A good budget is not inflexible.

14. Tell yourself every day that instant-gratification isn’t all that gratifying.

A few days ago, I read that the average person only waits 5 seconds for a web page to open before becoming irritated and moving on. Clearly, we live in a culture which embraces speed and instant results over patience.

You will need to learn to delay your desires in order to maintain a successful budget. Make a plan and stick to it.

15. Don’t worry about investing money right out of the gate.

In the personal finance blogging community, the suggestion to delay investing for retirement is utter blasphemy! However, I believe that there are better uses for your first months of pay. Make sure your budget is in order, build an emergency fund, and take time to research your investment options. When the time comes to invest, look into low-cost options through Betterment and Motif Investing. You will be glad that you waited.

16. Identify your values and be sure that your budget follows them.

If you’re not sure where to start with values-based budgeting, check out my two part series on budgeting with values in mind:

Values and Budgeting – Part One

Values and Budgeting – Part Two

17. Once you’ve identified your values, create written goals that you wish to accomplish.

Writing V-SMART Goals is the best way to accomplish your goals.

18. Be transparent with your friends and family about your budget.

It is OK to explain that you are striving to manage your spending responsibly. In fact, if you keep your budget goals a secret, it will be more difficult to stick to your budget, as co-workers will invite you out for happy hour drinks and apps every Friday. Just be up front and honest.

You can still have a social life on a budget. But be willing to say "no."
You can still have a social life on a budget. But be willing to say “no.”

19. As follow-up to number 18, be willing to say “no.”

If you want to live on a budget and win with money, you will likely hurt people’s feelings from time to time.

20. Avoid making any purchases on impulse.

If you are considering a sizeable purchase, write it down and check back again in thirty days. See my recent piece, The Thirty Day List, for a step-by-step process on delaying purchases.

Note: This piece contains affiliate links. FinanceSuperhero only recommends products designed to save readers money.


Readers, what budget tips do you have for singles?

June 2016 Blog Report – Treading Water

Welcome to the third FinanceSuperhero Monthly Blog Report! As was the case with the previous blog reports, I am writing this post for the sake of transparency and posterity.

LESSON 1 – LIFE GETS IN THE WAY OF BLOGGING

On a personal level, June was a chaotic whirlwind of a month. Notably, on June 7th, I finished my employment contract as a school administrator. I had been waiting for this day since late February, when I submitted a formal letter of resignation and petition to return to a teaching position within the district.

Waking up on June 8 was inarguably one of the greatest feelings of my life. I had finally escaped a job which, while it paid well, was sapping me of my energy, creativity, and happiness. I thought life might slow down a bit beginning that morning, allowing me to enjoy some much-needed time of rest and relaxation.

WRONG.

A few days later, Mrs. Superhero and I made the trek from Chicagoland to Michigan to visit family and attend a graduation open house for my twin cousins. While Chicagoans suffered through 98 degree heat that weekend, Mrs. Superhero and I, forever Michiganders at heart, delighted in the 85 degree perfection known as Pure Michigan summer. If you’ve never experienced a Michigan summer, let Tim Allen tell you all about it in the radio campaign for my hometown below.

A primary reason for our visit, as always, was to visit my grandmother, who recently turned 91. Unexpectedly, she became ill during our visit and was hospitalized. Fortunately, she is now doing well in a rehabilitation stint and is eager to return home.

What does this have to do with the blog? Everything.

For the first time, I learned what happens to a newer blog when its writer stops paying attention for several days at a time, barely cobbles together a few articles, forgets to approve and respond to comments, doesn’t check e-mail, and stops interacting with fellow bloggers:

-Page views decline
-Alexa ranking suffers
-Reader loyalty wanes
-Typos find their way into published posts
-Goals fail to be met

Blog Report June 2016

LESSON 2 – GOALS AND TARGETS ARE NOT ALWAYS REACHED

Confession time: I am an overachiever. The generation of students I teach refer to my personality type as a “tryhard,” defined by Urban Dictionary as

A face-saving insult used by someone who is feeling inadequate. Basically accuses anyone who is better than them at anything of putting in effort. Doubles as an excuse for sucking by implying lack of effort on the speaker’s part.

