Personal Finance 101: Drive Your Car Forever

This summer marks the 10 year anniversary of the worst purchase I have made in my life so far; a brand new SUV. Back in 2007 I had just landed a new job, which is where I am to this day, and decided the car my parents bought for me in high school, a 1996 Honda Accord LX, was ready for a trade up. I loved my Honda Accord and drove it through high school and college. I even drove it for about a year after graduation. It had nothing wrong with it, engine-wise. But the windows didn’t roll up or down very well, the power locks would jam often so the car wouldn’t lock at night and would keep attempting to. I remember countless times at the end where I would go to my car the next morning and hear my locks still trying to go down. Fantastic. Other than that I loved it and it drove great. My Accord had approximately 125,000 miles on it once I traded it in, in the summer of 2007.

Don’t Ever Buy a New Car

I traded in my 1996 Honda Accord for a brand new 2008 Nissan Pathfinder. I had been dying to have a SUV and went after one as soon as I could. I actually signed a 39-month lease at first, but then broke my lease around month 30 to purchase the car outright. I then financed my Pathfinder for 60 months. I paid it off only a couple months early, but it still took be just about 8 years to pay off a $30,000 SUV. In hindsight, this was not my proudest moment financially. I still look back to this day and wonder how long I could have kept my Accord running for. Could I have put 300,000 miles on it? Part of me really wishes I still had it. I could have just thrown $500 at the locks and been fine, right?

For 8 years I was paying $350 a month on my Pathfinder. During this same time the S&P 500 returned 7% (after the 2008 crash). If I would have invested my money into the market instead of my car, I would have close to $45,000 instead of a car I paid about $35,000 after interest. That car is only worth about $7,000 now too. Those numbers are not adding up in my favor.

Now I plan on driving my car for as long as possible. I will drive this puppy until the wheels fall. Actually, my goal is to drive it for another 10-15 years and not buy another car until my house is paid for. That is my personal finance challenge to me and my wife. This would mean I would have to drive my car until it has approximately 200,000 to 250,000 miles on it. That’s a tall order, but possible. I take good care of my car with above average maintenance and think I can pull it off. I feel like I owe it to myself after what I did in 2007 when I bought a brand new SUV. Never again will I buy I brand new car. Buy used and drive it for as long as you can.




What is FinTech?

One of the more recent buzzwords in the financial and technology space is “FinTech”. But what does FinTech mean? Well after that first sentence it’s probably easy to decipher the meaning of FinTech; which means “financial technology”. Financial technology companies consist of both startups and established financial and technology companies trying to replace or enhance the usage of financial services.

FinTech is a progressing connection of financial services and technology. For example, financial institutions are becoming more technology focused, whether it is Vanguard, Wells Fargo, Bank of America, or even your local credit union. At the same time, large tech companies are offering peer-to-peer (P2P) payment solutions over social networks and email.




Examples of FinTech?

FinTech, the abbreviation for financial technology, is a broad category that refers to the innovative use of technology in the design and delivery of financial services and products. And below are a few examples of FinTech or financial technology.

  • Betterment (robo-advisor & investing)
  • Wealthfront (robo-advisor & investing)
  • motif (trading & investing)
  • Lending Club (peer-to-peer or P2P lending)
  • Venmo (payment)
  • Square (payment)
  • PayPal (payment)
  • Apple Pay (payment)
  • Acorns (personal finance)
  • Mint (personal finance)
  • LearnVest (personal finance)
  • TransferWise (currency & money exchange)
  • Kickstarter (crowdfunding)
  • GoFundMe (crowdfunding)

Stock Market Last Week (June 12-16, 2017)

This past week, June 12-16, the stock market was very mixed, as the Dow was up, the S&P 500 was flat, and the NASDAQ was down. You’ll see this in my retirement portfolio as well. The Federal Reserve raised short-term interest rates while also laying out its plans to reduce the size of its $4.5 trillion balance sheet. The Red raising short-term interest rates 25 basis points was the biggest market news of the week.

The next big story was Amazon’s $13.7 billion bid for Whole Foods which is seen as highly disruptive for both retailers and food companies. 20 of the biggest losers in retail and food sectors lost approximately $40 billion in market cap by Friday afternoon. Some analysts are predicting Amazon to potentially be the 3rd largest grocery retailer by 2021.

