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Showing posts from December, 2021

Golden handcuffs - when you are sticking it out, just because it pays so damn well

If your job or career pays so well that everything else pales by comparison it pretty much locks you down in golden handcuffs. Yes, this is an extremely privileged position, yes, an unsatisfying high paying job is objectively much better than unsatisfying low paying job. It is a first world problem for sure, but it’s still a problem. If your job is not great, but they are similarly or better paying ones out there, then you don’t feel like you need to stay in it. If on the other hand your job pays you twice as much as many other jobs you could have and if you value money, then you might get stuck. For people interested in financial independence the money matters a lot as it’s their ticket to freedom. It makes a lot of sense to increase your income and increase your savings rate, cutting your ‘working years’. If you look a the famous blog post of simple math behind early retirement , the difference in years to early retirement between saving 80% of your income vs 50% is pretty signific

Capital Gains for Asset Traded in Different Currencies

It’s December again and time to pay up the Irish Capital Gains taxes (if you are an Irish tax resident) for the first period of 2021. If you need more info about it, look at  citizensiformation.ie . I have just calculated my due capital gains this weekend and I thought to share some of my tips. I’m not a tax professional, so as always feel free to double check any advice on this blog. Gain != Gain in foreign currency converted to EUR at current exchange rate One big pitfall you can make while computing your gains for assets in USD is to look at the gain in USD and convert it to EUR at the current exchange rate. Why is that bad? If the exchange rate was constant, then it wouldn’t be a problem at all. But if the rate fluctuates, the difference can be substantial. Imagine you invested 100 EURO in December 2016. With exchange rate 0.95, this gets you ~105 USD, you buy stock X with it. Then in January 2018 you sell your stock for 115 USD, it appreciated, nice! The gain in USD is 10. But you