I invited Mark Zaifman and Monique Tilford to join me for a teleclass by this name, knowing this question is on everyone’s minds. While Mark gave financial investment advice, I tended to give more lifestyle advice – examining assumptions about “just gotta have it”, meeting needs differently (like taking your kids to free events rather than expensive ones), re-skilling. If money is indeed “life energy”, then investing time in activities that will bring you a big return in security makes sense – perhaps as much sense as investing in mutual funds. Okay okay, apples and oranges, but listen to what I wrote a friend when she asked:
Hi. any advice about what to do with a small inheritance? especially since the people involved are not FI right now but would like to be?
Read on… and tell me what YOU would advise…
put some of the money into a safe haven for a cash reserve and then…
- pick a community where you want to live for at least 10 years by criteria like: growing season, soils, rainfall, ‘sunfall’, local good water supply, at least 100 feet or more above sea level (but near a port may be useful). Check predictions of how it will change as the climate does.
- if you are close with your family, live close to them
- Also pick a community if you are my age where there are lots of young people interested in farming.
- buy a house there and trick it out for passive solar and pv panels. think about rate of return. here a $3000 with installation heat pump can repay $600-$1200 a year in heating bills depending on cost of energy and depth of cold. that’s about 2-4% on your investment, which ain’t great but it’s around where bonds are. passive solar can be very effective conversion of stuff into less expenses. I’m building a passive solar heating unit on my house (or at least dreaming of it) and i’m guessing i can reduce heating costs by up to 50% (yes there is sun in the pnw) depending on how big it is and how well it works – and my investment will be less than $1000.
- develop a web of relationships of reciprocity – giving and getting.
- use some money to travel where you want to travel now as flying won’t be as easy.
- buy that list of essentials you’ve thought of: sewing machine, down comforters, electric bicycle (buy a pv panel to charge essentials), tools, a greenhouse, learning skills to be more ‘financially independent.’
That’s as far as I have gotten. What would you advise?