In retrospect, many of my achievements in life can be attributed to this inner drive to keep growing, do more, and exceed expectations. On the other hand, it can be very disappointing when things don’t go my way, to be fully-transparent.

In my previous blog report for May, I established the following goals for June 2016:

1. Reach a minimum of 3,000 new page views in June
2. Reach a minimum of 3,000 total Twitter followers in June
3. Officially join the Yakezie Challenge
4. Grow my Alexa ranking into the top 900,000 globally by July 1
5. Publish 15 new posts in June

The results, while not surprising when considered in light of the relative inattention I paid to this blog, are disappointing.

1. FAIL – 2,383 new page views
2. FAIL – 2,435 Twitter followers as of July 1
3. SUCCESS – I joined the Yakezie Challenge on June 3
4. FAIL – My current global Alexa ranking is 1,446,221. For reference sake, my US ranking is 275,939. While I do not pretend to entirely understand the details behind Alexa’s ranking metrics, I know the metric includes unique page views and unique visitors in its algorithm:

Alexa’s Traffic Ranks are based on the traffic data provided by users in Alexa’s global data panel over a rolling 3 month period. Traffic Ranks are updated daily. A site’s ranking is based on a combined measure of Unique Visitors and Pageviews. Unique Visitors are determined by the number of unique Alexa users who visit a site on a given day. Pageviews are the total number of Alexa user URL requests for a site. However, multiple requests for the same URL on the same day by the same user are counted as a single Pageview. The site with the highest combination of unique visitors and pageviews is ranked #1. Additionally, we employ data normalization to correct for biases that may occur in our data.

5. FAIL – 11 new posts were published in June

LESSON 3 – EMBRACE CHALLENGES

While June wasn’t a total loss, I am currently a bit behind where I had hoped to be with FinanceSuperhero. Now that things have settled down, I could choose to whine about it or redouble my efforts and start winning. While I hope my choice will be obvious one month from now, I have to admit that my usually unflappable fortitude was shaken a bit by fatigue and apathy last week.

Then I read a post, The Stonecutter’s Credo by Bobby at MillennialMoneyMan.com, which seemed to be speaking directly to me. (If you haven’t read the entire post, do so ASAP!) In the post, Bobby shares a powerful quote from Jacob Riis:

When nothing seems to help, I go and look at a stonecutter hammering away at his rock perhaps a hundred times without as much as a crack showing in it. Yet at the hundred and first blow it will split in two, and I know it was not that blow that did it, but all that had gone before.

Prior to the motivational shot in the rear end from this post, I had been thinking about scaling back my goals for the blog a bit. However, I now see that that would be foolhardy, and frankly, taking the easy way out.

With that said, here are my blog goals for July 2016:

1. Reach a minimum of 5,000 new page views in July
2. Reach a minimum of 5,000 total Twitter followers in July
3. Be a more collaborative member of the blogging community by guest posting on at least 3 other blogs.
4. Grow my Alexa ranking into the top 800,000 globally by August 1
5. Publish 16 new posts in July

Like last month, some of these goals are natural, while others are stretch goals. For example, pushing my Alexa ranking up will be a significant challenge. My Twitter goal ought to be accessible provided I maintain consistent, daily use of tools like Crowdfire and ManageFlitter to market FinanceSuperhero on Twitter.

By the way, if you haven’t followed me on Twitter or liked the FinanceSuperheroFacebook page, please take a moment to do so.


Readers, how was your month of June? What accomplishments are you celebrating? What goals do you have for July?

 

May 2016 Blog Report – Steady Progress

Welcome to the second FinanceSuperhero Monthly Blog Report! As was the case with the April 2016 Blog Report, I am crafting this post in the interest of transparency and accountability.

Lesson 1 – Self-Promotion Is Tiring

When I launched FinanceSuperhero via Bluehost, I was pleasantly surprised by the relative ease of setting up my own domain and the overall process of formatting a website. I recall sitting back at my desk, striking a self-congratulatory pose, and enjoying the moment.

The process of selecting plugins, creating Twitter and Facebook handles, and even publishing my first post all came rather easily. Probably too easily, I am afraid.

