CHASING FIRE INTERVIEW SERIES

FIRE Starter – Tips on How to Grow Your Net Worth in the Early Years

Zach Financial Markets Leave a Comment

You can find all of Zach’s previous posts here. Today, Zach is going to discuss how you can grow your net worth in the early years. Many people miss the fact that compounding takes a decade or longer to really work its magic. That is why I push the income side of the equation so hard. Your contributions (the gap between your income and your spending) make up the majority of your net worth for at least the first ten years in most cases. You could be the exception to the rule, but I wouldn’t bet my – or your – financial future on that. I even wrote a post about the inflection point of contributions vs. compounding (that you …

Don't Panic

How To View & Manage Your 401K To 7 Figures

Gen Y Finance Guy Financial Markets 15 Comments

Before I get into what I have been doing wrong with my own 401K, let me tell you what I have done right. The one thing I have consistently done is contributed to my 401K and in most years maxed it out. That said, there are several mistakes that I have made over the past 8 years: (1) I have held way too much cash when I should have been fully invested. (2) I withdrew $10,000 as part of the downpayment on the house we now live in, because it was allowed penalty-free (but not tax-free). (3) I didn’t take full advantage of the max contribution limits. (4) I borrowed from my 401K not once but twice. Since I started …

I Miss My “Guaranteed” 15% Return (or Better) Every 6 Months

Gen Y Finance Guy Financial Markets, General Information, The JOB 29 Comments

Last week I was reading a post by fellow a blogger and unfortunately did not bookmark the post. And to make matters worse, I don’t remember which blog it was (first thank you to the blogger for the inspiration for this post, secondly this post is going live a few months since reading that post). However, the post was talking about how even people who work in Finance don’t make the best decisions when it comes to their finances. It reminded me of a story that I would like to share with you all here. Back Story I used to work for a public company a little over a year ago that offered an “employee stock purchase program” or ESPP for short. The program allowed …

Sell Into Strength - Investment Rule #2

Sell Into Strength – Investment Rule #2

Gen Y Finance Guy Financial Freedom, Financial Markets, New Rules, Options, Words To Live By 6 Comments

Over the course of the coming weeks and months I will be laying out the investment rules that I live and die by. These are rules that I have developed over the last ten years as both a retail and professional investor and trader: Rule # 1: Buy into weakness. Rule #2: Sell into strength. Rule #3: Reduce cost basis. Rule #4: Keep investments small. Rule #5: Keep 80% of total invested capital in ETF’s and up to 20% in individual names. Rule #6: Choose duration over direction. Rule #7: Manage your winners. Rule #8: Manage risk at order entry. Rule #9: Increase your # of occurrences. Rule #10: Make investments with a probability of profit > than 50%. Selling …

My plan for $63,000 in Cold Hard Cash

Gen Y Finance Guy Financial Markets, Investing 41 Comments

Before you read any further would you do me a favor? Could you help spread the word by sharing this post on social media? It’s no national secret that my investment accounts are largely flush with cold hard cash. As I write this post my brokerage accounts have a total net liquidation value of $102,000 (rounded number). Of the total liquidation value I have $39,000 invested, with the remaining $63,000 sitting in cash. Most of the personal finance bloggers out there would likely advise me to continue putting money to work regardless of the fact the stock market is at ALL TIME HIGHS. However, I have a much different philosophy. I agree that the market has had an incredible run …

Example of Buying Into Weakness – Investment Rule #1

Gen Y Finance Guy Financial Markets, Investing, Options 22 Comments

“Dude, suckin’ at something is the first step to being sorta good at something.” -Jake, “Adventure Time” A few days ago I wrote a post laying the foundation for my 10 rules for investing. In rule #1 we discussed what it means to buy into weakness. After some good dialogue with you guys in the comments of that post, it dawned on me to include a real example of what it actually looks like to buy into weakness. It was a comment by Mr. Maroon that helped spark the idea when she said: Enter Mrs. Maroon When we first started aggressively trying to save money for investments and actively watching our balances, we agreed that the very best approach was to …

Buy Into Weakness – Investment Rule #1

Gen Y Finance Guy Financial Markets, Investing, New Rules, Options, Words To Live By 24 Comments

Over the course of the coming weeks and months I will be laying out the investment rules that I live and die by. These are rules that I have developed over the last ten years as both a retail and professional investor and trader: Rule # 1: Buy into weakness. Rule #2: Sell into strength. Rule #3: Reduce cost basis. Rule #4: Keep investments small. Rule #5: Keep 80% of total invested capital in ETF’s and up to 20% in individual names. Rule #6: Choose duration over direction. Rule #7: Manage your winners. Rule #8: Manage risk at order entry. Rule #9: Increase your # of occurrences. Rule #10: Make investments with a probability of profit > than 50%. (Note: …

A Certificate of Deposit that returns 100X my Chase savings interest rate

Gen Y Finance Guy Financial Freedom, Financial Markets Leave a Comment

As we all know, interest rates are at all-time historic lows, and therefore so are the interest rates paid on many savings accounts out there. I remember the days before the financial crisis when you could open an online only savings account through HSBC and collect a 5% interest rate. At the time I was still in college, but I still took advantage of this opportunity. For at least a year I found an arbitrage opportunity in the market where I could pay all my tuition and school expenses on my credit card and transfer the balance to a new card at a 0% interest rate for 12 months and then leave the cash I had in my online HSBC …

Markets don't go up forever

Markets Don’t Go Up Forever!

Gen Y Finance Guy Financial Markets 1 Comment

Here are some questions that could be going through your head: With the market down close to 10% from the September high of 201.9, is this a buying opportunity? Should I be short the market betting there is more downside to come? Is the Bull Market over? How do I prepare for the next “opportunity of a lifetime?” After hitting a low of 660 back in March of 2009, is this Bull Run finally over after 6 impressive years? How does the Feds’ decision to end QE this month play into the recent price action over the past month? Is it a coincidence? Are prices still over-valued? Are we entering a new Bear Market? Will volatility be short-lived or remain elevated for some time to …