Making Early Retirement Happen When You Have Kids

family-grandma-my-personal-finance-journeyThe following is a post by MPFJ staff writer, Kevin Mercadante, who is a freelance professional personal finance blogger for hire, and the owner of his own personal finance blog, He has backgrounds in both accounting and the mortgage industry.

Nearly everyone it seems is holding out for early retirement. But what happens when you have kids? It’s not impossible, but it is admittedly more difficult. You have to rearrange your finances and your timing to accommodate the raising of children. It can be done, but it requires more creativity.

Think of Your Kids (and Grandkids) as Motivation for Early Retirement

While most people focus on the financial costs of having children, the flipside is that you think of them as being one of your primary motivations for early retirement. If it will be possible for you to retire while your kids are still fairly young, that will give you more time to be with them, and to raise them the way you want.

It will also eliminate the career stress and the financial uncertainty that can go with the dual obligations of child rearing and having a career.

And even if you are unable to retire when your own children are young, your Plan B can be to retire early and spend more time with your grandchildren.

You May Have to Adjust Your Independence Date

It probably won’t be possible to early retire on your own specific timetable. You’ll have to work your independence date around your kids.

Much will depend upon how far along you are in the planning process, but you may have the need either to accelerate early retirement to be home with your children, or to delay it until they are emancipated.

Flexibility will be a critical part of your early retirement planning strategy when you have kids.

You Know Those Kids Who Seem to Have Everything? Yours Won’t

In every neighborhood (or classroom or extended family) there’s always that one kid, or family of kids, who seem to have everything. It might be the latest and the best bicycle, motorized Kiddy car, cell phone, laptop, sporting gear or clothing. Such a child or group of children have a way of “setting the standard” for just about every other kid in the group.

That’s a game that you will not be able to play with your own children. It’s an arms race for the best stuff, and it’s a very expensive lifestyle. If you plan to retire early, you’ll have to prepare your children to live more conservatively.

That’s not being selfish on your part either. A conservative outlook when it comes to finances is a life strategy that will benefit your kids throughout their own lives.

Preparing for College on the Cheap

It can cost well over $100,000 to send a child to a state college, and more than $200,000 for a private college. Those are options you may have to scale back on.

You might want to start your kids at a community college for the first two years. From there, you might encourage attendance at a state school to finish their undergraduate degree.

You should also encourage any efforts to get scholarships or grants. And even though it’s fairly unusual these days, there’s nothing wrong with having your kids participate in providing at least some of the cost for their own education.

Your Time WILL be More Limited

This is a limitation that there is no skirting around. While a childless person may be able work two or three jobs, 100 hours per week, your life will require more balance.

Though you may have to work more than the average person does, such as a full-time job plus a side business, you will have to allocate plenty of time for your kids.

No matter how important the goal of early retirement is, this is a challenge that you will have to meet successfully. The time that you don’t spend with your kids when they are young will be gone forever!

This will perhaps be the biggest challenge you will face as a parent preparing for early retirement. And there’s no sugarcoating the fact that you will have to make trade-offs. Only you can decide what the specific balance between work and child rearing will be.

Think carefully, because there’s no do-over when it comes to kids.

And So Will How Much Money You Have For Savings and Investing

There’s also no debating that children will leave less money available for savings and investment. Children mean higher medical costs, disposable diapers, a succession of clothing and toys, afterschool programs, tutoring, day care and higher-than-you-think costs for participating in high school sports.

All of that will be less money available for savings and investing. But you must view the money that you will spend on your kids as an investment in their future. That’s no less an investment than preparing for your own retirement.

Do As Much As You Can Before Becoming a Parent

If you don’t already have children, but you want to, you will help your own cause considerably if you can do as much retirement preparation in advance as possible.

This will actually have to advantages:

  1. The more that you can do before you have kids, the more likely it is that you will retire early in their lives and have more time with them, and
  2. The more that you can do in advance will mean less pressure later on, enabling you to spend more stress-free time with your kids, while still being on track for early retirement

Advance preparation will include minimizing debt, and frontloading as much retirement and investment savings as possible before your kids are born.

This will not only give you a head start, but it will also set you up in the right life patterns. This will be extremely important once your first child arrives. Having children very much puts you in a position where you are dealing with the unexpected. If you already have your early retirement plans in a row before they are born, you can continue to make progress even as you deal with the uncertainties that children bring.

A Scaled Back Version of Early Retirement is OK

If in spite of your best efforts, you are unable to reach your early retirement age goal as a result of having children, you can simply regroup.

No major financial milestones are ever achieved without building a healthy dose of flexibility into the plan. If you have to delay your early retirement by five years, that will be a small price for properly raising your children.