Build it they will comeAt the time, I am sure I thought that the hard work had been done. After all, I had built a website, by golly! But in the days ahead, I quickly learned that building a blog is not much like Field of Dreams. Fear not: No spoilers ahead.

In the 1989 hit movie, Kevin Costner plays the role of Ray Kinsella, a man who hears a faint prophetic voice and opts to transform his corn field into a baseball diamond. Of course, the plot is not simple, nor cut and dry, but Kinsella’s ball field eventually draws visitors.

Unlike Kinsella’s diamond, a blog like FinanceSuperhero requires constant promotion and upkeep. As someone who does not enjoy self-promotion, this quickly became a problem. Thanks to the advice of several other personal finance bloggers, I discovered the beauty of Twitter and Facebook automation via platforms like Buffer and TweetJukebox; after setting up a simple posting schedule, I had solved a significant problem. I am still working out a few kinks related to the transition to TweetJukebox at this time.

Lesson 2 – Quality Content Remains King

To make a long story short, my most unique posts are the ones which receive the best traffic and most comments. If I write a mediocre post that does not provide great value to readers, I can immediately tell by looking at my site statistics over the next several days.

I know many bloggers who strive to hammer out short posts several times per day, but that will never be the norm for me. I will continue to post two or three times per week and do my best to provide articles and rationales supported by research.

Note: This is a classic example of Effectiveness vs. Efficiency. Matt at DistilledDollar wrote an excellent article on this subject a few days ago.

Lesson 3 – Goals and Targets Are Critical to Success

At the end of April, I established two simple goals for the month of May:

  1. Reach a minimum of 1,750 new page views in May
  2. Reach a minimum of 1,750 total Twitter followers in May

As of June 1, I achieved Goal 1 (2,043 page views) and fell short of Goal 2 (1,499 Twitter followers). My only regret with regard to these goals is that I did not seek greater accountability in my pursuit.

Therefore, I am making public my goals for June 2016:

1. Reach a minimum of 3,000 new page views in June
2. Reach a minimum of 3,000 total Twitter followers in June
3. Officially join the Yakezie Challenge
4. Grow my Alexa ranking into the top 900,000 globally by July 1
5. Publish 15 new posts in June

Some of these goals represent a natural progression for a newer website, while others resemble stretch goals. Fortunately, I will have more time to rigorously pursue these goals, as I will be transitioning to a new position and gain several weeks of “vacation” time in the process. I will plan to share brief updates on my progress at the conclusion of several posts throughout the month of June.



Readers, how do my site statistics compare to your statistics in your second month blogging? What other goals should I establish for June?

 


Kicking Sallie Mae to the Curb: Goodbye, Student Loans!

In my nearly two months as a member of the personal finance blogging community, I feel I have developed a good grasp on the different types of financial bloggers. Some aim to share a technical and sophisticated approach to personal finance, while others are more simplistic and inspirational in nature. Some are humorous and self-deprecating, while others think they know way more than they do (Brief digression: Visit BeardsandMoney for a great article which touches on this topic). No matter the financial state in which a reader my find herself, there exists several blogs which can help her navigate the twists and turns of personal finance.

In the past year, the community has exploded with a host of new bloggers who are advancing our niche and providing me with plenty of inspiration to improve my writing and provide articles which are accessible and thought-provoking for readers. Challenges like the Million Dollar Club launched by J. Money, the Yakezie Challenge launched by Financial Samurai, the Save the Savings Challenge launched by Andrew at FamilyMoneyPlan, and a somewhat-secret project (in which I will be participating) in the works to be announced next week by two to-be-named-later writers, have added to the atmosphere of collaboration, encouragement, and excitement in our community.

Related: See the Blogroll

While this is all very exciting, Mrs. Superhero and I hardly need additional things about which to be excited. Friday was a big day for us. We pulled the trigger and kicked Sallie Mae to the curb by paying off my graduate school student loans!

I wish this story were nothing but rainbows and butterflies, but good things rarely come without a grind.

The Story

In May 2014, I completed my Master of Arts degree. When I entered repayment that November, I faced these terms:

GS2

 

 

 

 

 

 

I read further and my the lump in my throat began to grow:

On your current repayment plan, including interest and capitalization, your total estimated amount to be repaid is $27,178.23.

