Cars Part 2 – How We Saved Another $32,400

About a year ago I wrote about how Elisa’s car has saved us $26,200 over 4 years. Today, we’ll explore the numbers behind my own car. As I am writing this sentence, I have not yet run the numbers so I am excited to see how my car’s cost of ownership compares to Elisa’s. I bought this car back in 2011 when I moved to Greensboro, NC for graduate school. I had about $6,000 to my name, and even though I didn’t know about financial independence back then, I knew that borrowing money for a car was a bad idea. I … Read more…

Buy or Rent? – All the Numbers Behind Our Recent Home Purchase

Buy or rent

One of the most common misconceptions out there is the notion that buying a home is always a better financial decision than renting one. This is nonsense. “Always” is rarely a good answer in the world of personal finance. There are too many factors at play for one alternative to always trump the other ones. A common argument in favor of buying that clearly overlooks many important factors goes something like this: “my mortgage payment would be roughly the same as my rent payment. Therefore, I should buy because I’m building equity!“. Not unreasonable, but awfully incomplete. With that in mind, let’s take a look at … Read more…

The Millionaire Next Door – Book Review

Who are the rich in this country? What do they do? How did they get rich? Can I become one of them? The Millionaire Next Door provides some very interesting and, perhaps, surprising answers to these questions. The authors, Dr. Stanley and Dr. Danko, are two academics who have dedicated much of their time to study millionaires, and the research behind this book is very comprehensive. The opening paragraph of the book is very insightful and provides a great preview of all the good stuff that follows: “Twenty years ago we began studying how people became wealthy. Initially, we did … Read more…

Expenses Revealed – Q1 2016

Over the last few weeks I have been buried studying for the CPA exam. I finally seem to be slightly ahead of schedule, so I thought I would take some time to write an update on this year’s spending so far. During the first quarter of 2016, we came back to the U.S. shortly after celebrating our wedding in Colombia. Other than that it was a rather inconspicuous quarter as Elisa came back to work, and I started my last semester of grad school. Without further introduction, I present to you our expenses for the first three months of 2016. … Read more…

A Random Walk Down Wall Street – Book Review

Saving and investing are two key elements to reach financial independence. In this post I review one of the best books about investing I have read so far: A Random Walk Down Wall Street – The Time-Tested Strategy for Successful Investing. I believe this is a good read for any curious mind looking to improve their understanding of money and investing. Burton G. Malkiel, the author, has a great deal of professional and academic experience in the world of investments. So you can be confident that the advice on this book is coming from someone who is very knowledgeable. The … Read more…

It’s Not About the Money

Financial independence… That wonderful thing that happens when your passive income equals or exceeds your expenses. It takes a sizable amount of money to get there. How much exactly? 25 times your annual expenses using the 4% percent withdrawal rule. For me, annual expenses are about $29,000, so I would need at least a $725,000 portfolio in order to reach financial independence. In other words, the ultimate freedom costs $725,000 for us, and that’s what Elisa and I are working towards.   What Do You Mean It’s Not About the Money? Clearly, money is a key ingredient to financial independence. … Read more…

Net Worth – What Is It and Why Should You Track It?

As we enter the second half of the year, I thought it would be a good time to check up on our net worth and show you how I track it. What is Your Net Worth? In simple words, your net worth is everything you own minus everything you owe. In accounting jargon, it is your assets minus your liabilities. Pretty simple stuff so far. Why Should You Track It? Your net worth is like the blood pressure of your financial life. Leave your blood pressure unchecked for a long time and you might be in for an ugly surprise. … Read more…

Camp Mustache 2016

Back in January, I stumbled upon the possibility of getting tickets for Camp Mustache 2016. After about 15 minutes of thinking, I decided to go. I’m lucky I did because tickets sold out within a day or so, as I found out later. What Is Camp Mustache? The official website describes it as “4 days, 3 nights, 2 mountains, 1 rainforest – Meet like-minded badasses and learn about financial independence, in a relaxed outdoorsy environment”. I would describe it as the most inspiring experience in my financial independence journey so far. In case you are wondering, the event is named … Read more…

Cars Part 1 – How We Saved $26,200

About 4 years ago, Elisa purchased her first (and so far only) car. I thought it would be interesting to look at how much this car has cost us and see how it compares to what the average American spends on his/her vehicle. At the time, we were not thinking about financial independence. In fact, we didn’t even know what it meant. We just wanted to make a responsible decision, so we looked at the things we were hoping to get out of the car: Safe and reliable transportation Efficiency and low maintenance That’s it. In my opinion, that’s all a car … Read more…

Tracking Expenses – Lessons Learned From 2015

Management guru Peter Drucker said “If you can’t measure it, you can’t improve it“. So in order to take control of your finances, you first need to know where your money goes. I know a guy who thought he was saving about $200 per month. He wasn’t actually tracking his expenses, the $200 savings was just his best guess. After a couple of months of actually tracking his monthly expenses, he found out he was actually losing $300 per month! Don’t be this guy. There are many approaches to budgeting and staying on top of your finances. We actually don’t … Read more…