Last Week’s Stock and Bond Index Performance (June 12-16, 2017)

  • NASDAQ -0.9% (YTD 14.3%)
  • Dow Jones Industrial Average 0.5% (YTD 8.2%)
  • S&P 500 Index 0.1% (YTD 8.7%)
  • U.S. Aggregate Bond Index 0.3% (YTD 2.8%)

How did my retirement portfolio perform last week (June 12-16, 2017)?

Below is a snapshot of my three biggest retirement portfolio mutual fund movers in terms of percentage gained last week.

The below mutual funds are held within my work 401(k) plan as well as two separate Roth IRA plans. I currently invest 15% of my income into my company Roth 401(k), and that doesn’t include the company match I get. All accounts are held with Vanguard (so as you can see I primarily invest in Vanguard funds because of this).

  1. Vanguard REIT (Real Estate Investment Trusts) Index Fund (VGSLX) 1.5 %
  2. Vanguard Windsor II Fund (VWNAX) 0.2%
  3. Vanguard 500 Index Fund Admiral Class (VFIAX) 0.8%

Can I Beat the Stock Market?

I am actually not trying to “beat the market” with my retirement portfolio…I am trying to match it. I do have alternative indexes in my retirement portfolio to help possibly beat the market, e.g. Small Cap Value, REITs, International, and Emerging Markets. Through lots of reading and research on my part, I’ve found that a number of these assets classes “zig” when the market “zags”. I am purposely over-weighted in Small Cap Value, which at times helped me beat the market and at the same time lag the market.

With that said, if I can beat the market I will absolutely take it (obviously)! Last year in 2016 my retirement portfolio returned 13.01% versus 9.54% from the S&P 500. The primary reason I was able to beat the market last year was due to the strong performance of my Small Cap Value holdings, which I am weighted heavily in.




Thus far in 2017, which is 169 days, my retirement portfolio is up 7.2% versus 8.7% from the S&P 500. So while I beat the market in 2016, I am now lagging it in 2017. But I am investing for the long term so this doesn’t concern me, as long as I am within reason of the market (roughly 1%). I use a free account with Personal Capital to track my investments like this.

I am a Millennial, a liberal arts major, and I am my own financial advisor. I am strongly considering using the services of robo-advisor Betterment, however. The more I read and research Betterment, the more I like their product, services, and overall costs. But at this point, I am managing my own portfolio.

My goal with this Millennial personal finance blog is to show all Millennial’s that you have the power to take control of your personal finances through self-education and self-development on money and finances, and by striving to become financially literate. That is what I have been doing for years now, focusing on becoming an expert in financial literacy, so I can one day become financially independent. I’m trying to prove to Millennial’s that we can all do this and thrive with money. We Millennial’s have the greatest resource on our side to become financially independent and build wealth…time! Save, invest, and let compound interest do the rest.

Follow my blog as I highlight relevant personal finance and retirement topics pertaining to us Millennial’s. You can also join my journey as I track the true cost to raise a child these days. Most of my research shows that on average it costs $14,000 per year to raise a child, which equates to roughly $250,000 to raise a child from birth through high school (the cost of college is not included in this $250,000). I am trying to defy that price tag and show that a Millennial family can raise a child on well less than $250,000…or I will come to the sad realization that this number is dead on. Time will tell.




My 2017 Monte Carlo Simulation

How much I’ll have in the future for retirement depends on how my investments perform over time. To get my best estimate I used Financial Engines, a tool provided by my employer for retirement planning. This tool explores thousands of possible economic scenarios using a technique known as “Monte Carlo” simulation. The animation below is a visual representation of this process.

The “Monte Carlo” retirement simulation gives my wife and me a “very like” 83% chance of meeting our desired retirement income goal of $80,000 by the age of 55.

Note: the Monte Carlo simulation includes both of us receiving social security retirement benefits at age 65. Those are purely 30 year out projections done on the Social Security Administrations Website. 

Based off our current finances, we feel we could retire early at age 55 and successfully live off $80,000 annually, or approximately $6,500/month. This is based off the fact that our house will be paid for well before age 55, which currently accounts for roughly 25% of income, and the fact that we will no longer be contributing to Roth IRA’s and/or 401(k)’s once retired, which currently accounts for 15% of our income.

