Retirement, Financial Independence, and Living Life

Retirement, Financial Independence, and Living Life

This is what a happy life is to me.

After two very long posts this week, DIY Wedding Ideas – Worth It Or A Waste Of Money and How Much Money Should I Save Up For A House, today’s post is a somewhat shorter (and a rambling) one.

Lately, we’ve been home “shopping” online a lot.

It’s almost become an addiction.

Okay, who am I kidding? It is an addiction. Luckily, shopping for homes online is a free hobby of mine.

My favorite websites right now are Zillow and Realtor and I look at each a few times each week. We don’t plan on moving for around two years from now, but it’s still something we plan on putting a lot of thought into.

Before you think both me and Wes are crazy planners, I do want to say that it’s mainly just me who is crazy. If Wes had his way, we would have moved yesterday.

We want to move to a new state (Colorado is winning right now), and the next home we buy will probably be our “forever” home. We plan on living in it for a long time and possibly retiring in it.

The whole thing sounds a little crazy, even to me, especially since we are only 25.

 

What is a happy life?

Colorado is exactly how I imagine a great life (and retirement) would be. Whenever we visit the state, we are always amazed by how beautiful it is and we even love the air (it’s not humid like in St. Louis where you are constantly walking in a sea of mist).

With our future move to wherever we end up deciding on moving to, we have been thinking a lot about what a happy life is.

Every time we talk about possibly moving to Colorado, it always leads to us saying something similar to “this is how I imagine retirement would be. This is a happy life.”

Some think we are crazy, but why do so many people think you can’t enjoy your life until you reach retirement? Why do we have to wait to like where we live until we reach retirement age?

There are plenty of ways to save for retirement, while also enjoying the life you live right now.

My dad passed away in his 50s, before he was even able to retire. Well, technically, he “retired” when the doctors told him he only had a few months left to live. So, he spent his “retirement” in a horrible way. He worked extremely hard his whole life and saved for retirement religiously, and it’s something I’ve always admired. However, I don’t want my whole life to be all about working.

I want to be able to enjoy life now, instead of waiting decades down the line to possibly (sorry if that sounds morbid) enjoy myself.

 

Anyway, what does retirement mean to me?

Since we plan on moving somewhere enjoyable soon, does retirement mean anything to me? That is a question someone asked me recently. They said I would have nothing to look forward to in the future.

Retirement to me means financial independence. I want to have freedom when it comes to my career and also when it comes to how I enjoy my life.

I don’t see myself ever not working, unless I was prevented in some way (such as medical reasons). I like the motivation that work brings, and I like what I do. However, I understand that my feelings about everything may change in the future, and that is why financial independence is something I want to strive for.

 

How do I plan on reaching retirement?

I’m definitely not one of those people who plans on cutting everything in their lives in order to reach retirement. I still want to enjoy life, take vacations, spend time with friends and family, and more. However, I think doing all of that, reaching retirement, and living a fun life is all possible at the same time.

I plan on reaching retirement through a mixture of cutting expenses, growing my income, and hopefully adding some passive income to the mix. Thanks to several different personal finance bloggers (mainly Paula at Afford Anything), I have been more and more interested in getting into real estate and renting out places both long-term and short-term (such as through AirBnb or VRBO). That is a passive income area I would like to get into.

Even though I am no where near retirement, I do want to live an enjoyable life right now though.

 

How do you see yourself in retirement? Living in another country? Working still?

What does a happy and successful life look like to you?

 

How Much Money Should I Save Up For A House?

How Much Money Should I Save Up For A House?Buying a home is one of the largest purchases a person will ever make. I can’t think of anything that would be more expensive.

Since buying a home is such a large part of a person’s life, no one wants to make a mistake. It would be a costly mistake if you did make one.

Recently, I received a reader request for a new post about buying a home. The reader asked:

I would love to see a post on the best way to save up to buy a house, i.e. what is a good percentage to put for the down payment, what other costs should be saved for such as homeowners insurance, inspection fees, etc.

I think this is a great question. I am not a home buying expert, but I have bought a home in the past and we are in the very, very beginning stages of buying our next.

With our first home, we got a great deal and bought a house that was much lower than what the bank approved us for. We researched like crazy and thought about all of the different little expenses that would come up when you own a home so that we would not be surprised. There were still a few surprises, but for the most part nothing was too shocking.

However, this is not how many people buy a home. Many people buy a home by only looking at the sticker price, and not really thinking about anything else. There are many expenses that go along with buying a home and all of these little expenses can really inflate the price.

