
<div class="wp-block-image"><figure class="alignright size-large"><img width="350" height="525" src="https://retireby40.org/wp-content/uploads/2021/05/May-2021-update-350.jpg" alt="" class="wp-image-22297" /></figure></div>



<p>Hey, everyone. <a href="https://retireby40.org/summer-2021/">Summer is here!</a> The weather is beautiful and it really cheers me up. We got our second Covid vaccine shot in May. Now, we feel a lot more comfortable going out without a mask. On Saturday, we ate out for the first time in over a year. We’ve been meaning to try this neighborhood Indian restaurant for a long time. The food was perfect. It was really great to be able to go out again. I’m very optimistic for this summer. We have two road trips planned and probably will take many day trips too. It really feels like we’re coming out of this Covid pandemic.</p>



<p>On the personal finance side, we had another great month. Our net worth hit a new high again! The stock market keeps going up. I’m starting to get leery, though. How long can it keep this up? Now is a good time to take a little profit and diversify if you can. I sold some stocks to invest in commercial real estate with <a href="https://retireby40.org/crowdstreet">CrowdStreet</a>. This will help generate passive income when Mrs. RB40 retires next year. Our cash flow was also good in May. Things are going quite well.</p>



<h2><strong>2021 Goals</strong></h2>



<p>This is my 2021 goal sheet. It works really well. Try it out if you can’t keep up with your New Year goals. The key is to go over the spreadsheet at least once a month to track your progress. That way, you can see which goals need extra attention.</p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="667" height="377" src="https://retireby40.org/wp-content/uploads/2021/05/May-NY-Goals.jpg" alt="" class="wp-image-22276" /></figure></div>



<p>All right! 2021 is turning out to be a great year for me. I already accomplished 6 of my goals and I’m making good progress on the rest. (I made modest goals because 2020 was such a crazy year.) Here are the details.</p>



<h2><strong>Financial Goals</strong></h2>



<ul><li><strong>Real Estate Crowdfunding $150,000.</strong> In April, I invested in an apartment renovation project near Seattle. I have high hope for this one. The housing market in that area is hot. Recently, the projects on <a href="https://retireby40.org/crowdstreet" target="_blank" rel="noreferrer noopener">CrowdStreet</a> got funded very quickly. I think investors are taking profit from the stock market and diversifying. That’s a great idea, but finding a solid alternative investment can be difficult. This is where CrowdStreet comes in. It’s a great way in invest in commercial real estate.</li><li><strong>FI Ratio &gt; 110%.&nbsp;</strong>As usual, this is my main goal for 2021. The&nbsp;<strong>FI ratio </strong>is passive income divide by expense. We are doing quite well so far this year. We are spending less money than usual because of the pandemic. I’m very happy with 120% FI ratio.</li><li><strong>1-year cash for Mrs. RB40 mini ER</strong>. Mrs. RB40 plans to take a mini-retirement in 2022. I want to have a nice cash cushion before then. Usually, we spend less than $50,000 per year so that’s my target. Currently, we have about $23,000 in our saving account.</li><li><strong>Side hustle income &gt; $3,000</strong>. Mission accomplished! This goal is just for fun. Side hustling is a good way for early retirees to keep busy and stay active. This year I plan to charge scooters, take surveys, and sign up for cash bonuses. In May, I made $2,520 from charging scooters. Wow! It was the best month ever. It seems like most people moved on to do something else. Delivering food is probably a better gig since you get tips. But I’m happy with charging scooters because I don’t have to interact with anyone. Heh. It’s also good exercise for me. Although, I probably should cut back a bit. I’m spending a bit too much time on this side gig, 10-20 hours/week.</li></ul>



<h2><strong>RB40</strong></h2>



<ul><li><strong>Refresh Retire by 40 – Done!</strong> Whew! I finally completed this goal. It has been on this list for over 2 years. This work required a big block of time and focus. I just couldn’t do it at home. I only finished because I was stuck in <a href="https://retireby40.org/solo-quarantine-week-1/">quarantine for 2 weeks</a> and could focus on it. I hope you like the new design.</li><li><strong>1,000 subscribers on my YouTube channel.</strong> Currently, we have 316 subscribers on <a href="https://www.youtube.com/channel/UCH8PcOiAjrzR3Td6lyvclrw?view_as=subscriber" target="_blank" rel="noreferrer noopener">our YouTube channel</a>. We didn’t upload any video in May. I was too busy trying to finish up our taxes. Making video clips is hard!</li></ul>



<h2><strong>Personal Goals</strong></h2>



<ul><li><strong>Visit Thailand. Done!</strong> I got back from Thailand in February. I spent 6 weeks there to check on my mom and reconnect with families and friends. It was great. I would love to retire there 6 months/year.</li><li><strong>Weight &lt; 135 lbs. Done!</strong> In Thailand, the serving size was much smaller than what I’m used to. I lost weight and it is now 133 pounds. Hopefully, I’ll be able to keep it under 135pounds for the rest of 2021.</li><li><strong>Estate planning. Done! </strong>We started the process with our lawyer last year. I thought it won’t be done until March, but we completed it right before I went to Thailand. That’s perfect timing.</li><li><strong>V for vasectomy.</strong> I saw my doctor for an annual physical before I flew to Thailand. She said she can refer me to someone when I get back. We don’t want any more kids. This one is WIP.</li><li><strong>Happiness level &gt; 8. </strong>May was a <strong>9</strong>. I had a relaxing time and didn’t stress out much. The weather was really nice as well. I also got my 2<sup>nd</sup> vaccine shot and went out to a restaurant! It was a great month.</li></ul>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="580" height="371" src="https://retireby40.org/wp-content/uploads/2021/05/May-Happiness.jpg" alt="Happiness chart" class="wp-image-22279" /></figure></div>



<h2><strong>Net Worth (+9.3%&nbsp;YTD)</strong></h2>



<p>I’ve been&nbsp;<a href="https://retireby40.org/personal-capital-track-finances-free/">tracking our net worth</a> since 2006 and it is very motivating to see our progress. Our net worth is up by 9.3% since the beginning of 2021. That’s excellent. IMO. My annual net worth target is +10% per year. We are almost there! 2021 is a great year for businesses. People are ready to spend and investors will profit from that mentality. Let’s see if the market can keep on rising…</p>



<p>Here is a chart of our net worth from Personal Capital.</p>



<p><a href="https://retireby40.org/pcap/" target="_blank" rel="noreferrer noopener">*Sign up for a free account at Personal Capital</a> to help manage your net worth and investment accounts. I log in almost every day to check on our accounts. It’s a great site for DIY investors.</p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="600" height="294" src="https://retireby40.org/wp-content/uploads/2021/05/May-Net-worth.jpg" alt="" class="wp-image-22281" /></figure></div>



<h2><strong>2021 Passive Income ($15,863 YTD)</strong></h2>



<p>Here is a quick summary of our passive income. You can see all the details on my&nbsp;<a href="https://retireby40.org/passive-income/"><strong>Passive Income page</strong></a>.</p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="554" height="245" src="https://retireby40.org/wp-content/uploads/2021/05/May-passive-income-1.jpg" alt="" class="wp-image-22283" /></figure></div>



<p>April was a great month on the passive income side.</p>



<ul><li>Real estate crowdfunding: I received $343 from our investments. This should improve as more projects stabilize.</li><li>Rental income: Our tenant is back from Europe! We made $533 from our rentals in May.</li><li>Dividend: We received $779 from our dividend portfolio. That’s pretty good.</li></ul>



<p>At the end of May, our FI ratio was 120%. That’s excellent, but it’s mostly due to low spending. Our passive income is still a little low. &nbsp;</p>



<p>*FI ratio = passive income/expense</p>



<h2><strong>May 2021 Cash Flow</strong></h2>



<p>Our cash flow was great in May. We didn’t spend much and saved 61% of our income.</p>



<p>Here is the Sankey diagram. You can get a quick overview and see the details below.</p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="650" height="500" src="https://retireby40.org/wp-content/uploads/2021/05/May-2021-Sankey.jpg" alt="" class="wp-image-22284" /></figure></div>



<h2><strong>Gross Income: $15,197</strong></h2>



<p>Our gross income was solid last month. Any month with $15,000+ income is a very good month.</p>



<ul><li><strong>Mrs. RB40’s job</strong>: $8,663.</li><li><strong>Blog income:</strong> $2,350. We had a good month at RB40.</li><li><strong>Real estate crowdfunding</strong>:&nbsp;$343. A good month for RE crowdfunding. You can read more at the&nbsp;<a href="https://retireby40.org/passive-income/real-estate-crowdfunding/">RE Crowdfunding Passive Income page</a>.</li><li><strong>Rental income</strong>:&nbsp;$533. Woohoo! Our tenant is back in town. Now, we’ll have positive cash flow this year. Read more at the&nbsp;Rental Property Passive Income page.</li><li><strong>Dividend Income</strong>:&nbsp;$779. Slow month for dividend income. See more details on my&nbsp;<a href="https://retireby40.org/passive-income/dividend-stocks/"><strong>Dividend Passive Income page</strong></a>.</li><li><strong>Interest Income:&nbsp;</strong>$9.</li><li><strong>Side hustle &amp; Misc:&nbsp;</strong>$2,520. I charged a ton of scooters in May. The weather was nice and people are out a lot more. I also made $10 from ProductTube for sunscreen shopping. &nbsp;&nbsp;</li></ul>



<h2><strong>Monthly Spending: $2,769</strong></h2>



<p>This year, I plan to spend about $50,000. So our&nbsp;<a href="https://retireby40.org/a-simple-easy-budget-plan-for-people-who-hate-budgeting/">monthly spending budget</a>&nbsp;is $4,166/month. May was another low spend month. We just don’t have a lot of expenses right now.</p>



<ul><li><strong>Housing</strong>: $1,261. This category includes mortgage, home insurance, HOA fees, property taxes, utilities, home improvement, repair, and furnishing.</li><li><strong>Parents</strong>: $500. My brothers and I each sent $500/month to my parent. They don’t have much retirement savings. Fortunately, they live in Thailand so $1,500 is enough. I also own the condo they live in so their housing expense is very small.</li><li><strong>Groceries</strong>: $404. Wow, that’s low. I don’t know exactly why it was so low last month. The previous month, we spent about $650. I guess it balanced out</li></ul>



<p>Here are some of the dinners I made.</p>



<p><strong>Green curry noodles</strong> &#8211; This dish was really good. I used Indian eggplants instead of Thai eggplants, but they worked well. Our son didn&#8217;t like it, though. He said it was spicy. I didn&#8217;t think it was spicy at all. </p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="600" height="600" src="https://retireby40.org/wp-content/uploads/2021/05/green-curry.jpg" alt="" class="wp-image-22288" /></figure></div>



<p><strong>Okonomiyaki</strong> &#8211; Family&#8217;s favorite. This is super easy to make once you have all the ingredients. </p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="600" height="600" src="https://retireby40.org/wp-content/uploads/2021/05/okonomiyaki-1.jpg" alt="" class="wp-image-22292" /></figure></div>



<p>Fajita &#8211; Mrs. RB40 made chicken fajitas. Mmmm&#8230; fajitas. </p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="600" height="600" src="https://retireby40.org/wp-content/uploads/2021/05/fajita.jpg" alt="" class="wp-image-22294" /></figure></div>



<ul><li><strong>Bills</strong>: $23. (This is just life insurance. Water, gas, and electric bills are included in the housing category.)</li><li><strong>Transportation</strong>: $204. This was for gasoline, insurance, public transportation, and maintenance. I also got a battery jump starter and an air pump for the tire.</li><li><strong>Entertainment</strong>: $111. We went out once and ordered takeout twice. . &nbsp;</li><li><strong>Kid</strong>: $0.</li><li><strong>Pet</strong>: $26.</li><li><strong>Travel</strong>: $0.</li><li><strong>Health</strong>: $96. Doctor appointment and prescriptions.</li><li><strong>Clothing: $</strong>35. Mrs. RB40 got a new pair of boots.</li><li><strong>Misc: </strong>$108.School’s fundraiser.</li></ul>



<p><strong>Others</strong></p>



<p>I don’t count these as personal spending.</p>



<ul><li><strong>Taxes and deductions</strong>: $3,230. I sent in the art tax and various other local taxes.</li></ul>



<h2><strong>2021 Savings ($44,644 YTD)</strong></h2>



<p>Alright! 2021 is going very well for us.</p>



<ul><li><strong>Joe’s 401k</strong>: $14,500.&nbsp; &nbsp;</li><li><strong>Mrs. RB40’s 401k</strong>: $7,500. She contributes $750 every paycheck.</li><li><strong>Roth IRAs</strong>: $5,000</li><li><strong>529 College Savings</strong>: $2,000.</li><li><strong>Extra savings</strong>: $15,644</li></ul>



