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Financial Samurai
financialsamurai
financialsamurai@www.financialsamurai.com
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Dear Readers,

In 2009, the world was falling apart, and my net worth was taking a beating. I thought it would be a good idea to start a personal finance site to help myself and others make sense of chaos.

After all, I had spent 10 years working at Goldman Sachs and Credit Suisse, studied economics at William & Mary, got my MBA from UC Berkeley, saved aggressively, diversified my investments, and still got financially rocked!

Since the global financial crisis, more than 90 million visitors have stopped by Financial Samurai to learn, share, and grow.

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financialsamurai@www.financialsamurai.com
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119 Posts
A Love-Hate Relationship With Owning Rental Property Real Estate
The shift has made a positive mental health difference whenever I need to spend time dealing with rental property issues. Then maybe you can better decide whether owning rental property is right for you. Owning rental property makes you respect other people's points of view. Severe COVID restrictions actually helped rental property owners because more people demanded and appreciated housing. Most of the time, all I have to do is make sure each rental property is in good condition so that my tenants are happy.... more
A Love-Hate Relationship With Owning Rental Property Real Estate
Freedom May Not Be Priceless: Consider Going To Jail For Money
Freedom Is Valued Differently At Different Ages Given time is finite, the value of freedom tends to appreciate the older we get. The Value Of Freedom From Ages 0 - 18 Freedom has the lowest value when we are kids. As we grow older and interact with kids who have more freedom, we slowly begin to realize the potential of true freedom. How about you? The Value Of Freedom In College If you decide to go to college, the value of freedom skyrockets. Maybe it's not the value of freedom that skyrockets, but the appreciation... more
Freedom May Not Be Priceless: Consider Going To Jail For Money
Your Wealth Is Mostly Due To Luck: Be Thankful!
Are you confusing your good fortune due to your own skill rather than due to luck? I'm here to argue that above average wealth is mostly due to luck. The more we can recognize our luck and not take our luck for granted, the more prosperous we'll become. Outsized Wealth Is Mostly Due To Luck When you accumulate a net worth of one million dollars, three million dollars, five million dollars or ten million dollars, know this level of wealth is mostly due to luck. We almost didn't have children because we tried... more
Your Wealth Is Mostly Due To Luck: Be Thankful!
Thankful For Luck: A Phone Call That Changed My Life For Good
Despite the pandemic and a bear market making things difficult for so many, there is still so much to be thankful for. We need to all be thankful for the luck we've had so far. Thankful For Luck That Changed My Life The year is 2001 and the Nasdaq, down 50%, just celebrated its one year anniversary of hitting its peak. The Job Offer Package, So Thankful A couple of weeks later, I took a day off in order to fly out to San Francisco and meet the team on a Friday. If you want to be more thankful, try give writing... more
Thankful For Luck: A Phone Call That Changed My Life For Good
Being A Professor Is The Ideal Occupation For Riches And Status
The average Stanford professor makes about $250,000. Professors are able to buy multi-million dollar properties. Sam Bankman-Fried’s FTX, his parents, and senior executives of the failed cryptocurrency exchange bought at least 19 properties worth nearly $121 million in the Bahamas over the past two years. The average professor makes $300,000. A combined income of $600,000 is a top 1% income. With a 20% down payment, Bankman and Barbara Fried could comfortably buy a $3,000,000 vacation. For more information,... more
Being A Professor Is The Ideal Occupation For Riches And Status
Americans Can Save A Lot Of Money If We Want To, Don’t Worry!
After lockdowns began on March 18, 2020, the U.S. personal saving rate skyrocketed from a respectable 9.3% pre-pandemic to an impressive 33.8% in April 2020! Americans suddenly decided that saving money during a time of great uncertainty was a priority. At the time, I thought to myself: How is it possible the median retirement savings amount for 32 - 37-year-olds was only $480 using 2013 data? Meanwhile, the median retirement savings amount for 56 - 61-year-olds was only $17,000. Recommended Saving Percentage... more
Americans Can Save A Lot Of Money If We Want To, Don’t Worry!
