I’ve been writing about our path to financial independence (FI) for a bit. In this post, I’ll explain what financial independence is, the different stages of FI, and which stage we’re at.
Category: Personal Finance
I had some lofty goals for 2022. We wanted to max our Roth IRA, save for a move, and pad our emergency fund. That was difficult to do on a single salary in Northern California. Here’s a breakdown of our financial goals last year and whether or not we met them.
Since our move back to Michigan, our budget and finances have changed for the better. I wanted to highlight a few of these changes in this post.
My new job doesn’t have the best dental insurance. The premiums for two people costs about $76 a month, and has an annual maximum of $1000 per person. That means I’m paying more than $900 a year for the potential of us using up $2000 in benefits. That didn’t seem ideal to me. My previous dental insurance costs only about $40 a month for two people with better coverage. So, I did what I do best: research my options.
It’s been a while since I wrote a blog post. A lot has happened in the last few months. We moved back to Michigan from California, which makes this our third cross-country move.
When I first started budgeting, I built a small emergency fund of $1000. This is the first of seven baby steps recommended by Dave Ramsey. Over 6 years, we built up the emergency fund to cover 6 months of expenses. At the same time, we also have sinking funds. So what’s the difference between emergency and sinking funds? And do we need to have both?
Before I started budgeting, I was horrible with money. I had a minimum wage, part-time job, and was living paycheck to paycheck. I also got help from my parents with tuition and some living expenses. But, I still wasn’t making any progress in my financial situation, as my checking accounts always dwindled back down to zero at the end of the month. I couldn’t build up any savings or emergency fund, which was horrible since I couldn’t come up with the funds for an emergency root canal.
In 2014, I started to learn about personal finance and budgeting, and tried YNAB. I credit the YNAB method on getting out of the paycheck to paycheck cycle. Here, I want to go over how I got out of the paycheck to paycheck cycle and was able to save for emergencies and future large purchases.
Recently, I made $500 from opening bank accounts with Bank of the West and Monifi. I’m still waiting on $600 from two more bank accounts. Here, I’ll go over the easiest money I’ve made by taking advantage of bank signup bonus offers.
Last week I wrote about credit card churning. This week I want to go over the credit cards we use for cash back and how we optimize their usage to get the most discount. By stacking these with cash back portals and discounted giftcards, we’ve been able to get almost 25-30% discounts on our recent purchases.
I occasionally churn credit cards. Mostly for the sign-up bonuses, but also for the ongoing cash back deals. These sign-up bonuses are not taxable as they’re seen as rebates by the IRS. Last year, we got $750 in sign-up bonuses. It supplemented our meager income during gradschool, and even earned us some free trips.
Here I’ll go over what it is, who should and should NOT be churning credit cards, how to find good deals, and how to analyze if it’s worth it to keep the credit card open, especially if it has an annual fee.