<p><strong>YTD 2021 saving rate = 63%</strong></p>



<h2><strong>May 2021 wrap up</strong></h2>



<p>May was another great month for us. Our income streams were all strong and we didn’t spend much. Our net worth hit a new high again. Real life was great too. 2021 is turning out to be a very good year. Hopefully, we can keep this up for the rest of the year. We need a good year to prepare for Mrs. RB40’s early retirement next year.</p>



<p><strong>How was May for you? &nbsp;</strong>I hope you had a great month as well.</p>



<p><a href="https://retireby40.org/pcap/" target="_blank" rel="noreferrer noopener">*Sign up for a free account at Personal Capital</a>&nbsp;to help manage your net worth and investment accounts. I log in almost every day to check on our accounts. It’s a great site for DIY investors.</p>



<p>Disclosure: We may receive a referral fee if you purchase or signup for a service through the links on this page.</p>
<p>The post <a rel="nofollow" href="https://retireby40.org/may-2021-goals-financial-update/">May 2021 Goals &#038; Financial Update</a> appeared first on <a rel="nofollow" href="https://retireby40.org">Retire by 40</a>.</p>


May 2021 Goals &amp; Financial Update


<div class="wp-block-image"><figure class="alignright size-large"><img width="350" height="525" src="https://retireby40.org/wp-content/uploads/2021/05/Summer-2021-350.jpg" alt="" class="wp-image-22240" /></figure></div>



<p>Are you ready for the summer?! It’s Memorial Day Weekend, the unofficial start of summer. Oh man, I am so ready to relax and chill out for a while. We got our second Covid vaccine shot two weeks ago so we are fully vaccinated. <strong>Woohoo!!</strong> I am so excited to go out, travel, and see friends and families again. In fact, an old friend just came to town for a visit and we hung out without social distancing. It was great. I am a big introvert, but even I miss interacting with friends in real life.&nbsp;</p>



<h2>End of school year</h2>



<p>The Memorial weekend also means the end of the school year for many students. <strong>Congratulations to all the graduates out there! </strong>Don’t miss <a href="https://retireby40.org/my-best-advice-to-new-college-grads/">my best advice to new college grads</a>. For younger students, it’s time to relax and enjoy the nice weather.&nbsp; We are still a bit careful this summer so I’m sending our son for any camps. He’s not big on them anyway. I asked if he’d rather go to day camp or buy stuff and learn on his own. He said the day camps are too much like school and he prefers to get some new toys. Hence, we’ll go get a new skateboard and some other fun toys soon. I’ll sign him up for soccer in the fall. By then, a lot more people will be vaccinated so I’ll feel safer.</p>



<h2>Fun toys</h2>



<p>Oh, do you know any good outdoor toys for a 10-12 year-old boy? Here is my list. Let me know what else can we buy. Might as well spend some of that stimulus money, right? I guess indoor toys would be okay too.&nbsp; I’d rather he played outdoors, though. He already spent so much time indoors this past year.</p>



<ul><li>Skateboard</li><li>Pickleball set</li><li>RC truck</li><li>Drone</li><li>A baseball bat and a new glove</li><li>???</li></ul>



<h2>Travel</h2>



<p>Another thing we really miss is traveling. Last summer, we took a couple of <a href="https://retireby40.org/oregon-road-trip-2020/">short road trips</a>. It was fun, but we’re itching to explore further afield. We have two road trips planned this summer.</p>



<h3>Beach trip</h3>



<p>My brother and his family are coming to visit in June. We’ll show them around Portland then go to the beach for a few days. RB40Jr is looking forward to seeing his cousins again. They’re similar in age so they should have a lot of fun together. We meant to go see them last summer, but Covid spiked in California so we called it off. All of us feel much better about traveling now that we are vaccinated.</p>



<h3>Yellowstone!</h3>



<p>I reserved a campsite for a full week in Yellowstone! Our son is in 4<sup>th</sup> grade and he got a free annual pass as part of the <strong><a href="https://www.nationalparks.org/our-work/campaigns-initiatives/every-kid-outdoors" target="_blank" rel="noreferrer noopener">Every Kid Outdoors</a></strong> program. We’ll drive to Yellowstone and make a few stops along the way. This should be a great road trip.</p>



<h3>Yosemite?</h3>



<p>We might visit Yosemite if we can schedule it somehow, maybe in August. I wanted to go last summer, but you know&#8230;</p>



<h2>Any plans this summer?</h2>



<p>What about you? Do you have any big plans this summer? International travel is still a bit iffy. Many countries are struggling with Covid. I went to see my parents in Thailand earlier this year and I was in <a href="https://retireby40.org/im-done-with-quarantine/">quarantine for 2 weeks</a>. It was not fun. Most people can’t spare 2 weeks for quarantine when they go on a vacation. I think 2021 is a good year to visit sites in your own country.</p>



<p><strong>Also, are you planning to send the kids to camps? If not, what is your plan for the munchkins?</strong></p>



<p>Image credit: <a href="https://unsplash.com/@mateo_giraud" target="_blank" rel="noreferrer noopener">Mateo Giraud</a></p>
<p>The post <a rel="nofollow" href="https://retireby40.org/summer-2021/">Summer 2021!!!</a> appeared first on <a rel="nofollow" href="https://retireby40.org">Retire by 40</a>.</p>


Summer 2021!!!


<div class="wp-block-image"><figure class="alignright size-large"><img width="350" height="525" src="https://retireby40.org/wp-content/uploads/2021/05/My-Best-Advice-to-New-College-Grads-350.jpg" alt="" class="wp-image-22234" /></figure></div>



<p>This one is for the new college grads out there. <strong>Congratulations!</strong> Graduating from college is a huge accomplishment. Now, it’s time to rock the world! I graduated over 25 years ago and I still remember it well. I was euphoric to finish 5 years of engineering school. It was a tough program (BS/MS combined). By the end, everyone was totally burned out from studying. All of us couldn’t wait to start working and making some money. Fortunately, I graduated at a good time (1996) and was able to find a stable <a href="https://retireby40.org/engineers-plan-early-retirement/">engineering job</a>. That was a great starting point and I built our wealth from there. My journey worked out well, but it could be better. If I could go back and give my younger self one piece of advice, what would it be? Here is my best advice to new college grads.</p>



<h2><strong>Keep learning</strong></h2>



<p>This is very specific. My best advice is to <strong>learn about financial independence</strong>. I didn’t discover financial independence until my mid-30s. Luckily, I <a href="https://retireby40.org/what-was-your-lowest-point-financially/">came from a humble background</a> and I started investing right when I began my engineering career. I knew I need to save the rainy days. By the time I found out about financial independence, we were almost there.</p>



<p>The rainy days came when I realized I didn&#8217;t want to be an engineer anymore. The career wasn&#8217;t the right fit for me anymore and I needed to move on. We saved and invested for a long time so I had to tough it out for just 2 more years. After that, I was <a href="https://retireby40.org/my-two-weeks-notice/">able to retire early</a> and escape from the corporate grind. Thank goodness I knew about financial independence by then. If I didn&#8217;t, I&#8217;d still be an engineer. Whew! It would have been better if I learned about financial independence sooner, though.</p>



<p>Like any young person, I <a href="https://retireby40.org/my-5-worst-financial-mistakes/">made plenty of mistakes</a>. We purchased a big house, drove a BMW convertible, spent a lot of money on entertainment, and invested in the wrong financial products*. It worked out okay, but we would have wasted a lot less time if we knew about financial independence right from the start. It would have given us a focus. I would have learned to invest much earlier.</p>



<p>*I invested with my bank’s financial branch. The “free” financial advisor sold us crappy mutual funds with high fees so he could make a commission. New investors should start with Vanguard. You really can’t go wrong with them. Once you learn more about investing, you can branch out and invest in individual stocks and other assets. Don’t invest with a “free” financial advisor at the bank. They&#8217;re about as bad as used car salesmen, IMO. </p>



<h2><strong>What is financial independence?</strong></h2>



<p>Basically, financial independence is when your investment can cover your cost of living while you&#8217;re alive. Once you achieve financial independence, you won’t have to work for money anymore. Many <a href="https://retireby40.org/can-wife-early-retire-yet/">FI people continue to work</a> because they like their job, they want to shore up their finances, and/or they want to feel useful. That’s okay too. You don’t have to stop working if you don&#8217;t want to. Financial independence gives you more choices. That will come in handy someday.</p>



<p>Yes, financial independence is possible for regular people. You don’t have to be born rich or make a huge amount of money to achieve financial independence. You just have to keep an open mind and keep learning.&nbsp;Here are some concepts that are crucial to financial independence.</p>



<h3>Key concepts</h3>



<ul><li><strong>Saving rates</strong> – Your saving rate is your saving divide by income. The higher your saving rate, the less time it takes to become financially independent. I recommend aiming for 50% saving rate. That will help build your portfolio very quickly. If you can&#8217;t <strong><a href="https://retireby40.org/the-secret-of-saving-50/">save 50%</a></strong> right from the start, don&#8217;t worry. Just do your best and keep improving every year.</li><li><strong>Lifestyle inflation</strong> – New college grads usually have high <a href="https://retireby40.org/lifestyle-inflation-inevitable/">lifestyle inflation</a>. When you make more money, you tend to spend more too. This is dangerous because it will screw up your saving rate. New grads should be very careful about upgrading their lifestyle too quickly.</li><li><strong>Investing</strong> – If you <a href="https://retireby40.org/why-start-investing-young/">start investing while you’re young</a>, you’ll be way ahead of everyone else. Time is your friend when you&#8217;re young. You can benefit from compound interest and learn about investing from experience. It&#8217;ll be much more difficult to start investing when you&#8217;re 40.</li><li><strong>Safe withdrawal rate</strong> – This is one way to <a href="https://retireby40.org/3-ways-define-financial-independence/">define financial independence</a>. It will give you a number to shoot for.</li><li><strong>Start contributing to your retirement plan</strong> &#8211; I know, I know. You don&#8217;t care about retirement right now. But, you need to start contributing to your 401k as soon as you can. The power of compounding is amazing, but you have to start early. Read more here &#8211; <a href="https://retireby40.org/what-if-always-maxed-401k/">What if you always maxed out your 401k?</a></li><li><strong>Track your expenses</strong> – This one is critical. Most people have no idea what they spend money on. <a href="https://retireby40.org/retirement-investing-track-expense/?doing_wp_cron=1527462248.5477850437164306640625">Tracking your expenses</a> will help you figure out what you spend your money on. Do this for at least a few months. Once you understand your spending pattern, you can improve it. Then you don&#8217;t have to track every penny after that. </li><li><strong>FIRE blogs</strong> – There are many great resources on financial independence now. Here is my list of <a href="https://retireby40.org/early-retirement-blogs-everyone/">great FIRE blogs</a> to get you started.</li></ul>



<h2><strong>Good luck!</strong></h2>



<p>Alright, I’ll keep it short today. It is almost summer and I&#8217;m cutting way back on work (blogging.) This summer, I&#8217;ll work 10-15 hours per week and focus on being a SAHD the rest of the time. We have to enjoy the journey, right? </p>



<p>In summary, my best advice to new college grads is to learn about financial independence. Just read and keep taking it in. You don’t need to be <a href="https://retireby40.org/obsessed-early-retirement/">obsessed with financial independence</a> right away. Learning about it will help you get started on the path to financial freedom. It’s like that movie Inception. Financial independence is an awesome concept. It will be stuck inside your head and hopefully, you’ll look at money differently. Money isn’t just for spending. Money really means financial security and freedom. My life is 100x better now that we are financially independent. It is unbelievable.</p>



<p>Congratulations again and good luck on your journey!</p>



<p><strong>What is your best advice to a new college grad? What would you tell yourself if you could go back in time?</strong></p>



<h2>More advice for new grads</h2>



<p><a href="https://retireby40.org/follow-your-passion-is-bad-advice-unless/"><strong>Don’t follow your passion</strong></a> &#8211; Contrary to popular belief, that’s bad advice. </p>



<p><a href="https://retireby40.org/investing-advice-recent-graduates/">Investing advice for new college grads</a> – I wrote about investing advice for new grads previously. Now, I realize it’s better to learn about financial independence first. It’s more motivational.</p>



<p><a href="https://dividendsdiversify.com/46-habits-of-self-made-millionaires/" target="_blank" rel="noopener noreferrer">46 Habits of Self-Made Millionaire</a> &#8211; This is a great post from Dividend Diversify. Adopt some of these habits and you&#8217;ll be a millionaire.</p>



