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Qualifications: grew up in a very modest (i.e. lower) part of town, parents worked in blue-collar professions, and started buying a rental property in the 1960's, then dad passed away (with four kids). Now definitely intergenerational wealth, all kids went to college in STEM, parents in their 90's (step-dad helped build up RE holdings to 36 units) with holdings in the 8-figures. No I haven't inherited any of it (yet) but well into middle age myself, make very good money (and will leave it at that), and have a few RE holdings.

> I'll have manager experience. I'm also reading a book called "real estate investing for dummies" and I just finished "rich Dad poor Dad"

Good for you, I didn't start reading books on anything finance related until well into my 20's, and then I read a lot of very good books. I don't think much of Kiyosaki, frankly, but as Brian Tracy said 'to earn more you must learn more'. So don't stop, keep on reading, and especially books over blog posts and short pieces. Why? Books will have more complex ideas and more research to back it up.

Regarding your game plan: you did not indicate what you are interested in doing, and what you do well, and what people will pay you to do, and what the world needs. Take a look at this ikigai graphic. Not sure if you know that welding or sales is this for you, and of course there are other things you may grow into. But hey if you have a good idea that this is the path you want to take, good for you!

I came here to say about sales, few salespeople are on Reddit, they are very busy making lots of money to talk about it. In my own (technical) sales field base runs from $65K up to $120K with another 40% commission, but you need to have the right background (STEM college degree, experience as a customer, and aptitude for outside sales) so barriers to entry are high. So yes, six figures in your late 20's is achievable, and it does take a lot of hard work, no doubt!

Of course owning your own business as a contractor, or becoming a top welder, or tons of other things you could do, I know of plenty of people who do very well.

Regarding the end goal, admirable, and I say your thinking is in the right place. The road to FI is varied - real estate is a very good method (the way my parents went, they bought low and held onto their properties in a HCOL area), investing into index funds another good method (again read books like Boglehead's Guide to Investing, or another favorite of mine on the sidebar called The Richest Man in Babylon) The amount these books can make you over five or ten years is a lot. Over 15 or 25 years is huge.

> Even if I don't get to enjoy it

I see many piling on here saying 'you should enjoy it' but I didn't interpret this comment in that way. You realize it's a road not many take (too many live way beyond their means, and don't have savings / passive income / true wealth to show for it). Yes there's sacrifice, and it takes a long time to build up $1,500 in monthly passive income much less $15,000, but people do this and often you cannot tell. (For example, look up the book The Millionaire Next Door.)

Are you on the right path? Definitely YES. The path to financial independence starts with a mindset, and the fact you are asking the question puts you out in front of all the peers of yours who are thinking about lots of other things, which you know all too well.

Will you make mistakes along the way? Of course, we are all human. The important thing is mindset, and the great thing of being younger is that you have time to make other choices, and learn along the way.

/u/greebly_weeblies nails it EXACTLY.

My wife is a veterinarian. I am a chemical engineer. Never the twain shall meet... though some of her clients are rich people for one of our primary clients. :)

What I am in a downturn, she is likely to NOT be, when she is in a downturn because of say "winter", I am likely okay. We're further protected in that my wife works equine primarily with expensive sports horses. Individuals with THAT kind of money don't see a lot of swings in their need for vet care with the overall economic picture. There is some, but not a lot and it tends to move slower than say vet care for fluffies... which is directly tied to the economic picture of the middle class.

I however, primarily do process design for NEW installations and RETROFITS of semiconductor fabs (I previously did refinery process engineering design work before moving). This, like any kind of capital intensive industry is up and down at various times. Times get lean, times also get EXTREMELY heavy (like now) where I work a lot. I am better protected because I am a salaried engineer, PE in the states we do work, and have years of experience as a lead... but having to drop to 20 hours a week, or taking 1 month off unpaid is always a possibility.

We're very lucky in that we make very similar quantities of money, and will for the foreseeable future until one of us will overtake the other. This means budgets made for "one income" mean that in the event of job loss, the only thing we lose is FI savings.

Note, my flair says 34% SR, but... we pay extra on our mortgage and pay down her student loans with significant extra money. Were we able to drop that towards investment accounts of any form our savings rate would be >50% (haven't done the math, but I would say 60% ish). So, I lose my job or go to zero hours... we can still make our mortgage payment, her student loan, our expenses, a reasonable NORMAL retirement age savings, some reasonable other stuff, we just don't save any money towards FI and RE while I am unemployed.

For a more "middle class" look at the risk of budgets based on two incomes, check out the book "The Two Income Trap" by Elizabeth Warren (yes, the senator), which is a fantastic read. The book explores the role of children in all this... and much of our other bubbles of the time (houses, etc.). GREAT read...

https://www.amazon.com/Two-Income-Trap-Middle-Class-Parents-Going/dp/0465090907/

There is a 2016 edition too if you want to pay $11 vs $0.01.

Also, /u/greebly_weebies, I appreciated the Enron references. I LOVE LOVE LOVE "The Smartest Guys In the Room" which is a FANTASTIC history of the whole Enron debacle. GREAT book... very informative. There are telling stories in there of joint Enron employees losing EVERYTHING... or secretaries putting 100% of their savings into Enron stock...

YEE HAW... all the way to the TOP boys!

That's okay, it was a formative experience. No sense beating yourself up about the past as long as you can learn from it.

It's good to keep all of these FIRE principles in mind, but don't obsess over it. Look for jobs that will help you gain new skills, specialize in something useful, and open more doors than you could have before. I recommend the book So Good They Can't Ignore You to help guide your search.

Specifically, you should sit down with every person you know who has a full-time job and ask them:

1. What is your job? What are you responsible for, and what do you do every day?
   
2. How did you get to where you are? (You can just say that question specifically--gets some interesting responses!)
   
3. What do you think I would be good at? Do I remind you of anyone you know whose job you think I could learn more about?
   
4. Can you recommend someone else with an interesting career or life that I can talk to?
   
   Rinse and repeat. There are so many millions of different jobs in the world that you can't possibly learn about just from reading. Your primary purpose here is to learn about different jobs and how people got them, but this kind of networking will also help you get a job should you decide to apply to any of the places these people work. Networking works best when you aren't asking people for anything--but there's no reason you can't go back to them weeks or months later and say, "Hey, our conversation really inspired me. I noticed department X is hiring for position Y. Do you happen to know anyone over there I could speak with to learn more about it?" etc.

Good morning r/fi!

My book is now officially a paperback and ebook on sale on Amazon (ebooks will be free tomorrow [June 29])! The two versions aren't linked yet, but hopefully tech support gets back to me before tomorrow!

So what’s in the book? 6 chapters about everything young people need to know about money. Personal finance concepts like mortgages and credit cards, budgeting and saving, investing, taxes, a 21 week guide to having more money, and a primer for FI.