Below are questions you may want to ask yourself before deciding on a home:

 

What expenses come with a home?

There are many expenses that come with buying a home. All of the different home expenses should be budgeted into what you can actually afford. I always think it’s best to be as prepared as possible.

Possible home expenses include:

The actual home. Okay, this one is obvious. This will be the price you actually pay for a home. You need to think about your interest rate and closing costs in this area too. Your interest rate can vary and even just a difference of one percent could mean a hundred dollar or more difference each month.

Property taxes. This can vary widely from city to city and state to state. It’s always best to look at the property taxes before bidding on a home. One house that is priced in one city might have property taxes of $2,400 a year ($200 a month), and a very similar house with the exact same price in another city (and yes, it could just be a mile down the road) might have property taxes of $4,800 a year ($400 a month). That difference in property taxes might be what puts you over your budget.

Home insurance. For this, you want to think about all parts of home insurance. Will your home need any added insurance? Such as for earthquakes, flooding, or hurricanes? Our home insurance is fairly cheap, at around $700 per year. I know someone who pays $2,800 for their annual home insurance though. Prices can vary greatly depending on where you live and how big your home is.

Bills. Different homes will have varying amounts when it comes to bills. For example, older homes tend to have higher utility bills because of inefficiencies in the home (air flow throw cracks in windows and doors, old furnace, etc.). For example, one home that cost $300,000 might have a monthly electric bill of $75 per month. Another home with that exact same price might have a monthly electric bill of $500 per month. Some of the bills you might expect (related to your home) include electric, gas, trash, sewer, water, cable, and more.

Inspection fee. This is usually a one-time fee. Before you buy a home, you should ALWAYS get a home inspection. Don’t skimp either. I recently saw someone on Facebook who was looking for a home inspector and she said she just wanted the cheapest thing possible and she didn’t care what the inspector checked. This is a HUGE mistake. I know someone who skipped a home inspection and a week into moving in, the bathroom upstairs flooded and the floor caved in. This was a ton of damage, and it turned out the problem had been building up for quite a long time. This means a home inspector most likely would have caught this. Different areas you might want to have checked include: the foundation; radon (don’t skip this. We almost did and our realtor advised us not to. Our home actually failed the radon test and we negotiated to have the radon equipment included in the sale contract); mold; termites; plumbing; electrical system; and more.

Furniture and appliances. I know someone who recently bought a home but was complaining that it was completely empty. They said they forgot to budget in furnishing the home, which turned out to be more expensive than they thought. So instead, they had boxes for end tables and only a bed in their new home. Furniture and appliances is an area you should not forget about unless you truly do not care. There are ways for you to save money (such as shopping on Craigslist), but it can still all add up very quickly.

House repairs and maintenance. Don’t forget about this! Home maintenance and repairs can include a lot. This includes:

  • Yard cleanup such as collecting leaves and mowing the lawn;
  • Plumbing such as replacing new pipes, clogs in drains, and so on.
  • Paint. Both interior and exterior.
  • Electrical. What if a squirrel chewed through your wiring?
  • Windows. What if a window broke?
  • HOA. I wasn’t sure where to put this but I think this category is best. Before you buy a place, you should figure out if you want to belong to a homeowners association or not. Their fees can add up quickly.
  • The list goes on and on…

 

How much should I budget for a new home?

This is a hard question to answer.

Whatever you budget, you should always keep in mind the total cost of a home. As you can see above, there are many expenses that go into the total cost of owning a home.

It can be hard to decide on a budget for a home. It’s really just a realistic number that you feel comfortable with. Some people take out a loan that is around 25% to 30% of their after-tax take home income.

For me though, I like to stay significantly lower than that though. I would rather have my mortgage and home related expenses to be somewhere around 10% to 15% of my monthly after-tax take home pay. This is because I am a freelancer, so my income is not stable. I also live in a low cost of living area where housing is cheap, so I could never really imagine paying a crazy amount for a home when I am used to cheap home pricing.

Whatever you do, you should always have a budget in mind before you start home shopping. Also, try to get pre-approved before you go shopping for a home as well because you never know if you will even get approved.

One last note for this section: Your budget does not have to be the same budget that the bank gave you. Banks are notorious for lending out more than people can realistically afford. This means you should take the bank’s budget as a guide, but you will probably be better off if your budget is lower than theirs.

 

How much should I put down for a down payment on a house?