<p>Image credit: <a href="https://unsplash.com/@charlesdeloye" target="_blank" rel="noopener noreferrer">Charles DeLoye</a></p>
<p>The post <a rel="nofollow" href="https://retireby40.org/my-best-advice-to-new-college-grads/">My Best Advice to New College Grads</a> appeared first on <a rel="nofollow" href="https://retireby40.org">Retire by 40</a>.</p>


My Best Advice to New College Grads

It Takes More Than Money To Retire Early Interview: Randy


<div class="wp-block-image"><figure class="alignright size-large"><img width="350" height="525" src="https://retireby40.org/wp-content/uploads/2021/05/9-Years-After-Early-Retirement-350.jpg" alt="" class="wp-image-22168" /></figure></div>



<p><strong>Woohoo! I got my second Covid vaccine shot.</strong> Soon, we’ll be able to go out like in the good old days. Boy, it has been a strange year. Our son studied online and Mrs. RB40 worked from home the whole year. Our small home got quite cramped with everyone there 24/7. (We live in a duplex.) Fortunately, our tenant went to Europe for 9 months. We agreed on 50% off rent and the ability to use his living room as office space. It worked quite well.</p>



<p>Recently, our tenant came back so we have less space again. However, RB40Jr started going to school a few hours per day. Mrs. RB40 also goes to the office occasionally. In 2 weeks (after 2nd shot), she’ll be able to go out more and travel for work occasionally. Things are slowly going back to normal. Whew!</p>



<p>It’s been 9 years since I <a href="https://retireby40.org/gave-up-engineering-career/">retired from my engineering career</a>. This past year was the craziest retirement year so far. However, it was still way better than my last years at work. Back then, I was a miserable jerk. Even the worst year in retirement is better than work. Ha!</p>



<p>Early retirement really isn’t for everybody, but it is perfect for me. I love my life today. I have a lot of autonomy and I can do whatever I want. Strangely, a year of pandemic seems to bring this reality to many people. Workers got a taste of working from home and they loved it. Many older workers also plan to retire early. The pandemic showed us that life is short. You have to enjoy it while you can. If you don’t like your work, then it’s time to figure something out. Mrs. RB40 is one of those workers. Now, she’s ready to take a year off (2022) and see where to go from there. </p>



<h2>Early Retirement Recap</h2>



<p>First, let’s do a quick recap.</p>



<p><strong>Before ER</strong>&nbsp;– I worked in chip design for 16 years. In the beginning, engineering was great and I enjoyed learning and working on the technical issues. Eventually, I became more senior and needed to take on more leadership roles. The career wasn’t a good fit for me anymore. Personally, I think&nbsp;<a href="https://retireby40.org/engineers-plan-early-retirement/">every engineer should plan for early retirement</a>.</p>



<p><a href="https://retireby40.org/life-after-retirement-one-year/"><strong>Year 1 ER</strong></a>&nbsp;– I retired to become a SAHD/blogger in 2012 when our son was 18 months old. That first year was the toughest year for me. Being a SAHD to a toddler was a lot of work. At that age, they don’t listen very well and they constantly push boundaries.</p>



<p><strong><a href="https://retireby40.org/4-years-early-retirement-update/">Year 2 to 4 ER</a>&nbsp;</strong>– Life became a bit easier once RB40Jr started preschool. I had more time to work on my blog and my health. It was a good balance. Life gradually improved as our son got older.</p>



<p><strong><a href="https://retireby40.org/5-years-after-early-retirement-update/">Year 5 and 6 ER</a>&nbsp;</strong>– RB40Jr started kindergarten and&nbsp;<strong>life became awesome</strong>. I had a lot more time to myself and he made a lot of friends. It was a bit turning point.</p>



<p><strong><a href="https://retireby40.org/7-years-after-early-retirement/">Year 7 ER</a></strong>&nbsp;– We had more challenges than usual and I was stressed out. My mom was diagnosed with dementia and we moved her to Thailand. I couldn’t take care of her and my son at the same time. Eventually, she’ll need to go to a nursing home and it’ll be a lot more comfortable for her in Thailand.</p>



<p><strong><a href="https://retireby40.org/8-years-after-early-retirement/">Year 8 ER </a></strong>– This was a strange year. Life was great until the coronavirus pandemic hit. Our governor shut down nonessential businesses and closed all schools. We didn&#8217;t do much.</p>



<p><strong>Year 9 ER</strong> – We stayed home and life slowed down to a crawl. We didn’t really mind it because we enjoy being home. Then, I went to see my mom in Thailand. Life was almost normal there at the time. There were only a few Covid cases so I had a nice break during the peak of the pandemic in the US. It was so nice that I had a hard time adjusting back to life back home.</p>



<h2>Early Retirement is still awesome</h2>



<p>I <a href="https://retireby40.org/is-the-fire-movement-a-fad/">love early retirement</a> because I have a lot of autonomy. I don’t have a boss and I largely control my schedule. Of course, I have “work” because I’m a stay-at-home dad. When he was little, RB40Jr took up all of my time and energy. However, the SAHD part became much easier as school and teachers took over a large portion of his time.</p>



<p>2020 was a crazy year, though. I had to help with schooling and being a SAHD took up a lot of time. We got through it, though. Virtual schooling kept improving and it’s quite good now. RB40Jr doesn’t need a lot of supervision anymore. He can log on, join the meetings, chat tech support (his teacher), and do most of the online lessons by himself. Actually, he learned a ton about technology. It’s pretty amazing. Being a SAHD is easy again because he doesn’t need constant supervision anymore.</p>



<h2>Successful Early Retirement?</h2>



<p>There are&nbsp;<a href="https://retireby40.org/3-indicators-of-a-successful-early-retirement/">3 indicators of successful retirement</a>&nbsp;– health, wealth, and happiness. Let’s see how I’m doing in all these areas.</p>



<h3><strong>Healthier</strong></h3>



<p>Last year was not good for me. My weight increased from 130 to 138 pounds. RB40Jr also got chubby. We were home all day and it was super easy to snack constantly. Mrs. RB40 took up baking during the pandemic so that didn’t help. We all gained weight.</p>



<p>Fortunately, I went to Thailand and <a href="https://retireby40.org/im-done-with-quarantine/">quarantined for 14 days</a>. They provided 3 meals per day and that was it. No snacks, junk food, or sugary drinks. The serving size was also much smaller than the US serving size. I got down to 132 pounds and kept it down since then. You could order extra food from room service, but I only took advantage of that a few times. I wanted to lose weight.</p>



<p>There is another piece of bad news. My blood pressure is high. My doctor put me on medication to control it. I guess that’s part of getting older. Other than that, I’m pretty healthy.</p>



<p>Early retirement was good for me because I was&nbsp;<a href="https://retireby40.org/my-two-weeks-notice/">stressed out all the time</a> when I was an engineer. I had back pain, panic attacks, tinnitus, dizziness, depression, and more. It wasn’t good. Now, I feel much healthier.</p>



<p>*If you want to keep your weight down, try intermittent fasting. Here is how I do it. I only eat from noon until 8 pm on weekdays. This cuts down on the calories and I don’t miss breakfast much. Try intermittent fasting if you want to control your weight. It really works. If you can’t do it by yourself, I highly recommend Martin Dasko’s&nbsp;<a href="https://retireby40.org/fasting" target="_blank" rel="noreferrer noopener"><strong>Intermittent Fasting Course</strong></a>. It was very helpful when I first started IF.</p>



<h3><strong>Wealthier</strong></h3>



<p>We are a lot more fortunate than many families. This pandemic didn’t affect our finance too much. Mrs. RB40 kept her job. My online income decreased about 20%, but we weren’t dependent on that so it wasn’t a big deal. The stock market crashed, but it came back like a hurricane. We stay invested and our net worth increased quite a bit. It’s pretty crazy how well investors did in 2020.&nbsp;<a href="https://retireby40.org/passive-income/">Our passive income streams</a>&nbsp;took a hit, but it’s recovering.</p>



<p>All in all, we are much wealthier than before I retired. Of course, a lot of that is due to Mrs. RB40. She is still working. The real test will be when she stops working next year. You’ll have to wait and see if we can continue to grow our wealth after 2022.</p>



<figure class="wp-block-image size-large"><img width="700" height="440" src="https://retireby40.org/wp-content/uploads/2021/05/RB40-Household-net-worth.jpg" alt="" class="wp-image-22166" /></figure>



<h3><strong>Happier</strong></h3>



<p>Last year was stressful because of the pandemic. However, I was still happier than when I was an engineer. We stayed home and enjoyed ourselves for the most part. 2020 would have been a lot more difficult if I was single. I’d be so lonely if I had to go through 2020 by myself. Mrs. RB40 and RB40Jr enjoyed being home. They are homebodies and didn’t have any problem at all with the lockdown.</p>



<p>Another issue was my mom’s health. It was great to see her in Thailand, but it also made me realize that my dad needs more help. He tried hiring some helpers, but it never worked out. Next year, I plan to go stay for 3 months so I can help out more. In fact, I should do that every year. Why not?</p>



<p>Overall, I’m happy with life. I just hope school opens up like normal in the fall. That would be perfect.</p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="580" height="371" src="https://retireby40.org/wp-content/uploads/2021/05/April-21-Happiness.jpg" alt="Happiness" class="wp-image-22032" /></figure></div>



<h2>Early Retirement Projects</h2>



<p>The last 9 years have been amazing, but life goes on. The <a href="https://retireby40.org/work-not-optional-after-retirement/">secret to early retirement</a> is to have some goals. You have to stay somewhat busy so you don’t get bored. Early retirement doesn’t mean chilling at home every day. Most people won&#8217;t be happy with that. You need a few big projects to work on. Here are some of mine.</p>



<h3><strong>Fixing up the house</strong></h3>



<div class="wp-block-image"><figure class="alignright size-large"><img width="200" height="171" src="https://retireby40.org/wp-content/uploads/2021/04/Mar.-Financial-Update-200.jpg" alt="house" class="wp-image-21743" /></figure></div>



<p>This project is probably on most people’s lists. It is endless. This year I plan to build a covered pergola over the deck. This will provide shade and help channel the rain away from the house. That’s the main project this year. (We decided on doing just one big project per year. Otherwise, it’s just too much.) I also have a few other small projects like painting, replacing the hallway fixture, and power washing the deck. Someday, I’d like to live in a home that requires very little maintenance.</p>



<h3><strong>Blogging</strong></h3>



<p>Another project that keeps me busy is blogging. However, it has been difficult this year. I had a great time in Thailand and it was tough to get back into the routine. Writing became much more difficult than in previous years. I feel like my passion for FIRE is slowing seeping away. I’ll keep blogging this year and evaluate the situation again next year. We plan to take a year off to travel around the world so that might give me the jolt I need. I could write more about traveling and the nomadic lifestyle.</p>



<p>Blogging is still fun, but I need to figure out my next big project.</p>



<h3><strong>Around the world trip</strong></h3>



<p>We want to take a year off to&nbsp;<a href="https://retireby40.org/preparing-around-world-trip/">travel around the world</a>. Lots of people did it, why shouldn’t we? Even our neighbor lived in Sri Lanka for a year. Well, it’s daunting. We have our lives here and we’re not ready to let that go yet. However, this coronavirus pandemic helped push us along the way. Things that were daunting don’t seem that scary anymore.</p>



<ul><li><strong>Homeschooling</strong>&nbsp;– It’s hard, but we can do it.</li><li><strong>Mrs. RB40’s work</strong>&nbsp;–Work is going well for her, but she is ready to take a year off to figure things out. If she doesn’t like early retirement, she can find a job afterward.</li><li><strong>Rental properties</strong>&nbsp;– I’ll put our rental condo up for sale after the lease is up. We also have a renter at our duplex, but I don’t think it’s a big deal. He can keep an eye on our home while we’re gone.</li><li><strong>Finance</strong>&nbsp;– Our passive income should be enough to fund a year off. One concern I had was renting out our home while we’re gone. Now, I don’t think we need to rent it out. Our housing cost is pretty low at $1,250/month. It’s low because we live in one unit of the duplex and rent out the other. We can carry that for a while.</li><li><strong>Parents&nbsp;</strong>– My mom&nbsp;<a href="https://retireby40.org/adversity/">has dementia</a>&nbsp;and she lives in Thailand with my dad. My dad is taking care of her, but he needs help. It’s stressful. I’ll spend a large portion of this trip in Thailand so I can help out. Mrs. RB40 can spend a similar amount of time with her parent.</li></ul>