Both U.S. and Canadian versions will be free tomorrow and I would very much appreciate the community’s opinion on what I’ve written (especially on the taxes side of things for the U.S. version). But really any feedback would be great. Reviews on Amazon would be awesome too :)

Ebook U.S. Version https://www.amazon.com/dp/B0713R5YCX

Ebook Canadian Version https://www.amazon.ca/dp/B071YMYN2M/

Thank you for reading!

Edit: I can't spell

Nassim Taleb wrote a book called Antifragile that gives one possible perspective on your question.

By putting yourself in a "safe" place (not 100% dependent on a job to pay bills, spending all your income, etc) you're making a small contribution to the health of the whole.

A small thought experiment: If everyone in America started saving 40% of their income tomorrow, what would happen?

Plenty of jobs would disappear, but there would be more than enough reserved to fund those who lost their jobs until something else became available.

Right now I'm planning on making significant contributions for my in-laws when they can no longer work. I'm 26, and am positive that I'll be providing a lot of care for them in less than ten years. That means that the more I can save now, the more I can care for them later, and keep them healthy and happy, while preventing them from being a drain on "the system".

Last thought - there's not a fixed dollar cost per child's life saved. If it was that simple, some huge foundation (Gates, Zuckerburg) would kick all the money needed to eliminate all malaria-related deaths ever. They could afford it. The challenges are so much more nuanced than that. So you couldn't save 30 lives a year with your $100k, even if you tried.

Great question, though. I love thinking through all of these kinds of things.

PS have you read Your Money or Your Life? I think it might help answer some of these questions.

edit: spelling

I'm a natural introvert, but every great opportunity I've encountered has been a result of expanding my social network, and these 2 books are what made that happen:

How to Win Friends and Influence People - Every successful businessperson on earth has read this book. It's incredibly useful for someone like me, who doesn't really like talking to people. This book made me good at it, even though I still don't like it.

Never Eat Alone - This one's a little different. I attended a talk by this author, and it completely changed my life. The book is geared more towards people who want to be CEOs (which is not me), but I applied the basic principles to just working in my organization and my local community, and it's paid off many thousands of times over. Sadly, the talk he gave based on the book was slightly more useful than the book itself (although I still highly recommend it - particularly the first half). So you might want to track down Keith Ferrazzi on YouTube or something.

If I'd read these in college I'd have retired a long time ago.

I'd recommend reading [First National Bank of Dad] (http://www.amazon.com/First-National-Bank-Dad-Foolproof/dp/1416534253/). The author went through the same challenges (and made some of the same mistakes) you are facing. I am currently using it as the model with my kids.

Top-level, forcing savings is a bad idea, as is implying you cannot do something because of the need to save. Immature brains are not wired to process the subtlety you wish they could handle. If you follow that route, they may come to see savings as the antithesis of fun and that any money earned/received should be spent immediately, lest Dad take it away for "savings" in a bank earning sub-1% interest.

Better to prompt the desire to save. Rather than a real bank account, create your Bank of Dad that pays significant interest. By doing so, Junior will see that he can spend that $5 now or put it in "The Bank" and have $10 soon (you define what "soon" means). Help him see what that $10 could buy that $5 today could not, which helps clarify the benefit of putting that $5 away today. He may even find that between when he puts the money away and when it grows to $10, the thing he wanted to buy is no longer as interesting.

By doing all of these, you show the power of compound interest and the magic of delayed gratification. You are helping to form solid habits, ones he will hopefully continue on his own (and when the compounding interest rate is less stellar...).

As for results, my own efforts are too early to tell (ask me again in 20 years).

Hey rattlesnake30,

I know exactly how you feel. I still get upset about reflect on my college experience on a regular basis. "Why didn't anyone tell me about what was really important in life!?" "How come everyone tells you to study what you love, and that you can do anything, and you'll be building the future, when in reality there is a 90% chance you'll be working in a cubicle?"

I allow myself these little pity parties so I can dismiss them quickly and get back to my current goals: FI, Music, my marriage, and my fitness (Anyone seen Don Jon?, something like that). Honestly, reading about stoicism helped A LOT. I was pleased to see MMM encounter Stoicism eventually too, although I don't think he's the best intro to it. I liked William B. Irvine's Guide to the Good Life (which you'll find at the library and NOT buy from Amazon if you really want FI :) )

I went to undergrad for Physics and then and M.S. in biotechnology. My 2.5 year program started with promises of "85% of graduates find work with an intro salary of $85k/yr or higher". When I finished, I was un-employed for 6 months and then a fellow Physics major got me a job at a software company doing implementations at ~$40k/yr. $40k still felt great compared to grad school stipends but after a few months I realized that I had all the toys I could want, I could afford vacations, I had a nice apartment, I didn't need more money, what I needed was more time to enjoy those things and to get the hell out of a cubicle. Discovering FI was the thing that finally motivated me to try to get better at my cube job. 3 years later I've doubled my salary and am ~40% of the way to FI.

Like I said, I still get pissed off about college. Enterprise level software implementation is a far cry from biotechnology, but I'd rather be getting paid than pumping pipettes for a temp contract (must have PhD to run a lab).

Know this:

1. You learned a tremendous amount getting a biomedical science degree! Those words on a resume might be standard if you're applying to a biomedical engineer job, but to many other jobs they are very impressive. I barely escaped with my degree in both undergrad and grad school (C's get degrees) and I still reap the benefits of putting those words on my resume even (or especially) outside my field of study.
   
   
   
2. No matter how deep your debt is, if you make FI your goal, you'll make progress in no time.
   
   
3. You don't need to know what your passion is now. I'm in my 30's and I still haven't found a job that I really care about. I'm still looking, and I'm still open to finding it, but it just hasn't happened yet. Once I'm FI, I'll be able to work or volunteer with organizations or on my own, on projects that I KNOW will energize me and I can't wait.
   
   Stick around. It gets better!

Every great opportunity I've ever had has been a result of knowing someone. Nearly every great employee I've ever hired has been a result of getting a recommendation from a mutual friend.

What I wish I'd know when I was in school:

Your #1 job while you're in school is to grow a large and varied social network in your field (and related fields). Not a Facebook-type social network, but one based on real-life interactions and relationships. Volunteer, meet people, help people, become valuable to people.

I highly recommend the book Never Eat Alone. It's geared more towards executives, but with advice that applies to anyone.

Also How to Win Friends & Influence People. Every successful person on earth has read it. It's dated, but the concepts are fully relavant.

I really like this idea, and it's pretty much what I'm doing. Last year I posted something about this here on r/financialindependence and I've also exposed my lifestyle here.

Since my teenage years, my goal has been to live free. I stumbled upon FI books early on ("Boglehead's guide to investing" anyone!?) and figured hitting FI early on was possible and desirable. I majored to be an Actuary and while studying, I started creating websites and doing other freelance work on the side. These projects took off very slowly, but were enough to pay for random college expenses.

