Game of Thrones vs. Game of FIRE – Season 2

Game of Thrones Season 2 features another 10 hours of nudity, rape, and mass murder, which sounds a lot like a Harvey Weinstein casting meeting for Braveheart II, but HBO presents this to us as quality entertainment – folks actually pay money to watch this crap! We have 13 female nude scenes with 12 sex romps, 2 rapes, and 130 deaths. A to the A-MEN!!! Now… finding something better to do with our time…

Game of Thrones, Season 2

In this 2nd season the Starks declare war on the Lannisters and a guy named Khal Drago dies and some other guy named Xaro Xhoan Daxos tricks Drago’s followers and kidnaps their dragons to assume control of the Land of Qarth. Then a magic dragon named Puff comes in and…. Oh, wait, I made up that last part… I’m not sure what the hell is going on here but it sounds like Bilbo Baggins crushed up some Viagra with some bath salts and washed it all down with a Four Loko. Quick – let’s find 10 hours where we can find value for our hard earned money!

Game of FIRE

Game of FIRE (Financially Independent Retiring Early) – In equating the amount of time spent watching a game of Dungeons and Dragons devolve into a black magic sex film we once again have 10 hours where we can continue a financial plan with a goal toward financial freedom. Put away your broadsword and get your loincloth back on, we’re going to look at our financial situation, and read up on some strategies for investing in the stock market that are battle-tested.

A map and some money

The first thing you will want to do this season is honestly and accurately determine your financial footing. Figure your net worth by listing your assets and your liabilities. Take a look at that list of liabilities and determine a course of action for dealing with them. It’s not worth spending a lot of time covering ground that is readily covered by folks like Dave Ramsey or Clark Howard, but the formula is easy – pay off your smallest debts first and work your way up to your largest debts, keep at least 3 months worth of living expenses in cash reserve, max out your Roth IRA and invest in your 401k (if you have one) up to the company match, and more if you can afford it. More on that in Season 3, but that’s where we’re headed…

As we prepare to start investing it’s important to understand what we will be doing with our money. In 10 hours time you have more than enough time to take a look at 2 very, very important books:

The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns by John C. Bogle – this is common sense, idiot-proof investing advice from the master of index investing and the founder of Vanguard. It is a must-read for anyone wishing to understand investing as it relates to simple AND effective strategies.

A Random Walk Down Wall Street: The Time-Tested Strategy for Successful Investing by Burton G. Malkiel – as you enter the jungle of Wall St. and attempt to navigate amongst the snakes and charlatans, this a must-read for anyone who will be taking control of his/her own finances.

With your remaining time, you’ll have 2 tasks – One, take a look at your 401k and seek to understand what you are investing in there, and how much you are contributing. More than likely you will have a “Target Date” fund (thanks in large part to this year’s Nobel Laureate in Economics Richard Thaler).

This fund will target your retirement date and then determine a blend of stocks and bonds based on how far you are out from that date. As you get closer to your “target date”, the fund will automatically roll your allocation more toward large cap stocks and bonds, becoming more conservative as you near retirement.

These funds are very vanilla and a bit inefficient. Many of them charge an “overlay fee” on top of the expense ratios of the underlying funds, resulting in additional layer of expense. On average they will cost you .65% or more per year which sounds minuscule but I’d rather run with an S&P500 index fund with an expense ration around .10% or less. That’s my 2¢ on the 401k anyway. Low fees (as low as possible) and tracking the market with a fund that can act as a “cornerstone” of your total stock allocation in the future.

For your second task, prepare a Roth IRA and get ready to max it out if at all possible @ $5,500 per year ($458/month). Don’t worry about buying anything, we’ll cover that later. Just get setup and get your monthly contributions rolling. We will take a look at what to buy soon enough.

The Roth will provide us with tax-free income after we’re 59 1/2 years old. Yeah baby! Tax-free living that won’t require a ticket to the Cayman Islands and a meeting with a guy named Phillippe who whispers all the time…

Up Next…

Ok – there it is again. Another ten hours to continue your steps toward financial freedom. Coming soon, we will look at Season 3 of Game of Thrones,and a look at the continued depravity.

On Game of FIRE we will look at debt strategy and consider some radical ideas to get out of debt – FIRE begins with being debt free. It’s the only way to experience true freedom and get on the move down the road toward financial independence. Stay tuned…

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