<p>Those were my main concerns and they are all surmountable. After RB40Jr finishes 5<sup>th</sup> grade in 2022, the stars will line up. We’ll take a year off to go travel. He can start the 7th grade when we get back. One fewer year of middle school isn’t going to hurt him.</p>



<h2><strong>Keep at it</strong></h2>



<p>All in all, these last 9 years have been amazing. Life is so much better than when I was working full-time. I don’t regret retiring early at all. If I didn’t quit my engineering career, I wouldn’t be this happy or healthy. I might not even be wealthier with the bigger paycheck. When you’re unhappy, you spend money to try to make life better. Who knows? I’d probably had a midlife crisis and gone off the rail if I was still stuck in the old gray cubicle. That’s the real key to FIRE. You make it your goal and go after it with everything you have. Life is short. Don’t spend it working in a job you dislike. Keep at it and good luck everyone!</p>



<p><em><strong>Thanks again for following my early retirement adventure and good luck on yours! I really appreciate your support.</strong></em></p>



<p><a href="https://retireby40.org/pcap/" target="_blank" rel="noreferrer noopener">Sign up for a free account at Personal Capital</a>&nbsp;to help manage your investments. I log in almost every day to check on my accounts and cash flow. It’s a great site for DIY investors.</p>



<p><strong>See my guide –</strong>&nbsp;<a href="https://retireby40.org/how-to-start-a-blog-why-you-should/">How to Start a Blog and Why You Should</a>. Starting a blog changed my life. It provides some income after retirement and it’s a great way to build a community. Those are the two biggest problems after retirement. It’s a great way to use some of your free time.</p>



<p><strong>Disclosure:</strong>&nbsp;We may receive a referral fee if you sign up with a service through the links on this page.</p>
<p>The post <a rel="nofollow" href="https://retireby40.org/9-years-after-early-retirement-update/">9 Years After Early Retirement Update</a> appeared first on <a rel="nofollow" href="https://retireby40.org">Retire by 40</a>.</p>


9 Years After Early Retirement Update


<div class="wp-block-image"><figure class="alignright"><img src="https://lh3.googleusercontent.com/m0l_Oj2u0uTuyIIUY884Oku2ABkS654V49atGGKntF17G-O95V0zyHTcg2UAP8sWOh5OV1JXuhhIpksyXjlTeruXd87rWcFCtp62DzhuYWEE9im8Dw4QPNQOC8y10H8wAWBx3yx11I-vxLY83xzLNMPxOllYXX8h0eM0TnHgDRcGgxcANDXk4IlbjLa92EbV_MM-m4DV3ZPEmy9pyPRkedcbmFcXGr83HnK0zCrD8wXSISO-8t2dmTUI-7dbWDgV50wU7HdXgdnp6zOD066y6nB3kfrOJttdH7ShRbP19AK4zqAH-8FFbKxDRUVrNNsVu8Yu79KxIsjuImqGDgSMWVe02M4IBxXIJdFQyou97uQ31xzXNRj3OxeJ4SzdnpoFhldmKQUz0hBU5VMew8K2PvnecHYlQX7h8gvVGa8fwlY2ysILFtWkkLt7lXO7l3vzVqsfIRd5gpQyl0FDg7sx0gZdIoaPFMRqJLGY-ZYjCG7ofnN_3QuL43Q_dfLTIcYEWPpFRIk2VanJ8aZo0fZ3TZ_x_zJFprNEiTgtjrX1dAHX5EQ22Y7ThWSfnWuniQA-F_TWgwTqz6bFtQbmZBpw94LszdTToelFqgqtkqP20Q=w350-h525-no" alt="How to Be Lucky in Life" /></figure></div>



<p>This is a follow-up to – <a href="https://retireby40.org/dont-best-win-big-life/">You Don’t Have to Be the Best to Win Big in Life</a>. In that post, I suggested that anyone can be successful by following a few guiding principles. One of these principles is to <strong>be lucky</strong>. Hmmm… You might be skeptical, but being lucky will really help you out in life. But, isn’t luck just random? How can you be lucky in life? I’m sure you know people who have a charmed life. Whatever they do seems to turn out right. On the other hand, there are unlucky people who keep running into random obstacles and constantly screw up their lives. Well, being lucky isn’t 100% random. Those lucky people are doing something right and today, we&#8217;ll see if we can try to tilt the odds our way. It&#8217;s better to be lucky than unlucky, right? </p>



<p>Please take my poll at the end of this post!</p>



<p>*Originally posted 2017. Updated 2021.</p>



<h2><strong>I’m one lucky guy</strong></h2>



<p>I don’t want to brag, but I’m one of those lucky people. It’s been <a href="https://retireby40.org/8-years-after-early-retirement/">8 years since I retired early</a> from my engineering career and I love my life. My early retirement lifestyle is almost ideal. Our net worth tripled since I retired early. I have a great family life and plenty of time to do the things I want. I&#8217;m much healthier these days as well because I eat better, exercise, and have very little stress. It’s an unbelievable string of lucky incidents that led me here.</p>



<p>I had a pretty humble beginning, though. I was born in Bangkok and grew up in Chiang Mai, a city in northern Thailand. My first lucky break was that my parents were college graduates. That’s pretty amazing because there were only a few universities in Thailand 50 years ago. My dad was one of the very few kids from Chiang Mai to attend a university in Bangkok. My mom was one of the few women who got a Master’s degree in those days. They weren’t elite members of society either. My dad was penniless and he hustled his way through college. My mom’s family was better off, but she studied hard and was a good student. Having college-educated parents meant I had more opportunities than the average Thai child. That’s a huge advantage in a poor country like Thailand in the 70s.</p>



<h2><strong>Strings of lucky breaks</strong></h2>



<p>I’ll summarize my lucky breaks in life and go through a few of them in detail a bit later.</p>



<ul><li>My parent immigrated to the United States, a country with a lot more opportunities than Thailand.</li><li>This concept is getting more foreign today. I graduated from college with a Masters&#8217;s degree with no debt. That MS was earned in one year instead of the usual two.</li><li>I got a well-paying job right out of college and had a steady income for 16 years.</li><li>I married Mrs. RB40. She is frugal, smarter, more ambitious, more organized, calmer, and looks way better than I do. We make a great team, but I won the jackpot with this one.</li><li>I retired early and I’m living a fantastic life as a blogger/SAHD.</li><li>We had a kid at the perfect time. If our kid had been born earlier, I would have been stuck in a routine that would be very difficult to change until he graduates from high school. He was born just at the right time for me to <a href="https://retireby40.org/engineers-plan-early-retirement/">retire from my engineering career</a>.</li><li>I’m relatively healthy for a 47-year-old American. I have a minor genetic disorder, a mild form of mitochondrial disease. My triglyceride is also a bit high, but it’s under control with medication. I think I’m pretty healthy compared to many Americans my age. I did 19 pull-ups earlier this year and that was my best yet. (That was in 2017. Now I can do 5 pull-ups without hurting myself.)</li></ul>



<p>Are all these lucky breaks random chances? Some of them may feel like random chances, but many of them are the result of small choices made over many years.</p>



<h2><strong>Luck isn’t random chance</strong></h2>



<p>Tell me if this is random. RB40Jr used to find coins almost every time we went outside. He refused to ride in a stroller when he was 18 months old and he walked everywhere with me. He’d find coins on the ground on most of these walks, in the parking meter machines, MAX ticket machines, and in various fountains around town. It was a game for him and he loved finding coins. Was it lucky that he found money everywhere he went? He must have found more than $60 over the years.</p>



<p>Unfortunately, he rarely finds coins now that he’s 10 years old. Maybe it’s because he’s further away from the ground and he is less lucky. No, finding those coins wasn’t really luck. He found them because he was looking for them. Now he is preoccupied with other stuff. He doesn’t look around for the coins as much and he rarely finds them anymore. Being lucky is really about keeping your eyes open for opportunities.</p>



<p>Some of my lucky breaks were purely random. Being born to college-educated parents in a country full of uneducated farmers was pure luck. You couldn’t do much to influence your luck when you’re a kid. Okay, that’s not quite true. My dad became an orphan when he was 5 years old and went to live with his uncle. At the time, the education requirement in Thailand was for kids to finish 4<sup>th</sup> grade. When my dad finished 4<sup>th</sup> grade, his uncle wanted him to quit school and work at his business. The uncle told him he wouldn&#8217;t get lunch if he insisted on going to school. It’s simple &#8211; no work, no lunch money. My dad loved going to school so he decided to continue even without lunch. He doesn’t talk about his youth much so I don’t know all the details, but somehow he graduated with very good grades and got into a university in Bangkok. That’s pretty crazy, right? See, you can influence your luck even when you’re young.</p>



<p>Anyway, our family immigrated to the U.S. when I was 12 years old. That was another big lucky break for me. There are so many more opportunities here for people who work hard. However, there was some behind the scene machinations there too. My dad came to the US first to see how he’d do here. He was thinking about going back to Thailand until his kids (me and my brothers) wrote him a letter asking him to bring us all to the US. If we hadn&#8217;t given him our full support and encouragement, I’d have grow up in Thailand and you’d probably wouldn&#8217;t ever hear of me.</p>



<h2><strong>Lucky with money</strong></h2>



<p>I’ve been very lucky with money too. I got a well-paying job right out of college and had a stable income for 16 years. There is no doubt luck was an element, but there has got to be more to it than that. I got an MS in electrical and computer engineering in 1996. That’s right before the dot com boom. It was the perfect time to be in computer engineering. My alma mater had a 5 year BS/MS program and I was lucky enough to get into the program. The MS gave me a little edge and helped me get early promotions. I was in the right field at the right time.</p>



<p>I saved and invested diligently for 16 years and <a href="https://retireby40.org/gave-up-engineering-career/">left my engineering career behind</a> in 2012. Against all expectations, our net worth kept increasing and it has doubled since I retired from the rat race. I’m very lucky that Mrs. RB40 continues to work and my blog is making some income so we can continue to save and invest.</p>



<p>Again, it wasn’t all luck. I was reading a lot of personal finance blogs in 2010 and the site name, Retire by 40, popped into my head one day. I didn’t hesitate and started blogging right away. 2010 was a good time to start blogging because there were only a few early retirement sites on the internet. I got in relatively early and had a head start. I think it is a lot harder to stand out now because there are so many excellent personal finance blogs. Was it luck that I started blogging in 2010 or did I recognize an opportunity and seized it? It was probably a bit of both.</p>



<p>*Here is my guide on <a href="https://retireby40.org/how-to-start-a-blog-why-you-should/">How to Start Blogging and why you should</a>. Check it out!</p>



<h2><strong>Lucky with love</strong></h2>



<p>Oh, this one is really tricky. I married way above myself. Mrs. RB40 is smart, frugal, ambitious, beautiful, and she is<a href="https://retireby40.org/investment-fundamental-1-partner/"> the perfect partner for me</a>. We love each other and we have a great son. That’s a lot of luck because half of all marriages end in divorce. The odds are even longer considering we met each other in college and she went off to Peace Corps for 3 years after she graduated. Everyone we knew didn’t think it was going to work out. People grow and change a ton at that age. Three years is a very long time when you’re 22.</p>



<p>But finding the love of my life wasn’t completely random chance either. Let me tell you how we met. I was a junior in college and I started a Thai student club. I wanted to meet some students from similar backgrounds and the college had a little money in the budget for that kind of thing. Hey, why not get a few dollars back from all that tuition I was paying? Our inaugural meeting was at Girvetz Hall and the power went out before anyone showed up. I figured that no one would be there, so I didn&#8217;t show up either, but Mrs. RB40 got a hold of my phone number somehow and called me back to hold the meeting. Oh boy, was she mad that I wasn&#8217;t there. Anyway, she took over as president the next year and did a better job than I ever could. We started dating each other soon after.</p>



<p>The Peace Corps years were tough. I don’t even want to talk about it. We both wanted to explore our options. It was a miracle we got back together. Our relationship hasn’t always been smooth, but we understand and support each other completely now. We’re both very lucky to have each other.</p>



<p>*More about <a href="https://retireby40.org/valentines-day-special-a-rom-com-story/">our story</a> here.</p>



<h2><strong>How to be lucky in life</strong></h2>



<p>Sorry, this one got a little personal and a little long, but I hope you&#8217;re enjoying it. My point is that being lucky isn’t just random chance. A lot of it depends on your actions too. Here are some ways to become luckier in life.</p>