When I graduated, I took a gap year and my freelance work was enough to sustain while traveling through Southeast Asia. At that point, I was netting ~500 to 1000$ a month from 20 hours of work (per month). I loved the lifestyle of working an hour or two every other day. It just became something I did once in a while on the computer instead of (or actually, while) browsing Reddit or FB.

I realized that if I roughly doubled this income, I might be able to sustain this lifestyle permanently. Coming back home (to Canada), I invested a lot of energy expanding several streams of income (mostly freelance work) and eventually it paid off. I even had the luxury of turning down 9-to-5 high-paying actuarial jobs.

Remote work now takes roughly 5 hours of my time each week (and 95% of that can be done whenever I feel like), and it allows me to live in a very low COL area, which ironically might help me reach FI sooner than if I worked in a HCOL city as an Actuary. Although I wouldn't mind living like this for a long time, I'm on track to become financially independent at around 30 y/o (in ~5 years).

While I understand that for many, working part time is not an option, trying a lifestyle that resembles "FIRE" (lots of free time, low stress, no financial worries) can really be beneficial. I feel like many blindly aim for FIRE because they dislike work, or like the idea of not having to work, and while I can fully understand why, living for the future is a dangerous gamble. Not because "you might die before" as stereotypical consumers might claim, but because of the terrible mental habits you risk developing. I believe that people overestimate the reliability of postponing happiness for extended periods of time. While the grass is quite green without work, in itself it doesn't do much, it only makes you more of what you already are.

Happiness is largely determined by mental habits. If you are not developing great mental habits RIGHT NOW, they won't magically appear the day you retire. All around me, I see people waiting for retirement to finally travel/invest time in passions/develop skills/etc. I'm skeptical of how well this works in practice. I have the feeling that people would benefit from treating their mental habits with the same care that they show towards their bank account. Surely you don't want this path to mentally cripple you and end up like this.

Like others mention, I wouldn't really call myself "half-retired" though. It's really nothing more than a cooler lifestyle. (subjective, of course).

The target retirement funds are pretty great, especially if you are new to investing and haven't figured out the particulars. You can check out the Bogleheads' wiki or get the Bogleheads' guide to investing if you want to understand simple investing strategies a bit better. I would say that if you want to retire early you should save more than the IRA limits, but if you don't have an employer sponsored 401k, you will need to research the tax-sheltered investment options available to you. Compound interest is pretty awesome; assuming a somewhat conservative long term rate of return at 7% from your two IRAs, you will have over $1 million saved in 30 years, but your contributions will only be about $330 thousand!

I worked my way up by getting to know everyone, going to lunch with people outside of my department (particularly department heads and others above me), and offering to help wherever I could. I'm in IT, so I had the ability to help people often. I became the go-to guy for all web stuff, which irritated my own department head, but he was generally seen as a pain in the ass anyway.

So when he was gently removed from his position, I was the logical replacement.

I got started on this strategy by attending a talk by Keith Ferrazzi, author of Never Eat Alone, and applying his large-scale networking ideas to my organization. (Interestingly, my gf went to the same talk, applied his networking ideas to her own life, and landed her perfect job as a result.)

Summed up, the idea is this: Do favors for everyone you're in a position to help, and you'll gradually develop a portfolio of people who can potentially help you. Boiled down like that it sounds very manipulative. But so does How to Win Friends & Influence People, and you'll meet few successful people who haven't read that book.

No, I'm not paid by Ferrazzi, and have never spoken to the guy.

I’m a workaholic at heart, too. I have to force myself to stop and spend time with my family, and even then, if I’m honest, it’s probably not enough. At different times in my life, I’ve developed good boundaries, like only checking my emails twice per day, but then I slide back in to old, bad habits. Your post is a good reminder for me! One suggestion is to check out “The 4-Hour Workweek” by Tim Ferris, if you haven’t. Not so much for the idea of really only working four hours per week, but for the good advice on creating systems and expectations at your job that reduce your hours, while also prioritizing what is truly important. I think I need to re-read it myself! Best wishes!

Coming from someone who has a reasonable amount of experience investing, this is what I wish I were told when I was in your shoes.

1. DO NOT DAY TRADE. It is one of the surest ways to lose your paltry sum of money to fees and expenses.
   
   
2. Read http://www.amazon.com/Little-Book-Common-Sense-Investing/dp/0470102101 ASAP. Very solid basic outline on how the financial markets work. Implement the advice today. Seriously, open an account and put your money to work for you. Compound returns are almost magic.
   
   
3. Rebalance annually.
   
   
4. Write down your ultimate goals and form a plan for executing them. Ex: I would like to have 100,000 by my 25th birthday. If equity markets return an average of 8% and you invest X each year, can you reach this goal?
   
   
5. Learn how to use Excel. I cannot stress enough how valuable MS Excel is in financial modeling. If this is truly an area of interest for you, you will be very well served by learning to use the tools of the trade.
   
   Best of luck.

Read The Millionaire Next Door. It goes through the difference between inherited and earned wealth. The TL;DR of thr portion you're interested in is that those who inherit wealth squander it, those who earn it raise their children in a way that allows them to earn it as well. If you want your kids to be wealthy, teach them the value of money and give them the tools to earn kt themselves.

I am considering setting up a trust fund for my children that will make them FI once they turn 30 or 35 or something, but I'll give them very little before then. I'll also give them lots of opportunities to earn extra money so they can support themselves through school.

My parents could have paid to put me through school, but instead they only paid half. It was just enough that I could work my way through school without taking on extra debt. They also gave me a 0% loan to buy a house, but I had to pay it back on a schedule. I think this is the right approach to wealth propagation.

And you're right, I don't know any really wealthy people (well, some, but not inherited, it was earned). And I'm glad I don't.

> I've always liked the idea of offering them a physical bank with a ridiculous interest rate so that they can see interest with their own eyes

This is the premise behind The First National Bank of Dad, which David Owen wrote a book about, but which you can learn about for free via a podcast:

> David Owen, author of The First National Bank of Dad, talks with EconTalk host Russ Roberts about how to educate our children about money and finance. Owen explains how he created his own savings accounts for his kids that gave them an incentive to save and other ways to teach them about postponing gratification, investing, keeping money in perspective and other life lessons. The conversation closes with a discussion of the value of reading to your kids.

> http://www.econtalk.org/archives/2012/05/owen_on_parenti.html

Your $7k in credit card debt is a big warning signal to me too. Your debt is part of your total financial picture. So while you may have put 20% of your income away last year for retirement, clearly you didn't manage very well living off of the other 80%, because you went into debt.

If you would put away $1k towards retirement in a month, but you would also go $1k further into debt that same month, you did not come out ahead, you actually stalled or may even have gotten worse (if the interest rate on the debt is higher than the profits in the retirement account).

Maybe a kick-in-the-butt helps, and I'll use MrMoneyMustache for that, since he's funny.