While I was relieved to have completed my degree, I must admit that I felt a little clammy and my blood pressure rose a bit when looking at the previously mentioned figures. In that moment, I was determined to ensure that my $18,000 educational investment would not grow by over $9,000, or approximately $900 per year, over the standard 10-year repayment term.

The problem I faced at the time was that I still owed over $5,000 on my undergraduate student loans. Yes, I was stupid. The worst kind of stupid. The kind of stupid with several zeros and even a comma involved. I took on additional student loan debt without paying off my existing student loans.

As I approached repayment, I was nervous. But mostly I was angry at the guy in the mirror for digging myself into such a large hole.

Climbing Out of the Hole

There are two different ways to tell this story.

The Short Version

All in all, we paid off a total of $21,229.00 of graduate school student loan debt over the course of 19 months, or 1 year and 7 months. This is an average of $1,117.31 per month, which does not appear particularly impressive or sacrificial for two working professionals who also own and operate a small business and engage in side hustles.

As I reflect and experience the benefit of hindsight, I think we should have paid off the loans much sooner. Maybe we could have done so if we had cut back on dinners out with friends, took a staycation  in place of our modest vacation last summer, and kept driving Mrs. Superhero’s vehicle from college.

This version, while still happy, is vanilla, incomplete, and unsatisfying. It’s the financial success story equivalent of the How I Met Your Mother series finale.

Ted
No spoilers from this HIMYM super-fan

 

 

 

 

 

 

 

The Longer (Better) Version

While The Short Version is factually accurate, it misses some of the finer nuances of our journey toward freedom from student loans. Perhaps the biggest fault of The Short Version is that it is leaves out two other significant financial successes which occurred as recently as the previous 11 months.

In July 2015, Mrs. Superhero and I decided it was an opportune time to upgrade from our 2000 Mercury Sable. Our search led us to a 2013 Hyundai Sonata. We had planned to purchase a vehicle with cash in the ballpark of $8,000-$10,000, but the  we couldn’t shake the idea of the Sonata and drove it home two days after taking it for a test drive. This depleted our $10,000 car sinking fund (and led us to take out an $8,000 loan with a 36 month term at a very low interest rate to cover the difference).

Two months later, in October 2015, I had another sweaty, racing heart moment when I sat down and reviewed the spreadsheet of our total non-mortgage debt. As I mentioned earlier, we still owed just over $5,000 on my undergraduate student loans, in addition to $19,000 on my graduate school student loans and the $8,000 auto loan. This was a sobering realization.

The hole had gotten even deeper, and while we had a new-to-us vehicle to show for it, I knew that something needed to change. That month we paid just over $4,300 toward my undergrad loans and tacked on an additional $829.00 the following month to wipe out these loans for good!

Our momentum was halted a bit in December and January, but shortly after the calendar turned, another look at my Excel sheet sent me back into orbit. In addition to minimum payments on the Sonata and grad school loans, we paid an additional $2,338.79 on the grad school loans in February 2016. Following a similar plan, we paid minimum payments and an additional $1,100 in March and an additional $4,000 in April. It felt like we were on a roll in some respects, but the finish line still seemed like a faint mirage on the horizon.

In personal finance and investing, we all know the mantra: slow and steady wins the race. I was content to push slowly and steadily toward the finish line and rest in the comfort of this phrase. That is, until I snapped for a third time last week.

A quick look at our emergency fund and sinking funds revealed that we could make a final payment of $10,166.37 without exposing ourselves to the unnecessary risk of an underfunded emergency fund. Upon realizing this, I told Mrs. Superhero that this payment would be the best early birthday present I could receive. Without hesitation, she gave me the green light, and last Friday, I submitted the payment!

Reflections

I feel The Long Version shows that perhaps I am being a bit hard on us, as we paid $10,000 as a downpayment on a vehicle in July 2015 and paid off the final $5,168.83 on my undergraduate student loans in this same time period that we paid off my grad school loans. Over 19 months, the total student loan and car debt paid + car downpayment figure rises to $36,397.83, or $1,915.67 per month.

The averages get more fun when you consider that we really got intense beginning in July 2015. From July 2015 to the present, we paid a combined total of $28,889.37 on the aforementioned student loan and auto debts, or an average of $2,626.34 per month for 11 months.