<ul><li><strong>Keep your eyes open for chance opportunities</strong>. Lucky people excel in creating, recognizing, and taking advantage of chance opportunities. The world is full of opportunities. Lucky people seize them and unlucky people let opportunities pass on by again and again.</li><li><strong>Hard work = more opportunities</strong>. Thomas Jefferson said, “I&#8217;m a great believer in luck. I&#8217;ve found that the harder I work, the more I have of it.&#8221; I agree 100%. Hard work creates more opportunities. My dad could have given up on school, become a laborer, and have hot lunches every day, but he persisted. That’s a hard choice for a kid to make. Hard work might not pay off right away, but it builds up like karma.</li><li><strong>Don’t get stuck in a routine.</strong> This is an interesting one I found in my research for this article. If you get stuck in a routine, you’ll exhaust the possible opportunities because you&#8217;re doing the same thing every day. Try something new and you might find new possibilities. Vary your routine a bit and you might get lucky. </li><li><strong>Learn new things</strong>. I love reading and learning new things. Getting exposed to new ideas will help you dream up more opportunities. If I hadn&#8217;t been reading personal finance blogs in 2008 and 2009, I wouldn’t have started blogging in 2010. Learning new things is a great way to keep life interesting.</li><li><strong>Trust your instincts</strong>. This is another tip that I found in my research. Your intuition excels at pattern recognition and it is designed to help you. My gut told me I need to quit engineering and get out of the rat race. Logically, it didn’t make sense. I was making good money and I could have gotten another job elsewhere. It was right and I am much happier today than when I was an engineer. Your gut is right 95% of the time and everyone should pay attention to it. This works best when you need to make a snap decision.</li><li><strong>Believe you’re lucky</strong>. Being lucky is a self-fulfilling prophecy. If you believe you’re lucky, you will be lucky. It works, trust me.</li><li><strong>Don’t sweat the bad stuff.</strong> Of course, I’m not lucky all the time. I&#8217;ve had plenty of bad luck too, like the time I was on my way to visit Mrs. RB40 and totaled my car. (This was when we were in college.) She had to come and pick me up. However, I usually forget about bad luck very quickly. You have got to look at the upside in life. I walked away with no injury from that car crash and it could have been a lot worse. Thank your lucky stars even if you had an unlucky incident because it could always be worse. </li></ul>



<h2><strong>Choose to be lucky</strong></h2>



<p>Before we end today, I encourage you to choose to be lucky. Here is an example. Warren Buffett believes he is very lucky because he was born a Caucasian male in the United States. White nationalists believe they are being discriminated against and they are mad that they didn&#8217;t get the job they applied for. Who do you think is luckier in life? Yes, Warren Buffett had some advantages, but the country hasn’t changed that much. The alt-right people are picking the wrong narrative and success won&#8217;t be easy for them.</p>



<p>Okay, what about you? Are you lucky in life?</p>


Note: There is a poll embedded within this post, please visit the site to participate in this post's poll.



<p><strong>Don’t believe that being lucky is just random.</strong> A lot of it is influenced by you. If you’re unlucky, you can turn it around. Just do more research on the subject because there is a ton of stuff on the internet. There is even a class that will teach you to be lucky. (Maybe I should make a course about this. Do I hear opportunity calling?)</p>



<p><strong>Alright, let me know what you think. Are you lucky in life? Most of you are probably just as lucky or luckier than I am. </strong></p>



<p><strong>Related article</strong></p>



<p>Richard Wiseman did a research on lucky people. This is a short paper to read and it&#8217;s pretty interesting. <a href="http://www.richardwiseman.com/resources/The_Luck_Factor.pdf">The Luck Factor</a>.</p>



<p><strong>Image credit:</strong> <a href="https://picjumbo.com/about-viktor-hanacek" target="_blank" rel="noreferrer noopener nofollow">VIKTOR HANACEK</a></p>
<p>The post <a rel="nofollow" href="https://retireby40.org/how-to-be-lucky-in-life/">How to Be Lucky in Life</a> appeared first on <a rel="nofollow" href="https://retireby40.org">Retire by 40</a>.</p>


How to Be Lucky in Life


<div class="wp-block-image"><figure class="alignright size-large"><img width="350" height="525" src="https://retireby40.org/wp-content/uploads/2021/05/David-@-I-Retired-Young350.jpg" alt="" class="wp-image-22084" /></figure></div>



<p>When we think about early retirement, we tend to focus on the money. That’s natural because we need money to retire early. Building up a portfolio is a crucial step to early retirement. When I was trying to retire early, it was all about how much we spend and how much <a href="https://retireby40.org/passive-income/">passive income</a> we need. However, it takes more than money to retire early.</p>



<p>We have done well over the years and saved up a good amount. That’s true for lots of people. There are over 11 million millionaire households in the US now. Most of these millionaires are still working hard. Clearly, money isn’t the only requirement for early retirement. Some people just <a href="https://retireby40.org/early-retirement-isnt-for-everyone/">aren’t a good fit for early retirement</a>. Finance is a big part of the equation, but there is more to early retirement than that. I thought it’d be interesting to see what that elusive something is. That’s why I’m doing this interview series.</p>



<p>Today, we have David Cox from I Retired Young. He worked abroad for many years and retired to the French Alps in 2016. Let&#8217;s see how he did it.</p>



<h3><strong><span style="color:#2e0270" class="has-inline-color">Can you give us a brief background about yourself? What career did you retire from?</span></strong></h3>



<p>Hi, I’m David. I’m married to Sally and we have two kids, the eldest is 25 and the youngest is 22 and about to finish university. We’re therefore empty nesters. I’m 51 years old although I have no idea how that happened – I’m pretty sure I’m really younger and the date on my birth certificate is wrong!</p>



<p>I retired early in 2016 when I was 47 – it’s great, I love it. Despite that, I enjoyed most of my career, even though being an accountant doesn’t sound very exciting?. I started on the bottom rung of the ladder as an accounts clerk earning minimum wage and worked my way up to be a finance director. I earned more, but had more stress too.</p>



<p>Originally I’m from the UK, but we lived and worked overseas for many years, in Jamaica, Hong Kong, United Arab Emirates and South Africa. Right now, we live in the French Alps.</p>



<p>If you want to find out a bit more, <a href="https://www.iretiredyoung.net/post/start-here-for-early-retirement">this post</a> and <a href="https://www.iretiredyoung.net/post/my-early-retirement-starts-here-2">this post part 2</a> will fill in some of the gaps</p>



<h3><span style="color:#2e0270" class="has-inline-color">Early retirement means different things to different people. Lots of people don’t think I’m “retired” because I blog a few hours per day and I’m a stay-at-home dad. That’s perfectly fine. Everyone is entitled to their opinion. <strong>What does early retirement mean to you? Do you work at all?</strong></span></h3>



<p>First, the easy bit, do I work at all? The answer is no. Now the more difficult question, what does early retirement mean to me? I think it’s stepping away from the job that I used to do. If I exchanged that for a full-time job in a coffee shop, would I still be retired? I guess I’d say not, because I’d be working a job and being paid for it. But at the end of the day, it doesn’t really matter, the aim is to be happy whatever it is we do. To me, the key thing is being financially independent which is what opens up choices for us.</p>



<h3><strong><span style="color:#2e0270" class="has-inline-color">What were your financial goals and how long did it take you to achieve them?</span></strong></h3>



<p>My goal was to have security for my family so that if something happened to my job we would still be OK. I’m not the smartest guy, so tended to look at disaster case scenarios only, ignoring the fact that I could get another job, even if it didn’t pay the same money.</p>



<p>Although I didn’t realize it at the time, aiming for security turned out to be much the same as aiming for financial independence. I never really had a long-term plan to get to early retirement, but an accidental by-product of wanting security for my family got me to the point where early retirement was an option.</p>



<h3><span style="color:#2e0270" class="has-inline-color">When I was planning my early retirement, I was consumed with the money part of it. I didn’t put much effort into the other details. I’d say it was 90/10, financial/non-financial. What about you? <strong>Did you put much effort into the non-financial side of early retirement planning?</strong></span></h3>



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<p>I focused on three things in my early retirement planning:</p>



<ol type="1"><li>Did we have enough money, which was broken down into:<ul><li>how much would our savings and investments generate? and</li><li>how much would it cost to live the life we wanted?</li></ul></li><li>What would I do, would I be bored?</li><li>Would I be lonely?</li></ol>



<p>I’d say that I put equal focus on the money and what would I do questions, but less on the would I be lonely question.</p>



<p>In hindsight, there are two important things that I’ve learned.</p>



<ol type="A"><li>There is another question that I should have asked but completely missed…<a href="https://www.iretiredyoung.net/post/a-piece-of-early-retirement-advice">what impact would my early retirement have on my wife and, on the basis that she wasn’t planning to stop working, what impact would that have on what I wanted to do?</a></li><li>That it’s OK to not know the answer to every question about early retirement ahead of time. My planning, although not perfect, certainly helped, but I was still left with having to make a leap of faith because it’s simply not realistic to be able to foresee or plan for everything. Once I accepted that a leap of faith was OK, I found the go/no go decision for early retirement much easier.</li></ol>



<h3><span style="color:#2e0270" class="has-inline-color"><strong>Where are you in your life cycle?</strong> Most people retire around the traditional age – late 50s to early 70s. Their children are grown, their partner and friends are stepping back from work, and their parents may have passed. In short, you have a lot fewer obligations at a later age. To go against the grain and retire in your 30s or 40s can be lonely and challenging. <strong>Do you think it is difficult to retire early with all these obligations?</strong></span></h3>



<p>I retired when I was 47 at which time my daughter had left home and was working and my son had one more year at home before heading off to university. In terms of financial obligations, we had our son’s education, which was a known cost, but no mortgage or other debts.</p>



<p>I’m confident that our kids will be OK standing on their own feet, and our wider family are independent, so I don’t have any care or financial obligations in that direction.</p>



<p>Do these things make it easier for me to retire early compared to others who may have dependent children or a need to support parents or siblings? I guess the answer is yes, from both a financial perspective and also having the freedom to do what I want when I want rather than being tied to school holiday dates or perhaps having to care for family members. Having that freedom is an important part of my early retirement life.</p>



<h2>It takes more than money to retire early</h2>



<h3><span style="color:#2e0270" class="has-inline-color">Now let’s focus on the intangibles. To be blunt, lots of people have more money than you. Most of them aren’t retired. They still work and contribute to the economy. <strong>What makes you special? How can you retire when almost everyone else in your position continues to work? Why are you different?</strong></span></h3>



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<p>The first thing I’d say is that of the FIRE acronym, the Financial Independence part is the important bit. Once you’ve got to FI, or even partial FI, it opens up new choices. Retiring early is just one of those choices. Continuing to work is another option, and so long as you’re enjoying it, that can make perfect sense.</p>



<p>That said, aside from people simply loving their job, there are other reasons why they might continue to work, such as:</p>



<ol type="1"><li>They say they don’t know what they’d do if they didn’t work, that they’d be bored. I think it’s a shame when I hear this because it suggests that they don’t have the imagination to find other enjoyable pastimes. Surely they miss out on so many things, whether they’re still working or not, if their mind is lacking imagination or not open to new things.</li><li>They need to keep earning to afford the big house, luxury car, latest gadgets, and generally to keep up with the Joneses. We used to have a five-bedroom home with a swimming pool, now we live in a two-bedroom 650ft² (61m²) apartment, and I’m just as happy. It’s awesome when you realize that real happiness isn’t about having the biggest, best or newest stuff. In the interests of transparency, I still splurge sometimes, but only if we can afford it, and I definitely wouldn’t trade my early retirement life for some new gadget.</li><li>Society still doesn’t regard retiring early as normal. I guess a few years early, maybe five, possibly ten years early doesn’t raise too many eyebrows, but I retired 20 years before the normal date, and some others are even earlier. That’s not what society expects and people can find it difficult to deal with. When people ask what I do, it doesn’t fit their expectations when I say I’m retired and the conversation gets kind of stuck because my answer doesn’t fit the script. Most people prefer to stick to the norms rather than go against them.</li></ol>



<h2><strong>Optional questions from the readers</strong></h2>



<h3><strong><span style="color:#2e0270" class="has-inline-color">If you live in the United States, what’s your plan for healthcare? &nbsp;</span></strong></h3>



<p>I don’t live in the US, but I thought I’d comment anyway. I think many people outside the US are bemused by the healthcare system. I saw a blog post recently where a couple was budgeting over $20,000 a year for health insurance – that seems unbelievable to me and I’m very grateful that I don’t have the same in my budget!</p>



<h3><span style="color:#2e0270" class="has-inline-color"><strong>Why did you pursue early retirement?</strong>&nbsp; What made the FIRE folks evaluate life and said this path is the right one for me?</span></h3>