Maybe reading "Your money or your life" by Vicki Robin and Joe Dominquez might help you to see "money" in a different light, and thus makes you more careful in how you spend it?

Maybe it helps to write down your reasons to get a better grip on your finances - for example: if you would pay off that credit card debt this year, then next year you'd probably have roughly $8k more to spend than this year, and if you keep being smart about your money, that $8k could go to something that you really care about... (I don't know what that is, but you perhaps do? What would you buy if you had an extra 8k? Or $16k? Or $24K?).

I think automation is one of the answers. You put money away as soon as it comes in. That way, you hardly see it and you don't feel that you can spend it. (The paying yourself first principle, where you put money aside for your future self and see that as some kind of bill that just needs to be paid).

One easy way would be to put aside $6k/month into a savings account (you possibly already have the savings account, so you just need to create one or two automatic transfers per month, set to happen right after paychecks come in).

Maybe also easy (-ish): start overpaying on your mortgage. Put in an extra $2k/month. Your interest rate on the mortgage probably isn't extremely high (probably like 3 to 4%?), but hey, putting an extra $24k/year there surely beats spending the money on stupid stuff, right?

A bit harder would be to do some research into tax-friendly ways to save money. Put the maximum amount of money into the 401k at work, for example. And decide which investment options to choose. For your own company, you can also open a 401k for yourself, but there are also some other options for people who are entrepreneurs/own their own business; so you would need to research that as well.

So start with the savings account; and try to get the rest up and running by say the end of January.

I want to tell you that you may very well be able to change your attitude towards money. I come from a similar background, and it just took me a few years to change my attitude around money, when it finally came in. I also had a few years of spending everything (and then some). I have managed to change my ways and am happier for it. And I think you can do that, too. (Because I'm definitely no superhuman).

One book recommendation: "Your money or your life", by Vicki Robin and Joe Dominguez.

Also check out the FAQ at the subreddit /r/personalfinance, they have recommendations on how to use the 401k, what investments to choose, etc.

Sometimes you can use books as "mentors." I'd recommend:

Your Money or Your Life - This motivated me to get my savings rate up to 70%+

The 4-Hour Workweek - Currently reading this and it definitely seems like a good read to get motivated to start a business, run a business more efficiently and reclaim your time.

Check out Library Genesis for a possible free download of the epub/mobi/pdf...if that's your thing.

The bit your missing is those on the FIRE path generally come in one of two version: the first group approach FIRE by driving down their living expenses extremely low. Examples approaches are living off-the-grid tiny houses and eating rice and beans. Another low-cost tactic is living in low cost of living places (COLA) and in the extreme means moving to poorer countries ("retirement hacking"), e.g. Mexico with it's good weather and your USD goes further. MMM (build all my own stuff) and Market Timer (living in a cheap country) are two examples. I have a feeling this group is actually the minority of the two, but I don't have any surveys. I've only met two this type IRL (well, living this way by choice).



The other type are high income earners who save a high percentages of their income. Bogleheads's survery's income (column U) has some eye-popping numbers and clearly skews towards highly educated/high income. WCI and Financial Samurai are both good examples of people who both have/had high incomes and decided to convert those incomes into wealth/FI through savings and investing. In the data that's out there(Millionaire Next Door and the little bit of self-reported data in the BH survey), this appears to be the more common path to FI. It certainly is easier to save lots when you earn a lot rather than try to squeeze every expense out of your life day in and day out for decades.

I've had a lot of back-and-forth with /u/GraemeCPA on his book about FIRE, and I recently learned that it was out on Amazon. I haven't grabbed it yet, but Graeme has been a great contributor to the sub, and I wanted to make sure that people realized that this was out there.

I plan on checking it out and seeing if we can add it as a resource on the sidebar.

Building Wealth And Being Happy: A Practical Guide To Financial Independence

Welcome to the states! It sounds like you and your husband are doing quite well for yourselves. Saving for the future and being financially independent is a great goal to strive for. Maxing out your IRA and 401K is a great idea as it'll save money on taxes. Beyond that, I recommend low-cost mutual funds for nonpre-tax savings - a good book to read that's great for beginners would be The Boglehead's Guide to Investing. I also recommend checking out /r/personalfinance

As to worrying about lifestyle creep, there are a few tricks I like to do to keep me from spending needlessly. The first is to envision how long it would require me to work to be able to afford something. For example, you make $55k/yr or about $27.50 pretax, so if you see a new pair of shoes that are $125, you'd need to work for a little more than 5 hours to be able to afford them. Are they still worth it to you?

Another trick is to wait several weeks from buying large, expensive items. I like to set a price point for myself and if it's over that ($250) I need to wait several weeks to buy it. If I forget about it or find 2 weeks later I don't need it than I just saved myself money - it's saved me from buying a lot of needless electronics. This takes some will power, but I believe that you can do it.

Why are you only looking to invest for 1-2yrs? This is a fairly short term investment for someone your age and a guaranteed 2.55% isn't terrible, it will probably keep up with inflation.

When looking at investment choices you need to think about how long you want to invest, how much risk you want to take and what type of returns you hope to get. For many people around here they are investing for 10 years plus, looking for low risk and hoping for about 7-10% in returns per year. To get these types of number they are investing in EFT and index funds with low expense ratios.

If you are looking at a managed fund you need to take a close look at their expenses and then calculate how much it will cost to use them. In most cases they end up being much more expensive with no guarantee they will provide enough extra returns to justify the cost.

Ultimately it's your decision so you should spend some time learning a bit more and decided what's best for you. Check out /r/fiaustralia for some tips specific to Australia and read through the side bar here in /r/financialindependence. Maybe buy a book or two and have a read through them. I suggest The Coffeehouse Investor and the Boglehead's Guide to Investing

As always I recommend relaxing for a bit and taking some proper time to learn about investing and find a plan that suits you personally. Good luck :)

https://www.amazon.com/No-More-Mr-Nice-Guy/dp/0762415339

​

Why do you care so much about what others think of you? Why can't you make decisions that make you happy regardless of what other people think? You need to realize that:


1.) You have emotional/phsysical/psychological needs

2.) You are the only one who can pursue the means to meet said needs.

3.) You are the only person who has your best interest in mind.


I'd be surprised if your unwillingness to be open about your career struggles with the people around you doesn't correlate with an unwillingness to be open about your other desires/needs/wants.


Perhaps I'm wrong, at any rate I think the linked book is worth your time.


Good luck!

The most common answer here will be VTSAX.

The better answer for a 21 year old will be that you should read JL Collins. This book will also recommend VTSAX, but more importantly it’ll tell you why VTSAX is a good choice, and even why investing at all is a good choice. Your library probably has it if you don’t feel like buying it, and you can knock it out in a weekend.

