Read These 4 Personal Finance Books to Launch Your FIRE Journey

Many people have asked me where to begin on their journey to become work optional. For me, it all began with a book, and that’s why this is the starting point I recommend to people. Whether you check them out from a library or buy it for your own, these 4 books below are my absolute must reads in this specific order.

P.s. Some links below are affiliate links, meaning, at no additional cost to you, I may earn some compensation. All opinions are 100% my own! I truly appreciate you and your support. :)

1. Shift your Mindset • Read: Rich Dad, poor Dad

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Rich Dad, Poor Dad by Robert Kiyosaki opens your mind to thinking like RICH people do about money. A huge factor in beginning your financial journey is being in the right mindset. Shift your frame of mind to how the wealthy think and get in the mindset that you too can become wealthy!

Don’t work for money, make your money work for you. – Robert Kiyosaki

This book was so eye opening to the power of being in control of my finances and adding ASSETS (things that make you money) versus LIABILITIES (things that lose value).

($5.39 on Amazon at time of publishing.)

2. Learn Finance Basics • Read: I Will Teach You to Be Rich

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To build a house of wealth, you must first have a solid foundation. This no-bullsh*t book, I Will Teach You to Be Rich by Ramit Sethi, is a crash course on finance 101. It touches on everything from negotiating bills to credit cards. It’s funny, actionable, and doesn’t encourage living like a pauper, but rather designing a rich life.

Spend extravagantly on the things you love, and cut costs mercilessly on the things you don’t. – Ramit Sethi

I bought this book for my two younger sisters who just started working. One bought 12 copies to give to her friends as graduation presents. If that doesn’t emphasize how much of a game changer this book is, I don’t know what will convince you.

($8.79 on Amazon at time of publishing.)

3. Invest your money • Read: The Simple Path To Wealth

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Read The Simple Path to Wealth by JL Collins when you’re ready to begin managing your own investments this guy breaks down how to do it simply and easily yourself. He talks about why you MUST be investing to have FU money, basically the concept of Financial Independence

I may not have owned a Mercedes, but I owned my freedom. Freedom to choose when to leave a job and freedom from worry when the choice wasn't mine. – JL Collins

TL;DR he talks about why you should be investing in low cost total US stock market index funds and total bond market index funds. That’s what I do!

($14.39 on Amazon at time of publishing.)

4. Become Financially Independent/Retire Early • Read: Quit Like A Millionaire

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I loved Quit Like a Millionaire by Kristy Shen on FI/RE for several reasons—She’s a woman in a male dominated FI community, she’s makes is conservative in her estimates, and for her breakdown on what to do when once you actually crossover to FI.

If you understand money, life is incredibly easy. If you don’t understand money, like the vast majority of people, life is incredibly hard. – Kristy Shen

This is a must read for anyone pursuing financial independence and wanting to retire early. Her belief aligns 100% with mine in that no matter your circumstances, everyone can retire early (no gimmicks, luck, or trust funds required!).

($10.79 on Amazon at time of publishing.)

I’ve read manyyyy other FIRE books from Your Money or Your Life, Work Optional, and more, but these are the ones that stood out from the library of books I’ve read and continually point people to them whether their just beginning they are finance journey or somewhere in between!


Disclosure: By using some of these links, at no extra cost to you, I may earn a small commission, which helps me help you! xo

8 Useful Steps Every First Time Home Buyer Should Take

Hey guys! Today, I have an awesome guest post by The Money Minimalists! I’ve been thinking about entering the housing market recently, especially since I think the area I’m in will become depressed with everyone working remotely these days. My friend, Kseniya, is a licensed real estate agent in Florida and a personal finance blogger. She’s worked with numerous first time home buyers and is here to shed some light on how to begin your home buying journey!

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“When do I start preparing to buy a home”? This is one of the most common questions I get from first time home buyers. The best time to start preparing to buy a home is today. 