<p>As I mentioned earlier, I didn’t pursue FIRE, instead it was security for my family that motivated me, and that just happened to move me towards FI. I also didn’t spend years dreaming about retiring early. Instead, my early retirement decision went like this. I was working in an industry that was going through a tough time and, on top of that, there was a tipping point at work that made me kick my office door shut and ask if I really needed to put up with this $#!*. That evening, I thought about it and was surprised to find the answer was that maybe I didn’t. I pretty much made my mind up within 24 hours that I wanted out of the corporate BS, although it took another couple of months to garner the courage to hand in my notice.</p>



<h3><span style="color:#2e0270" class="has-inline-color">Now that you don’t spend 8-10 hours working in a full-time job, <strong>what are you doing with your time?</strong> What’s your typical day like? Do you have a problem finding things to do?</span></h3>



<p>I did worry about having enough things to fill my old work day, but it hasn’t been a problem. I’m embarrassed to say that I’ve twice kept a timesheet of what I do, once <a href="https://www.iretiredyoung.net/post/2019/04/12/early-retirement-what-i-do-am-i-boredupdate">in April 2019</a> and also <a href="https://www.iretiredyoung.net/post/2017/11/09/early-retired-what-i-do-am-i-bored">in November 2017</a> in case you want to have a look. I guess the summary is that I enjoy running, cycling, skiing, meeting friends for coffee, doing my blog and reading some other blogs, I’m trying and failing to learn French, have done some shorter trips and some longer travels, and also take care of the chores.</p>



<h3><strong><span style="color:#2e0270" class="has-inline-color">What was your biggest challenge after early retirement?</span></strong></h3>



<p>Without doubt it was that I wanted to do things with my new freedom, such as travel, but I hadn’t factored in that my wife wanted to continue to work. Our plans didn’t match up. When we both worked and were raising our kids we seemed to have lots in common, but now I find that many of the things I’ve become interested in aren’t what Sally wants to do. This is something I hadn’t expected or planned for at all.</p>



<h3><span style="color:#2e0270" class="has-inline-color"><strong>Would you change anything about the way you retired from your job?</strong> Sometimes, I wish I stuck around for 6 more months. I could have worked out a deal and get a severance package instead of walking away with nothing.</span></h3>



<p>I was talked into returning to the company in a part-time consultancy role for four months which was a mistake. My mind and heart had made a decision to leave and I found those four months painful. It added extra money to our bank balance, but it wasn’t worth it.</p>



<h3><strong><span style="color:#2e0270" class="has-inline-color">Did you make any big mistakes? How can we avoid them?</span></strong></h3>



<p>I think my one mistake was not getting my retiring early plans aligned with what my wife wanted. It may sound stupid, but it simply didn’t cross my mind. Perhaps this was a bigger deal for us as we were expatriate workers.</p>



<h3><strong><span style="color:#2e0270" class="has-inline-color">How much time do you spend (per week or month) reviewing your finances, or reading about retirement finances/investment/etc., now that you’re retired?</span></strong></h3>



<p>I’m not sure, but if I have an educated guess, I’d say somewhere between half a day and a day on our finances, mostly because I enjoy it. I also regularly read four or five FIRE blogs, including Retireby40 of course!</p>



<h3><br><span style="color:#2e0270" class="has-inline-color"><strong>What are you still not getting done/postponing, even in retirement? Perhaps some goal or something you said you’d always do when you have more time</strong>…<strong>What’s your next big dream?</strong></span></h3>



<p>What I’m not getting done is learning French – I’m trying a bit, but not nearly as much as I could, should, and need to do.</p>



<p>I also have an idea to buy a cargo van to convert into a camper and spend a year traveling through North America in it. Sally says this is a stupid idea, and it’s on the back burner for now, but I’m not giving up on it completely just yet (we currently have a plan B campervan plan). More recently, the idea of building a tiny house has been knocking around my head (I just asked Sally and she didn’t say this was completely stupid?). To be honest, I am completely hopeless at do-it-yourself projects so these things may not be completely sensible, but that doesn’t mean we shouldn’t try. YouTube has a lot to answer for!</p>



<h3><span style="color:#2e0270" class="has-inline-color"><strong>Looking back on your journey, any regret?</strong> </span></h3>



<p>No regrets at all, my life is great. Since retiring early, I’ve moved to the French Alps, done my first ski season, <a href="https://www.iretiredyoung.net/post/2019/09/04/early-retirement-lifestyle-route-des-grande-alpes-the-home-straight">cycled from Lake Geneva to the Mediterranean</a>, traveled for <a href="https://www.iretiredyoung.net/post/2018/12/12/early-retirement-travels-are-finished">four months in Australia and Asia</a> and another <a href="https://www.iretiredyoung.net/post/2019/12/21/early-retirement-travels-v2-are-done">three months in California, Costa Rica, and Colombia</a>. I became a vegetarian and then a vegan. Currently, I don’t drink alcohol and just feel my mindset has changed for the better. I’m smiling just writing this…no regrets!</p>



<h2 id="block-c38683c2-c9cc-492e-b42b-65a738fc5eff">Thank you, Dave!</h2>



<p id="block-d89469cb-7ad4-40bf-8374-f90ccd3b8d8c">That was a great interview. Dave raised a great point about retiring with your spouse/partner. What you want might not exactly align with what they want. I suspect I&#8217;ll have a similar problem when Mrs. RB40 retires. She thrives in a structured working environment. I&#8217;m not sure if she would really enjoy early retirement. That&#8217;s why we plan for her to take a year off and we&#8217;ll go travel. If she doesn&#8217;t like it, she can go back to work when we get back. </p>



<p id="block-c0608f49-3b6b-4d27-8d6b-d29827c8d1c1">Ok, I need your help. I love this interview series, but I need more people to interview. The problem is this is a long post. It&#8217;s a lot of work! Please volunteer to be interviewed. I&#8217;m desperate to continue this series.</p>



<p id="block-3b2da1c5-7c7c-4789-a721-c02568d98ff8">Let me know what you think of this interview series. If you have any questions you’d like to ask, leave them in the comment as well. I’ll add them to the interview. Thanks!</p>



<h3 id="block-76648eba-1ff1-4c4b-a2ad-52c18133d1d0">Previous Interviews</h3>



<ul id="block-51cf3ef6-d1cd-41ef-99f5-6c060c0f7344"><li><a href="https://retireby40.org/it-takes-more-than-money-to-retire-early-interview-tawcan/">Bob aka. Tawcan</a></li><li><a href="https://retireby40.org/retire-early-with-muni-bonds-adams-update/">Adam and Jane, our long-time readers retired in 2019</a>.</li><li><a href="https://retireby40.org/it-takes-more-than-money-to-retire-early-interview-financial-freedom-countdown/">Financial Freedom Countdown</a></li><li><a href="https://retireby40.org/it-takes-more-than-money-to-retire-early-interview-mr-tako-escapes/">Mr. Tako Escapes</a></li><li><a href="https://retireby40.org/it-takes-more-than-money-to-retire-early-interview-route-to-retire/">Jim from Route to Retire</a></li><li><a href="https://retireby40.org/it-takes-more-than-money-to-retire-early-retire-by-40/">Joe, Retire by 40</a></li></ul>



<p><br></p>
<p>The post <a rel="nofollow" href="https://retireby40.org/it-takes-more-than-money-to-retire-early-interview-with-i-retired-young/">It Takes More Than Money to Retire Early Interview: I Retired Young</a> appeared first on <a rel="nofollow" href="https://retireby40.org">Retire by 40</a>.</p>


It Takes More Than Money to Retire Early Interview: I Retired Young


<div class="wp-block-image"><figure class="alignright size-large"><img width="350" height="525" src="https://retireby40.org/wp-content/uploads/2021/05/April-Financial-Update-350.jpg" alt="" class="wp-image-22044" /></figure></div>



<p>Hey everyone, is anyone still procrastinating with their taxes? I’m pretty much done, but I haven’t filed them yet. I usually file an extension because the K-1 forms are always late. I was hoping they&#8217;d get here by the end of April. (The Schedule K-1form is for reporting earnings, losses, deductions, and credits to the investors in a partnership. When I invest in real estate crowdfunding, each project forms a new partnership.) Anyway, I’m waiting for these forms to show up. Other than that, life is going pretty well. Oh, I also got the first vaccine shot. I can’t wait for the second one so we can relax a bit more.</p>



<p>On the personal finance side, we had another great month. The S&amp;P 500 index went up about 5% in April. That’s incredible. Our net worth also hit a new high so I’m very happy. This is a good time to take a little profit and diversify if you can. I sold some stocks to invest in commercial real estate with <a href="https://retireby40.org/crowdstreet" target="_blank" rel="noreferrer noopener">CrowdStreet</a>. It&#8217;s not much, but at least I took some money out. Our cash flow was also good in April. Things are going quite well. I’m optimistic for the rest of 2021.</p>



<h2><strong>2021 Goals</strong></h2>



<p>Here is my 2021 goal sheet. It works really well. Try it out if you can’t keep up with your New Year goals. The key is to go over the spreadsheet at least once a month to track your progress. That way, you can see which goals need extra attention.</p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="667" height="377" src="https://retireby40.org/wp-content/uploads/2021/05/April-Goals.jpg" alt="" class="wp-image-22028" /></figure></div>



<p>All right! 2021 is turning out to be a great year for me. I already accomplished 5 of my goals and I’m making good progress on the rest. Here are the details.</p>



<h2><strong>Financial Goals</strong></h2>



<ul><li><strong>Real Estate Crowdfunding $150,000.</strong> In April, I invested in an apartment renovation project near Seattle. I have high hopes for this one. The housing market in that area is hot. Recently, the projects on <a href="https://retireby40.org/crowdstreet" target="_blank" rel="noreferrer noopener">CrowdStreet</a> got funded very quickly. I think investors are taking profit from the stock market and diversifying. That’s a great idea, but finding a solid alternative investment can be difficult. I really like real estate crowdfunding so far. It’s a great way to invest in commercial real estate.</li><li><strong>FI Ratio &gt; 110%.&nbsp;</strong>As usual, this is my main goal for 2021. The&nbsp;<strong>FI ratio </strong>is passive income divide by expense. We are doing quite well so far this year. We don’t spend much (due to Covid) and I don’t think that will change anytime soon. I’m very happy with 124% FI ratio.</li><li><strong>1-year cash for Mrs. RB40 mini ER</strong>. Mrs. RB40 plans to take a mini-retirement in 2022. I want to have a nice cash cushion by then. Usually, we spend less than $50,000 per year so that’s my target. Currently, we have about $23,000 in our savings account.</li><li><strong>Side hustle income &gt; $3,000</strong>. Mission accomplished! This goal is just for fun. Side hustling is a good way for early retirees to keep busy and stay active. This year I plan to charge scooters, take surveys, and sign up for cash bonuses. In April, I made $1,464 from charging scooters. Wow! It was the best month ever. It seems like most people moved on to do something else. Delivering food is probably a better gig since you get tips. But I’m happy with charging scooters because I don’t have to interact with anyone. Heh. It’s also good exercise for me. &nbsp;</li></ul>



<h2><strong>RB40</strong></h2>



<ul><li><strong>Refresh Retire by 40 – Done!</strong> Whew! I finally completed this goal. It has been on this list for over 2 years. This work required a big block of time and focus. I just couldn’t do it at home. I only finished because I was stuck in <a href="https://retireby40.org/solo-quarantine-week-1/">quarantine for 2 weeks</a> and could focus on the task in front of me. I hope you like the new design.</li><li><strong>1,000 subscribers on my YouTube channel.</strong> Currently, we have 305 subscribers on <a href="https://www.youtube.com/channel/UCH8PcOiAjrzR3Td6lyvclrw?view_as=subscriber" target="_blank" rel="noreferrer noopener">our YouTube channel</a>. I uploaded 2 videos in April. Making video clips is hard!</li></ul>



<h2><strong>Personal Goals</strong></h2>



<ul><li><strong>Visit Thailand. Done!</strong> I got back from Thailand in February. I spent 6 weeks there to check on my mom and reconnect with family and friends. It was great. I would love to retire there 6 months/year.</li><li><strong>Weight &lt; 135 lbs. Done!</strong> In Thailand, the serving size was much smaller than what I’m used to. I lost weight and it is now 133 pounds. Hopefully, I’ll be able to keep it under 135 lbs. for the rest of 2021.</li><li><strong>Estate planning. Done! </strong>We started the process with our lawyer last year. I thought it won’t be done until March, but we completed it right before I left. That’s perfect timing.</li><li><strong>V for vasectomy.</strong> I saw my doctor for an annual physical before I flew to Thailand. She said she can refer me to someone when I get back. We don’t want any more kids. This one is WIP.</li><li><strong>Happiness level &gt; 8. </strong>April was a <strong>9</strong>. I had a relaxing time and didn’t stress out much. It was a good month. I also got the first vaccine shot! Just one more and we can loosen up. I can’t wait. So far, my happiness level is much better this year than it was in 2020.</li></ul>



