Best Financial Decision You’ve made

[freeazabird]

What would you say is the best financial decision you’ve made?

[ender]

To switch into tech.

[Wolfpack Mustachian]

Passive investing

[Trifle]

I married a frugal man. 

[Wolfpack Mustachian]

I married a frugal man.

Dang, good one. I should have put that down. DW's frugal nature has definitely had the biggest impact.

[ATtiny85]

Didn’t repair my snowmobile after I melted the engine for the second time, and basically sold it to my buddy for parts. Hmm, sort of reminds me of one of my worst financial decisions…(this was back in 97 but it still stings)

Reading and actually paying attention to costs. That led to full on low cost passive investing for over a decade.

[Metalcat]

Oof...from a wealth perspective, my decisions have objectively turned out very poorly despite being extremely smart choices and well thought out at the time. Life likes to throw me fucking crazy curveballs that fuck with my plans. Had things "worked out" as intended, I would have ended up very, very wealthy, but likely very unhappy.

However, in terms of quality of life? Things have worked out remarkably well, and I would say that my best financial decisions have been to live frugally enough to be extremely flexible and adaptable.

Probably my best financial decisions have been in terms of marriage and real estate.

Marriage:

As has been mentioned, marrying a frugal person is extremely helpful. But even more than that, marrying someone who is profoundly aligned in terms of values and priorities makes all decisions easier and more optimal.

I'm the driver of our financial decisions, but I can propose some pretty radical ideas and know they will have a high likelihood of being well received, because if I think something is a good idea, then it's highly likely that he will as well.

When optimizing isn't a fight or a process of compromise, it's a lot easier to optimize.

That said, we put an astronomical amount of effort into effective communication to keep these trains running smoothly. That's probably the most valuable investment we make, 'cuz divorce is fucking expensive.

Real Estate:

I've never been one for real estate investing. I would have happily stayed a renter for my entire life, mostly because I don't like to stay put for too long. However, buying ended up making a lot of sense...3 times over.

With a focus on frugality, not gains, I bought in 3 wildly different locations, which are each ideal for us in very different ways. This has given us access to a MASSIVE range of life experiences that we can bounce around as suits our mood, or rent them out for good cashflow if we want/need to scale back our costs.

Basically, minimizing costs and maximizing flexibility has generated a much more interesting, satisfying, adventurous, and rewarding life than we would have had if our initial plans to make a lot of money had worked out.

[NotJen]

Switching from an expensive college to the top cheapest college for my degree - conveniently co-located with tons of great jobs in my field in a LCOL area.

Of course, I would have probably been fine no matter what college I graduated from - I was born to be financially conscious, and I credit most of my success to genes and luck.

[Zamboni]

Getting divorced.

[Photograph 51]

Learning tightwad skills and attitudes early.

[Metalcat]

Getting divorced.

Yeah, sometimes staying married is way more expensive than divorce.

DH is divorced and it's the smartest financial move he ever made. He was barreling towards bankruptcy.

[mizzourah2006]

To switch into tech.

Similar to this I decided to self-teach data science and machine learning. It's hard to tell what would have been, but I think it's safe to say that this move at least doubled my comp over the past 6 years (actual comp is up about 3x over the past 6 years) and I didn't have to move to a HCOL city to do it.

[rantk81]

In the depths of the housing/financial crisis, in 2010, I bought that 1 BR condo with garage parking to use as a rental, for under 70K... which I collected regular rental income from up until 2018 when I sold that condo for 250K.

[Fomerly known as something]

There is this thing called TSP (401k) shove money into it.

[charis]

There are several hard to rank decisions:

Not desiring to "keep up with the Joneses."  It's a money pit.

Moving from VHCOL city back to med-low COL hometown (where everyone wants to babysit the grandkids)

Buying a house in an affordable but upward moving neighborhood right after the housing bubble burst.

Finding MMM right after grad school (though still on the late side).

[achvfi]

Finding and being part of MMM forum.

I would have succeeded with money overtime, because by nature I am responsible with money. But with all the great knowledge and wisdom of community here my finances have been supercharged.

Thank you all!!!!

[nereo]

for me it's probably tied between

• fully funding my IRA every year since I was 12, and
• generally living like a frugal grad student much of my 20s and 30s

Spending habits are now permanently ingrained in my spouse and I, as are automatic investments

[Villanelle]

From a mercenary persecptive, probably marrying DH, and not [just] in the warm fuzzy way that Malcat suggests.

