1. Finding community and the ChooseFI podcast
I subscribe to the idea that you are the average of the 5 people you spend the most time with. The ChooseFI podcast and community counts for at least 1/2 of a person to me. It has changed my mentality, my outlook, my feelings, my ability to block out noise, and most importantly my behaviors. All for good while finding balance in reality and well-being.
Click here to discover the ChooseFI Podcast.
2. Diversifying by selling my Denver rental property
When I started tracking my net wealth I realized I was quite wealthy! But only because my house in Denver accounted for over 50% of that wealth. And after learning about the cult and myths of homeownership, I started to realize that I had so many eggs locked up in this one basket. Like having 50% of my net wealth in Tesla stock. This basket in one city, in one neighborhood, with tenants that may or may not take care of it, and so on. Luckily, I sold at the perfect time in March 2022 and after paying my taxes I dumped all of it into ETFs. While most of the proceeds went into VTI, I did split about 10% of it between two REITs so I could keep exposure to real estate but through actual diversification. REITs are investment vehicles where you get the benefits of owning property but without doing any of the work. REITs hold hundreds or thousands of properties, not just one. I can finally sleep at night now that I am rid of that house.
Click here to read up on the case study I wrote about buying vs renting, using the house I sold in Denver.
3. Simplified my strategy, and always seeking ways to reduce (or prevent) complexity
I stopped overthinking my investments and took the least sexy path: the simple one. I started dumping all of my money into VTI (a Vanguard index ETF). I also stopped hoarding money after I realized I did not need an emergency fund of $20,000. I now only keep what I realistically would need in liquid cash, meaning enough cash to cover expenses that are not insured for or can’t be put on a credit card like an apartment deposit during a move. For me, that's $5,000. And any time I get the urge to buy a cheap property in Europe I remind myself "that's going to add 20 more open tabs in your brain, more complexity, so don't do it".
4. Geo-arbitrage and relocating to Italy
When I quit my job to start freelancing in 2021, I did it primarily because I was being paid effectively $50 per hour but my employer was charging me out to clients at $500-$900 per hour depending on the geography and project. I knew there was enough of a niche in my market that I could go out on my own. TThanks to Covid, I could do all of my work truly remotely and use geo-arbitrage to maximize my Foreign Earned Income Exclusion and Foreign Tax Credit in my US taxes. I of course pay taxes in the country I live in, but now that I've relocated to Italy I have dropped my effective tax rate from 40% (the Netherlands) to 10-15% (Italy).
I did this by finding community and the ChooseFI Podcast, selling my Denver rental house, simplifying my investment strategy (and life), and geo-arbitrage.
What are not my boosters? I do not penny-pinch on coffee or eating out. I do not penny-pinch on living solo. I do not penny-pinch on my hobbies that bring me the most joy.
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Unfinished human, currently v.5.0. Expecting at least 10 more versions. Aspiring adult.