Post-Mortem Analysis Of A Bullish Investment Thesis
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Post-Mortem Analysis Of A Bullish Investment Thesis
How To Become A Good-Enough Investor: Investing Lessons Since 1996
A good-enough investor is a rational investor who will take the steps necessary to achieve his or her results. A bad investor either invests too little or too much based on their risk tolerance or doesn't invest at all. 4) A good investor knows baseline returns and valuations As a stock investor, you know the historical annual return of the S&P 500 since 1926 is about 10%, with dividends reinvested. Every good investor knows to invest the majority of their assets in low-cost index funds. Do you really want to... more
How To Become A Good-Enough Investor: Investing Lessons Since 1996
The Ideal Retirement Age To Minimize Regret And Maximize Happiness
The Average Retirement Age In America To get a retirement age baseline, as you can see in the chart below, the average retirement age is between 61-65. In a quest to live a better-than-average life, it's logical to conclude the ideal retirement age should at least be below 61-65, the majority age range of when Americans retire. Factors Involved In The Ideal Retirement Age Here are some factors to consider before deciding when to retire: Length of time spent in schoolCost of educationStudent loansMultiple job... more
The Ideal Retirement Age To Minimize Regret And Maximize Happiness
The FTX Crypto Exchange Collapse: Lessons We Should Learn
Binance, which caused the panic in the first place, then said it had signed a non-binding Letter of Intent to purchase FTX. But after reviewing FTX's books, Binance backed out and has left FTX to collapse, thereby eliminating one of its largest competitors. Apparently, FTX now owes billions to its clients and doesn't have the money to pay up. Where the hell did its customers' funds go? Supposedly, FTX's founder, Sam Bankman-Fried's hedge fund, Alameda Research, owned a bunch of FTT, the coin FTX created. Shaken... more
The FTX Crypto Exchange Collapse: Lessons We Should Learn
Suing Your Employer For Laying You Off Is Probably A Bad Move
With thousands of employees, this could be significant, though maybe not to Elon.Employees laid off in violation of the WARN Act receive back pay at the employee's final rate or 3 year average of compensation, whichever is higher. California Is An At Will Employment State Most employees in California are considered to be "At-will" employees. No employer can force a California employee to keep working at a job they don't want. At the same time, an employer is free to lay off an employee at any time for any lawful... more
Suing Your Employer For Laying You Off Is Probably A Bad Move
The Amount Of Money Needed To Retire Early And Live In Abject Poverty
Some hate their jobs so much they are willing to retire early and live in poverty! One shortcut to retiring early is the concept of Coast FIRE. Coast FIRE is a type of financial independence where you have invested enough money so that by the time you hit traditional retirement age, based on historical returns, your investments will have grown large enough to cover your retirement. Retiring Early To Live In Poverty Doesn't Make Sense Instead of retiring early to live in poverty, wouldn't it be better to find... more
The Amount Of Money Needed To Retire Early And Live In Abject Poverty
How To Develop A Better Personality To Get Into An Elite University
Harvard assigns a personality score to every applicant for admission to an elite university. As a parent of multi-racial kids, they might inherit my bad personality. But as any good Financial Samurai believes, the longer the odds the greater the upside. It's still worth trying to develop better personalities, the shorter the odds, says Financial Samurai. For more background, I spent 13 years building relationships with financial clients and 13 years so far building Financial Samurai into a top personal finance... more
How To Develop A Better Personality To Get Into An Elite University
The Most Bullish Economic Indicator Yet: A Lower I Bond Rate
The lower Series I Bond interest rate means the government believes inflation has peaked and is heading down. If you know inflation, and therefore interest rates are coming down, you aren't going to pay a higher interest rate for the next six months on your debt. At the same time, the Series I Bond interest rate has to be competitive enough to attract capital over the next six months. If the interest rate is not high enough, then the government won't be able to meet its capital raising target from Series I Bonds... more
The Most Bullish Economic Indicator Yet: A Lower I Bond Rate
The Golden Parachute Severance Package: Oh How Sweet It Is!