Narrowing the focus further, I realize that we paid off $17,831.65 in the 54 days leading up to May 13, 2016. This averages out to $330.21 per day!

Why This Worked For Us

Among the reasons for our success, three reasons stand out in my mind:

Effort and maximization. As previously mentioned, Mrs. Superhero and I have worked a lot over the past 19 months to make the aforementioned accomplishments a reality. We could have whined and complained about the predicament that we I placed us in, but instead we took action and did something about our unhappiness.

Values identification. Mrs. Superhero and I loathe debt with a passion. While we could have used the aforementioned funds to significantly build our investment portfolio over the past 19 months, I am satisfied with our decision. Over this time frame, the S&P 500 and VFINX, two important benchmarks for investors, have produced underwhelming results, in my opinion. And even if they had produced steady and modest growth, our values still indicate a preference for eliminating debt at this stage.

Sacrifice. I am fairly convinced that many people who know me and Mrs. Superhero personally think we are weird due to our handling of our finances. Once they have read this article, they are sure to think we are even weirder! Going against the grain of today’s culture with regards to our finances has been a sacrifice at times, but a worthwhile sacrifice nonetheless.

Recommendations

  • Identify your values and establish a set of written financial goals as soon as possible. I know plenty of people, including fellow bloggers, whose values and goals have led them to defer paying off their debt in favor of growing an investment portfolio and developing passive income streams. I do not begrude or criticize them for their choices, as their pursuits are grounded by values and goals.
  • Do not stray from your established goals and timelines without good reason. You will be tempted to give up and spend, but you shouldn’t do so in order to impress people you don’t even know. Don’t do it!
  • If you are drowning in student loan debt or other debt, explore refinancing with SoFi. SoFi is an excellent option to reduce the total amount of interest paid over the lifetime of a loan and make the pursuit of debt freedom much more manaegable for money people. Check out your options for student loan refinancing  and personal loan options here. You will receive a $100 welcome bonus when you sign-up!
  • If possible, join me and Mrs. Superhero in freedom from student loan debt. It is truly a great feeling. We hope to replicate this feeling in a few more months when we pay off the Sonata; however, that will come after we build our opportunity fund and navigate the summer months ahead.

Disclaimer: All links to SoFi are affiliate links. While I cannot personally share a testimonial regarding the product because I no longer have student loans which could be refinanced, FinanceSuperhero will always recommend products that can help readers accomplish their goals in a faster and more cost-effective manner.


Readers, have you experienced any recent triumphs over debt? What were the keys to your success? How did you stay motivated? If you are still in debt, when do you plan to eliminate student loans or other debt?

Whining Is Easier Than Winning

Two weeks ago, I channeled my inner Cesar Millan and began training our newest four-legged friend, Coda, who joined our family on Easter. I stood at the top of the staircase and looked down at my puppy. He stared back at me. And then it started: the shrill, deafening barking.

Some readers may find my training methods a bit cruel, but I refused to walk down the staircase to carry the little pup up the stairs. Yes, I felt bad, but after a few minutes of prolonged whining, Coda’s persistent protest gradually shifted toward perseverance.

One step. Two steps. A struggle to conquer the remaining steps.

Success!

Without becoming overly philosophical with this illustration, I believe Coda succeeded for a reason. It was not because of my tough love. He made it to the top of the stairs because he had not yet been conditioned to give up.

In this moment, it occurred to me:

Whining might get you pity, but it won’t net you any PROGRESS.

Unfortunately, the average person yields to his own inner whining and gives up far too easily. We are conditioned by our culture to seek and accept the path of least resistance. Furthermore, we whine and complain that life is so difficult and trying even in the absence of real difficulty, discomfort, or strife.

I am guilty of it from time to time, and chances are, you are, too.

The Problem

Despite my best intentions to avoid association with chronic whiners and complainers, society has conditioned us all to complain as an odd sort of coping mechanism. We are encouraged to talk about our problems, yet rarely are we encouraged to act upon potential solutions.

So instead of helping each other to grow and overcome difficulty, we lend a listening ear, nod in agreement, and encourage the status quo.