We waste years of rent payments under the impression that we cannot afford a home. You do not need to put 20% down to buy your first house. There are 3% down payment programs out there, and even zero down payment options. Buying a home can seem daunting but it’s one of the best decisions I’ve ever made and I’m here to show you how you can start planning for one today. 

8 Steps Towards Homeownership

Last year, I was a first time home buyer myself. I bought my very first home at 25 and finally got to experience what my clients had been going through for the past few years. Between my personal experience and guiding numerous others, I have created an in-depth guide going over the 8 steps towards homeownership. Budgeting is all about planning and accounting for your expenses and homeownership becomes much more attainable the earlier you start planning for it.

  1. Understand why you’re buying a home

    Are you ready to settle down? Are you buying a home in the hopes of renting it out in the future? There are countless reasons people choose to buy a home. Understanding why is pivotal to making sure you approach homeownership the right way. 

    If you’re planning to transform the home into an investment property, the location and average rental prices should be a higher priority to you than if you were buying a personal home. Make sure you understand what this home means to you so you can approach the home search appropriately.

  2. Determine your budget and timeline

    You do not need 20% down! In fact, the average down payment for a first time home buyer is 6%. There are also programs for 3% down payment, and even zero down payment! 

    But, keep in mind that down payment is not your only cost as a buyer. You will also have to budget for closing costs (usually around 4% of the purchase price, these include taxes, insurance, and processing fees), and the actual process costs (around $1000-1500, these include the inspections, survey, and appraisals).

    So, in total, the home buying process roughly costs: 3% down payment + 4% closing costs + $1,500. This will vary based on your down payment choice, property taxes, lender, and inspection costs.

    Once you determine the amount you need to save for, you can add this into your budget and determine how long it will take you to be ready. Keep in mind that some sellers are able to contribute and cover part of your closing costs, if not all.

  3. Tackle your credit score

    You do not need impeccable credit to purchase a home. One of the most common loan programs (FHA) requires a credit score of 580. Keep in mind that different lenders might have “overlays” where they create more stringent guidelines for their loans. Be sure to speak to multiple lenders before committing.

  4. Determine what you’re looking for

    The perfect house does not exist. You will need to determine what your priorities are so you can simplify your home search. Some common ones are school district, location, and size.

  5. Familiarize yourself with the tools

    There is a wealth of information out there to help make the most informed decision on your home! You can look up whether the home is in a flood zone, crime reports, and much more!

  6. Interview and pick a Realtor

    This is one of the most important steps. Your Realtor can either make or break your home buying experience. Make sure you pick one who you can trust and who will make it a stress free and enjoyable experience. 

    How do you find a Realtor? You can find them at open houses, Zillow, Yelp, Realtor.com and even social media! Search popular hashtags like “#[your city]Realtor”. Make sure to read their reviews before committing to one!

  7. Interview and pick a lender

    Talk to at least 3 lenders before picking one! Your Realtor should be able to provide names of the ones they trust, and you can do your own research as well. The guidelines, fees, and interest rates all vary based on your lender.  You can also search for them on Zillow, Yelp, Realtor.com and social media!

  8. Get pre-approved by a lender

    Once you’re ready to get the process rolling, you can get pre-approved by a lender! This is the process for you to become eligible for a mortgage. They will pull your credit, look at your last two years tax statements, last two months bank statements, and your pay stubs. Make sure to do this step at least two months before you’re ready to buy! 

Even if you’re a year or two away from buying a home, I recommend running through the down payment calculation and evaluating your credit score so that you can be productively working towards your goal. For a more in-depth run down of these steps, check out my 21 page guide here.

Please share these first time home buyer tips with your friends and family so they can be informed before buying a house! 


Why Traditional IRAs are (usually) better than Roth IRAs for FIRE

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As a new member of the Financial Independence community, I finally decided to contribute to a Traditional IRA instead of a Roth IRA for 2020!

Why a Traditional IRA?

