Notes for BiggerPockets Money Podcast 122
Audio time: 55 min
Read time: 1 min
Basics of Financial Independence (FI)
Spend less than you earn
- Track your spending (ex. Mint)
- By tracking his spending, Scott was able to identify his biggest spending categories (housing, transportation, food)
- House hacked to get rid of housing expense
- Reduced car travel
- Can splurge on food because above two categories are minimized
Invest aggressively
- Invest in assets that appreciate and cash flow
- Low-cost index funds instead of actively managed mutual funds
- Real estate investors can consider themselves retired when they can spend less than their total cash flow. Similarly, for regular investors, when they spend less than their dividends
Increase your active earned income
- Hard to increase wages at this time (coronavirus) but it’s still possible to increase your worth
- Listen to podcasts, read books, learn something new that you can take with you when this period is over
Create assets
- Real estate in light of coronavirus: market slowdown, less competition, more days on market
- This would be a good time to familiarize yourself with your market if you haven’t done so already
- If you’re thinking about starting a business, owning a business, or anything business related, listen to BiggerPockets Business Podcast 51
Live the life you truly love
- What life do you want? How do you want to live?
- It will be difficult to write a 5-year plan and execute that perfectly, so start with a plan that generally sounds good and evolve that over time
- You can’t do all of the above (steps 1-4) if you don’t know your WHY of FI
- The goal of FI is not to quit your job, the goal should be so you can live the life that you truly love
Leave a Comment