Pay lower taxes by itemizing deductions every other year

Do you own a house with a mortgage on it?  If so, you may be a good candidate to itemize your deductions on your tax return.  Before we dive into why and how to do this, let’s first define what itemized deductions are, shall we?  According to Wikipedia: Under United States tax law, itemized deductions are eligible expenses that individual taxpayers can claim on federal income tax returns and which decrease their taxable income, and is claimable in place of a standard deduction, if available. Let’s go over some of the most common items people can and do itemize.  This

Read more

Creating our early retirement checklist

So you’ve done all your saving and investing, took care of your Roth IRA problem, and now you’re ready to pull the trigger and tell your employer bye-bye.  However, as an early retiree, you are a forward thinking individual and wish to tie up any loose ends before your early workplace exit.  I happen to be in this situation as I write this post.  I am going to share with you what’s in our early retirement checklist. Before we dive into this checklist, I must share the lyrics that come to my mind when I think of lists; From Santa Claus

Read more

A Beginner’s Guide to Brokerage Hacking

A Beginner’s Guide To Brokerage Hacking : Earning Substantial Side Income In a Few Hours What is Brokerage Hacking? Brokerage hacking involves taking advantage of promotional rules set up by online brokerages in order to earn substantial bonuses for opening up new accounts or adding to existing accounts. A history of my brokerage hacking First, let’s review, in sequential order, all of the various brokerage accounts I have had over the years, and why; Putnam Investments (my first foray into investing, suggested by a financial adviser) Janus Funds (I had funds rolled over from an IRA into Janus because they offered no load

Read more

Determining an appropriate emergency fund

What is the size of an emergency fund a future retiree should have?  Why set one up at all?  How should an emergency fund be compiled?  Before we answer these important questions, I think we should define what an emergency fund is. According to Investopedia, An emergency fund is an account used to set aside funds needed in the event of a personal financial dilemma, such as the loss of a job, a debilitating illness or a major expense. Why have an emergency fund? Many financial planners advise a 3-6 month emergency fund.  Let’s explore some reasons why you might want

Read more

Our 2016 tax return exposed; The good, the bad, and the awesome

Benjamin Franklin said there were only two things certain in life: death and taxes.  The Finance Patriot is working hard to avoid both. Before diving into the details of our 2016 return, which I know you are all dying to know, let’s start with our 2016 tax summary (from taxact.com).  After reviewing the summary, please scroll down for a detailed discussion of each line item. Federal Tax Summary, 2016 W-2 Income $105,626 Adjusted gross income $105,626 Deductions $14,133 Exemptions $16,200 Taxable income $75,293 Tax computed using Form 1040 Line 44 – Qualified Dividends Capital Gain Tax WS $9,779  Credits $(2,000)

Read more

Embracing our 38 year mortgage into retirement

Pay off your mortgage, pay off your mortgage, quickly, fast, don’t even think about not doing it!  Stop, don’t pass go until you pay off ALL your mortgage first.  You must work forever if you don’t pay off your mortgage as early retirement is impossible without doing this first. These are the near universal words in the FIRE community. What is a 38 year mortgage? Is there such a thing as a 38 year mortgage, you might be asking?  The Finance Patriot has lost his mind. No, there is no such thing as a 38 year mortgage offered from start

Read more

Five Things I’ll Miss About Work When I Retire Early

In the niche world of Early Retirement and Financial Independence writing, the themes seem to be focused endlessly on the things we will enjoy about leaving the full-time work force world of being a wage slave.  I too, have these feelings each morning I am forced to be on a 10 minute conference call, where we discuss our plans for the day (inevitably this 10 minute call lasts 15-30 minutes). Recently, though, between analyzing our investments and our realization that I can retire today, I have been reflecting on my last six years at my current employer.  I want to detail all

Read more

The Roth IRA Rescue; Why Early Retirement Planning Requires a different plan

When I first started thinking about retirement, I never pictured myself being able to retire very early.  I had never seen it done before.  Heck, my own parents worked until death and age 70, the latter having only stopped working due to the business she worked for went bankrupt and closed its doors.  So what is a young lad to do? I knew great options existed, so I took full advantage of work pre-tax retirement accounts.  I put money into my 401(k), as much as I could to avoid the 28% (now 25%) Federal tax bracket.  Prior to this account,

Read more

A History of My Interest in Financial Freedom and Early Retirement

Who am I and how did I get here? As an infant, the concept of work and career are foreign.  The concept of play is not.  Somewhere along the way, work becomes more important than play… far more important.  Therefore, as we grow up, it is incumbent upon us to figure out a way to reset the pendulum. Welcome to the Finance Patriot.  What comes to mind when you think of a patriot?  The web defines a patriot as; a person who vigorously supports their country and is prepared to defend it against enemies or detractors. Fair enough.  In America, the

Read more