He makes a lot more money than I likely ever would have, though I have no idea if single life (or life married to someone else) would have meant a career change, or what would have happened if I hadn't left the work force to be a trailing spouse. 

Second place (or maybe even first) is having been born to my parents, though I suppose that wasn't a choice.  They modeled and discussed frugality, the huge dangers of credit ("never, ever use a CC to buy something you couldn't pay cash for" was drilled into me a decade+ from before I'd ever get a card), buying used cars, not keeping up with the Jones, etc. 

[patchyfacialhair]

Best decision: Dropping out of a private expensive college after the first year. $40k in loans back in 2007 was no joke.

I ended up resetting the clock, going to community college for 2 years, then 2 more years at the local state college. I paid cash for all that tuition and was free of all the original debt shortly after graduation. Took a lot of work to make that happen while also doing full time school, but I have no regrets.

I imagine I would have made severely different life choices if I was looking at $160k in undergraduate loans.

[dandarc]

Probably career choice - although looking back, I think I might have been happier had I taken that accounting job (Federal Government) vs. the programming one I did take (at an insurance company). Despite the low starting salary, clearly got me into a much higher paying career path. So financially was clearly the right move. I've never made google money - actually that job I took paid the lowest salary anyone in my 2006 CS class at Michigan State got according to the salary survey, but it did enable a path to low-fix-figure income within 6 years of graduating none the less.

[HenryDavid]

The decision in 1997 to aim to live on 1/4 of the “normal” North American level of consumption.
This was for environmental reasons. Not financial. The financial benefits came as a by-product and a surprise.
In retrospect though it was a great financial decision.

In deciding to shoot for this target, and to make a game of doing it while still enjoying life, I ended up saving enough to retire after basically 20 years of a decent, pretty enjoyable job. No big secret strategies, just:
-ditched the car
-ate mostly vegetarian
-shopped 2nd hand, used the library, etc etc. All the stuff everybody here knows about.
-saved all the unspent money in the most boring and conservative ways.
Along the way I married a smart and frugal partner (artists have to live that way), stayed fit and healthy, and had a great time. Still having it. (“Richer” people have said “I envy your life” which is . . . weird. Because they can have it too.If they can stop saying “yeah but yeah but yeah but.”)
The “1/4 consumption” goal has been hard to define, so now we try to live on 1/2 the local median income. We sort of fail at it, we spend more like 2/3. Because we still travel a bit. But the goal and the strategies have been nothing but beneficial for our quality of life. It’s a rewarding game to play.

[ender]

To switch into tech.

Similar to this I decided to self-teach data science and machine learning. It's hard to tell what would have been, but I think it's safe to say that this move at least doubled my comp over the past 6 years (actual comp is up about 3x over the past 6 years) and I didn't have to move to a HCOL city to do it.

Amusingly for me I had no idea what money you can make in tech when I switched, I just liked the work more. lol.

[Michael in ABQ]

Joining the Army National Guard (my decision) and deploying overseas a couple of weeks into my sophomore year of college (not my decision). When I came back to college the next year I had about $15k I'd saved from the deployment and more importantly, I was considered independent for FAFSA. So, with my annual income of about $5-7k from the National Guard I qualified for the maximum in grants and subsidized loans - plus I received a 50% waiver on tuition, tuition assistance on the remainder, and the GI Bill ($400 a month into my bank account).


However, since college and living expenses were basically covered at that point, I made one of my worst financial decisions and decided to take out student loans I didn't need and invest them in the booming stock market of the early 2000s. When I graduated the market crashed and my financial heavy portfolio lost about 70% of its value leaving me with $10-12k of student loans and a stock portfolio that had dropped from $15k to about $4k. I also blew another $5k on other investments during that time including a couple of small businesses and foreign exchange.

In the end, those lessons taught me to just stick with passive index funds which I've done successfully for the last 15 years or so.

[sisto]

I don't think I can pick just one. I will list my top three.

1. Going back to school and getting a degree in my late 20's
2. Investing in my 401K, upping it every raise and not panicking/changing through multiple downturns (IE: dot com, 2008, and 2011)
3. Finding and taking advantage of the awesome advice this forum offers

I was already quite frugal, but I learned a lot about investing and taxes here.

