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It took a benefits consultant to highlight the financial power of a subtle, obscure tax code change buried away in Section 401, subsection k of the Internal Revenue Code. Benna realized this section, designed primarily for high-earning corporate executives, could help workers save money on taxes when preparing for retirement.
The year you were born determines when you become eligible for your Social Security full retirement age benefit. Spoiler alert, that age is no longer always 65. If you want to use this calculator to determine your full retirement age—and learn more about the drawbacks of claiming Social Security early—click here.
Tax avoidance isn’t the same as tax evasion. The tax code is full of legal loopholes accountants can use to lighten their clients’ tax burden. NPR shares their (and listeners’) favorite sections of the tax code in this podcast. For instance, large estates can be counted as farms and some cars count as heavy machinery. Listen to this podcast to learn about tax loopholes that range from surprising to legitimately useful.
The FIRE movement gained steam during the pandemic, when some were inspired to clean financial house amid an environment of global economic uncertainty.
FIRE followers typically prioritize high savings rates, relatively frugal living, and aggressive investing strategies in an effort to work less and enjoy life more in the long term. They range from low-income manual laborers to high-income tech workers and doctors.
Many FIRE proponents also abide by the 4% rule, which says that retirees can withdraw roughly 4% (adjusted for inflation) of their retirement portfolio each year.
Many FIRE proponents follow specific financial rules, like the 4% rule, in order to achieve FIRE. They also take steps to create an efficient tax strategy and take advantage of compound interest.
A man named Barney Whiter saved half of his salary each month so that, eventually, he could retire at age 43. Other FIRE followers rent out rooms in their homes or even their cars in attempts to achieve the same financial freedom.
Amy X. Wang, the assistant managing editor of The New York Times Magazine, looked at the people behind the growing FIRE movement in a recent podcast episode.
“Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence” by Vicki Robin and Joseph Dominguez argued that people should prioritize consuming less and living better.
The United States is home to more than 33 million businesses, the vast majority of which are small businesses, with millions being created (and others closing shop) every year. These businesses often rely on loans, provide the goods and services that keep the economy flowing, and sometimes even grow large enough to enter public markets or provide private investment opportunities. Explore key topics central to business and finance, from the role of the Federal Reserve to how initial public offerings work, how millions of American students finance higher education, and more.