This is another tough question to answer, as there is not a single solution.

For us, I always thought our next home would be paid for completely in cash (many years down the line), but now it just seems like there are many positives in not rushing this process (there are both positives and negatives in not paying a home off early).

In some cases, you may be able to put down just 2.5% on your home, whereas other times you are asked to put down 20% or 30%.

How much you put down on your home really depends on if your goal is to pay it off early or not, and how much you can truly afford.

If you don’t care about paying off your home early, then putting 50% down may not make much sense if there are better investments out there and you don’t feel comfortable putting all of your money down. If you want to pay off your home in a “normal” 30 year rate, then putting down just the minimum (without having to pay PMI – see below) that your bank allows you might be best.

I will say that if you put down less than 20%, you will most likely have to pay private mortgage insurance (PMI), which can be a couple hundred dollars tacked onto your mortgage each month. This might be an expense that makes a home no longer affordable.

However, if you want to pay speed up your home payoff plan, then you might decide to put down as much as you realistically can afford in order to jump on your home payoff goal.

 

How much do you think a person should save up for a house?

Are there any other expenses I forgot about?

 

Image via Flickr by robboudon

Saving Over $2,000 A Year With Republic Wireless – How Much Money Could You Save?

Saving Over $2,000 A Year With Republic Wireless - How Much Money Could You Save?

How much money are you throwing away each month by not having Republic Wireless?

Have you ever heard of Republic Wireless? If you haven’t, you definitely need to continue reading, especially if you are paying anything over $50 a month for your current phone bill.

I first heard about Republic Wireless last summer. I was shocked by how cheap their prices were, and they’re even cheaper now.

We spend around $25 a month on each phone from Republic Wireless and it comes with unlimited talk, text, and wi-fi. There are even cheap cell phone plans as low as $5 a month.

Yes, FIVE DOLLAR CELL PHONE PLANS!

This is much better than the $225 we used to pay for our phone service each month through AT&T.

Yes, this is an affiliate post by the way. If you are interested in skipping my review but you want to try Republic Wireless right at this moment, please click on my affiliate link. It’s very appreciated! :)

 

Why is Republic Wireless so cheap?

I’m sure this is a question you are asking yourself right now.

Republic Wireless IS really that cheap. It’s that easy to save money by switching to Republic Wireless. It’s not a scam, a joke, or something where they are going to jack the price up later (they are not like cable companies).

There is no catch, there are no contracts, no activation fees, no roaming charges, and you can switch your plan easily if you need to (up to twice a month).

So, how is all of this possible at such a cheap price?

I know if you are anything like me, sometimes a price so low can seem too good to be true. It only makes sense to want to look into it further.

Republic Wireless is able to offer such a great price on their phone plans because of the hybrid technology they offer. All of the phones on the Republic Wireless network use wi-fi as the default setting. This means that whenever you are near a wi-fi network, your phone will attempt to connect to it and use it. This makes it very cheap for both you and Republic Wireless.

This also means that if you are traveling internationally, you can use your Republic Wireless phone for the same low flat price!

Wi-fi is everywhere these days, so it’s not a hard thing for them to be able to do.

 

What happens when there’s no wi-fi around?

You might be wondering, but what if I don’t always have wifi available? That’s no big deal because your phone will still work even if you are not in a wi-fi area.

This is because your cell phone will then connect to a cell network (a Sprint tower and if that’s not available then a Verizon tower) so that you can still make phone calls, send texts, and more.

Now, if you’re worried that you might lose wi-fi during a phone call, no need to worry about that situation either. Republic Wireless’ phones can switch seamlessly to a cell tower so your phone call doesn’t drop. Also, if the wi-fi you are currently using isn’t the greatest, you can switch your phone manually to use a cell tower (or the opposite way around as well). This way, you can always use what’s best for you.

The service is great, and at the prices Republic Wireless offers it honestly cannot be beat.

 

Saving Over $2,000 A Year With Republic Wireless - How Much Could You Save?

What kind of plans does Republic Wireless offer?

Republic Wireless has four different plans. They are all cheap and very affordable. I don’t think it gets much better than the plans they offer.

There is the $5 plan that is wi-fi only. You have unlimited talk/text/data with this plan over wi-fi with this plan. That is an incredible deal and for the most part it should be very easy to find wi-fi.

The next plan is The Republic Plan at $10 per month. It includes unlimited talk/text over wi-fi and cell and unlimited data over wi-fi. Another incredible deal.