A Traditional IRA is typically better choice to contribute to a Roth IRA if you’re going for Financial Independence Retire Early (FIRE). Theoretically you’re making more now than after you become Work-Optional. After retiring early, you’d be making much less than at your 9-5.

Therefore, it would be better to get a tax deduction now by contributing to a Traditional IRA. You’d only be taxed on the Traditional IRA money once you slowly move it to your Roth IRA post-FIRE. So for tax purposes post-FIRE, your reported income would be made up of the money you converted to your Roth IRA plus the dividends you’re receiving from your stock investments.

For me, I anticipate yearly expenses to be ~$35,000 plus whatever I move to my Roth IRA. So for the most part I’d mostly be in a much lower tax bracket (12% vs. 22%) than right now—here are the current tax brackets.

Side note: I’m not factoring real estate into this FIRE strategy. Most of the FIRE people I follow (Our Next Life, Mad FIentist, JL Collins) did it through index fund investing alone. Plus, financially it doesn’t make sense to invest in real estate in my HCOL area. The article that inspired me to contribute to a Traditional IRA is by the Mad Fientist. He gives a lovely breakdown on his blog.

Except if you earn too much…

There is one very, very KEY 🔑 detail that I overlooked when implementing this IRA strategy. I won’t qualify for a Traditional IRA tax deduction because I’m on track earn too much this year. Noooo my plans have been foiled! 😞

You only qualify for a Traditional IRA tax deduction if your Modified Adjudged Gross Income (MAGI) is less than $75K. If your MAGI is less than $125K contribute directly to a Roth IRA. If you’re a super high earner (read: BALLA 😎 ) and your MAGI is over $125K, then you would still need to contribute to a Traditional IRA and then once you max it, immediately do a Backdoor Roth IRA Conversion.

This “problem” 😭 I have is really a blessing, but I didn’t realize this would be an issue until I had already opened, contributed and invested it. If you are in the same boat I am, all hope is NOT lost!

How to course correct if you just started investing in a Traditional IRA & are unqualified for the deduction

Similar to a Backdoor Roth IRA Conversion you can still recharacterize (convert) contributions to a Roth IRA. My concern was that I’d already bought shares in my Traditional IRA account and since we’re in a bear market, I’d have to sell at a loss and lose out on money I’d put in.

However if I do a Full Recharacterization of my entire Traditional IRA, I’m able to convert everything to my Roth IRA without selling. This would only work if you just opened and contributed to your Traditional IRA for the first time and haven’t taken any distributions from it. 🙌

THANK THE TAX GODS and more specifically a person named Kim 😊 in the Choose FI Facebook group. It was there that I initially asked what I should do regarding my dilemma and Kim gave me the above answer within 15 minutes. Glad there is a huge community of smarter and more knowledgeable people than me to help guide my FI journey. And hopefully this helped you too!

xo, Catie


Disclosure: Some of these links are affiliate links, meaning, at no additional cost to you, I may earn some compensation. All opinions are 100% my own! I truly appreciate you and your support. :)

Serious About Saving? Start Here.

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Congrats 🎉 , you’re here! And that must mean you’re ready to get serious about saving (and investing) your money. Maybe you just started your v first job or finally have a 401K. If so, you’ve come to the right place.

I know it may seem like retirement is a long way off, which is great because that means time is on your side. However as a woman striving for Financial Independence, I believe it’s so important to have work be optional if (more like when) your passions in life change. Although you may love your job today, ultimately you should have the financial ability to walk away and pivot your life to do whatever you want to do with it.

Maybe you want to be a stay at home mom or change careers or perhaps just travel more. You shouldn’t have to depend 💯% on your paycheck or partner to be able to do that. THAT is what investing and saving is for!

Here is the order of priority in which you should start saving your money on your journey to Financial FREEDOM:

  1. Emergency Fund (3-6 months or 1 month if you have debt)

  2. Employee 401K Match (if applicable)

  3. Pay off debts

  4. Max 401K (if applicable)

  5. Max IRA

  6. Go ham on taxable brokerage accounts

*Note: All of the numbers below reflect those who are SINGLE filers and under 55.