Typical Whining

Over the years, I have heard it all. Nothing surprises me anymore. The following are some of my favorites:

The little guy never gets ahead.

I often wonder who started this myth and why it continues to linger in the collective consciousness of the people. It is ironic that this statement is believed by so many, while countless underdog stories prove otherwise.

For example, consider the life of businessman Tom Gores. Born in Israel, Gores moved to the United States prior to turning five years old. He grew up playing playing football, basketball and baseball at Genesee High School in Genesee, Michigan. He stocked shelves at his father’s grocery story in nearby Flint, graduated high school in 1982, and attend Michigan State University, where he earned a Bachelor of Science degree in Construction Management.

Tom Gores
Photo credit to Carlos Osorio/AP/Detroit Free Press

Gores did not experience a privileged upbringing by any stretch of the imagination.

Today, Gores’ net worth is $3.3 billion. The founder of Platinum Equity and majority owner of the NBA’s Detroit Pistons, Gores is a self-made man. His high school coaches credit his business successes to his competitiveness, perseverance, and decision-making. None of them expected the quiet-but-talented athlete from a town of 24,000 people to follow the path Gores has blazed, but the little guy did it.

I’ll always have debt of some kind. It is a necessary tool for most people.

My head nearly explodes every time I hear this or a similar variation. When I achieve financial independence, I may take out a month-long ad in several major newspapers to remind the public that debt is not mandatory. These ads will also include a reminder that debt is not an exclusive club designed for lifelong participation, though Visa, American Express, and MasterCard would like you to believe otherwise.

I will not sport a holier-than-thou position and claim that debt has not helped me. Debt has allowed me to earn two college degrees and buy a house. However, these experiences would have been far sweeter had debt not been part of the equation.

When Mrs. Superhero and I finish paying off my student loans in the next few months, there is no turning back into debt (barring absolute catastrophe). Income is the only we will use to support our family and lifestyle.

I’ll always have a car payment/car lease because I can’t afford a nice car without one.

This statement also sends me into orbit every time. The truth is that moving up in vehicle is a process which need not involve debt nor take long if you are willing to be patient for a short time. Mathematically-speaking, a car payment or car lease are usually the worst methods toward owning a vehicle.

Let’s suppose you currently own a $2,000 beater car. While it is likely to depreciate over the next 12-24 months, I am willing to bet the vehicle could be sold for $2,000 in 18 months with careful marketing. Let’s also suppose that you saved $250 per month for 18 months prior to selling the beater. Through this flipping method, you could afford a $6500 vehicle. Continue the plan for another 18 months and an $11,000 vehicle is in reach. One additional cycle could allow you to purchase a vehicle valued at $15,500.  In four and a half years, you’ve moved up in car from a 1993 Honda Civic to a 2013 Hyundai Elantra. And you did it without a single payment! Of course, saving more than $250 per month could significantly change the conversation.

I deserve to be paid more than my current salary.

I find this phrase (and similar offshoots) is most often uttered by millennials. Please allow me to apologize for the collective whining of my generation.

Most millennials really need a lifestyle and attitude adjustment, not a salary adjustment. While the millennial median income is admittedly low across the United States, that hasn’t stopped millenials from living far beyond their means.

Facebook envy is largely to blame. Pictures of new cars and new houses lead the average millennial, especially men, into foolish spending in order to maintain appearances.

I am not saying that millennials should not increase their earnings. However, I am saying that whining is not the way to achieve that increase.

Recommended Action Plan

If you want to be successful, not just with your finances, you must start by addressing your attitude. Stop whining and take action to get ahead. Envision what you want your circumstances to look like and figure out how you will make that vision a reality. This will require V-SMART Goals, a plan to achieve the goals, and accountability. Ask a friend to call you out every time you complain about any financial struggles in your life. Put your wasted time to good use and correct the circumstances you hate.

A friend recently commented to me and Mrs. Superhero, “You two are busier than any other couple I know.” I had to hide my excitement that she had noticed! Ironically, she probably doesn’t even know how right she is; collectively, Mrs. Superhero and I typically work over 120 hours per week.