And even if you are forced to accept an early semi-retirement – in which you mostly scale-back on your career in favor of more time off – you’ll still be better off than you would have been if you never prepared for early retirement.

Early retirement is a worthwhile goal, but it should never be seen as more important than raising your children. It takes some real talent to balance the twin goals of child rearing and early retirement. But if you can, you’ll be well prepared for whatever life throws at you.

How about you all?  Have you or anyone you know planned an early retirement successfully?  What roadblocks have you encountered along the way? Do you have other strategies for planning for an early retirement not listed above?

Share your experiences by commenting below!

***Photo courtesy

4 Ways to Save Money on Moving

moving-van-my-personal-finance-journeyThe following post is by MPFJ staff writer, Laurie Blank.  Laurie is a wife, mother to 4 and homesteader who blogs about personal finance, self-sufficiency and life in general over at The Frugal Farmer. Part witty, part introspective and part silly, her goal in blogging is to help others find their way to financial freedom and to a simpler, more peaceful life

Without proper planning – and even with proper planning – moving can cost a LOT of money. Between the prep work beforehand, real estate fees, moving expenses and getting adjusted in your new home, the costs can seem endless. Here are some ideas on how you can save money as you prepare to move from one home to another.

How to Save on Getting Your Current House Ready for the Market

A move to a new home often means you have to sell your current home. It’s important to maximize profits on the sale of your current home without spending a bunch of money you don’t need to spend. In order to make your house shine and save money in the process, try these tips.

  • Stage your home yourself instead of hiring out. Most of home staging involves making the home look uncluttered and inviting. Check online sites such as Pinterest for home staging tips and do the work of staging yourself.
  • Deep clean and organize your home. A clean, organized home where every corner has been decluttered will help the home sell for top dollar and will also cut down on moving expenses because there will be less stuff to move to your new home.
  • Make inexpensive cosmetic repairs. This is another tip that will help you get top dollar for your current home. If you’ve got broken blinds, shabby curtains or ultra-worn furniture, seek out inexpensive resources for replacing or repairing them. A fresh coat of paint will do wonders. Freshly cleaned carpets (instead of replacing carpet) will make your home shine.

How to Save on Real Estate Transactions

Real estate transactions such as realtor fees and taxes can also add up when it is time to move. Try these tips for saving on selling your current home and buying your new home.

  • Negotiate your realtor’s commission fee. While the regular fee for most realtors is seven percent, it’s not unrealistic to talk a realtor down to six percent or even lower if you have a good reason. What justifies a good reason for a realtor to lower his or her fee? A turnkey property, a higher end property or a home in a valuable neighborhood. The easier your home is to sell, the more likely a realtor will consider lowering their fees.
  • Ask the seller of your home to pay some or all of your closing costs for your new home. By negotiating some seller paid closing costs, you can save several thousand dollars.

How to Save on the Actual Move

This is where things can get expensive. Moving companies often charge several thousand dollars to pack up and move a family from one place to the next. Here are some tips for saving.

  • If you’re moving locally, consider doing the packing and moving yourself, either by asking for help from family and friends or by renting a large moving truck.
  • Instead of paying for boxes, head to local grocery and department stores and ask if they have any boxes they’d like you to take off their hands. Many stores will gladly give you the boxes their inventory comes in for moving purposes.
  • If you’re moving out of town, get estimates and references from at least three different moving companies, as prices and services can vary wildly.
  • If you have to hire a moving company, ask if they’ll give a discount if you pack up your own belongings instead of having the moving company do it.

How to Save as You Get Settled in Your New Home

There are expenses to every part of moving, including when you’re settling into your new home. Here are some tips for saving money as you settle in.

  • Get more than one estimate for local utility, cable, satellite and Internet provider companies before you choose your providers. Ask for new customer discounts such as the first three months free or a waived installation fee.
  • Do any cleaning and painting yourself if possible, as opposed to hiring out.
  • Know beforehand what other items you’ll need to settle into your new home, and work to buy them at reasonable prices. When we moved from the city to the country, we found out quickly that we’d need a chainsaw for tree limbs that fell during storms and a decent snow plow for our long driveway. Because we hadn’t foreseen those purchases beforehand and had to make them quickly, we spent more than we needed to.

Moving is listed as one of the top stressful times in a person’s life, but with some forethought and planning, you can help make your move less stressful and less expensive as well.

How about you all? What are your tips for saving money while moving? How do you keep moving less stressful?

Share your experiences by commenting below!

***Photo courtesy

What Should You Expect In Retirement?

retirement-plan-my-personal-finance-journeyThe following post is by MPFJ staff writer, Marie. You can read more of Marie’s articles over at her own blog, Family Money Values. Enjoy! 

Although most of us are extremely busy leading our lives going about our daily routines, at some point, you might take a moment to wonder what to expect if and when you do ‘retire’.

