YMOYL explains financial independance this way. FI is defined as having an income sufficient for your basic needs and comforts from a source other than paid employment.

Do you feel you will ever be at this point? If so, how long do you think it will take to get to FI?

Homesteadmamma - Good Question!

Do you feel you will ever be at this point?
Yes. For about the last 6 years my DH and I have been making a very conscious effort to achieve FI . In the last 3 years we have downsized our home 2 times. Got rid of one car and lots of STUFFFF.
If so, how long do you think it will take to get to FI?
Lord willing in 4-5 years.

Neither my DH or I feel like we have to keep up with the Joneses. Though it is difficult for alot of our friends and family to understand this. Oh well :shrug2:

right now I dont think so but that is because of the amount of debt I carry. If I had only made wiser decisions in the past and paid cash, saved and invested, them I would say yes.
But I am trying now so maybe, just maybe

I hope so. I am not there at the moment, but I am working toward it. It may take us more years than I would like.

I would like to get to this point, but I don't know.... Mostly because of the debt we have at this point. I am doing all I can right now , but unfortunately, not everyone else in the household is on board with these same goals, even though my SO says he'd love to be be able to do that, his choices don't reflect that. And I have two sons, one who is in college, so of course, that is a big expense. My other son is 25 and still coming back needing $'s now and again, moving back in and out of the house etc.My spouse and I don't agree on how to handle the son who is always coming back for $'s.Oh well, I probably should just make another post out of that whole story, too much to explain here. Let's just say I think that if you want to achieve this kind of lifestyle, you have to make clear choices about where your money goes in order to get there.

This book made a huge difference in my way of thinking about life.Very thought provoking and interesting. But in order for this to be achievable in a family situation, with shared finances, *Everyone* has to have the same vision.

I can relate to the expense of college! I'm putting a child through school now and can't understand why the check I give him for living expenses doesn't last until the end of the month. :confused: I know I should be tougher with him and I try. DH and I disagree on the amount of living expense he should need.

I don't think i'll ever get there.

I see a light at the end of the tunnel for me.
My dh is wanting to take an early retirement.. He is 50 and hopes by age 55 he'll be able. He has amassed quite a bit in his previous life- before me.
The only obstacle now is my 3 chidlren and college expenses- which I couldn't, as a single parent, save up for- in my previous life.

So, once 3 children are done with college- (6 years) we'll sell the home- move south, buy a cheaper home (or condo) and live off the interest in savings.
I would still be young so I could still work PT as an RN for added security and probably the insurance- too
But I do have some self employment ideas.

I don't think we'll get there but I don't think we are really after that. Dh doesn't mind working. Our home should be paid off in 5 years but it will be 20 years before our last child is out of college. Dh will be 66 in 20 years. He will probably retire after that and we should have enough retirement income to live.

All our debt should be paid off by the middle of next year, and then we will build up our savings. We are only in our early 30's and we hope that in 10 yearswe will be able to retire or only work part-time, it will depend on how many of the 5 kids need help with school tuition. Two of the boys are talking about the military so that would cut back on how much we need. We'll just have to wait and see.

Absolutely. Based on my calculations of what I can afford to pay, and the amount of debt I have, I hope to be there in 9.5 years - maybe sooner if my eBay business takes off!:smball:

I am kicking myself, as well. I made a lot of poor choices in the last twenty years or so, but now I feel like I've pulled my head out of the hole it was in, and am looking around for the first time, thinking, wow, life would be so much greater if I weren't worried about when the next paycheck was coming in!

I am 100% determined to retire before I'm fifty (which, coincidentally is also approximately 9.5 years away), and to only work because I WANT to, not because I HAVE to.

I hope to have enough in about 10 years. If I can pay off my debts, starts saving like crazy, and resist "the urge to splurge", I will have more than enough by age 54. At that time I would like to work part time at something I enjoy-maybe working with animals in some capacity. It sure would be nice to be able to work 20 hours a week, or none if I choose!!

I think we are working toward this! When we have no mortgage payment this year, things will ease up a bit. We have no other debts. Our 4 kids are already finished with college with no debt, thanks to a lot of help from Mom and Dad! However, I would like to mention that FI is becoming harder and harder because of high medical costs in the USA. Many people who hoped to retire are now feeling that pinch. A retiree may have a budget all set up, but escalating health care costs offset it. For instance, we had some acquaintances here in CA who retired a couple years ago at about age 55. The husband has medical coverage as an ex- public school teacher but the wife was not covered automatically on his health insurance, and they must pay for this. Costs kept rising, and finally it reached $1200/month to cover her! That really messes up the FI equation! I read a recent article that stated many baby boomers are going to be in this crunch--too young for Medicare but also not really able to swing those ever-increasing high insurance premiums. Many people may have to keep working in spite of good savings just to be covered by health insurance.