[RetiredAt63]

Getting divorced.

Same here. 

Worse single financial mistake I made - not really thoroughly discussing money before we started wedding planning.  We did a marriage prep class with the church where we were getting married, I don't remember money coming up at all.  Ex's student loan, when he finally graduated and it had to be paid, was a big surprise.

Not my decision, but being born to parents who were teens during the depression gave me good frugal skills.

[lutorm]

Joining my current employer.

[nereo]

Joining my current employer.

This was a big one for me too… I was vastly underpaid and under appreciated in my previous jobs. The 2x part is great, but the support has been even more meaningful

[Metalcat]

Getting divorced.

Same here. 

Worse single financial mistake I made - not really thoroughly discussing money before we started wedding planning.  We did a marriage prep class with the church where we were getting married, I don't remember money coming up at all.  Ex's student loan, when he finally graduated and it had to be paid, was a big surprise.

Not my decision, but being born to parents who were teens during the depression gave me good frugal skills.

This is so common. I am always totally gobsmacked by couples who say that they never talk about their finances.

I'm honestly so fascinated by this, I want to be a fly on the wall of how they make financial decisions because I can't fathom it. Like, I literally can't imagine how the conversations would go.

[Dave1442397]

For me, moving to America. I have no idea where I'd be if I hadn't emigrated, but I doubt I'd have this lifestyle.

[curious_george]

Marrying my high school sweet heart - a nice, kind hearted frugal woman who would walk to the end of the earth to find me if I disappeared, takes care of me when I'm sick, etc, etc.

Working in tech.

Buying a $28,000 dollar fixer upper house right out of high school, fixing it up, then proceeding to keep expenses under $1,000 dollars per month for a family of four for nearly a decade before moving and expanding into a larger house and having more children.

Going to a community college paid for by the government while working full time while rehabbing houses when I was younger. I had no student loans when I graduated and still made the same income as my heavily in debt co workers.

It doesn't take a lot of hard work or sacrifice or even intelligence to become a millionaire - only a few well thought out decisions.

[charis]

Getting divorced.

Same here. 

Worse single financial mistake I made - not really thoroughly discussing money before we started wedding planning.  We did a marriage prep class with the church where we were getting married, I don't remember money coming up at all.  Ex's student loan, when he finally graduated and it had to be paid, was a big surprise.

Not my decision, but being born to parents who were teens during the depression gave me good frugal skills.

This is so common. I am always totally gobsmacked by couples who say that they never talk about their finances.

I'm honestly so fascinated by this, I want to be a fly on the wall of how they make financial decisions because I can't fathom it. Like, I literally can't imagine how the conversations would go.

Not to derail, but I don't see how a couple can never talk about their finances, unless they live apart and keep separate finances.  If they live together, there has to be at least one conversation about how they are going to pay the bills.  I know a married couple that never discuss money because they can't agree and it's always a fight.  They both make decent money, but one of them is a saver and pays all the bills and the other is starting to rack up some debt.  I don't see this ending well. 

[hudsoncat]

Jumping on the right spouse train here... we complement each other well financially. We're both frugal, but in different ways. He is happy to do the research to diy things I'd be more likely to pay a professional to fix. I'm much better about doing research to find great deals once we've decided we need/want to buy something. I drive our saving/investing because he couldn't care less outside of general info and periodic in-depth check-ins. His cooking is way better than most restaurants. He is also just the best human being I know.

[RedmondStash]

Being lucky enough to have parents who taught me to always live within my means and save at least a little from each paycheck, so I never got buried in debt.

Being lucky enough to graduate college without student debt.

Being lucky as to my relatively lucrative job options and career (yes, in tech).

Being lucky in finding a life partner who's amenable to FIRE philosophies, and with whom I have grown in compatible directions. Lots of luck there.

Being lucky enough to stumble across a FIRE website (because of a chance Facebook comment) that intrigued me enough to do the deep dive.

Firing our financial planner and taking the reins myself.

Being lucky enough to have an aptitude for math and Excel spreadsheet formulas.

Being lucky to buy our house when we did, and also lucky enough to stay employed with enough income to pay off the house. No way could we afford to buy into our neighborhood now.

Of course there were some shrewd choices and a lot of hard work. But honestly luck was the major factor for me. I could have made equally good choices and ended up a pauper had the timing been different. I have several friends who work much harder than I ever did, and who are likely to be up the creek with no paddle in their golden years.