Are there patterns that most people follow during their retirement years?  Are there similarities in things such as what we spend money on, how much we travel, amount of time spent with family, part time jobs or volunteerism activities.  Are there patterns that occur at different points in retirement – at different ages?

I’ve been retired now (or semi retired) since spring 2010.  I’ve observed some changes in the way I deal with retirement and have noticed changes in other retired folks that I know as well.

The Planning Years

Before you actually retire, you are probably spending at least some time thinking about finances after you leave the workforce.  How much do you need to save to quit work, how much can you spend after you retire, will your taxes be less (unlikely) or more when you do retire – all these can be ongoing concerns from the time you first start imagining a retirement.

Closer to the actual retirement date, you may spend time doing some analysis of current expenses to compare that to the income you anticipate drawing during retirement.  Of course you also need to add on any additional expenses that you may anticipate during retirement – moving, travel, health spending, new hobbies, etc.

I spent quite a bit of time in 2009 pouring through checkbooks and building spreadsheets of all our expenses for the past few years – then classifying them as required vs discretionary – to see where we would stand.

The Early Years

The early years of your retirement may diverge wildly from what other retirees do.

If you are healthy, active and well funded, these years may include multiple vacations, and/or more spending on entertainment such as concerts, tours, theaters and restaurants.  Some decide to pursue a dream – such as living in another part of the country or world, or selling the house and buying an RV, or pursuing more education or training.

You may decide to try to spend more time with family members, perhaps assisting with the care of your grandchildren or visiting out of town relatives or simply doing more with your spouse.

You probably are making adjustments to the absence of work related activities, associates and recognition.  You may be making related adjustments to the constant presence of a spouse – finding balance between the need for your own time and the time you share.

Most start these years with eager anticipation and many change lifestyles.  I dedicated time to learning how to build my website ( and finally achieving a life long desire to write and publish.  My spouse, after spending 30 years encased in a cubicle, has spent his retirement so far joyously working outside on our 6 acres.  A couple I know downsized from a luxury home to a luxury condo – not for the savings, but for the freedom from some of the homeowner chores.  They became snowbirds – relocating from the Midwest to the Southwest during the winter.  An aunt and uncle sold their subdivision home and went back to farm living – complete with vegetable gardens, fruit trees, cattle and cats.

Cautious retirees carefully track spending and income in their early years, until they are comfortable that their new levels of income will support their new lifestyles.  It can be difficult to adjust to varying amounts of income as opposed to a regular paycheck.  It is hard to anticipate what you can spend or what you will have to put aside for taxes when a good part of your income is paid out once a year at year end in the form of interest and dividends.

The Middle Years

After the initial thrill of not having to go to work every day wears off, retirees typically settle into a new pattern.  Spouses generally will have worked out new routines of living together and may have had an opportunity to deepen their understanding of each other (or on the other end of the spectrum, discover they are really incompatible).

On the whole, more than half of surveyed retirees report being well satisfied with life.

However, questions of self-worth may start to arise during these years, perhaps causing an interest in finding and supporting a cause – leading to volunteerism.  According to the National Institute of Aging’s Health and Retirement Study:

“People ages 60 to 69 at the time were most likely to have engaged in volunteer service, with one in three people in that age group having done so.”

To counteract feelings of worthlessness, some decide to take a more active role with grandchildren, or find a way to mentor others in an area of expertise.

Health issues may begin to plague us during our middle retirement years.    At a minimum, incidents of arthritis, hypertension and suspicion of cognitive impairment (you know – those ‘senior moments’) increase.

Some may find themselves slowing down, becoming less physically active due to depression, flagging interest in formerly enjoyable endeavors or health issues.

Loss of physical and mental ability can be disconcerting to us as we move through retirement stages.  Adjusting to fading eyesight and reduced hearing as well as increased difficulty in moving through the day can take awhile.  These signs of our impending mortality can make a person seek answers to the age old question of what happens when I die, or what purpose do I have on Earth.

The Later Years

As we age through retirement, we encounter more limitations and health restrictions to our activities.  However, in spite of that most of us continue to own our own homes.  The Health and Retirement Survey is finding that even among those 85 and older, more than half of the study participants (which were selected to be a broad spectrum of the American population) live in their own home.

Spending on health care typically rises during these years – whether from increased out of pocket prescription and doctor costs; more frequent hospitalization; or from the need for increasing daily activity care.

That Aunt and Uncle I mentioned above that moved to back to the farm in their early retirement years later moved (in their 80’s) to a smaller home across the country to get closer to a daughter and now have settled into a graduated retirement living center.  They are now in their 90’s and are in an independent living unit, but receive house cleaning, maintenance and cooking services.  They are set to be able to receive more care from the facility if needed as their bodies continue to fail.  For now, they still enjoy the center’s activities, their church and weekly visits to the daughter’s house – and both still drive.