40% of our expenses are currently going to the mortgage and retirement. So once the house is paid for and we’re retired, we should easily be able to live on approximately 60% of what we were making. This is what may allow us to successfully retire at age 55 with an annual retirement income of $80,000.

Monte Carlo Simulation

My 2017 Monte Carlo Retirement Simulation
My 2017 Monte Carlo Retirement Simulation




Each economic scenario explored by the Monte Carlo simulation makes different, realistic assumptions about inflation, interest rates, and returns on asset classes (stocks, bonds, and so forth) for each year of possible growth.

To make sense out of the thousands of estimated portfolio values, each is carefully sorted and counted. Then three very important numbers are shown. My median estimate is the most likely of the three, but I should be prepared for the downside just in case:

  • Upside: if your investments perform well, you may end up with a portfolio in the best 5% of the scenarios (95th percentile)
  • Median: if your investments perform average, you may end up with a portfolio near the middle of the scenarios (50th percentile)
  • Downside: if your investments perform poorly, you may end up with a portfolio in the worst 5% of the scenarios (5th percentile)

For example, suppose 100 scenarios are evaluated. If we sort these 100 retirement income estimates with the lowest estimate assigned the number 1 and the highest estimate assigned the number 100, then the retirement income estimate when your investments perform well would correspond to the income calculated in estimate number 95. If your investments performed poorly they would correspond to the number 5. And the media is 50.

Monte Carlo Simulation: Economic Assumptions

The Monte Carlo simulation doesn’t pick a single average number for inflation or interest rates. Instead, it looks at many different economic scenarios. To begin, every year of each scenario is based on different numbers for inflation, interest rates, and returns on asset classes (small cap stocks, large cap stocks, international stocks, bonds, and so forth).

But that’s not all. Estimating a realistic range of inflation, interest rates, and asset class returns (and their relationship to each other) requires special care. To be consistent, each number takes into account what has happened in prior years. Changes in one part of the economy (such as inflation) affect certain other parts (such as interest rates) during any given year. Estimates for any year should be consistent with estimates from prior years; for example, an inflation rate of 15% should not be expected for a year following one with 1%.

My 2017 Monte Carlo Economic Assumptions Simulation
My 2017 Monte Carlo Economic Assumptions Simulation

Monte Carlo Simulation: Retirement Income Sources

The Monte Carlo simulation estimates that if my investment performance is average/median (50th percentile), then my estimated income would be $116,000 per year at age 55. Of that retirement income, 81% will come from my retirement accounts (Roth IRAs and 401(k)). If my investments perform well (95th percentile), then my estimated retirement income would jump to $240,000. On the contrary, if my investment performance is poor (5th percentile), my retirement income would only be $61,200 per year.

Monte Carlo Simulation: My Forecast

Each economic scenario applied to my portfolio involves different rates of future interest, dividend, inflation, and portfolio growth. Some of those possible paths might end with my financial goals being realized – but others might not. My forecast is the percentage of scenarios where my portfolio reaches or exceeds my retirement income goal.

In my case, 83% of the scenarios ran by the Monte Carlo simulation equaled or exceeded my annual retirement income goal of $80,000.




Stock Market Last Week (June 5-9, 2017)

This past week, June 5-9, U.S. large-cap stocks were mixed (thank to tech stocks), while small-cap stocks rose by more than 1%. You’ll see this below in my retirement portfolio recap, as I own two different Small Cap Value index funds; the Dimensional Fund Advisors U.S. Small Cap Value Portfolio (DFSVX) and the Vanguard Small Cap Value Index Fund (VSIAX). Both were the top performers in my portfolio last week.

Friday, June 9th there was a huge tech stock sell-off from the big five; Facebook, Apple, Amazon, Microsoft, and Alphabet. These are the five biggest technology stocks and together they lost nearly $100 billion in value on Friday alone. Shares of Apple fell nearly 4% on Friday, while the other four companies fell more than 3%. This resulted in the NASDAQ having its worst week of the year in 2017.

Last Week’s Stock and Bond Index Performance (June 5-9, 2017)

  • NASDAQ -1.6% (YTD 15.3%)
  • Dow Jones Industrial Average 0.3% (YTD 7.6%)
  • S&P 500 Index -0.3% (YTD 8.6%)
  • U.S. Aggregate Bond Index -0.3% (YTD 2.4%)

How did my retirement portfolio perform last week (June 5-9, 2017)?

