On Apr 5, 7:19 pm, fache...[at]gmail.com wrote:
- quote -

I have not achieved financial independance at age 34, but I'd like to
think I'm much closer now than I was even 2 years ago.

Boards like this help "validate" a line of thinking, help shed insight
on how complicated some decisions are, and they also help reassure
those of us which are "going it alone" without a financial advisor.

My purpose in this orginal thread was to draw out the success stories
-- such as those that have been contributed. I didn't mean to seem
vague, or ambiguous.

Tales of financial failure would also be useful, but I don't expect
anyone here to publish theirs. I do, however, read articles about
failures/mistakes in "Inc." and "Entreprenuer" magazines - and they
are truly educational (specifically about small business failures) for
a guy like me.

*Ideally* for me, perpetuating Financial Independence would mean that
it should be sustainable indefinitely (ceteris paribus regarding the
economy, markets, and mother nature) and leave one well-provisioned
for family emergencies, philanthropic iniciatives, etc. This is very
subjective -- I tried to leave it open ended on purpose. While living
in the third world, I met many whose idea of "well-provisioned" meant
having at least 2 acres, 6 pigs, 4 mango trees, 10 banana plants,
etc...

I've learned the following from what's been posted:

1) Each 'success' seemed to be best suited to the investor. In other
words, it is highly recommended that you feel comfortable, and are
familiar with your chosen investments.
2) Your goal for reaching Financial Independence are best when
writtenout -- so that you can measure your progress in a meaningful
way.
3) Each 'success' seemed to give the investors fulfillment.
4) There is no such thing as "Done." Even prudently considered
investments bear risk. Stocks can tank, real estate can be
unexpectedly de-valued, the "electronic herd" could stampede your
foreign currency speculations. Hedging your bets (one way is
diversification) seems to be beneficial here.


:-) Time is on my side, because I am young, and because I am willing
to learn from example. The course corrections I plan to make cannot
all be made immediately. First on my list now (and I as I said, I'm
willing to learn from good examples!) is to get as much education as
possible. Second, investigate small business opportunities locally --
yes, I'm aware of the failure rate of start-up businesses. Third,
begin to investigate profitable ways to 'store' my money, whether it
be in Real Estate, in CD's, Mutual Funds, etc. Until I find a good one
(profitable, understandable, enjoyable, and workable), my income needs
to be divided up before I even get the paycheck. There's got to be
even a rudimentary savings plan in place to begin with.

I welcome suggestions!

Regards,

Fachento

(I'll see if I can find a copy of _The Millionaire Next Door_ at a
local library.)

"Mark Bole" <makbo[at]pacbell.net> wrote
- quote -

_The Millionaire Next Door_ presents data suggesting
otherwise: Kids raised in wealth tend not to know how to
strive to attain it.

"Fachento" <fachento[at]gmail.com> wrote
- quote -

For your reference and perhaps not uncoincidentally, _The
Millionaire Next Door_ spends not insignificant time on this
point. Turns out that many profiled there are generous to
charities.

Fachento wrote:

- quote -

Well, that's quite a bit different from your original post, where you
suggested that financial planning strategies such as "saving and
investing", as often promoted in this group, should be judged by the
success of those practicing same. You referred to "two camps" and "both
sides", which you then identified as "the "Real Estate Investment
Camp" and the "Stock/Money/Mutual Fund Camp."

What did you learn about the success rate of each side from the posts?

Since "time is on your side", what course corrections do you plan to make?

- quote -

But being born to rich parents or grandparents, as he was, is one of the
most common contributing factors to wealth. Always has been, always
will be. (And I'm not talking about inheritances or gifts -- just
having that cushion of comfort growing up, as ol' Billy did, can make a
world of difference in how much risk you are willing to take in your own
endeavors). "Saving and investing" -- the subject of your post -- is a
catch-up plan for the rest of us.

-Mark Bole

I've learned a great deal from what's been posted. Thank you, to
those of you who contrinbuted! Financial Independence is, more than
anything to me, the freedom to spend your time as you choose - which
for me would involve Philanthropy... giving back. Having the right
kind of debt, net worth, and positive monthly cashflow all seem to be
keys to reach this worthy achievement. Enjoying yourself along the
way, in work, and in play would be preferable!

