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Earn Active Income For Wants, Use Passive Income For Needs - Financial Samurai
When you reach financial independence or retirement you may eventually experience a sense of emptiness. After years of hard work, aggressive saving, and smart investing, you might feel a letdown because the toughest financial challenges are behind you. Based on feedback from readers since 2009 and my own experience after leaving work in 2012, I’ve
The Biggest Flex By Men Is Not What You Think - Financial Samurai
'Flexing' is a slang term that means showing off or boasting about one's accomplishments, possessions, or skills, often with the intention of impressing others. For example, someone might 'flex' on social media by posting pictures of their new Porsche or sharing stories about their achievements. Personally, I'm not a fan of flexing—what’s the point? It
Cheap, Fun, And Practical Buys With Your Stock Market Returns - Financial Samurai
With another strong year in the stock market, it’s time for investors to celebrate! While marveling at the growth of your portfolio is satisfying, a more rewarding way to celebrate is to actually spend some of those phenomenal returns on things that bring joy and fulfillment. Stocks, by themselves, provide no utility. We invest in
The Biggest Financial Misconception About Applying To College - Financial Samurai
After speaking to dozens of parents, a principal a couple of times, and a financial aid officer, I've determined the biggest financial misconception about applying to college is that you have to be poor or middle class to receive financial aid. The feedback I've received from everybody is that you can earn a multiple-six figure
Capitalizing On The Return To Office: Big City Real Estate Insights - Financial Samurai
Real estate is inherently local, with property values closely tied to the economic drivers and characteristics of specific regions. While understanding the national housing price forecast for 2025 provides valuable context, savvy investors should focus on identifying cities and states with stronger growth potential. After all, outperforming the market is just as important as generating
2025 Housing Price Forecasts: Continued Strong Gains - Financial Samurai
Now that I’ve shared the 2025 S&P 500 target price forecast, let’s dive into housing price forecasts for 2025. The outlook from housing analysts is positive, with expected gains ranging from -0.4% to 10.8%, and an average of about 3%. The only negative housing price forecast comes from Moody’s, which predicts a slight decline of -0.4% largely
Wealth vs. Morality: The Dilemma of Profiting From Sin - Financial Samurai
Sin—actions deemed morally wrong or harmful—can be difficult to resist, especially when money is involved. A hefty paycheck or a prestigious title can make it easier to overlook the potential harm our work may cause society. Moreover, unless you’re working for free, there’s often a moral trade-off involved—someone or something usually has to bear a cost
Boldin Financial Planner Review: Financial Freedom Made Easier - Financial Samurai
I recently had dinner with Steve Chen, founder of Boldin, in San Francisco, and I’m excited to deepen my partnership with his company. Since first writing about Boldin (formerly NewRetirement) in 2020, I’ve seen how much the platform has evolved and expanded its offerings. The world needs a financial planning tool that takes a holistic
Maximizing Tax-Free Income and Capital Gains In Retirement - Financial Samurai
There’s a lot of enthusiasm for Roth IRA conversions and Mega Backdoor Roth IRAs—and for good reason. Paying taxes upfront on your retirement accounts can be a savvy move, especially if you’re in a mid-to-lower federal income tax bracket, as it allows for tax-free withdrawals in the future. That said, thanks to the latest standard
2025 Wall Street S&P 500 Forecasts Are All Bullish - Uh Oh! - Financial Samurai
The 2025 Wall Street S&P 500 forecasts are rolling in, and so far, the outlook is all bullish. I haven't found a single bearish forecast, which is somewhat worrisome. Most firms project the S&P 500 will close 2025 around 6,500—a solid 8.3% gain from the current ~6,000 level. If 2024 ends as expected, with the
How One Lucky Financial Break Can Change Everything For Good - Financial Samurai
I firmly believe that above-average wealth is largely a result of luck. If we fail to recognize our lucky financial breaks, we risk confusing our abilities with good economic times. This overconfidence can lead to poor decisions and increase the likelihood of financial ruin. Since starting Financial Samurai in 2009, I’ve witnessed fortunes rise and fall. Time
The Santa Claus Rally Phenomenon And Its Origins - Financial Samurai
The Santa Claus Rally refers to a historically observed stock market phenomenon where U.S. equity markets tend to perform well during the last five trading days of the year and the first two trading days of the new year. Historically, the average gain during this seven-day period is around 1.3%. As time has gone on, largely thanks to
Mega Backdoor Roth IRA: Supercharging Your Retirement Savings - Financial Samurai
Ever since I started saving for retirement in 1999, I’ve been a proponent of tax-deferred retirement vehicles like the 401(k) and skeptical of tax-now vehicles like the Roth IRA. Working in banking, I was already being taxed out the wazoo and had no desire to pay even more. Frankly, I wasn’t even familiar with the
Key Factors To Consider Before Changing Health Insurance Plans - Financial Samurai
Health insurance is one of the most complex and aggravating topics for both consumers and providers in the US. Speak with anyone based outside the US and they all will comment about how much better things are abroad versus here. But as most of you would agree, having health insurance is a financial necessity in
Return On Effort (ROE) Is Your Key To Unlocking A Better Life - Financial Samurai
