# Zero to Hero



## zerotohero (Aug 5, 2011)

I am a thirty year old male looking to learn the skills required to attain financial freedom. I am literally starting from zero, well actually less than zero (my current net worth is about negative $18k) and looking to rise to financial independence in a hurry. On the bright side, I have recently settled down into a reliable growing career path that will provide a decent income for years to come and also the debt that I have is hardly interest bearing at all. I have about $1100 of monthly income left over after expenses available to start saving with. 
I am having difficulty getting started though because of the clutter of information out there. I need guidance in this beginning period but am not sure where to look. I decided to start a blog to document my journey, report what I learn along the way, and seek advice on how to procede. www.zerotoheroafter30.wordpress.com 
Any advice on where to start would be much appreciated. Can anyone help?
Thanks!
ZerotoHero


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## Abha (Jun 26, 2011)

What type of debt do you have and what is the interest rate on it?


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## Sherlock (Apr 18, 2010)

Since it sounds like you will be investing monthly, your best option is to go with index mutual funds. The TD e-series funds are very popular due to their low fees. Alternatively you could go with ING's streetwise fund which has a slightly higher fee but is a single balanced fund so it may be simpler.


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## Jon_Snow (May 20, 2009)

I'm well on my way to financial independance in my late 30's... here's the basics on how I did it.

Married a wonderful (and frugal!) woman, and thus TWO good incomes coming in.

No kids.

Having no kids means we don't need expensive housing. Small mortgage as a result, which will be paid off in about 7 months.

By embracing a live-below-your-means lifestyle I fully expect to be retired at 45. Uh... yeah, thats pretty much it. 

Good luck on your own journey Zerotohero!


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## KaeJS (Sep 28, 2010)

You need to pay off the debt before you do anything, regardless of interest rate.

I assume since you said your Net Worth is -18k, you do not own a home.

If you plan on renting for the rest of your life, it will be a long while before you hit financial freedom. By saving $1100 a month, you are basically just buying a month of living expenses in your retirement days, if you know what I mean.


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## Plugging Along (Jan 3, 2011)

I think the formula to financial freedom isn't that complicated.

Get rid of debt.
Spend less than you earn. 
Find a way to earn more.
Put enough away for emergency fund.
Set concete goals for finance with timeframes.
Start putting that money away and start investing.

Easy formula, difficult for many to implement.

I'm in my thirties, and am on my way (you can seArch me on net worth iq if you want). We are in a similar place as Jon, except We have kids and can have expensive tastes. We have had to compensate by making sure we both have two extremely good incomes. We did this by really establishing our caresses and having a clear plan before kids. We still spend less than what we make, and spend on what is important to us only if we have the money in the bank. We plan to retire a little later, but that's because we want to make sure the kids are covered for their post grad degrees.


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## OhGreatGuru (May 24, 2009)

Very good list Plugging Along.

Add to that (for OP): When making posts to a discussion forum, think about a subject header that actually encapsulates your question or topic, rather than a shameless self-promotion of your own blog site.


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## financialnoob (Feb 26, 2011)

KaeJS: I disagree about the value of the $1100. The OP is 30. If he puts $1100 away every month and gets a measly 2% return, that's still over $1M by age 65. That's a gross oversimplification of course, but it's certainly a really good start.

zerotohero: Congrats on starting your journey. I would suggest you consider your goals in life, and I mean the real important ones. Lots of people never think about this. They want everything life has to offer, but you can't have everything in life...where would you put it?  So once you prioritize your goals, you can start to work towards them. And this will have a huge influence on HOW you invest.

As one example, do you want to buy a home soon? That could impact the type of investments you put your future down-payment in.

As a starting point, I'd seriously consider focusing on getting rid of your debt. The market is a bit turbulent right now, and a mistake might put you further in the hole. But paying down your debt is a guaranteed return and you can't go wrong with that. Based on the $1100/month, you could work down your debt by the end of next year which gives you plenty of time to think about how you want to invest, learning about different options, while still making a very positive impact on your future by eliminating the debt.


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## Sherlock (Apr 18, 2010)

financialnoob said:


> KaeJS: I disagree about the value of the $1100. The OP is 30. If he puts $1100 away every month and gets a measly 2% return, that's still over $1M by age 65. That's a gross oversimplification of course, but it's certainly a really good start.


No, with a 2% return he would have 666k at 65. He would need a 4.5% return to make 1 mil. But your point is still valid.


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## financialnoob (Feb 26, 2011)

Whoops. I used the TD RRSP calculator which comes up with the $1M number. Now I'm curious what the heck that's based on.


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## the-royal-mail (Dec 11, 2009)

I wholeheartedly agree with OGG. I too wondered why the OP couldn't simply start a diary thread in our Money Diaries section, for ongoing feedback and discussion of his specifics.

I get the feeling many blogs these days are primarily about stealing forum participants and getting us to click on websites that are waiting for us with advertising and spyware. Ad revenue.

OP, feel free to post your questions/details in CMF (not on another website) and I'll be happy to offer you some feedback as I have done with many other new and old members alike.


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## MoneyGal (Apr 24, 2009)

financialnoob said:


> Whoops. I used the TD RRSP calculator which comes up with the $1M number. Now I'm curious what the heck that's based on.


Link your calculator and I'll break it down for you. 

(Maybe I should change my name to MathGal.)


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## financialnoob (Feb 26, 2011)

LOL MG. At least we could still refer to you as MG.

http://www.tdcanadatrust.com/planning/rrsp_planning_calc.jsp is the launch page, but the actual calculator is at http://tools.tdcanadatrust.com/tdam-npc-ie/RSP_Contribution_Calculator.asp.

But I checked out some other compound interest calculators and the $665K figure is correct.

Sorry Twilight fans, I couldn't resist.


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## KaeJS (Sep 28, 2010)

Sherlock said:


> No, with a 2% return he would have 666k at 65. He would need a 4.5% return to make 1 mil. But your point is still valid.


And what about inflation and the rising cost of living?

666k or 1M is definitely not going to be worth as much 35 years from now...


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## financialnoob (Feb 26, 2011)

KaeJS: You're right, and those are definitely important factors that need to be considered. It was just an oversimplification of how a smaller amount can grow considerably over time. That was also based on 2% growth, nothing too fancy at all.

This is also just for one person, one income. Maybe he meets someone similar and their savings increase triples because there are two incomes yet halving of the expenses. Maybe there are future raises. Maybe they have a kid and they can't save for a while. Who knows what the future may hold?  But it's a solid start.


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## MoneyGal (Apr 24, 2009)

financialnoob said:


> KaeJS: You're right, and those are definitely important factors that need to be considered.


That's also why you got different results from the TD calculator than a "plain" future value calculator - the TD calculator included an inflation variable.


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## financialnoob (Feb 26, 2011)

MG: D'oh. 

I actually used that variable a while ago and then totally forgot it existed. My bad. Thanks for solving that mystery!


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## zerotohero (Aug 5, 2011)

Abha said:


> What type of debt do you have and what is the interest rate on it?


My debt is a $17K personal loan with zero interest and I have a $10K in student loans left. Not sure what the interest is on my student loan but I think its minimal.


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## GOB (Feb 15, 2011)

You won't be a hero anytime soon if you don't even know what interest rates you are paying. You need to be more knowledgeable about your finances as a first step. 

Secondly, examine your budget and cut out unnecessary expenditures to seeks that $1100 savings per month can turn into something higher with a little frugality. Pick the low hanging fruit before worrying about investments etc


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