The estimated total golden parachute severance packages are: CEO Agrawal: ~$74 million CFO Segal: ~$65 million Head Of Legal Policy Gadde: $60 million Not bad for a company that went public in November 2013 and provided almost no shareholder value until Musk decided to overbid. Believe You Deserve To Receive A Severance Package Too One of the biggest pushbacks I get when I encourage people to negotiate a severance package is: Why would management ever grant me one? Yet, here are three executives who are set... more
The Golden Parachute Severance Package: Oh How Sweet It Is!
Top 10 Biggest Life Insurance Myths Debunked
The number of employees who have access to life insurance benefits through their employer has been declining for the past 15 years. Most employees need 10X the amount of Life Insurance coverage. In reality, the average 30-year-old male can get $250,000 in coverage for less than $20/month and $1 million in coverage. Women typically pay less than men of the same age. If you use PolicyGenius to purchase a life insurance policy. For more information, you could save $1300 or more. Insurers regularly drop rates to... more
Top 10 Biggest Life Insurance Myths Debunked
Where Are All The Adult Athletes? Sports And Your Career
The Benefits Of Playing Sports I recognize why parents encourage their children to play sports. One mom whose son will play tennis for UCLA told me tennis distracted her son from doing drugs, playing video games all day, and hanging out with a bad crowd. Based on my real-world experience so far, the vast majority of successful people I've met do not play sports or no longer play sports. Forcing them to play every sport or concentrate on one sport may backfire if they don't want to play. More than a decade later... more
Where Are All The Adult Athletes? Sports And Your Career
The High-Yield Corporate Bond Spread Is A Stock Market Indicator
The high-yield corporate bond spread is the difference between the yield of the bonds issued by riskier companies and risk-free Treasury yields. High-Yield Corporate Bond Spread Example Below is a chart that shows how the average high-yield corporate bond spread is still only about 5% as of 4Q 2022, which is the historical long-term average. Although the bond is callable by the company, let's say the company keeps the bond available until the maturity date of 5/1/2030. A Carvana bond investor could buy the bond... more
The High-Yield Corporate Bond Spread Is A Stock Market Indicator
Overcoming The Downer Of No Longer Making Maximum Money
Working for just one more year will boost your savings that much more! Then ten years go by and they regret sacrificing so much time for money. How To Be OK With No Longer Making Maximum Money Everybody has the ability to make a certain amount of money. It's more about saying no to a promotion that requires more work for more money. There is no point having a lot more money if you are unhealthy or die young? Having to work for 5 to 10 more years to potentially make 100% more was no longer worth it to me. After... more
Overcoming The Downer Of No Longer Making Maximum Money
Losing $1 Million In Real Estate Never Felt Better
Strategically Losing $1 Million In Real Estate As a real estate investor, my goal is to buy property below market value, improve the property, and rent the property at market price. Unfortunately for millions of homeowners in America, property assessors will not be motivated to lower assessed values to lower your property taxes. Successfully Lowering My Property Value Online I'm pleased to say that two months after lowering my property's statistics online, Redfin has finally revised my property's value downward!... more
Losing $1 Million In Real Estate Never Felt Better
It’s Easier To Generate More Passive Income In A Bear Market
As a fake retiree, I have invested $250,000 in Treasury bonds that will generate an extra $11,250 a year. The positive is that we can still make more passive money in a higher interest rates and get more money. The increases are mainly coming from Treasury bonds, private real estate investments, and rental property income. Sunbelt rentalProperty income is rising from $50,000 to about $65,000. The increase was due to the market. Lake Tahoe vacation property net rental income has increased from about $650 a month... more
It’s Easier To Generate More Passive Income In A Bear Market
How To Have A Risk-Appropriate Asset Allocation When Investing
A Risk-Appropriate Asset Allocation In A Bull And Bear Market During a bull market, if you have a risk-appropriate asset allocation, you will feel good knowing your net worth is invested in enough risk assets to benefit from a strong economy. Thanks to your discipline, investing FOMO doesn't overwhelm you to abandon your asset allocation for much riskier assets than you can really take. The only time your asset allocation would become riskier is if your risk tolerance has materially increased due to a sudden... more
How To Have A Risk-Appropriate Asset Allocation When Investing
The Best Time To Own The Nicest Car You Can Afford
