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Ask HN: What is your financial “setup”?

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Re: Ask HN: What is your financial “setup”?

#81

Post by torstenvl »

dragonwriter wrote: post #56
MuffinFlavored wrote: post #54

Earlier quoted context omitted.

> 3. Max out 401k and IRA every year using automatic deductions from your paycheck/bank account. > Pros: saving/investing on autopilot; lower taxable income Does it ever make sense to do Roth 401k instead of traditional 401k?

If you are expecting to be in a higher tax bracket in retirement (counting traditional IRA/401K income) then Roth IRA/401K may be a better choice, since it is after tax when invested but tax-free when withdrawn. Most workers will have substantially higher income subject to income tax during working years than in retirement even with IRA/401K withdrawals as taxable income, but that's not always the case.

I disagree with your analysis. Taxes due are going to be less a function of your income and more a function of tax law. At least in the United States, we have enjoyed many years of low and lowering taxes, at the expense of ever-increasing debt, and are likely reaching the limits of what we can expect the magic of monetary theory to insulate us from. Upshot: tax rates will have to increase substantially in the medium term.

Re: Ask HN: What is your financial “setup”?

#82

Post by sneak »

Hackbraten wrote: post #57
sneak wrote: post #29

Earlier quoted context omitted.

This could easily be rephrased as “How come people are so obsessed with using payment systems with real-time warrantless government surveillance for all purchases?” I honestly don’t get it. Why would you pay a percent or two to be surveilled? It creates a time stamped track log, too, which can be easily cross-referenced with (also surveilled) cellphone position. https://www.wired.com/2010/12/realtime/

YMMV but I don’t mind payment processors knowing my location. I’d choose that anytime over touching physical money (or having people who process my food touch it).

It’s not just the payment processors, it is also the federal government, who, via parallel construction, have the ability to lock you in a cage for years and effectively prevent you from ever leaving the country thereafter, should they ever desire to do so.

Re: Ask HN: What is your financial “setup”?

#83

Post by Jemaclus »

I highly recommend the book "I Will Teach You To Be Rich" by Ramit Sethi. It's an easy read and is a pretty fool-proof way to set up your finances. Any moderately successful person would probably give you the same advice, but the book lays it out in easy-to-read terms.

The gist of it is to automate everything as much as you can! Auto-pay, auto-deposit, etc.

Re: Ask HN: What is your financial “setup”?

#84

Post by balladeer »

_l4jh wrote: post #16

The thing that really worked for me was I only ever buy in person with cash. I almost never use my debit card in person. This simple thing changed my relationship with what I buy. Obviously my mortgage and other monthly payments are direct debit but unless the purchase is several hundred Euros or more I will pay in cash. I always have €200 in cash on me which is enough to cover me at least a week. Then whatever I hav…

I'd love to use cash. Only downsides are lack of change, it's always an issue, and it adds to the wallet thickness.

For me credit card works just fine. Somehow credit card has never felt to me like a credit instrument. For me it's always been offers, deals (when I have to buy something), free lounge/spa access, and free points. I have also set 3 limit alerts on my main credit card which does my ~90% of expenses usually and last alert means no more use unless something really urgent comes up.

If I need to buy something it goes to my "Buy" list on my todo app and depending upon the urgency either right then or during a sale I just check that "Buy" list and buy all or some of it. I don't buy anything else on impulse except books which are not very often and are not expansive at all. Food/eating out is the only thing I have budgeted. This has worked fine so far. Touch wood!

Re: Ask HN: What is your financial “setup”?

#85

Post by balladeer »

tra3 wrote: post #2

YNAB ( https://www.youneedabudget.com ) for budgeting and tracking spending. It forces you to pre-allocate your funds which ensures that you don't overspend unconsciously via credit cards. I've been very successful with it. > Anything that follows the "don't make me think" philosophy? I don't think that exists. YNAB requires pretty diligent tracking, but the payout (heh) is huge.

And there we added another expense to the list of here-money-goes-out-every-month :)

Re: Ask HN: What is your financial “setup”?