If people are noticing your hard work, you are on the precipice of greatness! Mrs. Superhero and I have done some basic math. There are 24 hours in one day and 168 hours in one week. This gives you plenty of opportunity to change your circumstances. Time is the great equalizer.  It is an asset everyone possesses equally.

Suppose the average person logs a 40 hour work week and sleeps 40 hours per week. This is less than half of the available hours in a week!

If you have significant financial problems, you have approximately 88 hours each week, when you are not working or sleeping, to roll up your sleeves and pursue progress! Pick up overtime, extra shifts, work a little harder to earn extra commission, start your own business, work as an independent contractor, start a new side hustle, or launch your own blog. Even if you worked one additional hour Monday-Friday and five hours on Saturday or Sunday, your progress would be significantly boosted.

Time is the great equalizer.  It is an asset everyone possesses equally.

My dad is a great example a Finance Superhero in this regard. He typically works 55+ hours per week. Similarly, Superhero Grandpa often worked 16+ hours per day in his younger years and even worked 8+ hour days on his side hustle in retirement.

Grandpa was too busy making (and counting) money to whine or complain.

As an added bonus, if you work additional hours for a short time period, you will not have time to spend money foolishly or put yourself into further debt. This is a worthwhile, temporary sacrifice. Yet people today are averse to hard work because we are conditioned, as I wrote earlier, to seek the path of least resistance.

This is why Americans are in love with debt. Our society must learn to see hard work, in a sense, as a punishment for putting yourself into a situation to have to pay off debt. Yes, you should be a little masochistic for a while. It will be good for your progress. Too much comfort breeds contentment, and contentment is the enemy of progress. Every time you feel tired or just want to quit, you should relish the feeling and know that you are on the verge of winning.

You won’t have to work hard forever. Do it for a short time and earn the right to relax in early retirement. As talk show host Dave Ramsey often says, “Live like no one else so later you can live like no one else.”


Readers, what do you do to guard against whining and complaining? How do you respond when others do it? What is the most common complaint you hear when others whine about their finances?

Redefining the Dream: Is Becoming a Millionaire Really Enough?

As a child, I spent a lot of time with my Grandma and Grandpa. They reached retirement shortly after my birth, and both of my parents worked full-time jobs. During the summer months, I spent one day each week with my grandparents. I will forever cherish the memories of eating homemade toasted bread and strawberry jam by the morning sunrise, the countless mornings spent building utility trailers with grandpa, sunny afternoons at the park, late-afternoon naps, trips to the pool, and the unparalleled hearty dinners from Grandma’s kitchen. Life was good.

During the school year, Grandma and Grandpa picked me up at the bus stop until I was old enough to stay home alone for a few hours. Those afternoons, too, remain as poignant memories. Grandpa and I often drove to the lake to feed the ducks, roamed the Earth in search of free lumber, or took his hunting dogs for adventures in a nearby wooded area.

During one particular walk in the woods, Grandpa and I wandered off the beaten path and onto a narrow, single track trail. At the end of this trail, we discovered an old, junked out car which had been left in a large hole in the ground. To the adventurous mind of a little boy, we had just discovered the equivalent of the Lost City of Atlantis.

I recall spending the remainder of that day thinking about that old car. Who had owned the vehicle? How it had gotten to its final resting place? And how had it had managed to sit in the woods untouched, year after year?

Grandpa knew how to entertain me, teach me to think, and lead me to dream big. This all came naturally to Grandpa, because he was an entertainer, a thinker, and above all, a dreamer himself.

Grandpa’s Dream

As I grew older, my adventures with Grandpa became less-focused on the things of childhood and more focused on life lessons and my future. Ever a motivator and encourager, Grandpa believed in me and had big dreams for my future. He said that I could be a doctor, lawyer, or businessman if I studied hard and earned good grades. Grandpa knew a thing or two about hard work, but he was the first to admit that he never saw a good grade in his life.

When I reached my teenage years, Grandpa became less-mobile, and our time spent together grew more and more sedentary. We traded walks in the woods for visits over coffee and cookies in the three-seasons room of Grandpa and Grandma’s new condo. Since Grandpa passed away in 2013, my biggest regret remains that I did not record more of Grandpa’s stories and advice.