<figure class="wp-block-image size-large"><img width="580" height="371" src="https://retireby40.org/wp-content/uploads/2021/05/April-21-Happiness.jpg" alt="" class="wp-image-22032" /></figure>



<h2><strong>Net Worth (+8.4%&nbsp;YTD)</strong></h2>



<p>I’ve been&nbsp;<a href="https://retireby40.org/personal-capital-track-finances-free/">tracking our net worth</a> since 2006 and it is very motivating to see our progress. Our net worth increased by 8.4% since the beginning of the year. That’s really good, IMO. My annual net worth target is +10% per year. 2021 has been a great year so far. People are ready to spend and investors profit from that mentality. Let’s see if the market can keep on rising…</p>



<p>Here is a chart of our net worth from Personal Capital.</p>



<p><a href="https://retireby40.org/pcap/" target="_blank" rel="noreferrer noopener">*Sign up for a free account at Personal Capital</a> to help manage your net worth and investment accounts. I log in almost every day to check on our accounts. It’s a great site for DIY investors.</p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="600" height="294" src="https://retireby40.org/wp-content/uploads/2021/05/April-21-Net-worth-1.jpg" alt="" class="wp-image-22036" /></figure></div>



<h2><strong>2021 Passive Income ($13,176 YTD)</strong></h2>



<p>Here is a quick summary of our passive income. You can see all the details on my&nbsp;<a href="https://retireby40.org/passive-income/"><strong>Passive Income page</strong></a>.</p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="554" height="245" src="https://retireby40.org/wp-content/uploads/2021/05/April-21-Passive-Income-1.jpg" alt="" class="wp-image-22038" /></figure></div>



<p>April was a great month on the passive income side.</p>



<ul><li>Real estate crowdfunding: I received $742 from our investments. This should improve as more projects start to payout.</li><li>Rental income: Our tenant is back from Europe! We made $553 from our rentals in April. It was enough to turn the year positive. Whew!</li><li>Dividend: We received $775 from our dividend portfolio. That’s not bad.</li></ul>



<p>At the end of April, our FI ratio was 124%. That’s really good, but it’s mostly due to low spending. Our passive income is still a little low. &nbsp;&nbsp;</p>



<p>*FI ratio = passive income/expense</p>



<h2><strong>April 2021 Cash Flow</strong></h2>



<p>Our cash flow was great in March. We didn’t spend much and saved 66% of our income.</p>



<p>Here is the Sankey diagram. You can get a quick overview and see the details below.</p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="700" height="500" src="https://retireby40.org/wp-content/uploads/2021/05/April-21-Sankey.jpg" alt="" class="wp-image-22040" /></figure></div>



<h3><strong>Gross Income: $15,320</strong></h3>



<p>Our gross income was solid last month.</p>



<ul><li><strong>Mrs. RB40’s job</strong>: $9,286.</li><li><strong>Blog income:</strong> $2,500. We had a good month at RB40.</li><li><strong>Real estate crowdfunding</strong>:&nbsp;$742. A nice month for RE crowdfunding. You can read more at the&nbsp;<a href="https://retireby40.org/passive-income/real-estate-crowdfunding/">RE Crowdfunding Passive Income page</a>.</li><li><strong>Rental income</strong>:&nbsp;$553. Woohoo! Our tenant is back in town. Hopefully, we’ll have positive cash flow this year. Read more at the&nbsp;Rental Property Passive Income page.</li><li><strong>Dividend Income</strong>:&nbsp;$775. Slow month for dividend income. See more details on my&nbsp;<a href="https://retireby40.org/passive-income/dividend-stocks/"><strong>Dividend Passive Income page</strong></a>.</li><li><strong>Interest Income:&nbsp;</strong>$0.</li><li><strong>Side hustle &amp; Misc:&nbsp;</strong>$1,464. I charged a lot of scooters in April. &nbsp;</li></ul>



<h3><strong>Monthly Spending: $2,824</strong></h3>



<p>This year, I plan to spend about $50,000. So our&nbsp;<a href="https://retireby40.org/a-simple-easy-budget-plan-for-people-who-hate-budgeting/">monthly spending budget</a>&nbsp;is $4,166/month. March was another low spend month. We still haven’t got our full Covid vaccine and we’re spending most our time at home.</p>



<ul><li><strong>Housing</strong>: $1,264. This category includes mortgage, home insurance, HOA fees, property taxes, utilities, home improvement, repair, and furnishing.</li><li><strong>Parents</strong>: $500. My brothers and I each sent $500/month to my parents. They don’t have much retirement savings. Fortunately, they live in Thailand so $1,500 is enough. I also own the condo they live in so their housing expense is very small.</li><li><strong>Groceries</strong>: $647. Wow, we spent a lot on groceries in April. We cooked most of our meals at home. In April, we only ordered out three times.</li></ul>



<p>Here are some of the dinners I made.</p>



<p><strong>Vietnam pizza</strong> &#8211; These are great. They&#8217;re super easy to make and you can customize the filling to your liking. Check them out. </p>



<figure class="wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio"><div class="wp-block-embed__wrapper">

</div></figure>



<p><strong>Crab fried rice</strong> &#8211; This is my crab fried rice recipe. I use turmeric and curry powder to give it that extra oomph. It&#8217;s really good. You can use chicken or tofu in this dish as well. </p>



<figure class="wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio"><div class="wp-block-embed__wrapper">

</div></figure>



<ul><li><strong>Bills</strong>: $23. This is just life insurance. Water, gas, and electric bills are included in the housing category.</li><li><strong>Transportation</strong>: $149. This was for gasoline, insurance, public transportation, and maintenance.</li><li><strong>Entertainment</strong>: $122. Mrs. RB40 purchased some stuff in April for herself. &nbsp;Her birthday was coming up.</li><li><strong>Kid</strong>: $0.</li><li><strong>Pet</strong>: $0.</li><li><strong>Travel</strong>: $0.</li><li><strong>Health</strong>: $119. Doctor appointment and prescriptions.</li></ul>



<h3><strong>Others</strong></h3>



<p>I don’t count these as personal spending.</p>



<ul><li><strong>Taxes and deductions</strong>: $2,380.</li></ul>



<h2><strong>2021 Savings ($35,446 YTD)</strong></h2>



<p>Alright! 2021 is starting off very well here.</p>



<ul><li><strong>Joe’s 401k</strong>: $12,875. &nbsp;&nbsp;</li><li><strong>Mrs. RB40’s 401k</strong>: $6,000. She contributes $750 every paycheck.</li><li><strong>Roth IRAs</strong>: $4,000</li><li><strong>529 College Savings</strong>: $0.</li><li><strong>Extra savings</strong>: $12,571</li></ul>



<p><strong>YTD 2021 saving rate = 64%</strong></p>



<h2><strong>April 2021 wrap up</strong></h2>



<p>April was another great month for us. Our income streams were all strong and we didn’t spend much. Our net worth hit a new high again. Real life was great, too. The weather warmed up and we spent a lot more time outside than earlier in previous months. Once I get the 2<sup>nd</sup> vaccine shot, I’ll loosen up even more. &nbsp;</p>



<p><strong>How was April for you? &nbsp;</strong>I hope you had a great month as well.</p>



<p><a href="https://retireby40.org/pcap/" target="_blank" rel="noreferrer noopener">*Sign up for a free account at Personal Capital</a>&nbsp;to help manage your net worth and investment accounts. I log in almost every day to check on our accounts. It’s a great site for DIY investors.</p>



<p>Disclosure: We may receive a referral fee if you purchase or signup for a service through the links on this page.</p>
<p>The post <a rel="nofollow" href="https://retireby40.org/april-2021-goals-financial-update/">April 2021 Goals &#038; Financial Update</a> appeared first on <a rel="nofollow" href="https://retireby40.org">Retire by 40</a>.</p>


April 2021 Goals &amp; Financial Update

It Takes More Than Money to Retire Early Interview: Tawcan


<div class="wp-block-image"><figure class="alignright"><img src="https://lh3.googleusercontent.com/RcWPKwRFGMH8fGzYzewZOMd7V4zyphif_Fhnf6seFWlK98YAUxjbZg_zehbTveQitbVRLUqY-2ueXxwFaRliLoFgYoQLRn1rqTigj9xpkGla64JVo3X90dSzpy6A4sjv5RNJowwsZzV1WYeBvrbEygNbGlNV3QpAlOTQ_XoHDcvtoRArd10dhQVYi0yg0xsOhnCLF8otOdJrPmsrKtIgNxjUhhKJvGcvJNVLg-uGaiDVUfrxbQJr5Nfo1Yv-ZV29fNXhehFbWhSwe_L5cuh-eKxKxiWds-LqwjqbXNAGgWCiLrF6RqVzyl9lHMhFR-1xsmODmTVa0eQxPh_rySxyDJOA7oX9mf3vuucjUhC_C2zpc0KnqumcQwf0pMWZRcmronWfB2mJNc_D_7gOW6F_zvoJ5QkYPEVVh04kHb4YfkPoxjFSCyv9W5SWl9e9cG4AZxmgFCGuzEqGg_P28bJUx4WSsim5mg5YzxbKK0g2_meErfscHUzfZYs7VFMTaXRDgHKCAmYtbt7Gh0XyH8_6hHfjF_eSrB8Ylf8eGuhUG90voruZmSTAaRMe1f10ELFWqHzrcBSmDDCy_TQFWzLmOhU3FYEjEy15MLh647qsaQq86wjG_5lk1ch72LqpV38WwCWuxODGB5H0R4Jl2L-hpXORpZZ83r8hRBXTAvsRWNncfAUXbGIXhlkw9KsxaKAI2Ko37TWfA9MhzSz702Bkkq4jMgKYSqTJdXnOsISEWhgMXp4KFquqJo4=w350-h525-no" alt="Why We're Using the 529 College Savings Plan to save for college" /></figure></div>



<p>Whew! Our son finally started going to school again. He goes for 2 hours in the morning and does <a href="https://retireby40.org/homeschooling-is-hell/">online schooling</a> in the afternoon. The last 12 months weren&#8217;t good. Many kids just don&#8217;t learn as well virtually. Our son did okay, but we were available when he needed help. Some of his friends with working parents are way behind. Anyway, the rest of this school year will be in this hybrid model. Hopefully, students will go back to school full time the next school year in September. </p>



<p>Anyway, our son is almost done with 4th grade. We only have 8 more years left to save for college. Wow, time really flies. The good news is his college saving is in great shape after the last 12 months. Last April, it was looking a little light. Today, I’ll share why we’re using the 529 plan to save for college and how much we saved so far. Let’s go over the basics of the 529 plan first.</p>



<p>*This article was originally written in 2013. There have been some changes to the 529 plan and I updated the post to reflect them. If you’re familiar with the 529 College Savings plan, feel free to skip to the end to check out RB40Jr’s college fund. I’ll update this post every year at the end of Q1.</p>



<h2><strong>Why we’re saving for college</strong></h2>



<p>If you’re a parent, you’re probably worried about the cost of higher education. The total U.S. student loan debt is $1.71 <strong>trillion</strong>. The class of 2019 graduated with an average of <strong>$29,900 in student loan debt</strong>. That’s a huge burden to start your adult life with. I graduated from college in 1996 and didn’t owe anything. My parents helped with most of my higher education expenses and I’ll be forever grateful to them. I worked when I was in college, but I didn’t make much. My goal is to do the same for our son. That way, he can <a href="https://retireby40.org/secret-wealth-buy-assets/">start building wealth</a> as soon as he begins working full time. It’s much better to start off at zero than in a hole. <strong>That will be our legacy to him as we are not planning to leave much if any inheritance.</strong> The best gift we can give our son is a good education. He can build his own fortune after that.</p>



<h2>How much will college cost?</h2>



<p>Oh man, this is going to be a shock to all the parents who haven’t looked into this yet. In recent years, the cost of higher education has been rising at about 5% annually. College is already expensive and 5% increase per year is kicking it into the stratosphere. How much will college cost 2029? I don&#8217;t know. Luckily, there are some online calculators out there to help us figure it out. We’ll use Vanguard’s <a href="https://vanguard.wealthmsi.com/collcost.php" target="_blank" rel="noopener noreferrer">College cost projector</a>. I’ll use the in-state expense for our alma mater, UCSB.</p>



<h2><strong>The Result</strong></h2>



<p>The estimate is a bit discouraging at first glance.</p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="600" height="366" src="https://retireby40.org/wp-content/uploads/2021/04/College-Cost-600.jpg" alt="College cost in 2029" class="wp-image-21777" /></figure></div>



