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Thrifty Thursday - Save Thousands on Your Phone Plan

Recurring expenses are insidious.  Companies love signing you up for subscription services as it means a consistent revenue stream by default.  The burden is on the consumer to take action, but momentum and inaction usually win out and the payments keep getting made. Taking a hard look at these subscriptions and other recurring payments can be very effective in reducing annual expenses, thereby lowering your Target FI Number and leaving more money for saving and investing .   Some expenses that don’t bring enough value can be eliminated.   Others can be greatly reduced with a little intentionality (just get a month or two of that streaming service to binge your favorite show, no need to leave it renewing for the whole year!)   However, there are some that are necessary but we can work on reducing their impact. One of my favorite hacks is switching to a low-cost cell phone plan offered by a Mobile Virtual Network Operator.    MVNOs lease bandwidth on existing cell towers ins
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Thrifty Thursday - Upgrade to LED Bulbs

Here’s a hack with a high percentage return.  If you pay your own electricity bill, chances are your use is metered and charged by the Kilowatt hour (kWh) .  A Watt (W) is measure of power, or energy per second, so a Kilowatt hour is just using 1,000 Watts of power for one hour. For example, a common household incandescent light bulb uses 60W of power.  If you left this light bulb on for 3 hours a day for a year, it would use 65.7 Kilowatt hours: $$Total\ Energy = Power * Time$$ $$Total\ Energy = 60 W * {3\ h \over day} * {365\ days \over year}$$ $$Total\ Energy = {65,700\ Wh \over year} = {65.7 kWh \over year}$$ Since Thomas Edison invented the incandescent bulb in 1879, however, there have been some improvements to the technology.  The latest is the LED Light Emitting Diode bulb.  An LED bulb can create the same amount of light Typically measured in lumens. as an old incandescent light bulb using much less power.  For example, an LED replacement for a 60W inca
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Thrifty Thursday - Hack your Housing

Housing is an expense we all must deal with which can add up to a large portion of our income.  The US the Bureau of Labor Statistics last survey on Consumer Expenditure found housing to be the largest category for the average American at 33% of their spending.  The Pareto Principle would tell us this is an area ripe for action.  What are some ways we can reduce the amount we spend on housing? Live at home for as long as you can.   Living with your parents is becoming a frequent stepping stone for college graduates.  Outside of America, multigenerational households are already much more common.  Not only is it more efficient to combine more family members under one roof, but younger generations living rent free is a great tax-free wealth transfer tool! Don’t forget about grandparents or close aunts and uncles living in areas you would like to work. Chose a low cost of living area.   Include the cost of living in your calculations when choosing the next place
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Thrifty Thursday

Introducing Thrifty Thursday. On Thursdays, I’ll post a quick article with a tip or life hack to help with Intentional Spending . These will fall into three basic categories: Freebies are life hacks to get something for nothing! Maybe there’s no free lunch, but there are plenty of things you have already paid for in one way or another and just need to take advantage of, or that are being offered in hope of future business. Cost Cutters are the things we all need, that you are probably already buying in some form, but cheaper! Worth It are things that might not look like savings up front, but could be worthwhile investments, eventually leading to more savings. They may also be actual splurges, but with a good value and totally worth it! Check out the articles so far: Freebies The Library Cost Cutters Hack your Housing Save Thousands on Your Phone Plan Worth It Upgrade to LE
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Thrifty Thursday - The Library

With the internet offering the temptation of quick, ubiquitous access to information, many of us have forgotten the old standby of the library.  However, the library still has a lot of value to add and it’s free Most libraries will issue library cards to residents for free. Many will even let a non-resident obtain a card for a small fee. to get a library card since your tax dollars are already paying for it! What can you get at your library? Books - While blogs and tweets are great quick hits, books often contain the highest quality information as the authors have put the time and effort to distil and consolidate their best material.  Meanwhile the editors and publishers make sure it’s concise.  Looking for something to read?  Focus on learning and self improvement; you can start with my recommendations . Audiobooks – Using audio to consume information while commuting, working out, or otherwise have your hands busy but mind free is a majo
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Intentional Spending

Your spending is an important factor in your financial independence journey. It effects the rate at which you can save and invest while in the accumulation phase and is also a critical factor in calculating your Target FI Number. When accumulating wealth, the amount you can save and invest is a simple calculation: what you make minus what you spend.  Like many of the levers we talk about, your spending has a non-liner effect on your FI journey.  Spending slightly less also means saving slightly more and both of those quantities are found in the formula for Stash Rate , leading to a multiplied effect. $$ Stash Rate = {Annual\ Savings \over Annual\ Expenses} $$ As we saw in the Stash Rate article, decreasing expenses leads to an exponentially increasing rate of wealth building. On the other side of financial independence, the level of spending in your drawdown phase directly determines your Target FI Number. $$ Target\ FI\ Numbe
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Stocks: How to Pay Someone Else to Work for You

 When you work for a company, you work to build someone else’s wealth.  When you own a company, other people work to build your wealth. Fortunately, you don’t have to be Bill Gates or Elon Musk to own a profitable company.   Instead, as we touched on briefly in the article on assets vs. liabilities , you can buy stock in the company.   Buying a share of stock mean you actually own a small piece of a company. One of the most efficient ways to own stocks is by purchasing low-cost index funds.   These funds can either be in the form of mutual funds or Exchange Traded Funds (ETFs).   The key difference to a traditional actively managed fund is that the index fund simply tracks the relevant market.   For example, an S&P 500 index fund would hold shares of the largest 500 U.S. companies In the S&P 500’s case, the largest 500 with some consistent caveats: at least 10% must be publicly available for trade
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