A 93 year old mother-in-law, was moved to a senior living center closer to family.  Although still mobile and alert, her failing eyes (macro degeneration) and unreliable knees cause multiple doctor visits a month.  A decade ago, she gave up driving due to her eyes, so one of the kids escorts her around town.  She has a one bedroom apartment in a multistory center and gets maid, laundry and meals and maintenance as part of her rent.  She is active attending family events her many children, grandchildren and great-grandchildren generate, as well as participating in activities put on by the senior living center – such as morning exercise.

How about you all? What have you observed about the patterns of retiree’s?

Share your experiences by commenting below!

***Photo courtesy

Personal Finance Statistics: How Do You Stack Up Against the Rest of America?

The following is a guest post. Enjoy! 

Managing your personal finances day to day has become routine, but many do not know how they stand against the rest of America. Are you better off than the rest or are you spending more than most of the country? Here are some statistics to help you determine if it is time to rethink your finances.

Finances and Credit Scores:

  • 76% of America lives paycheck to paycheck.
  • 77 million Americans have debt that averages to about $5,200 per person.
  • A 700 score is considered a good credit score and the average credit score is 692.
  • In 2015, between business and non-business, 911,086 Americans filed for bankruptcies. This is the lowest it has been in the past four years.
  • 25% of middle class households have less than three months savings.
  • When using credit cards, Americans spend 12-18% more.
  • In 2014, 48% used credit cards to pay for online purchases, while 30% use a debit card.
  • Only 30% of Americans plan long term savings and financial plans.


  • Two in three households of color do no have three months of savings accrued.
  • The home ownership rate for white households is 72% while the ownership for households of color is 46%.
  • African American households have interest rates at least 2% higher than that of white households.
  • 50% of white households and 71% of African-American households have received calls from debt collectors.

Retirement and Gender Differences: 

  • When it comes to knowing financial literacy (knowing how money works in the world, how to invest money and manage money, and how to earn money) women consistently score lower than men.
  • There are no differences between men and women who have strong financial literacy.
  • 50% of working Americans have less than $2000 saved for retirement.
  • 24% of Americans have postponed their retirement at least once during the past year.
  • 17% of retirees report that their current level of debt is higher than it was five years ago.
  • 50% of today’s American families are at risk of not being able to maintain the standard of living once they retire.

Buying a Rental Property for Cash Flow

for-rent-my-personal-finance-journeyThe following post is by MPFJ staff writer, Jeff. Jeff has been writing online about finance related issues since 2009, and after a lot of soul searching in 2015 has crystallized his goal of financial independence and blogs about his journey to freedom at

Recently after a few life changes, I started making changes to my investment strategy. I have gone head first into the rental property market, and have closed on my first 4 unit building. I was able to learn a ton during this process, and would like to show you how to properly analyze a rental property to make sure that you don’t end up losing your shirt. Some people think it’s just as easy as collecting rent and paying the mortgage (not likely) and some think its going to be awful with maintenance issues and other problems left, right and center and you’ll lose your shirt (also, possible, but not highly likely). When looking into a rental property, here are a few things you need to account for to determine cash flow.

Lets assume you have a rental property that is a single family house, renting for 1,500 per month. Here is how you should analyze to make sure you’re not going to get caught with your pants down.

Vacancy Reserves

The unit isn’t going to have people in it the day after the prior group moved out, is it? Most likely not. It may take a few weeks or a month or 2 to fill it. You’ll need to make sure you have reserves for this. Many investors use 7-10% of the rental price. Since I like easy math, we will use 10%, for a final number of 150/mo for vacancies.

Capital Expenses Reserves

Shortened to CapEx frequently, this is a reserve set aside for big ticket replacements. A new fence, a new roof, new furnace, new water heater, etc. 7-10% of the rental price is common here as well. Since we like our math easy, we will use 10%, for 150/mo.

Property Management

You may self manage because you live at the place early on, but will that always be the case? You’ll want to build in for property management as well, when your life changes. 10% (again) is common here, $150.

Since this is a single family home, the tenants will take care of the water, sewer, and electric and gas bills. Any other things (such as upkeep, snow shoveling, etc) can either be done by the tenants or the property manager.

If you’re just looking to get started with rental real estate, don’t just think that if you earn more in rent than the mortgage, taxes and interest (Sometimes abbreviated as PITI) that you’ve got a good investment. The first blown furnace you’ve got will cause you major problems and really hamper whatever cashflow you may have.

How about you all? Are you interested or are you currently investing in real estate?

Share your experiences by commenting below!

***Photo courtesy