If you cannot use credit responsibly, the common advice you are given is to simply chop up your credit card and use only cash for purchases. But what if you are a responsible credit user working your way to become a PAW? Then, I have a better suggestion for you. Chip up your credit card. What? Read on…
Author: Mr. TFR
It was over 10 years ago. Yet, I remember even the smell of the hospital sheets the day TFR Junior was born. I was in the hospital operating room after donning a protective gown when the doctors started to do a C-section on my wife. It was over in minutes and they handed the […]
We spend a lot of effort chasing our number or desired passive income to reach our financially independent or retired early (FIRE) dream. In all the search for ‘how much’, we also need to consider ‘how long’. With some retiring in early 30’s, the impact of this extreme early retirement should be carefully considered. If you are like me in 40’s or even in 50’s, there is at least one advantage we have over our 30’s retired brethren – our retirement planning is not as long. Don’t let that depress you. It’s the life you add to the years, not the years you add to life that matters! As Yoda would say: matter it doesn’t!
This is not an easy article for me to write. I now see this as an important counter to the other extreme I covered – life of a 1%er. It brings back unpleasant memories from my time in Asia, during my corporate stint there. Don’t get me wrong, we had a great time but the unpleasantness was for a different reason. Asia is home to over 70% of the world’s poor people. As is common practice there among all middle and upper middle class working households, the TFR household hired a part-time maid during our stay there. It was initially awkward to have a stranger spend couple of hours each day doing our chores but we slowly got used to it.
Regular readers of TFR know how passionate (‘obsessed’ is apparently the right word, as my friends have helpfully suggested) I am about my morning cafe latte. The few minutes of liquid companionship I get with its characteristic warmth and aroma and its complex, rich taste intertwined with steamed milk – in a marriage made in […]
Please read Part 1 first to give you a background to this post. This series is my attempt to look at important cognitive biases that prevent us from taking optimal decisions in life, career and investing.
Our bias to conquer today is the Confirmation Bias. As an investor or as an employee, we have all fallen victim to this at one time or another, or if you are like me, repeatedly!
We all like consistency in our life. It simplifies our thinking and gives us a routine to follow. While habitual consistency is our brain’s ‘low energy’ way to get through our daily life, you pay a heavy price for it when it comes to important decisions. Confirmation Bias is our innate urge to look for those things that confirm your pre-conceived ideas/notions/decisions and ignore other things that raise red flags. This bias dulls key facts that go against ideas and conclusions that we hold dear.
Despite the millions of gold lovers around the world, including many among TFR family and friends, somehow I have never been attracted to gold’s charms. I have often wondered about the fascination, bordering on obsession, of this yellow metal in modern society. Granted, during the pre-industrial age, gold was treasured because it was a bona fide currency in many kingdoms and civilizations that passed through this world.
This post takes off from what I read in Millennial Revolution about a million dollar house-poor owner in Toronto, Canada. The inference is similar to what I experienced personally in Washington DC. We Americans and Canadians love home-ownership, and so do Australians from what I have heard. In my business trip to Spain recently, I learned Spaniards also cherish home-ownership almost as a cultural mandate. Then, I started wondering whether all this only holds true in large developed markets or does it apply even in developing markets. Perhaps only the developed world is living with contagious house fever?
The following is a guest post from my friend Ethan. Given the retirement crisis, learning how to handle setbacks in personal budgets is relevant to many. I hope you find it useful.
Effective budgeting typically lies at the core of a successful, long-term financial strategy. Whether it is a relatively informal register of income and expenses, or a detailed, categorical log of household cash flow, keeping track of your money increases financial security.
The huge financial services industry and the much smaller community of Financial Independence and Retire Early (FIRE) bloggers differ on many fronts. Yet, we all agree on one principle – sustainable withdrawal and retirement success through simulation models. Of course, we all need to know our sustainable spending rate. But, as we saw earlier, focusing solely on the simulated probability of financial success only increases the relative probability of a non-financial event wrecking our plans. Today, we seek a new angle to one such non-financial risk factor that impacts your financial future.