Next there is the Republic + 3G plan which is $25 per month. This plan covers unlimited talk/text over wi-fi and cell and unlimited data over wi-fi and 3G as well.

The fourth plan is the Republic + 4G plan, which is $40 per month. This plan includes unlimited talk/text over wi-fi and cell and unlimited data over wi-fi and 4G as well.

 

What phone can I use?

If you sign up for Republic Wireless, there are two different cell phones you can use, the Motorola Moto X or the Motorola Moto G. The Moto X can be bought through Republic Wireless for $299, and the Moto G can be bought for $149. **Keep in mind you do need to buy a Republic Wireless phone (either a new or used one) because it has to have the specific Republic Wireless wi-fi capabilities in the phone.

You might be thinking that those prices are a high price to pay for cell phones. However, you have to remember that you are paying upfront for these phones AND getting very cheap pricing on cell service, so essentially your cell phone would be paid off within one or two months of your normal pricey cell service.

If you can find a used Republic Wireless phone, then you can get use this cell phone with your service. That would be a great way to save some money!

 

Saving Over $2,000 A Year With Republic Wireless - How Much Could You Save? 1Should you cancel your current contract and switch to Republic Wireless?

You can also use your old phone number, so you can’t use that as an excuse for not switching to Republic Wireless. When you switch to Republic Wireless, you can bring your old phone number with you, so no one will even know you switched phones and you won’t even be affected by the switch. It doesn’t get much easier than that!

However, one negative is if you cancel your current contract with a company such as AT&T, Sprint, or Verizon, you may have to pay a fee. This fee may seem large in the beginning, but when you think about how much money you could save over the course of a year, switching to Republic Wireless still wins hands down because of how cheap their service plans are.

Below are the different cancellation fees cell phone companies charge. It may vary slightly depending on when you started your contract, when your contract ends, and what type of phone you have, but this is what I found on online:

  • AT&T charges $175 for a basic phone cancellation and a $325 fee for a smartphone cancellation. However, keep in mind that many AT&T plans are not on a contract nowadays so you may be able to leave for free.
  • Sprint charges $200 for a basic phone cancellation and $350 for a smartphone cancellation.
  • Verizon charges $175 for a basic phone cancellation and $350 for a smartphone cancellation.

 

What do I think of Republic Wireless?

I honestly think Republic Wireless is awesome. I have been a paying customer for a little over a year now, and the service is definitely improving.

I won’t lie, one year ago the service was not the greatest, but either was my AT&T service that I paid over $200 a month for. Now, Republic Wireless has fixed a lot of their problems they had in the very beginning, and they are definitely doing loops around AT&T and the other big cell phone networks because of their amazing pricing and service plans.

Let’s just think about it – $2,700 for cell phone service for one year for both me and Wes through AT&T, OR $600 a year ($25 multiplied by two phones multiplied by 12 months) for both me and Wes through Republic Wireless?

Yes, you might think $2,700 is a ton, but if you add up your monthly cell phone service over the year, I’m sure you are somewhat close to that number or perhaps even higher. Isn’t it insane how much cell phones cost us?!

So, even if you pay a cancellation fee (lets use a simple $250 as the cancellation fee), buy two Moto Gs for $149 each, and then pay for 12 months of the $25 service for two phones, your price would be around $1,150 for everything for the WHOLE ENTIRE YEAR. It would be even cheaper (of course) if you had a plan with only one cell phone.

That could mean a savings of $1,500 a year. You could use that money on savings, a vacation, retirement, whatever you want! You would save even more if you kept your phone past the first year. Your savings could then increase to around $1,800 a year.

And that savings amount above is for two phones. If you only need one phone and you choose the simple $5 plan, your cost could be as low as $209 for the year (one Moto G plus 12 months of service at $5). This means if you only get the $5 cell phone plan through Republic Wireless, your yearly cost could be just a little over $60 FOR THE WHOLE YEAR for the phone service.

 

What if you’re not happy with Republic Wireless?

Republic Wireless is also awesome because they have a 30 day guarantee where they will refund the price you paid for your phone AND the price you paid to use their service. So, you can try out their service for FREE. I’m pretty sure you will be hooked anyways, but the guarantee is nice just in case you are not happy with the service.

If you are interested in Republic Wireless, please click on my link. It’s an affiliate link but I promise this review was 100% my opinion.

 

How much do you pay for your cell phone service? Do you think you pay too much?

Would you ever switch to Republic Wireless?

 

Image via Flickr by TaxCredits.net