One story, however, is permanently etched in my mind. One afternoon, Grandpa the told story of how he get started in investing. He explained that he had seen his neighbor drive by and wave in a brand new car every spring. One year, in his typical, rather direct fashion, Grandpa asked the gentleman how he could afford new cars each year. Unembarrassed, the neighbor told him that he had high-performing stock investments and that dividends were the key to his annual car purchases. He also spoke glowingly about his financial advisor.

In an instant, Grandpa had hatched a new dream far bigger than new cars. He wanted a piece of the pie for himself and for his family. Later that week, Grandpa went down to the advisor and opened a new brokerage account. The rest is history.

Secret Millionaires?

I grew up hearing faint whispers about Grandma and Grandpa’s wealth. They were thorough practitioners of stealth wealth, and while they owned their modest home outright and drove nice vehicles, they lived a minimalist lifestyle. The watched evening television in the dark, did not have central air conditioning, and rarely spent money. At Grandpa’s funeral visitation, an old friend told me that he once saw a moth fly out of Grandpa’s wallet. Literally.

Only one memory lingers as an indication that Grandpa and Grandma had money. Grandpa and I had just sat down for lunch at the kitchen table, and Grandma walked in from getting the mail. She handed Grandpa a piece of paper, which in hindsight was an investment statement, and said, “Well, you’re half of a millionaire.”

Grandma probably didn’t know I was listening (Note: She is still with us, so I will have to ask her soon if she remembers this story). Without knowing for sure, I suspect that Grandma was being modest. I am confident that their  investments represented only a portion of their assets. I was likely being thrown off the trail of two Secret Millionaires!

The Fruits of Their Labors

Among many the many benefits of their financial wisdom, Grandma and Grandpa were:

1. Financially Free. They had no debt, no obligations, and as a result, they could do virtually whatever they wanted when they wanted to do it.

2. Frequent Travelers. They vacationed a lot and visited every place which interested them.

3. Generous to Family. They provided weekly Sunday dinners for 20+ people, often took the entire family out to dinner, provided nice gifts for birthdays and Christmas, and gifted a one-time lump sum to each of their grandchildren one year in order to reduce their tax liability.

4. Proud Yet Humble. They knew they had earned everything they possessed, yet they never boasted.

My grandparents' home - where I learned to think and dream
My grandparents’ home – where I learned to think and dream big

A Contagious Dream

For years, I have desired to experience those fruits for myself. Ever since that afternoon at the kitchen table, my foremost financial goal has been to reach millionaire status. Not for vanity or bragging rights, but for the feeling of freedom, the ability to help other people, and to give away massive sums of money.

Today, as I write this article, I cannot help but wonder:

Will a cool million really be enough?

According to the life expectancy calculator at John Hancock, I can statistically expect a baseline life expectancy of 83 and a projected life expectancy of 93. Considering my goals of early retirement, it appears my nest egg will need to last upwards of 40 years! And what if I live to be 100?

Factoring in rising inflation and the decreased buying power of money as I continue to age does not increase my optimism that $1 million will be enough. Even if it were enough for me and Mrs. Superhero to live on, would it really permanently change our family tree? Would it benefit future generations of my family? Would it truly leave a lasting legacy?

I have few doubts that Mrs. Superhero and I will reach millionaire status, even though we are far from it at this point. But based upon the 4% Safe Withdrawal Rate, I question whether $40,000 per year will be sufficient.

The Dream Redefined

While I am an advocate for specific written financial goals, my target retirement number is surprisingly fluid at this stage in my life. Mrs. Superhero and I are focused upon eliminating our non-mortgage debt over the next couple of months, and I find it too distracting to focus upon too many goals at one time.

In the meantime, I am still dreaming of my own retirement. My dream is simple at its core:

  • Be free from the rat race–forever!
  • Enjoy carefree experiences with Mrs. Superhero, our siblings, and our future children and grandchildren
  • Work on my own terms in my future retirement, if I choose to do so, and answer to myself and no one else
  • Give outrageously
  • Change my family tree forever
  • Never experience stress due to work or money issues ever again

Until my dream is redefined again, this is my motivation.


Readers, what are your dreams for retirement? What motivates you? If you are currently retired, are you living your dream as you had hoped?