ChooseFI 505 | Mailbag: Getting Started with FI, Debt vs. Investing, Dividends, 4% Includes Taxes?, Roth 401k | Rachael Camp
32 snips
Aug 19, 2024 In this engaging discussion, Rachael Camp, a financial advisor with expertise in financial independence, shares her insights on various listener queries. They dive into the nuances of debt versus investing, the 4% rule, and how taxes impact financial goals. Rachael explains the differences between Roth and traditional 401ks, and the importance of prioritizing total return over high dividends. She emphasizes actionable steps for newcomers on their financial independence journey, making complex topics accessible and actionable.
AI Snips
Chapters
Transcript
Episode notes
Investing vs. Homeownership
- Prioritize investing over homeownership in some cases, especially if you can invest the difference in cost.
- Calculate the potential returns of investing that difference over the long term.
4% Rule and Taxes
- The 4% rule includes taxes, which are an expense.
- Taxes in retirement are often much lower than expected, especially with strategic planning.
Dividends Explained
- Dividends are not "free money" but a portion of company profits distributed to shareholders.
- A company's share price drops proportionally on the ex-dividend date.