<ul><li>The estimated cost of 4 years at UCSB, an in-state university is <strong>$190,474</strong>. Actually, this estimate is cheaper than last year&#8217;s estimate by about $7,000. That&#8217;s good news. </li></ul>



<p>That’s very high. Fortunately, the stock market recovered from the crash in 2020 and our son&#8217;s college portfolio is doing surprisingly well. It is 66% of the way there. I think we&#8217;re in good shape with 8 years left to save and invest. </p>



<p>The college cost is another big uncertainty. We&#8217;d have to move to California if he really gets into UCSB. The tuition for out-of-state students is triple the price for an in-state student. Anyway, UCSB came a long way since I was a student there. It&#8217;s a lot more difficult to get accepted now. Our son would have to do extremely well to get in. </p>



<p>We will have a more accurate picture as our son grows. I’ll update this post every year so you can see the progress we make. Personally, I hope he can get some scholarships and financial aid. Also, he can work while he’s in school. Those will help fund his cost of living during the college years. He’ll have some skin in the game by working and applying for financial assistance.</p>



<h2><strong>What is the 529 College Savings plan?</strong></h2>



<p>One great way to save for higher education is through the <strong>tax-advantaged</strong> 529 College Savings plan. The confusing thing is that each state has a different 529 plan. You don’t have to invest with your state’s plan either. You can invest with any state&#8217;s plan. We live in Oregon and we get a state <strong>tax credit</strong> for our contributions. So it’s an easy choice for us.</p>



<p>There are two types of 529 plans, <strong>prepaid</strong> and <strong>savings plan</strong>. The prepaid plan allows you to pay tuition at the current price and attend college in the future. The saving plan invests in stock and bond funds. I don’t really like the prepaid plan because it isn’t as flexible as the saving plan. We have no idea where our son will attend college so we want to keep it as flexible as possible.</p>



<p>Now, let’s go through the pros and cons of the 529 college savings plan.</p>



<h2><strong>Pros of the 529 college savings plan</strong></h2>



<p><strong>State tax benefit</strong> – Many states provide state income tax deduction or credit for the contribution. Recently, Oregon made a change to the tax benefit for the College Savings Plan. Instead of tax deduction, we can get up to <strong>$300 in tax credit</strong> for joint filers. This is a progressive tax benefit so it helps lower-income workers more. You can see the <a href="https://www.oregoncollegesavings.com/faqs/is-there-an-oregon-income-tax-credit" target="_blank" rel="noopener noreferrer">tax credit table at Oregon College Savings</a>. This tax benefit is actually worse than the previous years for us. In the past, we saved over $400 from the tax deduction. Oh well, that’s the way it rolls.  You can check your <a href="http://www.savingforcollege.com/compare_529_plans/?plan_question_ids%5b%5d=437&amp;page=compare_plan_questions" target="_blank" rel="noreferrer noopener">state’s 529 tax benefit</a> here.</p>



<p><strong>Federal tax benefit</strong> – If you use the money in the 529 college savings plan for education, then you don’t have to pay any tax on it. Only a few things in life are tax-free so this is a real gift from the federal government. Take advantage of it if you can. Now, the benefit applies to K-12 education so it’s more useful than ever.</p>



<p><strong>Automatic option</strong> – You can set up automatic deduction so you don’t have to worry about it. Many states have age-based funds which will <a href="https://retireby40.org/2013/09/early-retirement-asset-allocation/">allocate your fund</a> according to the beneficiary’s age. The automatic option makes it easier for parents to save.</p>



<p><strong>Transferable</strong> – If RB40Jr declines to go to college, then we can transfer that fund to other qualified members of our family. Perhaps Mrs. RB40 can finally go back to get a Ph.D. Otherwise, we can always gift it to the future generation.</p>



<p><strong>Estate plan</strong>&nbsp;– This one is for the grandparents out there who want to help out. They can contribute up to $15,000 ($60,000 for married couples) per beneficiary every year. This is a great way to pass money down to future generations without paying estate taxes while retaining control of the fund. In addition, there is a special rule unique to the 529 plans. You can gift a lump sum of up to $75,000 and still avoid the federal gift tax. We can treat the gift as if it was made evenly over five years. That’s pretty neat.</p>



<p><strong>Financial aid calculation</strong>&nbsp;– The 529 college savings account is treated as the parent’s asset. This is good news because only 5.64 percent (or less) of the 529 is used in the calculation for expected contribution toward your child’s college cost. Student’s assets are computed at 20% in the financial aid formula. It’s better to keep the assets under the parent’s name when it comes to FAFSA.</p>



<p><strong>More flexible withdrawal</strong> – In 2017, the tax reform package expanded the 529 plan benefits to include tax-free withdrawal for private K-12 schools. This is great if you live in a high tax state and send your kids to a private school. Check your state’s 529 plan to see if this is available.</p>



<p><strong>Disclaimer:</strong>&nbsp;Talk to your tax professional when you withdraw or contribute a large amount to make sure you don’t run into any unexpected problems.</p>



<h2><strong>Cons of 529</strong></h2>



<p><strong>Limited investments</strong>&nbsp;– Generally, there are only a few investment choices in the 529 plan. The Oregon 529 plan has U.S. equity, International Equity, Social Choice, Fixed Income Index, and Money Market. We can also invest in the age-based portfolios and target allocation portfolios.</p>



<p><strong>Reallocate twice per year</strong>&nbsp;– We can only reallocate twice per year in the Oregon 529 plan.</p>



<p><strong>Penalty</strong>&nbsp;– The 529 college savings plan is meant to help fund education. If you withdraw from the account and use the money for other purposes, you’ll have to pay tax at the normal rate plus <strong>10% penalty</strong>. The state may recapture the deduction as well. An exception to the 10% penalty can be claimed if the beneficiary has passed away or if the fund is not needed because the child received a scholarship.</p>



<h2><strong>The 529 college savings plan is a great way to save</strong></h2>



<p>Generally, everyone should <a href="https://retireby40.org/what-if-always-maxed-401k/">max out their retirement contributions first</a> and then save for college. Your 401(k) and <a href="https://retireby40.org/2013/01/start-contributing-roth-ira/">Roth IRA</a> provide great tax benefits and you may not have to pay the 10% early withdrawal penalty if you use the money to pay for college.</p>



<p>I also think it’s a good idea to<strong> front-load the 529 College Savings plan</strong> to maximize the benefit of compounding. If you put in $75,000 early on, it will earn much more than if you spread it out over 18 years. The earnings will be tax-free so it’s best to get rolling ASAP. The earlier you invest, the longer your portfolio has to compound. </p>



<ul><li>If you save $75,000 when your kid is born, you can accumulate <strong>$315,043</strong> (assuming 8% annual gain.)</li><li>If you spread $75,000 out over 18 years and save $347/month until your kid is 18, then you’ll have <strong>$166,810</strong>. It’s still good, but probably won’t be enough to pay for 4 years of college.</li></ul>



<h4>Caveat</h4>



<p>The only caveat is to make sure not to go over the $15,000/year gift limit. For the 529, you can contribute $75,000 in one year and treat it as if you were contributing the lump sum over five years.</p>



<p>Unfortunately, we didn’t have $75,000 sitting around when our son was born. We contributed extra in the first 4 years and then stepped down about $4,500 per year after that. You can see the contributions in the chart a bit later.</p>



<p>Currently, we have about $126,000 in RB40Jr’s college fund with 9 years left to go. The stock market did so well last year and his college fund increased $40,000 from 12 months ago. That’s really good. Our goal is to pay for 4 years of in-state public college. If he wants to go to graduate school or attend a pricey private college, then he will have to get some scholarships and take out some loans.</p>



<h2><strong>RB40Jr’s college savings</strong></h2>



<p>Okay, here it is.</p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="597" height="371" src="https://retireby40.org/wp-content/uploads/2021/04/RB40-College-Fund-Q1-2021.jpg" alt="" class="wp-image-21944" /></figure></div>



<p>Wow, what a change a year made. The college fund gained almost 50% since the last time I updated this post. </p>



<h2><strong>Screenshots</strong></h2>



<p>Recently, it was pointed out to me that you need screenshots to establish credibility. Anyone can say they have a million dollars in the bank. So here are some screenshots of RB40Jr’s college savings fund. What’s the world come to, when you can’t trust strangers on the internet anymore?</p>



<h3><strong>Vanguard</strong></h3>



<p>In 2017, I moved RB40Jr’s 529 College Savings account from Oregon to Vanguard (Nevada.) You can read more about the move here – <a href="https://retireby40.org/moving-oregon-college-savings-plan-529-vanguard/">Moving Our Oregon College Savings Plan to Vanguard</a>. This was done to minimize fees and it worked out well. The most important point is we didn’t have to pay the recapture tax when we moved from OR to Vanguard.</p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="599" height="391" src="https://retireby40.org/wp-content/uploads/2021/04/Vanguard-529.jpg" alt="" class="wp-image-21949" /></figure></div>



<h3><strong>Oregon 529 plan</strong></h3>



<p>Of course, I still want the tax deduction so I continue to contribute to the Oregon 529 plan. They made some changes since we moved the plan to Vanguard. Now, the underlying funds are Vanguard funds. </p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="583" height="275" src="https://retireby40.org/wp-content/uploads/2021/04/Oregon-529.jpg" alt="" class="wp-image-21952" /></figure></div>



<h3><strong>RB40Jr’s Roth IRA</strong></h3>



<p>In 2017, I started paying RB40Jr for his work as a model and photographer for this blog. He also helps me make clips for our YouTube channel. All of his income goes <a href="https://retireby40.org/how-to-invest-your-first-500/">straight into his Roth IRA</a>. He can use it for higher education so it is part of his college fund on my spreadsheet. The current balance is $8885, almost five figures! I’m sure it will keep growing as he contributes more. Hopefully, he won&#8217;t have to touch this account. It will compound very nicely if he keeps it for retirement.</p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="574" height="310" src="https://retireby40.org/wp-content/uploads/2021/04/Fidelity-Roth-IRA.jpg" alt="" class="wp-image-21956" /></figure></div>



<h3><strong>UTMA</strong></h3>



<p>This is his personal investment account. He put most of his gifts and <a href="https://retireby40.org/what-makes-a-good-side-hustle/">side hustle income</a> here. I invest it in Fidelity’s zero-cost total market fund for him. He helps me collect scooters, charge them, and return them to the wild. </p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img width="560" height="311" src="https://retireby40.org/wp-content/uploads/2021/04/Fidelity-UTMA.jpg" alt="" class="wp-image-21959" /></figure></div>



<h2><strong>Summary</strong></h2>



<p>Here is the summary of RB40Jr’s college fund. Wow, I&#8217;m impressed. The stock market did so well over the last 12 months. </p>



<figure class="wp-block-table"><table><tbody><tr><td><strong>College Savings</strong></td><td>&nbsp;</td></tr><tr><td>Vanguard 529</td><td>$90,180</td></tr><tr><td>Oregon 529</td><td>$24,563</td></tr><tr><td>RB40Jr’s Roth IRA</td><td>$8,669</td></tr><tr><td>UTMA</td><td>$2,399</td></tr><tr><td><strong>Total</strong></td><td>$125,811</td></tr></tbody></table></figure>



<p>All in all, I think we’re doing very well with RB40Jr’s college savings fund. 2020 started out really rough, but it turned out extremely well for investors. There is a lesson here. Once RB40Jr is in high school, we will need to rebalance his investment to become a lot more conservative. We’ll move a good percentage into bonds. It’s not a good idea to need money <a href="https://retireby40.org/should-you-invest-in-the-stock-market-now/">when the stock market is crashing</a>.</p>



<p>Anyway, I’m optimistic that we can cover most if not all the cost of higher education when he’s ready for it. We’ll just keep saving and hope he can get some scholarship.</p>



<p>Don’t forget to check back next year to see if we make any progress. The last 12 months were incredible. </p>



<p><strong>Ok, that’s it for today. Do you use the 529 plan to save for college or do you have a different plan?</strong></p>



<p><a href="https://retireby40.org/pcap/">*Sign up for a free account at Personal Capital</a>&nbsp;to help manage your net worth and investment accounts. I log in almost every day to check on my accounts and cash flow. It’s a great site for DIY investors. Check them out if you don’t have an account yet.</p>
<p>The post <a rel="nofollow" href="https://retireby40.org/529-saving-plans-college/">Why We Are Using The 529 Plan to Save For College</a> appeared first on <a rel="nofollow" href="https://retireby40.org">Retire by 40</a>.</p>