If successful financial planning is the goal of this post, then as
much attention should be given to the means, as to the end. More is
learned during the journey, I argue, than is learned when you arrive
at your destination. Success is not as much a destination, as it is
a journey. Those who are truly on-track to reach their destination
have as much right to inject their opinion as those who have already
comfortably retired.

As this poster offered:

- quote -

This is one facet of financial independence -- the knowledge that your
income and net worth give you the ability to walk away from full-time
employment and do what it is that you love (if they aren't the same
thing). (Congratulations, by the way!) You don't have to amass a
fortune to rival Bill Gates' in order to be independent!

Another poster offered:

- quote -

with the knowledge that you can do it over a sound financial
foundation, in perpetuity. Not X amount of money, or retirement at
age __. Since this seems to be the general idea of financial planning,
I hope that this thread continues to benefit the group!

Regards,

Fachento

fachento[at]gmail.com wrote:
[...]
- quote -

OK so far.

- quote -

Your definition is not very well crafted to satisfy your desire to
"judge", or measure (my interpretation of your goal), the success of
financial planning strategies.

First, if someone has positive net worth, then by definition they have
enough assets to satisfy all liabilities. So that part of your
definition provides nothing useful.

Then, you use the term "perpetuate" without stating how long you mean.

Finally, you seem to imply that "full-time employment" is some kind of
objective, quantitative dimensional scale. You can have full time
employment at minimum wage, and full-time employment at nearly a million
dollars/year. In both categories, some are struggling financially, and
some could quit their jobs tomorrow without a second thought.

Or to put it another way, the typical homeless person has attained
"financial independence", using your proposed definition.

My constructive suggestion is that you read up on the charter for this
group http://www.algebra.com/~mifp/Charter.txt and see if you can
provide a more specific question using the topic framework shown there
to satisfy your curiosity.

As it stands (other than some of the usual personality squabbles) I
think the anecdotes provided in this thread are interesting and useful.
Even more useful, but what you won't see much of, are the stories of
financial ruin, wealth squandered, poor strategies even more poorly
implemented. After all, this is a self-selecting group! ;-)

-Mark Bole

On Apr 8, 8:07 am, "Elizabeth Richardson" <erich...[at]worldnet.att.netwrote:

- quote -

I agree. It's all a matter of preferences:given the same income -say,
150K a year- some people prefer to spend the whole amount and keep
working during the rest of their lives; while other people prefer to
spend -say- just about 3K a month and save/invest the remainder 75% of
the income, and retire quite early. Being retired doesn't imply
necessarily that the person who retires early is richer than the other
person (in the sense that she/he earns less money) but that he/she
doesn't need to spend as much to be happy, and prefers to live a
simpler life with all their needs covered but not with luxuries. As
Seneca -an Ancient Rome philosopher- said, "no one can be poor who
has enough, nor rich who covets more."

Therefore, the point is that each person (at least, those lucky enough
to make enough money to have a real choice) should make a choice
early in their lives: do you prefer to have a Mercedes 600, a big
house full of expensive furniture, expensive vacations to Seychelles,
and then work till you are 65? Or do you prefer to just work to cover
your needs ( maybe indulging from time to time in some not-so-
expensive little luxuries), save/invest the rest of your income, and
then retire early?

"Elizabeth Richardson" <erichktn[at]worldnet.att.net> wrote
- quote -

One definition of "well off" is having had enough success to
no longer work, AFAIC.

We're splitting hairs and testing the moderators.

"Elle" <honda.lioness[at]nospam.earthlink.net> wrote in message
news:NYTRh.20503

- quote -

Actually, if you'll look at the post that started this thread, the OP was
asking for anyone who has enough to no longer work to respond. You don't
have to be well off to have had enough success to no longer work.