This explains it:

The Millionaire Next Door: The Surprising Secrets of America's Wealthy https://www.amazon.com/dp/1589795474/ref=cm_sw_r_cp_api_fMnJBb0GAZ99M

Essentially: the super super wealthy are less than 1% of the population. Meanwhile much of the actual top 10-1% tend to be in jobs that go along with conspicuous consumption. Think lawyer, banker, accountant, doctor. They tend to feel that they have to maintain a certain type of lifestyle to be “respectable” in their profession.

There’s also a lot of people who work in tech, many of whom are young and may not save much because they want to “enjoy life” and aren’t necessarily thinking ahead. (Although they do tend to have stocks.)

I highly recommend The Bogleheads Guide To Investing, it definitely gave me the understanding and confidence of index investing, plus, it's great to lend out to other people when they show interest in the topic.

As for how much of your starting income to set aside, the most important part is just to start it, and automate it.

• Start a Roth IRA at Vanguard
  
  • Roth IRA because your starting income is likely to be fairly low, which means you'll be in low tax bracket, so it's better to pay taxes on that money now, rather than when you withdraw it (which is how a Traditional IRA works)
    
• Set up an automatic transfer that happens after every payday
  
  • Note that you'll need to be confident the money will be there, so if you work for a smaller company where the paydays sometimes "drift", you might want to set up the automatic withdrawal to occur 1 week later than you expect to be paid
    
  • Also note that the Vanguard automatic withdrawal is often delayed by several days, I wound up setting up a separate checking account for it to withdraw from, and I have my normal checking account automatically transfer the money into my "investment checking account" each payday, that way I don't have to worry about whether my main checking account balance is before or after the Vanguard autoinvestment occurs
    
  • Choose an amount that makes sense for you, don't starve yourself, and don't frugal yourself out of fun... you are young and should still enjoy life, personally I recommend that people start with something like $50 each paycheck, but that obviously depends on how large your paycheck is, you can always adjust this later, and obviously you can make manual deposits to the Roth IRA if you have extra money you want to invest
    
    Note the below is just my recommendation for what I would do if I were just starting out, you should absolutely determine your own investment strategy and risk tolerance (although you are young, so you can afford to be more aggressive than someone closer to retirement)
    
    
• Stage 1: (Optional) Every once in a while you can go into your Roth IRA and purchase the VTI ETF when you have enough in your Money Market Settlement Fund to buy a whole share.
  
  • Unfortunately you can't set up automatic purchase of ETF funds, so you'll need to go buy shares manually while you're in this stage
    
• Stage 2: Once you have $1000 in your Roth IRA, invest it into whatever the farthest out Target Retirement fund is (when making the purchase transfer from any ETF shares if you purchased any previously), currently it's their Target Retirement 2065 fund, this will get you into the market, with roughly 90% stocks and 10% bonds
  
  • You can then set up future automatic transfers to automatically buy more of this fund
    
• Stage 3: Once you get to $3000 in your Roth IRA, you can then invest in VTSAX (transfer from the Target Retirement fund to VTSAX), which is the banner fund for low expense ratio index funds
  
  • Update your automatic investment to go into this fund
    
• Stage 4: As you build more and more money in your Roth IRA, you can start to diversify your holdings based on your investment plan, find other funds that match your strategy and see what the minimum investment is (most are either $1000 or $3000), and when you have enough in VTSAX where transferring the minimum investment to a new fund makes sense, you can do so
  
  • Update your automatic investment to contribute appropriate percentages to each fund, depending on your investment strategy
    
    Just to cover all the bases here for starting out:
    
    
• You should also be saving up money for an emergency fund, it's up to you to determine how much makes sense... if you're still on your parents insurance, and you can count on them for a safety net, you can be a little slower at building up this emergency fund
  
  • - Note (Advanced strategy): There is another benefit to the Roth IRA that I didn't mention above, which is that you can withdraw your contributions (but not any gains those contributions have made) from the account at any time, without paying an early withdrawal penalty or taxes. This means that you can technically use the Roth IRA to cover emergencies.
    
    • It's not "best practice", because you don't want to be pulling funds out of your retirement to cover emergencies, however if you have to choose between an emergency fund or contributing to a Roth IRA, I strongly recommend contributing to the Roth IRA and leaving the enough funds in the Money Market Settlement Fund to act as an emergency fund if you need it. This way you still have access to the money if you need it, but you're also getting money into the Roth IRA while you can. The $6000 yearly contribution limit seems like a lot now, but later in life you'll (hopefully) start maxing it out every year, so it's better to get the money in now and hope you don't need to take it back out then to leave it in a checking account where you might struggle to get it into a tax advantaged account later.
      
    • You should still make sure you have enough of an "quick access" emergency fund in a regular checking/savings account to cover immediate problems (overdraft on main checking account, need to fill up gas right before a paycheck, unexpected costs, etc.), as transfers out of your Roth IRA may take up to a week to show up in your checking account. Obviously you should also work towards eventually building a full emergency fund outside of your Roth IRA so that you can invest that money, rather than holding it in the money market fund, but when you're just starting out the Roth IRA can be a powerful place to keep the emergency fund until you can afford to contribute to both.
      
• In case you wind up at a job with a 401k match that you can participate in, you should participate in the 401k plan and maximize the match that you can get from your employer before you add money to your Roth IRA (but only after you have your emergency fund, since it's a lot harder and more expensive to try to get money from the 401k than the Roth IRA), this is basically "free money" that is considered part of the compensation you receive from your employer, so you definitely don't want to leave it on the table if you can help it.
  
  • 401k plans vary wildly, but generally speaking you're looking for index funds with low expense ratios. Since every 401k is different, you can always reach out (either here or on Bogleheads forums) for advice on your specific plan options.

• My book Building Wealth and Being Happy: A Practical Guide to Financial Independence is free on Amazon today (e-book version, can read in your browser, android, kindle, etc)
  
  
• I'll be selling and signing books this Sunday afternoon @ the Erin Mills Indigo in Ontario (Erin Mills Town Centre, 5015 Glen Erin Dr, Mississauga, ON)
  
  Cheers!

I like these anecdotes that show the power of compound interest. Here is another from The Automatic Millionaire. I saw something like this in my early 20s, and being a math nerd, I've been compelled to max out my retirement contributions ever since. I'm now in my early 40s and have around $700k saved for retirement. The future is looking pretty sweet.

I've been reading books on productivity for a long time, after reading about the concept of "flow" for the (seemingly) millionth time I went ahead and bought the book. I'm about 100 pages in (started it three days ago) and it's rapidly changing the way I look at life and work. Every situation is different, but on the long journey to FI it's 100% worth looking at a change now to make the rest of the journey more enjoyable. A lot of people on this sub will express a similar sentiment as the previous sentence, "Flow: The Psychology of Optimal Experience" seems to flesh out the nuts and bolts of how we'd go about doing that.

"Anyone have some cheese to go with this whine??"

