Retire at 40

2021-08-13 14:51:24 Inflation: there is nowhere to hide

An interesting situation looms. The head of the US FRS calmly says that inflation has accelerated noticeably and will remain high for some time, but the FRS can afford to continue to keep the rate at zero. Why raise it? When the dollar is the main reserve currency in the world and American inflation is spread evenly around the world.

So we live it turns out - in high inflation, and how long it will last is generally unclear. Anyone who is dissatisfied can leave the dollar for any other currency, but no one is forcing them to buy it with a stick. There are plenty of options: euros, pounds, yen, yuan) but there is no global flow of money from the dollar, other currencies have their own problems. And nothing can be done about it, this is how the global financial system works.

In addition, everything is getting more expensive - oil and gas, fertilizers, wood, metals, cars, real estate (developers / realtors are swimming in money).

Fact: there is too much money, in all areas, hence money depreciates. This seems to be a simple logic, everyone understands it, but they act in different ways. In this regard, I do not understand at all the position of people who stubbornly refuse to invest.

Relying even on my own life experience, I clearly understand that during high inflation it is most rational to keep most of the money in assets (in my case, in the stock market). So, at least statistically, I have a high probability of protecting myself from inflationary risks and gaining profit (if I'm lucky).

Subscribe to t.me/retire_at_40 Open / Comment

2021-08-10 17:01:17 FIRE movement

FIRE (financial independence, retire early) means financial independence and early retirement. The movement is developed and popular in the USA, there are already many examples of young retirees and a bunch of articles / blogs with unique experiences.

Fundamental principles:
1. Maintain a budget and save 50% of your income;
2. Rejection of the cult of consumption;
3. Investing.

Refusal of a car, simple clothes, a minimum of equipment, an ordinary phone instead of an iPhone, lack of credits - all this is already a consequence and details of a particular "fireman".

As in any movement, there are also fanatics here. Some live on water and beans for years, save 90% of their income, buy nothing at all, work 24/7, and retire in 5-7 years. These survival challenges are definitely not for me.

I chose an easy option for myself: a horizon of 10 years, an average yield of 10%, I save more than 50% of my income. The main thing is to start.

P.S.: recently acquired a new business. Namely, the @insider_amigo channel is incredibly happy about it! Subscribe! Plans to turn it into a huge media holding. Launched @tech_amigo recently. We will have the best news for all occasions!

———————————————
Subscribe to the channel and invite friends via the link. Let's get rich together: https://t.me/retire_at_40 Open / Comment

2021-08-09 14:39:57 Channel photo updated Open / Comment

2021-08-09 14:39:45 Channel photo removed Open / Comment

2021-08-06 13:39:54 ​Four things everyone should do before investing

Now people talk about investments absolutely everywhere. Advertising brokers from each box. People all around have + 100% profitability. Everything is cool while the market is growing. But people don't even know what they are buying. But every second person is puzzled by the question: "How does a stock differ from a bond?"

I think before starting investing, four fundamental questions need to be resolved: closing debts, improving financial literacy, starting to maintain a budget and accumulating a financial safety cushion.

First of all - to close debts

It's hard to give up the "credit lifestyle", but it's a road to nowhere. It is necessary to throw all the forces and resources to repay them.

"If you combine ignorance and credit, you will get very interesting results." - Warren Buffett (c)

I have never taken loans and do not intend to. I just know how to count and know perfectly well that I will lose money. At the same time buying some nonsense.

A mortgage is the only type of loan that can be considered, but at certain stages of the economy and interest rates. This is an unlikely scenario though.

Improving financial literacy

You need to know the basics. Understand basic concepts and definitions. Read literature and watch educational films and videos. I recommend the Khan academy channel and their series of videos on stocks and bonds.

Start budgeting

The most important point. I already wrote about this in a previous post. These will be real numbers, not an abstract "I spend so little". All people lie. Even to ourselves. Numbers - never.

Accumulate a financial cushion

Roughly speaking, an airbag should allow you to lead a minimum level of comfortable life from several months to a year.

Without savings, it makes no sense to start investing, since anything can happen in life. Force majeure can force the sale of securities and withdraw the currency at an unfavorable rate, and any collapse of the market will plunge into panic.

The size of the airbag and how it is stored may vary. I use short bonds or just dollars.

———————————————
Subscribe to the channel and invite friends via the link. Let's get rich together: https://t.me/retire_at_40 Open / Comment

2021-08-04 12:20:01 Maintaining your own budget is the basis for long-term investment

|READ MORE|

If you do not see the accounting of your finances, then never retire early. The family budget is the basis for investment. Accounting for expense, income, goals - these cannot be neglected. This is a habit that should come into use.