1. Open a high yield savings account (HYSA) & save 3-6 months of money

The absolute first thing I recommend you do if your current savings are at a Big Bank 🏦 , i.e. Bank of America, Chase, Wells Fargo, etc. is move that cash to an HYSA that earns ~1-2% of interest depending on the economy. Versus at Big Banks, you usually only get a 0.1% interest per month so you are losing A TON of money to inflation. While HYSA accounts don’t keep up with the yearly inflation rate, you at least lose less!

Right now I make about $20+ per month of interest on my Emergency 🚨 account that I have with Wealthfront. Love their simple UI, it’s so easy to use. Here’s my link to sign up for one too. Don’t walk, RUN. It takes less than 10 minutes to sign up and that interest money will make you feel like a million bucks! Seriously come back, I’ll wait.

Okay so now that you’ve opened your account, you’ll want to save 3-6 months of expenses in there justttt in case anything happens. I air on the side of caution since I don’t always have a steady income, so I have 6 months’ worth of savings in mine.

If you’re a full time employee 3 months is probably good, and if you have any debt, just start with one month. The key 🔑 to getting out of debt is not accruing more, which is why it’s important to have a little padding.

2. Max employee-sponsored 401K match (if applicable)

If your employer contributes a percentage of your paycheck to your 401K, take it. That is literally FREE money they are giving you. For example if they match up to 4%, 1$ on the first 3% and 0.5% on the rest up to 4%, you’d need to contribute at least 6% of your paycheck to get that full match.

If like me, you don’t get employer contributions, continue right along.

3. Pay off debts

If you don’t have debt, go right into investing with step 4.

The only way you’ll get out of debt is to stop spending more than you earn. Tackle your highest interest debts first and work your way toward the smallest. (This is known in the Debt Free Community as the Avalanche method. There is also the Snowball ❄️ method, which is to pay off your smallest dollar amount debt first since you get a psychological high, but the numbers aren’t logical so if you can stomach it, I’d go with highest interest first) Make automatic consistent payments until it’s gone. Get a bonus? Throw it at your debt. Side hustle income? Make a debt payment.

To see where you can cut back on and to get a high level overview of your expenses, track your spending for 3 solid months. And that I mean EVERYTHING. Even a $2.00 parking meter.

Here’s my personal Google Sheet that I use to track everything. Make a copy to use. To input your own categories, select the entire column (C, F, or J) and go to Data > Data Validation and retype in all the categories you think you’ll need. Update the categories in column M to match whatever you put.

I’m very spreadsheet illiterate, so if I can do it, you can do it. As you need more months, duplicate the sheets along the bottom. If you can see you’re spending $600+ on food, see how you do cutting back to $500. YOU HAVE FOOD 🍽 AT HOME! Every time you overspend you’re stealing money from your future self.

Until your debts have interest rates lower than 7%, I wouldn’t consider investing because the market return averages about that amount over 5-10 years.

4. Max your 401K ($19,500)

If you don’t have a 401K at all, move on to the next step.

I don’t expect everyone to be able to do this, especially if it’s your first job, but if you’re more than comfortable with the paycheck you’re getting after you’ve already hit the max, increase it by 1% every payday and see if you even notice it. Take advantage of your tax-advantaged accounts! They are there to help you and let your money grow in your bank accounts.

5. Max your IRA ($6,000)

Even if you don’t have access to a 401K we all have access to IRAs, which are also majorly tax-advantage. The limit is a lot less, but it’s still a lot and worth contributing to. I opened one with Charles Schwab since that’s what my dad opened my custodial account in when I was a baby. 👶 Vanguard is also a classic choice.