[ChickenStash]

Number one for me was getting a loan for college. Easily the best ROI of anything I've spent. I could have gotten here without it but it would have been a tougher, longer road.

The second would be not buying new cars often. I'm a gearhead that really likes fast cars which is a recipe for financial ruin. It's taken a fair amount of self-control to keep that desire at bay and keep the spending to a dull roar. If I were to stop putting money into my stash and lose my mind I could really go hog wild with the cars, either buying or modding them. I hang out on a few car forums and have seen this play out many times.

[mspym]

My spouse. Both because he sent me the first MMM article the day he read it and because he encouraged me to change to contracting which increased my income 4x.

[Metalcat]

From a mercenary persecptive, probably marrying DH, and not [just] in the warm fuzzy way that Malcat suggests.

He makes a lot more money than I likely ever would have, though I have no idea if single life (or life married to someone else) would have meant a career change, or what would have happened if I hadn't left the work force to be a trailing spouse. 

Lol, well yeah, to be totally fair, I would have been capital F FUCKED if DH did make good money when I got sick and lost my career.

So marrying a well employer civil servant with a reliable paycheque is a pretty good idea if you are a medical professional who spent a quarter million on over a decade of school only to become seriously disabled in your 30s.

Definitely, DEFINITELY marry a decent earning spouse if that's your plan. It kind of makes the difference between the story of me losing my dream career being heartbreaking but ending really well and the story being devastating and ending in potential homelessness.

So yeah, beyond the warm fuzzy stuff, I'm a BIG fan of the fact that my DH earns enough to support me being unemployed.

[Fru-Gal]

Understanding that there was an unusual pathway to a very high paying job in my area, then understanding that I need to fix my money mentality first, then networking my way to that high-powered job by having that company first as my client, then saving most of what I made for five years. Oh, and refinancing my house one last time. At each juncture, there was a part of me that had a harmful belief system that needed to be fixed.

To wit:

1. There’s no way I can get one of those six-figure specialist jobs.
2. The system is rigged against us. Everything is unfair and I’m a victim.
3. I can’t be a business owner, anyone can see that I’m just faking it.
4. Now that I have this job I deserve to spend tons of money on myself.
5. What’s the point of refinancing at this historic low rate, I’m just resetting the clock by 30 years.

[RetiredAt63]

Getting divorced.

Same here. 

Worse single financial mistake I made - not really thoroughly discussing money before we started wedding planning.  We did a marriage prep class with the church where we were getting married, I don't remember money coming up at all.  Ex's student loan, when he finally graduated and it had to be paid, was a big surprise.

Not my decision, but being born to parents who were teens during the depression gave me good frugal skills.

This is so common. I am always totally gobsmacked by couples who say that they never talk about their finances.

I'm honestly so fascinated by this, I want to be a fly on the wall of how they make financial decisions because I can't fathom it. Like, I literally can't imagine how the conversations would go.

We were students about to start grad school, so money discussions were very basic.  But generally?  The conversations go badly.

[bmjohnson35]

To consistently utilize my 401k from a young age.  I started off at 6% of my salary and built up from there. In hindsight, I could have invested more into it way before I started maxing it out, but the fact that I committed to it early and stuck with it was significant. 

My 401k- Automated (required little to no discipline), up to 3% company matching & tax-deferred.

[Fru-Gal]

This reminds me, probably the best decision I ever made was to start saving in a 401(k) in my mid 20s and never ever touch that money through some very very lean times (and counter to some of the bad advice I was given by family members). Compound interest is real.

[srrb]

This reminds me, probably the best decision I ever made was to start saving in a 401(k) in my mid 20s and never ever touch that money through some very very lean times (and counter to some of the bad advice I was given by family members). Compound interest is real.

Yep!! Not just patience and risk management as I first mentioned, but the money was off limits. And any financial decisions we made that went bad could not be remedied by pulling money out of the investments. Just as if we'd spent it on consumer goods/experiences like "normal" people, the money was gone, so that was part of the risk assessment when deciding where next to invest or spend. I'd say this was probably the best financial decision of them all.

[RedmondStash]

Oh, one more: opening a Roth IRA for both myself and spouse early on. We're well past the 5-year rule now. Well, one of them.