———————————————
Subscribe to the channel and invite friends via the link. Let's get rich together: https://t.me/retire_at_40 Open / Comment

2021-08-02 15:59:55 ​Four Formulas of Wealth and Poverty

I'll make a reservation right away that the number of poverty formulas differs in different sources, but the essence of this does not change. Wealth formula is one.

Munger, a friend of Buffett during the partnership and the current vice president of Berkshire, who once remarked that Buffett thought a $ 10 haircut would actually cost him $ 300,000. As it turned out, his estimate was rather conservative. If the $ 10 Buffett saved from the 1956 haircut had been invested in the partnership, it would have been worth more than $ 1 million today ($ 10 plus capitalized interest at 22% over 58 years). - Quote from Warren Buffett's Investment Rules

Bankruptcy formula

Income-Expense = Debt

Expenses exceed revenues. As a result: credits, loans. It does not depend on the amount of income. You can get 1 million a month and let everything go. There are many examples. About 40% of NBA basketball players have gone bankrupt after their careers. They also owe them to the state and the banks.

Poverty Formulas. There are two

Formula No. 1

Income-Expense = 0

We spend everything that we have earned. And so in a circle. Regardless of the amount of earnings.

Formula number 2

Income-Expenses = Savings-Expenses = 0

Incomes exceed expenses, savings appear, which are ultimately spent in full. For example, they put off their salary for vacation, then they spent everything. Bottom line: again there is no money and everything is in a circle.

Formula of Wealth

Income-Expenses = Savings multiply (% Investment) = Capital

The savings accumulate and are constantly reinvested. Then time and the effect of compound interest come into play.

Variables or how to use formulas
As I understood in due time, the first 3 formulas are not for me. I want to increase my capital every day. So where did I start?

With cost control. After all, you can earn a lot, but spend everything or even go into debt. I have removed all anti-consumption in my life. Then, I started looking for ways to increase income. This process is endless and constant. My savings began to grow even more. Well, constant reinvestment in the stock market and the results came in the first couple of years.

I like to count. And I perfectly understand that the effect of compound interest will reveal itself in all its glory in a couple of years. And even with small amounts, anyone will achieve amazing results.

In future posts, I will go into more detail about the effect of compound interest and the importance of running your finances.

"Today, someone is resting in the shade, because they planted a tree many years ago" - Warren Buffett (c)

———————————————
Subscribe to the channel and invite friends via the link. Let's get rich together: https://t.me/retire_at_40 Open / Comment

2021-07-31 17:41:14 Welcome to the channel!

I will try to write useful content about investing. It is about investing, not about trading and speculation. Invite friends and acquaintances to the channel. Let's get rich together!

I'm sure everyone can make a million. It only takes time, patience, discipline and a little knowledge. Now I want to talk about compound interest.

Ask Warren Buffett what factors behind his success are strongest, and he will answer - “compound interest” - with little or no thought.

He's been promoting this for the past 60 years, and that's what made him a billionaire. And every investor can copy it with ease.

According to his calculations, if the Queen instead invested this $ 30 thousand at 4% per annum, this portfolio would be worth $ 7 trillion today. Such is the remarkable power of compound interest, which Einstein called the eighth wonder of the world. Even the most modest amount, if allowed to grow, albeit by a small annual interest, but over a relatively long period of time, over time turns into an astounding amount of money.

I would especially like to draw your attention to the fact that Buffett says about the importance of even small percentages over a long period of time, the problem is that you and I do not have hundreds of years in reserve. I think you can talk about 20 or 30 years depending on how early you start investing. We will consider an acceptable yield of 12-15% per annum.

So, if you start with a $ 5,000 deposit and invest $ 2,000 annually, earn 15% per year, reinvest these amounts over 30 years, then you will earn $ 1,000,000 million and this is more than an acceptable amount for a retirement life.

In general, we do not wait and start using compound interest right now, no matter how old you are now.

———————————————
Subscribe to the channel and invite friends via the link. Let's get rich together: https://t.me/retire_at_40 Open / Comment

2021-07-29 17:07:54 Anti-consumption is imposed by society. It's everywhere. But the main danger comes from your loved ones.

|READ MORE|

About why it is important to say no to your family and ask questions about the advisability of a particular purchase

———————————————
Subscribe to the channel and invite friends via the link. Let's get rich together: https://t.me/retire_at_40 Open / Comment

2021-07-29 15:08:25 Forecasts by financial analysts and brokers are information noise. Its goal is to get people to trade in the stock market in order to earn commissions. Prediction accuracy is akin to a coin toss. Listening to analyst gurus is harmful and pointless.

|READ MORE|

I explain with examples from life why you can lose a lot of money and time on this
———————————————
Subscribe to the channel and invite friends via the link. Let's get rich together: https://t.me/retire_at_40 Open / Comment