We are more blue collar than white, although technically really neither. My
husband retired from a local government job with a pension which replaces
something less than 50% of his last wage. While getting ourselves to
retirement at younger ages than most, we lived on considerably less than we
earned and watched every penny. We invested the remainder in available 457,
401k and IRA plans; no individual issues, all mutual funds. We had a small
inheritance - less than $100k - which we did not squander. We have no debt,
including no mortgage. We live modestly, but no longer pinch pennies. We
don't wish to travel extensively, but I do have 3 trips planned this year.
My husband has a hobby which has been a lifelong passion from which he now
derives a small income. I continue to go to the office a few hours a week
(10-12) to work on special projects - something I'm enjoying.

Elizabeth Richardson

"The Henchman" <heyhey[at]isforhorses.com.easynews.com> wrote
- quote -

Please see the post that started this thread. Note that the
part of it to which I responded is directed to those who
"can claim success" in "financial planning," and so forth.

To clarify perfectly: Some queries and some responses are
for the well off; some are for the not well off; some are
for somewhere in between. I support all these. Understand?

"Elle" <honda.lioness[at]nospam.earthlink.net> wrote in message
news:c8PRh.135248$_73.33402[at]newsread2.news.pas.earthlink.net...
- quote -

Seems to me you want to keep this forum for the elite and wealthy or am I
reading this wrong?

But what I don't understand is why you expect people here to be well off, or
do you expect people to be well-off before they offer advice to questions?
It's up to the individual readers or seekers of advice to try and verify on
their own from other sources of information as well.

"Elle" <honda.lioness[at]nospam.earthlink.net> writes:

- quote -

I don't have a problem with admitting that the way I came to be
"well-off" had nothing to do with financial planning; after spending
most of my adult life in grad school or working low-paying jobs in
academia, I lucked out when a tiny, struggling startup company I
worked for was bought out for $$$ by a much larger company. So, in
contrast to many people here, who've built up wealth by socking money
away in a 401(k) and/or IRA over a period of many years, my financial
concerns are more focused on how to invest a big lump-sum payment and
minimize taxes on my investments going forward. I can't very well go
back and make up for all those years when I didn't have a 401(k) plan
to contribute to and/or was saving money to buy a house instead of
maxing out an IRA every year, anyway.... ;-)

-Sandra the cynic

"The Henchman" <heyhey[at]isforhorses.com.easynews.com> wrote
- quote -

Stating how they came to be well-off.

I do not begrudge anyone keeping private info to him- or
herself.

As far as I am concerned, MIFP remains helpful to many even
without the minutiae of how people here came to be well-off.

"Elle" <honda.lioness[at]nospam.earthlink.net> wrote in message
news:8DfRh.18709$PL.11835[at]newsread4.news.pas.earthlink.net...
- quote -

Define forthcoming? what do you expect from the porters and responders
here? Do you expect the successful investors to spill their guts? do you
expect the people who failed to to detail why? Why do you think there are
shortcomings here? is it the volume of participants? the level of
knowledge? do their incomes and plans differ from your dramatically?

I've managed to learn from three or four of the regular posters here a
couple of key important details about financial-planning within the last 6
months. I have been happy to-date with the questions I have posted and
plan on asking a few more and counting on one or two good answers.

Elle wrote:

- quote -

Well, more forthcoming on this topic than I expected!

At the risk of being trite... and with apologies to Ben Franklin...

"Healthy, wealthy, and wise -- pick any two".

-Mark Bole

Sgt.Sausage wrote:
[...]
- quote -

Try this link, it's been around a long time but still a good read in
case you've never seen it before. It is not spam.

"How to Become As Rich As Bill Gates"

http://philip.greenspun.com/bg/

Fri Apr 6 21:24:33 EDT 2007
Microsoft Stock Price: $28.55
Bill Gates's Wealth: $67.771883 billion
U.S. Population: 301,550,533
Your Personal Contribution: $224.74

-Mark Bole

On Apr 6, 1:19 am, fache...[at]gmail.com wrote:

- quote -

I am a relatively young guy who has achieved this "financial
independence" target. The reason is: 1/ I had a relatively well paid,
tax-free job for 9 years (1997-2006); 2/ I saved most of the income I
got from the job (my personal savings rate was 70 to 80 percent of my
salary); and 3/ I invested relatively well, mostly in commercial real
estate in my home country (which has a market value more than 3 times
higher than when I bought it five years ago). Right now, the rental
income from this property is more than enough to cover any reasonable
expenses I may have.