Below is a snapshot of my three biggest retirement portfolio mutual fund movers in terms of percentage gained last week.

The below mutual funds are held within my work 401(k) plan as well as two separate Roth IRA plans. I currently invest 15% of my income into my company Roth 401(k), and that doesn’t include the company match I get. All accounts are held with Vanguard (so as you can see I primarily invest in Vanguard funds because of this).

  1. DFA U.S. Small Cap Value Portfolio (DFSVX) 1.6%
  2. Vanguard Small Cap Value Index Fund (VSIAX) 0.8%
  3. Vanguard REIT (Real Estate Investment Trusts) Index Fund (VGSLX) 0.3%

Can I Beat the Stock Market?

I am actually not trying to “beat the market” with my retirement portfolio…I am trying to match it. I do have alternative indexes in my retirement portfolio to help possibly beat the market, e.g. Small Cap Value, REITs, International, and Emerging Markets. Through lots of reading and research on my part, I’ve found that a number of these assets classes “zig” when the market “zags”. I am purposely over-weighted in Small Cap Value, which at times helped me beat the market and at the same time lag the market.

With that said, if I can beat the market I will absolutely take it (obviously)! Last year in 2016 my retirement portfolio returned 13.01% versus 9.54% from the S&P 500. The primary reason I was able to beat the market last year was due to the strong performance of my Small Cap Value holdings, which I am weighted heavily in.




Thus far in 2017, which is 162 days, my retirement portfolio is up 7.4% versus 8.6% from the S&P 500. So while I beat the market in 2016, I am now lagging it in 2017. But I am investing for the long term so this doesn’t concern me, as long as I am within reason of the market (roughly 1%). I use a free account with Personal Capital to track my investments like this.

I am a Millennial, a liberal arts major, and I am my own financial advisor. I am strongly considering using the services of robo-advisor Betterment, however. The more I read and research Betterment, the more I like their product, services, and overall costs. But at this point, I am managing my own portfolio.

My goal with this Millennial personal finance blog is to show all Millennial’s that you have the power to take control of your personal finances through self-education and self-development on money and finances, and by striving to become financially literate. That is what I have been doing for years now, focusing on becoming an expert in financial literacy, so I can one day become financially independent. I’m trying to prove to Millennial’s that we can all do this and thrive with money. We Millennial’s have the greatest resource on our side to become financially independent and build wealth…time! Save, invest, and let compound interest do the rest.

Follow my blog as I highlight relevant personal finance and retirement topics pertaining to us Millennial’s. You can also join my journey as I track the true cost of raising a child these days. Most of my research shows that on average it costs $14,000 per year to raise a child, which equates to roughly $250,000 to raise a child from birth through high school (the cost of college is not included in this $250,000). I am trying to defy that price tag and show that a Millennial family can raise a child on well less than $250,000…or I will come to the sad realization that this number is dead on. Time will tell.




Cost of Raising a Child: 3 Months In

My wife and I are first time parents and we are now three months into the “parenting” process. I made it a goal to track all of our child care expenses so I could truly report on the cost of raising a child. I invite all of my readers to follow along our journey as I diligent track all expenses involved in truly raising a child these days in middle class America.

Prior to us having a child I did some research and the consensus was that it costs roughly $14,000 per year to raise a child, which equates to roughly $240,000 (without college). Don’t get me started on how much college will cost for my child




How Much Does It Costs to Raise a Child?

We are three months in and thus far we have spent $1,064 on my daughter in total. We have lucked out and received a number of hand-me-down clothes and toys, as well as a ton of gifts and gift cards from our baby shower that are still holding us over comfortably.

We also did a “diaper raffle” at our baby shower in January, where if you brought a pack of diapers you would be entered to win a prize. Luckily all prices were donated from others (wine, luggage, etc.). We received a ton of diapers and probably haven’t touched 80% of what we received. Lucky us, huh!? Well our little girl is growing slowly and is still in newborn diapers, so we actually had to go and buy a small pack of newborn diapers from Target to hold us over until she reached size 1. So we’ve have now collectively spent $15 on diapers in the first three months. Not bad…thanks to our baby shower diaper raffle.

Our expenses increased a great deal in May because my wife is back to work and we now have to pay for part-time child care. My wife was actually back to work at the beginning of April but we received lots of family help since my daughter was only 2 months old. We do get some family help still, but from now moving forward we will have to pay child care expenses monthly for a nanny who watches our daughter.