#86

Post by godzilla82 »

I know it is a difficult ask for commenters to tell where they are from, but most answers wouldn't make sense unless that information is given. I would have completely different money management principles if I lived in SF bay area or in a developing country. Also, the state of the economy matters a lot. If you lived in a country with 6+% rates of inflation, you would have completely different future planning than say in SF bay. Also important is taxation and rebates in your region. But I am pretty sure you are in SF bay area, as are most other commenters here, so I will excuse myself as I have nothing useful to advise.

Re: Ask HN: What is your financial “setup”?

#87

Post by redis_mlc »

sneak wrote: post #82
Hackbraten wrote: post #57

Earlier quoted context omitted.

YMMV but I don’t mind payment processors knowing my location. I’d choose that anytime over touching physical money (or having people who process my food touch it).

It’s not just the payment processors, it is also the federal government, who, via parallel construction, have the ability to lock you in a cage for years and effectively prevent you from ever leaving the country thereafter, should they ever desire to do so.

Google buys your payment stream, and can correlate that with your email, browsing and tracking history. Also other companies do this.

You have to be a tool to do most of your payments with credit cards now.

Re: Ask HN: What is your financial “setup”?

#88

Post by lostlogin »

balladeer wrote: post #84
_l4jh wrote: post #16

The thing that really worked for me was I only ever buy in person with cash. I almost never use my debit card in person. This simple thing changed my relationship with what I buy. Obviously my mortgage and other monthly payments are direct debit but unless the purchase is several hundred Euros or more I will pay in cash. I always have €200 in cash on me which is enough to cover me at least a week. Then whatever I hav…

I'd love to use cash. Only downsides are lack of change, it's always an issue, and it adds to the wallet thickness. For me credit card works just fine. Somehow credit card has never felt to me like a credit instrument. For me it's always been offers, deals (when I have to buy something), free lounge/spa access, and free points. I have also set 3 limit alerts on my main credit card which does my ~90% of expenses usual…

> it adds to the wallet thickness.

This was an irritating thing. My wallet has been one card stuffed in the back of my phone case for about 10 years now. One less thing to keep track of. It goes against the grain here, but going 100% cashless has improved things for me and has reduced my spending. The extra points on the credit card are nice and the crud and shrapnel that used to accumulate in and around my wallet are not a thing anymore.

Re: Ask HN: What is your financial “setup”?

#89

Post by lostlogin »

sshine wrote: post #23
Hackbraten wrote: post #22

Earlier quoted context omitted.

How do you feel paying in cash helps compared to cards? I honestly don’t get it. For me, withdrawing and paying cash simply adds unnecessary complexity, and on top of that, it destroys any paper trail you may need for tracking your individual budgets. How come people (mostly in Germany, from my experience) are so obsessed with cash?

Having recently received private financial advisory, my advisor recommended that I do exactly this: Withdraw cash weekly, use only that cash to pay for food. Supposedly, it will make you more aware of how your spending affects your balance. Swiping a card "feels free".

> Swiping a card "feels free"

Could this relate to age or how one grew up? It doesn’t seem like one abstraction is really all that different from the other.

Re: Ask HN: What is your financial “setup”?

#90

Post by benbristow »

eb0la wrote: post #67
_l4jh wrote: post #16

The thing that really worked for me was I only ever buy in person with cash. I almost never use my debit card in person. This simple thing changed my relationship with what I buy. Obviously my mortgage and other monthly payments are direct debit but unless the purchase is several hundred Euros or more I will pay in cash. I always have €200 in cash on me which is enough to cover me at least a week. Then whatever I hav…

I find this fascinating because in Spain we are in a quick restrict-access-to-cash spiral with banks shouting down offices every.month and getting an ATM nearby is increasingly hard unless you live or work in the center of a big city. If you actually touch the money, you can feel easily how much is going out. Plus, I guess having to go to an ATM to get money out makes it more valuable because you pay everything with…

I feel the opposite. I use a Fintech bank called Monzo that's available in the UK and is now expanding into the states.

When I have cash it feels like Monopoly money that I can splash on anything.

When using my card I get instant notifications as soon as I pay and the notification gives a running total to how much I've spent in the day. Also shows me how much money I've got to last me into payday taking into account recurring payments like bills, online-services etc.

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