Regarding debts, even if I'm now debt-free , I don't think that this
is an optimal situation. In my view, some debt -such as low-interest,
tax deductible mortgage debt- makes perfect sense if you use that
money to invest in high-yield assets, such as value stocks IF the debt
service does not generate a cash flow problem.

- quote -

education you can, that way you can get a good, well-paid job; 2/ do
not overspend, and try to save as much as you can; and 3/ invest
wisely, which means buy only assets that are undervalued at the moment
you buy it. The third part is probably the most difficult to achieve,
because to do this -buy undervalued assets- you need some careful
analysis, patience, and some luck.

<fachento[at]gmail.com> wrote in message
news:1175809182.586008.284890[at]p77g2000hsh.googlegroups.com...

- quote -

I have.

The wife turned 36 yesterday and I'm 38 in a few months.

Neither of us has to work. We could both quit working
today and not change our lifestyles one iota for the
remainder of our lives.

We've set our "go to hell date" as my 45th birthday.
She'll be 43 and I'll be 45. Barring a total economic
melt-down, neither of us will work a day past my 45th.


- quote -

Tradional "investments" -- you seem to split them into
(1) real estate and (2) stocks/bonds/equities/market/etc
have not done it for us. We're heavily invested in both
and neither is sufficient for the goal of 'financial
independence' for us for at least another 15 years or
so. Current projections for us show that we would reach
your goal of 'financial independence' on those investments
by some time between the ages of 50 and 55. I have full
confidence that they can, though. We've run the numbers and
it *will* work. I'll have to get back to youin 15 years on
that one to let you know if the projections and assumptions
held up.

No -- what's done it for us is the business world. Dollar
for dollar, their is no greater reward (both in monetary
and non-monetary terms) than starting and running your
own business.

I own and run a successful software development shop with 9
employees. I own a large percentage of an independent claims
adusting firm with 11 adjusters on staff. My wife owns and run
a property management firm and hangs out her shingle a few months
a year for tax preparation (she's a CPA) -- oh, and she's
got a part-time gig (3 days a week) job writing financial
reporting software for the local telco.

For me, the greatest, quickest, most rewarding way
to obtain 'financial independence' is running a successful
business or three.

For most, though, it's the quickest way to bankruptcy.
Far more fail and end in financial ruin than succeed.


Don't get me wrong. I *love* my stocks and my rental
homes. They are, for the large part (at least in my
short lifespan) reliable, predictable producers of
wealth that are very ... hands-off ... passive(?)
Running the businesses takes work. Hard work like
most have likely never seen in their lives. There is
something to be said for just writing a check or
making an electronic payment into a fund and watching
it grow without having to trade any actual labor for
that growth.

<fachento[at]gmail.com> wrote in message
news:1175809182.586008.284890[at]p77g2000hsh.googlegroups.com...

- quote -

I believe I have. Started saving in a 401(k) as soon as I was eligible to
do so, which was 1978. My girlfriend at the time did the same.

She's now my wife. She retired from full-time employment in 1998, I in
2003. Since then, we've done some consulting, some teaching, and some
writing--but could have gotten by without the income. Between our 401(k)
accounts and other savings, we have comfortably more than the 25 times
current annual spending "they" say one should have.

In retrospect, our asset allocation was too naive. She kept her 401(k)
entirely in fixed income; I kept mine entirely in employer stock.
Fortunately, said employer stock didn't tank until *after* I had wised up
and diversified. And did it ever tank! I think it lost more than 80% of
its value. But I was mostly out of it by then, and the rest of the
portfolio did just fine. And between us we wound up with a
not-too-unreasonable balance. So we had a couple of lucky breaks to make up
for our naive asset allocation.

Of course there could be another Great Depression, or any number of other
things could go wrong. But except for a downturn of that magnitude, I would
say that we're now financially independent. In particular, we back-tested
our current plans over the past 10 years, including the 48% drop in the S&P
500, and we'd have done just fine. And we're not counting on getting a
penny from Social Security.