No cheese necessary, the daily thread is a perfect place to vent :D

The trouble with a bank account is that the interest is so paltry. An idea I got from The First National Bank of Dad is to act as a bank for your kids and to pay them an exorbitant interest rate (like 5% monthly). Then they have a real incentive to save and can experience the fun of watching money meaningfully grow. You can reduce the interest rate as they get older and start to accumulate adult-like amounts of money.

Here are a few places to start if you're interested in the option:

• Ramit Sethi's Earn 1k course (when it opens again next)
  
  
• Dane Maxwell's Foundation Course (also when it opens again next)
  
  
• MJ Demarco's Millionaire Fastlane (Sounds scammy but is actually fairly inspiring)
  
  
• Tim Ferriss' 4 Hour Workweek (don't think you'll actually manage to pare down to 4 hours - the author doesn't)
  
  I can't vouch personally for the courses since I don't have the cash to join yet. Sethi has a 60-day money back guarantee and I've heard a number of interviews with Dane Maxwell and I really like some of the concepts he discusses.
  
  The books aren't hand-hold guides, but both are thought-provoking. A lot of people bash on Ferriss, but at least his stuff is interesting and gets you to think about your time differently.

Go grab this book from your local library.

https://www.amazon.com/Guide-Good-Life-Ancient-Stoic/dp/0195374614/ref=tmm_hrd_swatch_0?_encoding=UTF8&qid=&sr=

It's a great read helps you appreciate life in a different way and enjoy the ride.

I definitely enjoy the process as I go. I have no need to stress out about the process because I don't need expensive things. Since I don't need a lot of material/expensive items I no longer have to worry about making a lot of money.

I enjoy the job that I have, but I have no doubts that I'll be laid off randomly one day. It really doesn't matter because I only need 10 dollars an hour(this keeps going down as we save money) to meet my obligations. So might as well enjoy the ride.

So I’ve just started out also, and in not too much of a dissimilar scenario.

I heard a podcast, read a blog and I was hooked! So like you it started to spiral even further but the 1st real stop for me was this book.

Your Money or Your Life , 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence - Vicki Robbin

https://www.amazon.co.uk/dp/0143115766/ref=cm_sw_r_cp_tai_fKJxDb0YNBSP8.

There are plenty more out there but this basically gave me a good starting point, leading down a path of more and more resources.

Good Luck.

"I just finished Rich Dad Poor Dad which seemed like a bit of a cheesy self help book written in a couple days to serve as another part of this guy's passive income"

You are already ahead of 95% of the population. Recognizing that most financial advice is intended to make money for the adviser is the first and most important step.

"Passive income generation" and "higher reward investments" are dangerous terms to use. They are the RDPD con artist terms that equate to get rich quick schemes. You are better off starting off by reading Jack Bogle's "The Little Book of Common Sense Investing" (http://www.amazon.com/Little-Book-Common-Sense-Investing/dp/0470102101) as a start. Then you should educate yourself on what realistic investment returns are. They generally correlate with risk. Anytime you start looking at returns of 10% or more you must take on significantly more risk than the general market.

Unfortunately, yes. You can open a taxable brokerage if you really want to get into the market.

However, the best thing to do right now is focusing on graduating and building skills that will set you apart from others. Cal Newport's So Good They Can't Ignore You is a good read.

Not sure why this hasn't been mentioned yet: if you are unhappy and bored at work, being FI might also prove a challenge. Financial independence in itself will probably not be fulfilling. You'll need to create your own meaning now.

Use this as an opportunity to figure out what you care about and explore your passions. Knowing this will prepare you for FI and life in general :)

I'd highly recommend this book: https://www.amazon.com/Flow-Psychology-Experience-Perennial-Classics/dp/0061339202

Do you have written out Investment Policy Statement for your current situation? If not, learn more here or here - simple version. If you have an IPS in place now, you can review it with your wife. Then you can create a "what-if" IPS, to use in the event of your untimely demise.

Ours is actually a two-step process:

1. Short-term: What to do with insurance and other inherited accounts [Example: Put insurance money in 1 or more FDIC insured online savings accounts. Leave investment accounts as-is. Don't make big decisions during a very emotional time.]
   
   
2. Long-term: Managing the portfolio [Example: Pay off mortgage, set a new asset allocation, re-balance across new funds, etc.]
   
   Is your wife a book person? Mine is, so Bogleheads' Guide to Investing is on the list. I've also suggested she post on the Bogleheads Forums as that community has helped shape my/our current IPS. I've warned her not to trust "Financial Advisors" that are essentially salespeople. You mentioned you have an accountant/CFP you trust, so that person would likely be part of your plan.
   
   Finally, have an Inventory List of all the checking/savings/retirement/insurance accounts and their details. Make sure your wife knows where that list is. Detail any auto-payments or auto-withdrawals. For example, if my wife immediately cancels my primary credit card, our cable/internet bill won't get paid.
   
   At least every couple years, have the (potentially uncomfortable) conversation about what to do. A plan is only as good as the knowledge and understanding of the people who have to implement it.

Yes it is. I will not do the explanation justice so below is a link to JL Collins book A Simple Path To Wealth where he dives into the market trends.

The short answer is that the market always goes up. If you search for a graph of the stock market showing the last 100 years, while there are a few periods where you see some big dips, over the long run it always head higher.

Check out this book... it’s worth every penny!

https://www.amazon.com/Simple-Path-Wealth-financial-independence/dp/1533667926

Thanks! Yes, both kids get allowances. We set something up similar to this:

https://www.amazon.com/First-National-Bank-Dad-Foolproof/dp/1416534253

Even the 4yo gets it. He gets excited when he gets his interest. The other day at Target he picked up some BS toy and I said “you’ll have to spend your savings to buy that” and he put it back down.

(It’s not always that easy)

Depends on your interests. I would consider these important for any human, though:

• TaoTeChing
  
• How to Win Friends and Influence People
  
• Your Money or Your Life

Flow

This book completely changed how I see life. I've read a lot of self help books in my day, and this is the book that has finally allowed me to start actually applying the lessons I've learned in the rest of the genre.

Over the course of four or five months I've managed to start at 20 minutes and build out to an hour and a half daily of "flow activities". "Engineering flow" is a very real skill that takes time to learn and implement, but it's fucking worth it.

10/10 will be buying that book for a loved one this week :D

I thought the pronunciation was very clear! And thank you, adding to Overcast by feed url worked.

I just finished JL Collins book The Simple Path to Wealth before this one and highly recommend his stuff as well. The book is largely pulled from the content of his blog posts.

https://www.amazon.com/Simple-Path-Wealth-financial-independence/dp/1533667926

There’s an excellent book on this that gives a way to actually track and calculate this. I haven’t fully finished the book yet, but it’s definitely a good one: “Your Money or Your Life by Vicki Robin”

Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence: Fully Revised and Updated for 2018 https://www.amazon.com/dp/0143115766/ref=cm_sw_r_cp_api_fe78BbV04DE09

The #1 criterion that always matters: fees. Vanguard is well known for its low fees, and for a corporate structure that incentivizes low fees. They're good people. You could consider their ETFs, which mirror their mutual funds. (Their mutual funds usually have a $3K starting requirement, but the equivalent ETFs have no minimum and can be purchased in small increments.)

