Donating a Year’s Salary to Our Donor-Advised Fund

We started this year dedicating ourselves to $2,680 in charitable donations, ten times our previous, pitiful contributions. Just a few days ago we officially fully funded our donor-advised fund, meaning we could theoretically maintain that $2,680 each year for the rest of our lives (we haven’t touched on too many specifics of our spending on here, but for context, we live on a little more than $36k a year, including rent, and additionally give $10k to family each year).

According to the 4% rule of thumb, we’d need $67k, but we rounded up to $70k for good measure. Coincidentally, my starting salary as a new engineering grad six years ago was $67k! Due to the magic of compounding returns and some nice salary bumps along the way, this contribution only delays financial independence by about six months for us, and we should still be able to reach our goal of 2019!

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4 Things You Should NEVER Do When Investing

Hey, all! Felicity here, announcing a guest post from Troy of Market History. Troy’s site is a treasure trove of detailed, historical market data. You’d be hard-pressed to find a more comprehensive source, short of paying Bloomberg half of an average household’s income. Additionally, Troy explains historic market actions for those of us who are a little more clueless. Ever wonder why the dollar peaked in 2001 and 2002? Or a quick summary of all the peaks and valleys, with corresponding news events for any given year? Troy’s got you covered.

Troy also goes a bit against the grain compared to the typical early retirement / Financial Independence Retire Early (FIRE) blogs, in that he doesn’t put all his investments in index funds and walk away. He thinks it’s very possible to have above average returns by doing your research and timing the market based on fundamentals. While this is likely not a viable approach for everyone (we can’t all be Troy), it seems to work well for him. This post is keeping it simple with advice for everyone, though!

Take it away, Troy!

It’s hard to say exactly what investors SHOULD do because there are so many different investment strategies. There is no single “best” strategy that will outperform all the rest. However, there are certain things that no investor should ever do, regardless of his or her investment strategy. Once you know what you shouldn’t do, the field of things that you can do becomes much narrower.

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Case Study: Low Income, No Credit, and House Hungry

Recently I’ve had the pleasure of corresponding with an absolutely lovely young couple that wanted some advice. For anonymity’s sake, let’s call them…Amelia and George. Amelia and George are wonderful savers, partially due to necessity right now, as George is a full time student and Amelia is the current breadwinner with a small salary at a nonprofit. They both have sizeable side-hustles that are bulking up their income, but money is tight.

And they really want a house, possibly even a tiny house. Oh, and they have no credit score to speak of. Oh, and they may have to move in two years after George has graduated. Oh, plus, since we first started communicating months ago, a decision has already been made – the suspense!

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Cambridge Fire 2016

Rental Insurance and Holy Shit, Cambridge Fire

Last Saturday there was a ten alarm fire in Cambridge, MA, the largest fire in the area since the 80s. Thankfully, no one was seriously injured, but still – holy shit. Eleven buildings, over 60 people affected, multiple fire departments on the scene, and now that area looks unrecognizable.

It started scarily close to Fergus’s grad school apartment, making me even more thankful nothing similar happened to that fire trap of a house he lived in for years. Seriously – an electrician came by once to fix a problem and basically said “This house would be up in flames instantly if there was a fire,” which unfortunately is not that uncommon with the older homes in Cambridge. And of course those living in these fire traps are often lower income, students, or immigrants – people who don’t have a choice.

We know at least one family that’s been displaced. Apartment, car, all material possessions – gone during one awful day. And no rental insurance. Like many others, they took to crowd funding (we contributed), but not everyone can rely on that.

What does rental insurance cover?

Rental Insurance covers a few different things, the core being (more detail below):

  1. Cost to replace personal possessions
  2. Costs related to loss of use of insured location
  3. Personal liability
  4. Medical payments to others

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Index Funds: What John Oliver Left Out

Last Week Tonight With John Oliver is just a glorious show. This Sunday’s show was no exception.

If retirement accounts and fund choices scare you, that video is a fantastic introduction to investing that touts the benefits of index funds and the dangers of non-fiduciary financial advisors.

The thing is, I was an index investing convert even before I joined the working world, and I was still completely confused when it came time to choose investments for my 401k. As Fluffster now holds a Bachelor of Financial Advising (you can too, just click that link ;), here is a hopefully-straightforward supplement.

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