You commonly hear that it’s best for young adults to be invest in a Roth IRA, but this year I’ve started investing in a Traditional IRA because I’m planning on "retiring” early and living very modestly, so I assume my yearly income will dip to something very small, and therefore I’ll be paying less taxes then.

Read the Mad FIentist’s article 🧪 for the nitty-gritty details. He also has a lot of Financial Independence/Retire Early (FIRE) tips like front-loading and Roth conversion ladders that are very helpful once you’re well-versed in the basics of FIRE.

Obviously it is up to you to decide what is best for you though!

6. Go WILD on your taxable brokerage accounts

The sky’s the limit here 🌌 , aka you can invest as much as you want in your brokerage account. I have one with a robo-advisor, Wealthfront AND another with Charles Schwab, where I pick my own investments myself.

When I first started investing—and you need to start investing— I went with a robo-advisor 🤖 because it automatically picks low cost index funds (aka a balanced group of stocks) for you. Plus it automatically balances everything yourself. It’s SO easy and hands off. If you’re scared about picking your own stocks (and by stocks I really mean index funds and ETFs), I can’t recommend a robo-advisor enough. Get $5K managed free if you use my Wealthfront link to sign up. If you couldn’t tell, I LOVE WEALTHFRONT!

Once you’re ready to take the training wheels off, open an account with a big investment firm (Charles Schwab, Vanguard, Fidelity). If you’re considering Schwab, my link gets you a FREE $100 when you invest $1,000 with them. I’ve started investing more in a Target Date Index Funds because that is essentially like an EVEN CHEAPER robo-advisor.

On that note, if any of the concepts or terms above went over your head, GOOGLE IT! 👨‍💻 That’s how I learned everything I’m preaching. Use Investopedia, The Balance, Nerdwallet, or whatever other resource until you feel comfortable and knowledgable 🧠 about what you’re doing.

At the same time, don’t let your fear of investing or “losing” money stop you from getting started right now. You are young and time is your greatest asset. In the 150 years that the stock market has been around, there have been ups and downs, but it has always trended up. 🎢 You wouldn’t get off a roller coaster in the middle of a drop, and neither should you sell your investments at a low.

And finally, to preach Jeremy of Personal Finance Club: ALWAYS live below your means and invest early and often.

YOU CAN DO THIS!

xo, Catie


Disclosure: Some of these links are affiliate links, meaning, at no additional cost to you, I may earn some compensation. All opinions are 100% my own! I truly appreciate you and your support. :)

Taxes: To Owe or Not to Owe?

I’m team owe or get as close to $0 as possible. The way I look at it is:

Your money is an INTEREST FREE loan to the government.

Wow. Would a bank ever give you an interest free loan? Absolutely not. If you took those thousands of dollars and invested it in a US stock index fund in 2019, you’re looking at about a 20% return! Your money is working hard for you!

This is the strategy I’d recommend to those who are responsible with their money. If that’s not how you operate and you don’t set aside a little fund for paying taxes, then by all means go for a refund.

Now take my advice with a grain of salt, because this year I got a refund amounting to ~$2,000. At one of the contracts I worked they put 1 allowance instead of 2, resulting in this tax refund. However no regrets, because it actually came at the perfect time since I’ve been freelancing since December. The thing about entrepreneur life is that I have many outstanding invoices that haven’t been paid yet. I feel rich again! So there are two sides to every opinion.

If you haven’t filed your taxes yet, I used TurboTax. I tested a few other sites and landed on this one since it was the easiest in importing your info and guiding you through the entire process. I had to pay $90 since I had an HSA form that I had to file, but even my CPA friends use TurboTax to do their own taxes. Click here to get a 20% discount using my affiliate!

This year I will definitely owe since I have a bunch of 1099s I’ll receive for my freelance work. All for the best! Happy tax season, may you owe OR get a refund, whatever is best for you!

xo, Catie


Disclosure: Some of these links are affiliate links, meaning, at no additional cost to you, I may earn some compensation. All opinions are 100% my own! I truly appreciate you and your support. :)