Also strongly consider using index funds (which try to match the market by copying it) instead of managed funds (which try to beat it, and usually fail to, especially when fees are taken into account). But even if choosing a managed fund, fees matter and make a big difference to returns.

Other than that it depends on your goals and time horizon. I'd really encourage you to read some guides to investing -- they're usually pretty short, actually. The Bogleheads' Guide to Investing would be a good investment, if your library doesn't have it.

General Greeting: I'm 34m, engaged, no kids in our plans. Have lived in Orlando for 16 years since college, and have been making websites and working in software engineering since high school. I absolutely love teaching people how to code and lucked into joining Code School (as you would easily discover looking at my post history).

What brought you to /r/fi: After my mom passed away ~11 years ago, I started reading everything I could to understand what to do with the modest inheritance. This led to reading things like The Bogleheads' Guide to Investing, The Millionaire Next Door and eventually MMM which helped refine and shape my view of investing, consumerism and the role of money in my life.

Other hobbies/interests:: I listen to a lot of audiobooks, and challenge myself to read/listen more. Recently started a site (minafi.com) to write about topics different from my day to day -- minimalism, financial independence and mindfulness. It's been fun having another avenue to write about things that are at the top of my mind, and explore something different from programming. Bunch of other common hobbies - CrossFit, board games, cocktails, eating anything and traveling anywhere.


Picture of yourself if you want: Somehow even though I'm crazy open with personal facts, sharing a photo seems quite intimate. I don't think I've done that before on Reddit, but here goes!.

This one

I got it when it was free, haven't finished it yet. /u/GraemeCPA'/ writing is pretty good.

Sounds like you need a philosophy of life...especially since you already have a doctor of philosophy degree :)..


A Guide to the Good Life: The Ancient Art of Stoic Joy https://www.amazon.com/dp/0195374614/ref=cm_sw_r_cp_apa_i_LmVADb2ZYTREF

Read the book The Millionaire Next Door

Second: teach yourself to save a PERCENTAGE of your income. Don't care about the amount, care more about the percentage. If you teach yourself to save 10% (for example) and increase it with time, that will be great. We all ignore this because at the very beginning of work life the 10% is in pennies, but if you committed to it, you will keep doing it when your salary is twice as much.

I got the Richest Man in Babylon! by George S. Clason out of college It was published in 1926 and is still great advice. There is also a free audio version here!. The book is written very differently than most personal finance books. The author uses parables to teach financial lessons. This makes it a great introduction for the financial newbie. The part that most stuck with me is:

"“A part of all you earn is yours to keep. It should be not less than a tenth no matter how little you earn. It can be as much more as you can afford. Pay yourself first. Do not buy from the clothes-maker and the sandal-maker more than you can pay out of the rest and still have enough for food and charity and penance to the gods."

I joined the Peace Corps after college so I didn't get around to implementing Mr. Clason's advice. For some reason, over the three year period I was out of the US, his advice changed in my memory to three-tenths. So since I got my first full-time professional job at 27, I have been aiming to save 30% of income. I haven't always met this goal but I have averaged saving at least 20% of my gross income.

This past May, I read Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence! which introduced me to FIRE. While I'm a little sad about the 6 years, I wasn't saving for FIRE, the savings I accumulated is a great start. The approach in this book has been very useful in figuring out what I am willing to give up in order to increase my SR and achieve FIRE sooner.

Edit: fixed hyperlink

One of our subscribers, /u/graemecpa, has just finished a personal finance book. He was running a giveaway yesterday, but due to an apparent glitch in the RemindMe bot, many people missed the giveaway deadline.

So he's extended the promotion to today. Here's the link:Building Wealth And Being Happy: A Practical Guide To Financial Independence

To add to the reading list, I enjoyed reading 'The First National Bank of Dad' teaching kids a safe way to invest, and how to work allowance. In regards to what others have said, just being there and living by example is way more important.

First, many people are here just looking at 1M+ reach thinking financial independence means Retirement.

Retirement is a plan on its own, a kind of fulfillment in life. Being FI makes them towards that fulfillment.

People must read these two books, and plan for FIRE.

Retire Happy: What You Can Do Now to Guarantee a Great Retirement

[The Charles Schwab Guide to Finances After Fifty]
(https://www.amazon.com/gp/product/0804137366/ref=oh_aui_search_detailpage?ie=UTF8&psc=1)

> Even this seems a bit too aggressive for my taste

Your job for the next month or three is to become a sponge for financial knowledge. Even though you have a CPA and a CFP, in order for you to feel comfortable with their decisions with your money, you need to have some amount of knowledge with finance.

Read:

• jlcollinsnh's stock series
  
• about the Trinity Study
  
• perhaps read The Millionaire Next Door
  
• A Random Walk Down Wall Street
  
• The Intelligent Investor
  
  After all that, you should feel much better about both your withdrawal rate and how aggressive your portfolio will be.

1. Thank you for sharing your personal story.
   
2. Never be ashamed of being ignorant. We are all ignorant about many things.
   
3. Admitting ignorance is a power that many people lack. It is also the first big step towards learning. This is a super power that will propel you forward.
   
4. The majority of normal, everyday people, do not know the first thing about investing. Not knowing anything about investing is average. You are now confronting this. That makes you above average.
   
5. Start with these two books to learn about investing: The Simple Path to Wealth by JL Collins and The Little Book of Common Sense Investing by John Bogle.
   
6. Not exactly investing related but just in case you don't already know about it, you should read this too.
   
7. Congratulations on your daughter.
   
8. Congratulations on living a full and dynamic life where you are able to confront your fears and admit mistakes, even when the extenuating circumstances around your mistakes aren't your fault. Congratulations on being able to learn change and fight for your family and a better life.

You'd probably benefit from reading Your Money or Your Life. Chapter 6 or 7 deals with redefining your relationship with work. There's an argument to be made that differentiates between paid employment and work. It goes something along the lines that we do all sorts of work every day: from cooking, cleaning, and learning to higher level concepts like raising a family and contributing a community. Recently, we've elevated money as the reward from work ignoring the less tangible rewards from those other forms of work.

This one? A Guide to the Good Life: The Ancient Art of Stoic Joy https://www.amazon.com/dp/0195374614/ref=cm_sw_r_cp_api_i_4OjrDbTCS2ZEE

As an antidote to Jim Collins' book: I like "The Permanent Portfolio: Harry Browne's Long-Term Investment Strategy" by Rowland & Lawson. Jim recommends a 100% stocks portfolio, and the PP is completely different. Very interesting to read about the different Black Swan events that happened in the past, and how they influenced the PP portfolio.

https://www.amazon.com/Permanent-Portfolio-Long-Term-Investment-Strategy/dp/1118288254

US Link for those that are interested: https://www.amazon.com/dp/B0713R5YCX/

RemindMe! 1 Day "Free PF ebook!"

