Open post

The 411 on 529s

I don’t think I’m saying anything controversial here, but I think giving your children a solid education is the best gift a parent can provide. Despite the nationalistic economic trends emerging throughout the globe, the (high paying) jobs of the future will continue to require a strong education in order to compete globally. Additionally, there is strong research out there forecasting that the economic divide among the millennial and future generations is going to be much less based on race, and more based on who was able to graduate college without student debt. I owe so much of my current financial situation to the fact that I was able to graduate one of the most expensive schools in the country completely debt free.

As a new parent, saving enough to send my kid to college ranks as one of my top goals. While it doesn’t beat out retirement (you can’t borrow money for retirement but you can for school), it does beat out EARLY retirement. I would view it as a worthy sacrifice to have to work a couple of extra years if it meant sending my child to school debt-free. Though I have learned one thing over the last several weeks: the cost of college is scary high. I mean, it-Halloween-month-so-culturally-relevant-IT-remake scary. read more

Open post

We Froze Our Credit, Here’s How

The Equifax breach in early September, though not the largest data breach in history, spooked me like no other data breach has. Target, EBay, Sony, all of these data hacks I watched come and go, changing little about my every day actions. Equifax, however, just feels different. Maybe because it’s the ground zero of credit, or maybe because it has much more information about me than any other company would have (except maybe Amazon?). After talking with a few family members, I decided to freeze my wife and my credit.

What is a credit freeze?

According to the FTC’s website, a credit freeze restricts access to your credit report only to your existing creditors and certain government agencies. Because creditors won’t issue new accounts without seeing your credit report first, restricted access makes it very difficult for thieves to use your credit information to open accounts in your name. read more

Open post

Net Worth Tracker: September 2017

September was a big month for Mrs. NFF and I. We brought our new baby home from the hospital, we celebrate our 2-year marriage anniversary, I celebrated my 2-year anniversary at my company, and I turned one year older. Fall (my favorite season) is here, and we celebrated by traveling to Maine this past week to see the first leaves begin to change.


read more

Open post

What Does It Mean To Be Vested?

Last Sunday, I hit a major milestone at my company. I have officially been working here for 2 years. In some ways, it feels like I’m just starting but in others I feel like a seasoned veteran. This is especially true since the average job tenure of people my age is just 3 years (should I be looking for a new job already?). The anniversary date came and went without any fanfare. I didn’t get to chose an anniversary gift out of a magazine, or even receive a card from my company. I actually got something much, much better: I vested.

What is Vesting?

Vesting is a term used to describe how much of your 401k you are allowed to take with you if you leave the company. You may be thinking “Wait, I don’t get to keep my entire 401k?” Before you overreact, I want to be clear that vesting only applies to the portion that your company contributes. If you invest $5,000 in your 401k, and your company contributes $1,000, vesting only applies to the $1,000. You get to keep your $5,000 plus whatever you’ve earned in the market when you leave. read more

Open post

Spending Report: August 2017

Having a strong understanding of where your money is going is the first step on any financial journey. In Managing Our Finances with Mint, I talk about how Mrs. NFF and I use Mint to track all of our financial expenses and which categories we use to segment our spending. At the end of the month, I find it useful to go through our monthly expenses to how we did, and how to respond to unexpected changes to our spending. I hope by sharing my assessment with you, can you take a similar approach with your own spending self-assessment.

August 2017 Overview: Total Spending – $7,199 read more

Open post

Managing Our Finances as a Couple

Before my wife and I got married, we had a long conversation about how we wanted to handle our finances as a married couple. Previously, we were using a shared checking account for shared expenses like rent and utilities when we were living together, but marriage was an entirely new ball game. There were very different levels of student loans to pay off at various interest rates, as well as vastly different salaries with which to pay them. We needed to find an approach that allowed us to share in our financial successes and failures that also helped to control some of our worst financial habits.

It should be noted that our approach has worked for us, but that is not to say it will work perfectly for everyone else. People have different attitudes about money, financial situations, and financial goals, all of which should be factored in when decided on your own approach. read more

My Money Mistakes: Holding Onto a Bad Stock for Tax Reasons

While I hope to fill this blog with tips and tricks I’ve learned from my successes in achieving my goals, I know that I will inevitably make mistakes along the way. My hope is that by telling you about them, I can learn from them and hopefully help you to avoid them in your own journey to financial independence and early retirement.

“A man must be big enough to admit his mistakes, smart enough to profit from them, and strong enough to correct them.” – John C. Maxwell read more

Open post

Net Worth Tracker: August 2017

First off, I must apologize for the late net worth posting, but I promise that I do have a good excuse. A little more than a week ago, our family grew by one as we welcomed NFF Jr. into the world. It has been an amazing, if thoroughly exhausting, couple of weeks for my wife and me. But I find myself now with some extra time to update you on our financial happenings since last month.

August 2017 was another up month for the New Father Finance family, though I have to admit it is our worst month for spending this year. Some extra costs related to the birth of our son played a major part of that. In a later post, I’ll go into a bit more detail about our actual spending this month, and perhaps go into a little detail about some of our larger baby purchases. read more

Open post

What is a Target Date Fund

My sister recently graduated from graduate school and for the first time in her life has had a full-time job with a steady paycheck and benefits. Last weekend, she asked for my help because she gets a 401k but she didn’t have any idea of how to invest it. After setting up her account and reviewing what her investment options were, I thought that the best option was to sign her up for a target date fund. Specifically, Vanguard’s Target Date 2060 Fund.

What is a target date index fund?

A target date index fund is an index fund that invests in a mix of stocks and bonds (domestic and international) that is designed with specific date in mind of when you will need your money. The weighting of how much is invested in each asset class is meant to grow with the stock markets when you are far away from your target date, and get more conservative as you get closer to retirement. My sister, for example, won’t hit 65 until around the year 2060, so her target date fund is heavily weighted towards stocks, with only a small percentage invested in stocks. As she gets older, the fund will gradually move to be invested more heavily in bonds to preserve capital and reduce the risk of her losing a big portion of her savings right when she needs it. read more

Evaluate your Finances Like a Financial Analyst

As you travel along your journey to financial independence, it is enticing to only focus on your net worth and reaching some goal you’ve set for yourself in the future. However, to really assess the health of your finances and ensuring the best odds of hitting your financial goals, there are other metrics as well that you should at least be monitoring. To get an idea of what metrics to look at, we head to the headquarters of assessing the financial health of organizations: Wall Street.

Financial Analysts make livings on finding the companies that are going to increase their value (also known as Net Worth) in the shortest, most stable way possible. I’m not arguing that Wall Street is any good what they do (see: Index Funds: The Gold Standard of Stock Market Investing), but we can still find the things about Wall Street that do work well and use them to our advantage. One body of research we can use is around metric. There are several basic metrics that the Financial Analysis use to assess the health and future potential of a company. By adopting those metrics slightly, we can apply them to our own finances and paint a picture of how we’re going. read more

Posts navigation

1 2