We are working toward it.

DH seems to think we will be able to make it just fine with both of us working part-time within the next 5 years or so, I think it will take longer to build up a nest egg. I'm thinking more like 15 years, which would put DH at 55 and me at 50. While that depresses the heck out of DH (who thinks he "deserves" to retire whenever he wants), I think it would be pretty darn good!

What concerns me the most is health care costs.

We hope to get there by 15 more years, I would like to have more property to bring in extra money aside from our social security and calpers and 401 K.

That's our aim. At the rate we're going we should be totally debt-free, including the mortgage, by 2010. When that's gone we plan on putting away addition funds above the 401(k)'s and the ROTH's to build up by the time dh is 55 (22 more years), enough to be able to live totally on the interest. He then wants to be in business for himself, but not dependant on an income. Let's say, a hobby that has erratic income. And the ROTH's and 401(k)'s will be just icing on the cake when we're 65. That's the plan, that's the goal.

Yikes!!! I don't know if we will ever be financially independent according to that definition!! At least not before retirement at age 60 or 65?!! We are in our early 30's now with a new mortgage (we owe approx $200,000 on our mortgage still) and tons of debt. We do make a good income though and could pay off all of our debt not including the mortgage in approx 2 - 3 years maybe sooner if we were extremely disciplined. I think that after we pay our other debts we will look more closely at paying off the mortgage faster. Last month we borrowed $11000.00 to purchase RRSP's. This loan must be paid off in one year!!! Although it will be difficult we see it as a forced savings plan. I just joined FV a few days ago and I feel that all your responses are truly helping me change my attitude about money. I plan to use this site as a resource to help keep me motivated (as I'm sure many other members are doing). Thanks everyone!!

This is also our goal and we hope to reach it within 15-20 years maximum. Hubby is actually very happy in his job and plans to stay there through retirement, through this we will have a good retirement/pension/insurance plan. We're also using his 401k plan and will have the land paid off.

Our ultimate goal is when we retire from farming to sell the farm and buy a small place with about 5 acres and spend every last penny we made/saved.;) No kids and we've seen the devastation that inheritance has caused in his family so his brothers have already been told not to expect US to care for their children in the future and my brothers are stable enough to care for theirs in the future.

Selfish? Yes, but we're working hard for it and feel WE deserve it!:D

kj

No. Dh is 8 years from early retirement with a healthy work pension. We are finally paying out the mortgage this year. Money will go towards things we can take with us that decrease the cost of living...such as a front loading washer. Also towards financing the further education of two daughters. And travel. Ultimately the goal is to buy down into a smaller home.

From dh's perspective the goal has never been FI, but to just get by on what he earns. He has very low goals financially. I haven't had the energy to fight him on this one. My goal has been FI since I was in my 20's. However, dh has more of a poverty mentality and it's been a struggle just to get him to see we could have a better life financially. He just isn't into FI. He's into better lifestyle stuff. "Spend it all now!" is his motto. I'm content knowing there's money in an EF, some into RRSPs every month, the mortgage is being paid out early, and we have a healthy pension we can live off of in retirement.

But this is Canada, and we still have universal health care. Also, we had a health wake-up call the last couple of years and want to enjoy what time we have doing things, like travelling. FI is not such an important goal for us. Course, maybe living off a pension is FI?

Jean

I too see the light at the end of the tunnel, but I think maybe in 1-2 years we will hit FI or atleast tap it....

At this time we have very small debt which will be paid off next week and all we would have left is the mortgage, come this time next year we will be making additional priniciple payments to our mortgage of $260 a month or $130 bi-weekly to cut down our mortgage term by many many years.

We are also expecting a lump sum payment in the next couple months and wanted to save that as an EF, that would be 5 months of living expenses should something arise + some left over to put into the ING account to earn interest. Cross your fingers all turns out well.

Dh retired from the Canadian Military last year so we are very fortunate to have a pension cheque coming in each month but it isn't enough to retire on with having mortgage payments and 2 children still at home etc. We started funding our RRSP's ( registared retirement savings plan) for Canadians last year( We were late getting started). We are right now trying to build up a good solid emergency fund. Once the emergency fund is fully funded we will try to get the mortgage paid off as quickly as possible ( we figure we can have it paid off within 6 years from now) .