You can't really control bad coworkers or bad bosses (which will ruin any job no matter how much you love the work).

But you should read "So Good They Can't Ignore You" (Amazon link) The author proves that the commonly held belief of "follow your passion" is actually really bad advise. You can find happiness in about any career as long as you gain unique skills, have autonomy, and are working on something meaningful/impactful.

I recommend reading "The Millionaire Next Door", it goes it to more detail about the spending/saving/investing habits of the average most millionaires in America. Living in a culture that prioritizes spending it's not surprising those who do the best financially go against the grain, and are also frowned upon.

You sound like you'd enjoy The Millionaire Next Door.

Talk to instructors. Get to know people in your major and stay in touch with them after graduation. Do an internship. If there's a national organization in your field, join it and attend conferences (there's often some sort of student stipend, or at least cheaper registration).

Every great opportunity I've gotten was a result of knowing someone. The larger your (meaningful) social network, the more doors are open to you.

This book* was invaluable to me in learning to network, even though much of the information was geared towards someone who wanted to someday be a CEO. I applied some of the author's suggestions to my much more meager goals, and got my current job (of nearly 20 years) as well as several lucrative business investments as a result.

* I should add that the book is less than 20 years old, but that I got the position in a company I already worked for by using the book's advice.

You have done everything nicely. Before going to planner or other web sites, just read these two used books which will help you.

https://www.amazon.com/gp/product/141330835X (first few chapters)

https://www.amazon.com/gp/product/0804137366 (chapter 1 enough)

These two saves you lot of time instead of going here and there in web.

It helps that I work in a very highly paid industry. I would not be able to save nearly as much as I do otherwise.

I cannot recommend this book enough:

http://www.amazon.com/Bogleheads-Guide-Investing-Taylor-Larimore/dp/0470067365

Give this book a read. It's a great starting point.

https://www.amazon.com/Little-Book-Common-Sense-Investing/dp/0470102101

This is also a great book based on his philosophy: The Bogleheads' Guide to Investing https://www.amazon.com/dp/1118921283/ref=cm_sw_r_cp_api_KwCFybWY1FM4Q

this is a really good read:

https://www.amazon.ca/Permanent-Portfolio-Long-Term-Investment-Strategy/dp/1118288254

at a 4% withdrawal rate having 5ish years of expenses in cash/bonds is not a bad plan

1. The entire idea of FI is about creating a new income source: investments.
   
2. Learn how to program and do that as a side thing.
   
3. Tim Ferriss wrote https://www.amazon.com/4-Hour-Workweek-Escape-Live-Anywhere/dp/0307465357 which explains step-by-step how to create a small business and automate almost all of it so you get paid without working.
   
4. As someone who was an electrical engineer, I cannot fathom why you feel the need to "diversify" income. Engineers can almost always find work. The only reasonable thing which makes sense is you want to increase your income which leads back to programming, small business, or just focus on engineering and get promotions/jump jobs a few times for raises.

You should read So Good They Can't Ignore You

@carelesschemicals,

This is the issue of unplanned early retirement from work. Better to spend $4 on used book

https://www.amazon.com/Retire-Happy-Guarantee-Great-Retirement/dp/141330835X

Plan it properly !

The Boglehead Guide to Investing is essentially the Bogleheads Wiki but in a more colorful and accessible format. I keep it on my mantle at all times and pull it down whenever I need to re-center myself. It's expertly written and a true gem for FIRE individuals who are non-technical people. Cathartic and reassuring.

I was in this situation recently and picked up the book The Bogleheads' Guide to Investing

​

I set up the lazy 3 fund portfolio with vanguard and have been doing that ever since. I like it because it's super simple, and I don't have to think much. Just invest my amount every paycheck and forget about it.

>I guess what I want to do is a study of millionaires.

Someone beat you to it.

(A worthwhile read, if you haven't read it already. Practically the bible around here.)

Here's a short summary.

http://www.fool.com/60second/indexfund.htm

They are dead easy to set up. Create an account at Schwab (or Fidelity, or Vanguard, or eTrade)

What kind of returns do you get? I don't know. You're buying the stock market. That may sound scary but it shouldn't. If you're young, it's way safer than anything else.

I hesitate to recommend a book, but I'm going to anyway.

http://www.amazon.com/Little-Book-Common-Sense-Investing/dp/0470102101/ref=pd_bxgy_b_text_z

If you've got $500K to invest, even a 1% swing is $5K a year. Take at least some time to understand investing even if you're not interested in it.

Your other stated options (bank, real estate) are actually quite risky. At your age putting your money in the bank is pretty crazy. And real estate does not always go up. Not even in Australia.

Check the sidebar for this book and others. You really ought to read this and The Millionaire Next Door. https://www.amazon.com/Your-Money-Life-Transforming-Relationship/dp/0143115766

your money or your life

Read the 4-Hour Workweek by Tim Ferriss if you haven't already. He talks about Filling the Void.

https://www.amazon.com/Bogleheads-Guide-Investing-Taylor-Larimore/dp/0470067365

https://www.amazon.com/Little-Book-Common-Sense-Investing/dp/0470102101

you need to read the FAQ, wiki, or a book. You can start with https://www.amazon.com/Little-Book-Common-Sense-Investing/dp/0470102101

http://smile.amazon.com/Bogleheads-Guide-Investing-Taylor-Larimore/dp/1118921283/ref=dp_ob_title_bk

I will probably do 5% a month as long their accounts are not very large.

I got most of these ideas from The First Bank of Dad. The match is from Dave Ramsey.

The Simple Path to Wealth by J.L Collins

Here you go.

Rich Dad, Poor Dad is a scam and the author has been widely discredited.

Check out "Millionaire Next Door" for real life examples of people that have saved enough to live independently. The mindset of most of the people featured is representative of how to approach financial independence.

Your wife really needs to read jlcollinsnh. Keeping that amount of money in cash is an absolutely terrible idea.

After that, go read The Bogleheads' Guide to Investing.

Read up on it and manage your own money. Read this book http://www.amazon.com/Little-Book-Common-Sense-Investing/dp/0470102101

I invest in the entire economy for the lowest rates available, with one of the most, if not the most, trusted company in the game. And I only do so with a small portion of my total net worth; I don't put all my savings into index funds. Despite what others say I put a lot of money into savings just like you. I could live for years off of savings alone and guess what I like it! I don't care what others say. I have a very unstable job situation, I'm actually self employed right now. I will keep growing that savings account at the same time I invest in index funds.

And yeah, I will never ever ever pay someone to "help" me with my money. Seriously, read that book, he talks all about these "helpers" we hate.