Welcome back for the 2nd post in our series of Go Curry Cracker Reader Financial Reviews, where we dig deep into the finances and ambitions of a lucky anonymous reader. Together, we can overcome limiting beliefs, change the rules, and exceed our goals
This month we go to Manhattan where Mr and Mrs NYC have discovered that lifestyle inflation is one of the world’s most powerful forces, second only to compound interest.
We will also learn a little about the difference between owning real estate and investing in real estate, the high tax burden of NYC, and why the Backdoor Roth is not necessarily a great investment choice.
We exchanged many emails over the past several weeks, which inspired a lot of creative thinking on both sides. Let’s see how it turned out
The Big Tent: Cavalia
Hello 2015! Our 3rd full year of early retirement is off to a good start.
We kicked off the new year with some fireworks, went to the coast for a bike ride under a mountain (photos below), and then went under the big tent to see Cavalia, a horse and circus extravaganza.
In normal daily life, I continued with my Chinese studies, now in my 4th quarter. Winnie continued with flute lessons and enrolled in 2 new painting classes
We have mostly settled into our new neighborhood, and are now known on site by several of the local restaurants. At our favorite Szechuan place, as soon as they see Winnie the staff runs in the back room to grab an extra pillow for better back support. My favorite coffee shop knows my usual order, and the little hole in the wall Japanese place has started giving us free appetizers. It’s like we are in an episode of Cheers
How much did this extravagant living cost?
Two year’s ago Valentine’s Day, Winnie and I celebrated our love by going to a small pastry shop for afternoon tea. I remember our conversation like it was yesterday
Winnie: “We were really lucky to find each other. I have never met anybody that fits me so well.”
Me: “I know, I feel the same way.”
Winnie: “I bet we feel so comfortable with each other because we have been together in past lives, like soul mates”
Me: “You think so? I believe that”
Winnie: “Yeah, and maybe in our next life we will be together again. I could even be the man and you be the woman”
Me: “You think?”
Winnie: “Yeah… but, maybe you could lose some weight first. I’m not really into fat chics”
True love… how sweet it is
Go Curry Cracker Going to Battle with the RMD
Over the past few years, taxes have become a bit of a passion obsession.
I had always assumed our tax rate would be lower in retirement, and therefore followed the mainstream advice to max out my 401k each year. This definitely helped to Turbocharge our Savings, and saved a ton in taxes during the accumulation phase
Then in our first years of early retirement, it became clear just how low our taxes could be. Infinitesimally low. Completely non existent. Zero
Now I’m on a mission to Never Pay Taxes Again, not for any politically or financially motivated reason… but just because we can
You Sunk My Retirement! Photo by Rick Bennett
“What?! The IRS can take nearly 50% of my Retirement Fund in taxes?! How am I supposed to live on only half of my savings? With taxes like this, how can I ever retire, let alone early?”
There is a dangerous nuance in the US Tax Code code that is going to sink and destroy your retirement! There is nothing you can do when the Tax Torpedo strikes, taking nearly half of your income with it!
Sounds ominous, doesn’t it?