Cost to Raise a Child: 3 Months In (2017)

  • 1st month = $414
  • 2nd month = $105
  • 3rd month = $545
  • Since inception (March, 2017) = $1,064

 

May

Item Price
529 contribution $50
Child care $410
Ear piercing $40
Co-pay $30
Diapers $15
Total $545

How Much Does it Costs to Have a Baby?

Looking a head to next month, we should finally have all of our final bills in from the hospital so we can measure the literal cost of having a baby. Our June ‘cost to raise a child‘ report is going to be a big one! In reality our costs thus far to raise our child have been very, very low. But next month that all changes. Stay tuned for the June, 2017 breakdown…




Last Week Stock Market (May 29-June 2, 2017)

This past week, May 29-June 2, all major U.S. stock indexes closed at all time highs; Dow, NASDAQ, and S&P 500. In the month of May, the Dow was up 0.3%, NASDAQ 2.5%, and the S&P 500 was up 1.2%. All these gains this past week were fueled by optimism that growth in both the economy and corporate earnings continues to gain positive momentum. Telecom stocks led gainers, while financials and energy were the only two declining sectors on the week.

  • 594,00 jobs created and hourly wages have increased 0.7% since President Trump took office
  • The Atlanta Federal Reserve put out a model showing that our economy is growing at a 3.5% clip this current quarter
  • NASDAQ up 397% from March 9, 2009 low
  • S&P 500 up 261% from March 9, 2009 low
  • Oil settled at $47.66/barrel on Friday, June 2nd; down 4.3% on the week
  • Oil is down 11.3% so far this year in 2017
  • Oil is down 67.2% from record high in July 2008

Last Week’s Stock and Bond Index Performance (May 29-June 2, 2017)

  • NASDAQ 1.5% (YTD 17.1%)
    • 21.4% since election
  • Dow Jones Industrial Average 0.6% (YTD 7.3%)
    • 15.7% since election
  • S&P 500 Index 1.0% (YTD 8.9%)
    • 14% since election
  • U.S. Aggregate Bond Index 0.6% (YTD 2.7%)

How did my retirement portfolio perform last week (May 29-June 2, 2017)?

Below is a snapshot of my three biggest retirement portfolio mutual fund movers in terms of percentage gained last week.

The below mutual funds are held within my work 401(k) plan as well as two separate Roth IRA plans. I currently invest 15% of my income into my company Roth 401(k), and that doesn’t include the company match I get. All accounts are held with Vanguard (so as you can see I primarily invest in Vanguard funds because of this).

  1. Vanguard Extended Market Index Fund (VEXAX) 1.6%
  2. Vanguard International Growth Index Fund (VWILX) 1.5%
  3. DFA U.S. Small Cap Value Portfolio (DFSVX) 1.3%

Can I Beat the Stock Market?

I am actually not trying to “beat the market” with my retirement portfolio…I am trying to match it. I do have alternative indexes in my retirement portfolio to help possibly beat the market, e.g. Small Cap Value, REITs, International, and Emerging Markets. Through lots of reading and research on my part, I’ve found that a number of these assets classes “zig” when the market “zags”. I am purposely over-weighted in Small Cap Value, which at times helped me beat the market and at the same time lag the market.

With that said, if I can beat the market I will absolutely take it (obviously)! Last year in 2016 my retirement portfolio returned 13.01% versus 9.54% from the S&P 500. The primary reason I was able to beat the market last year was due to the strong performance of my Small Cap Value holdings, which I am weighted heavily in.




Thus far in 2017, which is 155 days, my retirement portfolio is up 7.3% versus 8.9% from the S&P 500. So while I beat the market in 2016, I am now lagging it in 2017. But I am investing for the long term so this doesn’t concern me, as long as I am within reason of the market (roughly 1%). I use a free account with Personal Capital to track my investments like this.

I am a Millennial, a liberal arts major, and I am my own financial advisor. I am strongly considering using the services of robo-advisor Betterment, however. The more I read and research Betterment, the more I like their product, services, and overall costs. But at this point, I am managing my own portfolio.