If you want to optimize your life, it's essential to understand the concept of Return on Effort (ROE). The higher your ROE, the more you get out of your efforts, making it an invaluable framework for decision-making. ROE can also help you better utilize your time by prioritizing tasks and opportunities that yield the greatest
A Net Worth Equal To 25X Expenses Is Not Enough To Retire Early - Financial Samurai
Being financially independent means having enough passive income to cover your essential or desired living expenses. A common guideline is to aim for a net worth equal to 25 times your annual expenses, often used as a baseline for achieving financial independence. However, this approach is overly simplistic because it depends on the composition and
The 4% Rule: Clearing Up Misconceptions With Bill Bengen - Financial Samurai
I had the pleasure of speaking with Bill Bengen, creator of the '4% Rule' for retirement planning. Bill has been a reader of Financial Samurai for many years and has always been courteous in the comments section when I write about safe withdrawal rates. So, I figured it was time we had a chat to
Uncover Your True Investment Risk Profile: It's Not What You Think - Financial Samurai
After reviewing my analysis on a conversation I had with a financial professional in 2013, I decided to take another close look at my finances. To my surprise, I uncovered a huge gap between my perceived risk tolerance and the reality of my portfolio. Since leaving work in 2012, I’ve generally seen myself as a
The Power Of Losing: How Setbacks Can Lead To Success - Financial Samurai
One reason many people shy away from competition is that they dislike losing. With often only one winner, the sting of defeat can feel too humiliating. When people stop competing, they can become more fragile over time, to the point where even small setbacks can disrupt their well being. Ironically, the best path to victory
2025 401(k) Contribution Limits: Bigger Savings, Better Retirement - Financial Samurai
The 401(k) contribution limit for employees in 2025 has increased to $23,500, up from $23,000 in 2024. The employer contribution limit also rises to $46,500, bringing the combined employee and employer 401(k) contribution limit to $70,000 for 2025. Don’t underestimate the power of employer 401(k) contributions, especially as you advance in your career. As you
Financial Planning Through Changing Presidencies: My Journey - Financial Samurai
With Donald Trump set to become the 47th President of the United States, it’s natural to wonder what this new administration could mean for your finances. For most people under 30, a change in leadership might not significantly impact financial planning. In your 20s, you’re often not earning enough or rich enough for a president’s
Four Years Later, You're Likely Way Better Off Than You Think - Financial Samurai
Every time a political candidate asks if you’re better off than four years ago, I can’t help but sigh. The implication, regardless of party, is always that you’re worse off and that they are the answer to your problems. The Democrat says things went downhill under the Republican, and the Republican says the same about
2025 Tax Brackets: New Ideal Incomes for Workers and Retirees - Financial Samurai
The IRS has announced new income limits for its seven tax brackets for 2025, with income thresholds increased by about 2.7% to adjust for inflation. This follows a 5.4% increase in 2024 and a historically large 7% bump in 2023. Reaching a top one percent income is becoming more challenging given the threshold keeps increasing
The Surprising Benefits Of Donating To Your Kid's School - Financial Samurai
Out of all the things you could donate your hard-earned money to, giving to your child's school might not be at the top of your list. If your children attend a private grade school with sky-high tuition, donating to the school might feel even more unnecessary. With so much poverty, homelessness, broken homes, and people
Apply Stop Losses To Protect Your Wealth And Quality Of Life - Financial Samurai
As an investor, it’s essential to understand that risk assets come with no guaranteed returns. Setting and following a stop loss can help protect your capital from significant losses, especially if you're an active investor who picks individual stocks. Yet, I've come to realize that stop losses aren't only useful for active investors—they can be
Enjoy Your Money: Investing in Fine Wine and Whiskey - Financial Samurai
Investing in alternative assets has become an increasingly popular way to diversify beyond traditional stocks and bonds. Wine and whiskey, in particular, are gaining traction due to their potential for strong returns, resilience during economic downturns, and rising demand. If Goldman Sachs and Vanguard's predictions are true for an abysmally low stock market return over
Finishing Rich Despite A Low-Return Stock Market Environment - Financial Samurai
Since the bottom of the global financial crisis in July 2009, the S&P 500 has generally experienced a strong bull market. While there were challenging periods in 2018, 1Q 2020, and 2022, stock market investors have largely been well rewarded. However, Goldman Sachs warns that the good times might be coming to an end. Goldman
Overwhelmed, Not Bored: An Unexpected Challenge Of Retirement - Financial Samurai
Before retiring in 2012, I didn't fear boredom or loneliness. It never occurred to me that I would be bored with so much potential freedom. My main fear was whether giving up a steady paycheck was an impetuous move that could lead me to financial ruin! After I left work, I found myself telling my
Reflecting On A Year After Purchasing A House I Didn't Need - Financial Samurai
October 2024 marks one year since I purchased the most expensive house I could afford. Leading up to the purchase, I wrestled with uncertainty about whether buying such a home was the right move. For most, a home is the largest purchase they will ever make, bringing with it a mix of excitement and worry.
