When I tell people that I'm quitting my job and traveling for the rest of the year, they first wonder how I'm affording it. You have to realize that I had a decent job for five years and I lived a pretty simple life. I set aside as much money as I could comfortably while still enjoying my quick trips abroad, a nice piece of video/computer equipment, or a dinner out with a nice lady friend.
All of my money was in stocks (which I've sold off) and online Savings Accounts since college. INGDirect.com and EmigrantDirect.com had the best rates. And because I have always been a pretty good money manager, my credit has stayed pristine. Last year I took the full line of credit from my oldest card (an MBNA Mastercard I applied for freshman year at UCI because they were giving away a CD case) at 0% interest and placed it into a 9-month Certificate of Deposit at 5%. While the money earned interest, I was required to pay a high minimum on the balance of the card. But in reality, I was actually forcing myself to save. Example: I borrow $10,000 from my credit card at 0% interest. I put it in a CD at 5%. I have to pay 1% of the balance (or $100) on the card monthly. After one year, I make about $512 on the savings account but I only owe $8800 on the card. The $1200 in payments I made are savings. The whole transaction nets me $1700. But I was working with much more money than that.
Which brings me to tax season. You pay tax on interest earnings. Fortunately, I have a side business in video services called Filmgeneration. I don't make a lot of money as it's usually just gigs I pick up through friends of friends. But I do put a lot of money into it and I am able to file a Schedule C and write off my expenses.
Once I've plowed through my savings (I assume Western Europe will take care of this pretty quickly) I will rely on credit cards and begging. After people ask me how I'm paying for this trip, they usually ask me what I'm going to do when I get back. I answer, "Working to pay off the trip".
Oh, and I'm selling stuff left and right. Anyone want an IKEA PS sofa bed? It's blue and really comfy.
All of my money was in stocks (which I've sold off) and online Savings Accounts since college. INGDirect.com and EmigrantDirect.com had the best rates. And because I have always been a pretty good money manager, my credit has stayed pristine. Last year I took the full line of credit from my oldest card (an MBNA Mastercard I applied for freshman year at UCI because they were giving away a CD case) at 0% interest and placed it into a 9-month Certificate of Deposit at 5%. While the money earned interest, I was required to pay a high minimum on the balance of the card. But in reality, I was actually forcing myself to save. Example: I borrow $10,000 from my credit card at 0% interest. I put it in a CD at 5%. I have to pay 1% of the balance (or $100) on the card monthly. After one year, I make about $512 on the savings account but I only owe $8800 on the card. The $1200 in payments I made are savings. The whole transaction nets me $1700. But I was working with much more money than that.
Which brings me to tax season. You pay tax on interest earnings. Fortunately, I have a side business in video services called Filmgeneration. I don't make a lot of money as it's usually just gigs I pick up through friends of friends. But I do put a lot of money into it and I am able to file a Schedule C and write off my expenses.
Once I've plowed through my savings (I assume Western Europe will take care of this pretty quickly) I will rely on credit cards and begging. After people ask me how I'm paying for this trip, they usually ask me what I'm going to do when I get back. I answer, "Working to pay off the trip".
Oh, and I'm selling stuff left and right. Anyone want an IKEA PS sofa bed? It's blue and really comfy.
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