Dh has a full time job which he really enjoys and says he wants to stay there till he is at least 55 which means another 11 1/2 years. I just started working for the same company where Dh works, I am part time and I am truly enjoying it :). Nothing is written in stone though, you just never know what is going to happen , companys can shut down, sickness etc.

I am thinking that we should be FI in about 10 or 11 years.

I'm hoping to hit FI in around 20 years. I should have all my current debt paid off in the next three but I don't own my own house and I plan on having children in the next three to four years so that will slow down the process.

I too kick myself for all the bad decisions I've made in the past few years. The sad thing is all the credit card debt I'm in I've acquired in the past three years. I just had/have a problem controlling my spending but since I am slowly but surely conquring that problem my future is starting to look brighter.

Ten year plan is getting out of debt, having child(ren), saving up a decent sized down payment and buying a house. I will probably buy a duplex though and rent one side out to offset the cost of the mortgage payment. As long as I don't buy more house than I can afford on my salary I should be in pretty good shape with the extra money coming in going towards the mortgage as well and any upkeep costs. The trick is keeping all other expenses down. Hopefully, I will be able to have the house paid off in 5-8 years after I move in depending upon circumstances.

After the house is paid for, I will have a lot better of a chance to achieve FI. The only thing that gives me pause at all for not acheiving this goal is the idea that I really have no idea how much children cost to raise. I hear all these rediciously large numbers and it drives me crazy. I expect daycare to be quite expensive and have planned for that but the additional costs scare me. But I wonder how much of those numbers is people just spoiling their kids and not shopping around for the best deals and such. And how much is upgrading to a larger house/car when they have a child.

The other thing I worry about is I'm an only child and my parent's will be retiring in 8 years although my mother waffles back and forth on waiting to retire to bring in more money. They don't have very much saved but will have their house paid for but what happens when their health goes down hill? I will be all they have to take care of them. And if they can't make ends meet then I will have to step forward and help out. It's stressful just the think about.

I don't foresee it happening before retirement age for us. I hope that by retirement I can be FI and not have money worries.

tlenad:

Amy D. in her book "The Complete Tightwad Gazette" has an article on figuring out how much it costs to raise a child (p. 608). You are right. The regular figures are overly inflated. I was told hundreds of thousands of dollars. I figure we raised both girls to 18 at $60,300cdn. each. We weren't particularly frugal at the time. Our costs worked out like this...for both girls combined...

~ $3000/year education (this includes things like gymnastics, soccer, homeschooling, etc.)
~ $2400/year food
~ $500/year clothing (we shop secondhand and I sew)
~ $300/year transportation
~ $500/year miscellaneous

Total $6700 x 18 years = $120,600 / 2 = $60,300cdn. per child

Jean

I don't know that my dh and I are FI, but all of our children are gone from home and we are thru this college obligations. I do know that we are saving more and a dollar goes alot farther than it used to. We are better off than we were 10 years ago and hope to be even better in the next 10 years. I know that we have saved because I am not depending on social security to meet our needs as we get older. I do know that we are blessed that we don't live paycheck to paycheck anymore and I swear I thought that day would never come. Our frugal lifestly has really helped that and we just live a simple exsistent, but don't do without. This is a great blog....

YMOYL explains financial independance this way. FI is defined as having an income sufficient for your basic needs and comforts from a source other than paid employment.

Do you feel you will ever be at this point? If so, how long do you think it will take to get to FI?

I am probably there right now. DH and I are homebodies, so not a lot of expensive hobbies, his most expensive is direct tv. DH has a pension available now but it increases a lot in the next 2 years and that is when he maybe wants to retire. I have lots of land I have purchased that has increased in value,enough to pay my house off and have money in the bank, but I am holding on for future growth.I currently am taking on even more debt to get some rental houses fixed and rented. But once they are going they should have positive cash flow.My total debt is about 450k, this includes the rentals and fix up money. I am sending 3 to higher education and paying their bills but trying to get them self sufficient in the future.I have one more to put thru college, but I think we could afford to do that even with current pension but no frills.I like to work, but I like real estate even more than my job,so I would like to be able to do some fix up , more hands on when I can afford it. The DH would also like to do some missionary work overseas, so we may need a lot of funds for that. I want enough I can spend and not worry, do I have enough for this.

My parents achieved it at 53 with one income (blue collar) and 11 kids. I know that wont happend for us that soon, but we are workign towards it. Once the house is paid off, we would be in that position. However I think dh loves his job too much to quit -which isn't at all bad in that case.

I guess we'll all be there when we retire! I'm retired now but not collecting any retirement for another 7 years. Dh has ten more years to go.