Switching Back To My Old Car Felt Amazing Two months and $14,600 in repair costs later, my car was ready for pick up in Lake Tahoe! The hotel car followed me to the nearest Enterprise in Truckee, where I dropped off the rental. Continental Sport Cross Contact LX 275/40R22 M&S tires are rare Having Kids Justifies Spending More On A Nicer Car The best time to own the nicest car you can afford is when you have kids due to the enhanced safety features. Then you continue owning that car for 10 or more years until... more
The Best Time To Own The Nicest Car You Can Afford
How To Get Disability Insurance And Maximize Benefits
"Typical group long-term disability benefits replace about 60 percent of the worker's usual salary. These benefits usually start when short-term benefits are exhausted and continue from five years to life." In addition, there ar​​e only five states that have state-mandated disability insurance requirements: California, Hawaii, New Jersey, New York and Rhode Island. Let me share a guest post with you on one man's experience taking Long Term Disability Insurance and Social Security Disability Insurance benefits.... more
How To Get Disability Insurance And Maximize Benefits
How To Enjoy Your Life After The Fed Ruins The World
From all the feedback I've gotten since 2020, nobody has told me they regret spending more time with their parents, siblings, or kids. My daughter turns three in December 2022, which means it'll be go time for me to be more present. A deepening global recession will help improve our family relationships because it will reduce the temptation to spend time making money. Remember the feeling of meeting someone you like for the first time? So wonderful! If you've already found the love of your life, work on improving... more
How To Enjoy Your Life After The Fed Ruins The World
When To Play The Status Game Again: Money, Fame, And Impact
If your family is posting about your vacation on a yacht in the Almalfi Coast, they're interest in you might go up! By admitting families with status, such schools increase their chances for future donations and quality referrals. Being Rich Is Only One Part Of Having High Status The rich continue to play the status game because there are plenty of rich people. My Views On Status Have Changed With More Exposure But now that I've gone to dozens of playdates, I realize I need to change my views on status. Too... more
When To Play The Status Game Again: Money, Fame, And Impact
What Income Level Is Considered Rich?
That's pretty rich! Income Rich And Capital Rich There are two aspects of monetary wealth we can focus on: Income and Capital. Some make a lot of income and are considered income rich. What Income Level Is Considered Rich? Instead of just saying what I think, I'm going to share my thoughts on various income levels per person for populations living in coastal cities such as San Francisco, New York City, Los Angeles, Boston, and Washington DC and work out the answer. To your tax-exempt 401k, you are left with... more
What Income Level Is Considered Rich?
How I’d Invest $250,000 In Today’s Bear Market
With the global financial recession building, opportunities are piling up, but things could get worse in this bear market given we’re only nine months in. 2022 has so far been a terrible year for both stocks and bonds. Real estate has outperformed stocks by over 25% but even real estate is starting to fade as mortgage rates surge higher. The Fed says it plans to hike through the end of 2022 and reassess. The S&P 500 could easily decline to 3,500. If the Fed insists on raising the Fed Funds rate to 4.5%, then... more
How I’d Invest $250,000 In Today’s Bear Market
How To Buy Treasury Bonds And Buying Strategies To Consider
Treasury Bonds are risk-free investments if you hold them until maturity. Online brokerage accounts are a marketplace for existing treasury bonds. Other safe options for investing cash include an online savings account, a Certificate of Deposit (CD) and AAA-rated municipal bonds. The risk here lies in liquidity risk and real interest rate risk, not principal risk. For example, if you purchase a 20-year municipal bond but need the money before 20 years. If you want to take more risk, you will likely have to sell.... more
How To Buy Treasury Bonds And Buying Strategies To Consider
Personal Lessons Learned Since The 2008 – 2009 Global Financial Crisis
With the Federal Reserve determined to hike rates to 4.5%, another global financial crisis might be brewing. But a world of hurt could be coming for the middle class this time around. Many of us have also diversified based on our risk tolerance. Here are some lessons learned during and since the last financial crisis, since The 2008 – 2009 Financial Crisis 1. It would be much better if you could predict the upcoming pain and make some changes and make certain changes and made certain changes before the pain... more
Personal Lessons Learned Since The 2008 – 2009 Global Financial Crisis
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