I also believe in converting traditional to Roth IRA early and often, to the top of the current tax bracket. Gives you future flexibility. Very glad I started doing that years ago.

[RunningintoFI]

Two come to mind for me. 

Using my employers tuition reimbursement program to get my masters degree while working full time fresh out of undergrad.  The Masters isn't really relevant at all but by staying a part-time masters student, I was able to keep my student loans in deferment for 3 years and paid them off with zero interest when all was said and done.  So two degrees and no debt felt real good!  Not to mention it instilled some severe frugality principles right out of the gate. 

Equally as beneficial was taking my brother in for a couple years at a severely discounted rate when he went through a surprise divorce process. Gave him some stability and social outlet while helping reduce expenses for both of us. 

[Omy]

Divorcing spendy hubby and marrying frugal hubby.

[chillyphilly]

Without question, self employing

[FINate]

I can't point to any single financial decision. In my experience, it's more about the cumulative effect of many smaller decisions.

On further reflection if I can point to any one thing it would be keeping money and finances in its proper place. That is, a good tool to provide for needs and even some pleasures, but not what defines my life or purpose, and not something to be used for status. And I don't view "my" money as my own, but rather as a gift to be stewarded.

Likes others here, I saved a bundle in college by living with my parents while attending a community college followed by a local state university. I intentionally avoided the fancy universities because I wanted an education, not an impressive degree (not accusing those who went to Fancypants U of anything, this was just something that was important to me at the time). Graduated debt free, which meant I could start saving and investing in my early 20s.

Married a woman who shares my values, so we've always been on the same page with finances. Like me, she's also somewhat frugal but not afraid to enjoy what we've been given.

Have never really felt the need to impress with fancy cars or expensive houses. Even when I was making high six figures for a few years, we keep the modest starter home and old cars.

This has also made it very easy to give money away to non-profits (our church, but also homeless shelters and overseas aid groups). Interestingly, this has also made investing much less stressful. Giving away a significant amount of money annually puts the ups and downs of investing into a different perspective.

Because we weren't trying to impress anyone with our spending, and we kept lifestyle inflation in check, we were in a place financially where I was able to confidently jump from a stable career job at an established company to a (at the time) relatively unproven startup. This became a very lucrative career move.

While at said company, I was able to take risks that paid off handsomely. For example, respectfully informing a Senior VP why he was getting negative reviews from his reporting chain. This could have gone badly if the feedback was not well received, but instead he was grateful for the honest feedback and ended up rewarding me with a large equity refresh.

Finally, I was able to retire early despite some rather generous golden handcuffs, which meant leaving a very significant chunk of equity on the table when i resigned. I'm very very thankful I didn't spend the past 7 years of my life sitting in traffic and pointless meetings. Instead, I got to spend a lot of time with my family and be there with my kids as they grew from toddlers to now preteens. Retiring, instead of working just to make money I don't need, is probably the best decision I've ever made, but this was contingent on a bunch of preceding decisions.

[freeazabird]

To switch into tech.

Similar to this I decided to self-teach data science and machine learning. It's hard to tell what would have been, but I think it's safe to say that this move at least doubled my comp over the past 6 years (actual comp is up about 3x over the past 6 years) and I didn't have to move to a HCOL city to do it.

What were your favorite resources for self teaching data science?

[Chris Pascale]

Government jobs - federal and state at the same time.

My full-time job is at the IRS and I teach at a local college. Current plan is to retire from FT fed service in 2030 at age 48 and move into teaching for 10-15 years, then retire from there - drawing both pensions.

During my time teaching I can possibly see myself exploring another degree plan to have a final career from age 60-70, but I can't really say. My wife and I have talked about joining the Peace Corps, or maybe becoming House Parents at the Hershey School.

Info about Hershey School House Parent Job: https://www.mhskids.org/houseparents/#:~:text=Milton%20Hershey%20School%20employs%20over%20200%20houseparent%20couples,shape%20the%20lives%20of%20children%20from%20lower-income%20families.

[clarkfan1979]

My first rental house purchase. It was a 4 bed/2 bath and the rent from 3 roommates covered the entire mortgage. It set me up for rental house #2, #3 and my current primary house. 

[BZB]

Getting a PhD in science and education/experience in another field so that I have a skill set that is unusual to find in one person. Also, getting divorced.