My goal with this Millennial personal finance blog is to show all Millennial’s that you have the power to take control of your personal finances through self-education and self-development on money and finances, and by striving to become financially literate. That is what I have been doing for years now, focusing on becoming an expert in financial literacy, so I can one day become financially independent. I’m trying to prove to Millennial’s that we can all do this and thrive with money. We Millennial’s have the greatest resource on our side to become financially independent and build wealth…time! Save, invest, and let compound interest do the rest.

Follow my blog as I highlight relevant personal finance and retirement topics pertaining to us Millennial’s.




How a Millennial Can Retire Early?

We Millennial’s have our entire financial future squarely in front of us. If we act accordingly we can easily become Millennial Millionaires and one day retire early. Envisioning an early retirement as a Millennial should be on all of our radars because the worlds single greatest wonder is on our side; the power of compounding interest and time. If we all act accordingly, financially-speaking, retiring early as a Millennial is a very achievable goal.

Early Retirement for Millennials

So what exactly does it take to retire early as a Millennial? First off, you have to save, and save aggressively. Most financial planners give all investors a conventional retirement savings target of 10% to 15% of your income, spanning a 40 year career. And if you are a Millennial and saving the latter already, 15%, you’re doing a fine job, and well above the average America. But retiring early isn’t what the “average” American does. The average American spends more than they make, buys goods they can’t afford, and fails to save for retirement. So if you want to achieve more than this and have your sights set on an early retirement as a Millennial, you are going to have to tighten up your budget and save more like 25% to 30% of your annual income.

Let’s imagine you’re a 25 year old Millennial making $55,000 a year. If you saved 30% of your income and also received an employer match of 5%, therefor making your annual retirement savings rate 35%. That savings rate of 35% annually would equate to $19,250 or $1,600 per month ($1,375 of which you contribute). If you invested that much annually for 30 years you would end up with $2,175,000 by age 55 (assuming an 8% return). The stock market has historically averaged 10%, so if you received those returns you’re looking at a retirement nest egg of $3,150,000 by age 55.

If at the age of 55 you ended up with a nest egg of $2,175,000, you could safely withdraw 2.5% of your money annually, giving you $54,000 a year to live on. The traditional withdraw rate most financial planners recommend is 3% to 4%. However, if you plan to retire early you must lower that rate and be a bit more conservative. A 2.5% withdraw rate at age 55 gives you a 90% probability of your money lasting until age 90.




If you received that historical stock market return of 10% and ended up with $3,150,000 at age 55, then you could safely withdraw nearly $79,000 annually. Both of these annual retirement incomes would be lower than your current working income in your early 50’s (given inflation and raises), but once retired you lose one huge monthly budget item – your retirement savings. You were used to saving 30% of your income for retirement and effectively living on 70% of your take home pay. These retirement income figures should be closer to that number than you think. And you would be retired early!

The other factor I didn’t mix in to the equation is your biggest monthly budget item; your mortgage. Most mortgages take up approximately 20-25% of your take home pay. So with a paid for home and a retirement savings rate of 30% through your working career, once retired you can easily live on less because you were used to putting out 50% of your pay towards the mortgage and retirement accounts. So now living off $54,000 to $79,000 at age 55 in an early retirement doesn’t sound so bad, huh?

We Millennial’s really just started our working careers and have a ton of time left in the professional workspace. Even those of us Millennial’s who wish to retire in our 50’s still have two to three decades worth of savings left to do, which gives you plenty of time to let your money work for you via compound interest.

Making Retiring Early Your Goal

Regardless of the age you wish to retire, whether it be in your 40’s, 50’s or 60’s, setting an attainable goal of allowing yourself this possibility at one of those ages is wise. And just because you say you want to retire at 50, and saving diligently to do so, doesn’t necessarily mean you have to fully retire at that age. Perhaps you still feel the strong desire to continue longer down your career. That’s great…that just means you’ll have even more money saved for retirement once you do decide to hang it up. Or can you scale back significantly and work part-time doing something else you love or consulting in your previous field part-time. This would ease you into retirement soften anyways.

Or, on the negative side, you may lose your job at a later age and have a tough time finding a new gig, again due to your age. Or your health may not allow you to work full-time any longer, or a family member’s health may be an issue you need to care for. However you slice it, saving prudently so that you are financially independent early than expected (say in your 40’s or 50’s), is only going to give you flexibility and options as you age. Again, you can always keep working and saving if you decide an early retirement isn’t for you. But I am going to save like crazy now so that I can one day be financially independent and have a multitude of options as I approach closer to retirement.