How Speaking To A Financial Professional Saved Me From Myself - Financial Samurai
Empower is offering free financial consultations until October 31, 2024, for anyone with over $250,000 in investable assets. I wanted to share my experience speaking with them and how I began my investing journey. If you complete two video calls by the deadline, you'll receive a free $100 Visa gift card. There is no obligation
An 80/20 Stock-Heavy Portfolio in Retirement Might Be Ideal - Financial Samurai
This guest post is by Vaughn, a long-time Financial Samurai reader who retired at 44 and is now 55. Vaughn's early retirement was driven by necessity rather than choice due to a congenital bone disease. Fortunately, his high income during his working years secured a solid SSDI benefit, and his mother’s foresight provided future rental
A Home Insurance Policy Review To Understand What's Covered - Financial Samurai
One of the worst experiences for a homeowner is filing a home insurance claim only to be told it's not covered. After years of paying premiums, the insurance company doesn't deliver when it's needed most. What a disappointment. This disconnect happens because we rarely take the time to review our home insurance policies each year.
A Severance Package Is The Ultimate Catalyst For Early Retirement - Financial Samurai
Retiring early with a severance package is one of the smartest ways to leave the corporate world. Walking away without trying to secure one could leave tens of thousands, or even millions, on the table. I also believe that retiring early is better than retiring rich. For those who choose my preferred retirement path, negotiating
Effective Ways To Protect Your Family From Harm's Way - Financial Samurai
As a parent, your top priority is to protect your children until they are old enough to fend for themselves. Protecting your children requires good health, being alive, having resources, self-defense skills, and using common sense. If you’re missing one of these, the chances of your children and partner being harmed go up. After a
Why Retiring Early Is Obviously Better Than Retiring Rich - Financial Samurai
There are two things most financially-conscience people aspire to: retiring rich or retiring early. But which is better? Many people who haven't retired believe early retirement sounds fantastic, especially since so many are disengaged from work. On the other hand, who wouldn’t want to retire rich? However, to retire rich, you typically have to work
Artificial Intelligence Put My Dad Out Of A Job And I'm Worried - Financial Samurai
For about 10 years, my father has been my primary editor on Financial Samurai. When my father isn't available, my wife steps in. This system has allowed me to maintain a consistent publishing schedule of three posts a week with a relatively high standard of quality. Typically, I spend 1.5–3 hours writing a post. Then,
Settling The Work From Home Debate Once And For All - Financial Samurai
One of the most significant developments to come out of the pandemic, if not the greatest, was the shift to remote work for millions of employees. Beginning in March 2020, businesses quickly adapted out of necessity, keeping their operations afloat with employees working in pajamas from their living rooms. However, this golden era of remote
Government Grift As A Lucrative Side Hustle To Build More Wealth - Financial Samurai
I remember being a broke college student during my senior year at The College of William & Mary. A group of us gathered at the Spanish House, the language immersion dorm where we lived, to brainstorm easy ways to make money. None of us had job offers yet, and we were anxious to prove to
The Curious Inability To Spend Money On Yourself - Financial Samurai
Recently, I hit a major milestone in my journey to overcome what I like to call 'frugality disease.' I spent $160 for an hour of private lessons for my two kids. In the past, I would’ve never paid such an amount. I’ve always been the type to teach them things myself, like swimming and bicycling.
What Creates That Cozy, Nestled Home Feeling In A Big City - Financial Samurai
Have you ever walked into a home and instantly felt cozy, even in the heart of a bustling city? It's hard to pinpoint exactly why it feels so comfortable and serene amidst all the noise and chaos. In this post, I’ll break down the key elements that create that warm, welcoming atmosphere. As we get