July 31, 2017

On the home(buying) front: money choices

The costs to build our future castle (home!) This whole post is going to be so much money. About so much money, I mean. Lots and lots of money. Stimulating the economy beyond anything I’d ever imagined would happen in this lifetime.

Hiring out work

The contractor’s labor, and the subcontractors’ labor, is a set price for the most part. I’m saying up front that we’re paying a premium for the general contractor whom we’ll call Bob and I didn’t negotiate a penny of that. Those of you who know me won’t even open your mouths to ask if I was “too embarrassed” to ask for a discount like some people thought.

It was deliberate. I’m a star performer at work, and I know how to treat them. You pay good money to get exceptional results. You do not nickel and dime someone who is going to play a huge role in quality control, and attend to your every need. That’s the best way to demotivate them.

Every week, my decision and refusal to negotiate his rate proves that Bob is worth every penny. He’s honest, hardworking, prompt to reply to any and all questions (stupid or not), shows up whenever and wherever we ask, on top of keeping the project on schedule. By the way, he wrote up a highly detailed schedule for us to work by. All of that makes him a total gem and a complete anomaly as a General Contractor, from the anecdotes of all the horrified friends and family hearing we were on a tight timeline.

But that’s not all!

  • He advises us on the best places to source our materials and helps us find discounts without compromising on quality.
  • He’s cultivated relationships in the contracting world: he chatted up the project reviewer which resulted in the job being classified as an update, instead of a renovation, and saved us $2700 in permitting costs. I would not have known to ask for that concession!
  • When we decided to save money on one of the “work in every room” aspects of the project (lighting) delaying it for later, he discounted his own rate by $350 to do the full job now. We didn’t ask, he offered.
  • When he made the wrong call on one of the walls, costing us an additional $500 in work, he made up for it by footing the bill for expensive aesthetic work that I wouldn’t have wanted to pay for, but PiC would have wanted.
  • He’s offered us lots of reclaimed and leftover supplies from previous jobs that the owners just wanted dumped. So far, that’s worth a smidge north of $1000.
  • The quality of his work is top notch so we passed rough inspection with flying colors.

By the end of this job, I anticipate that he will save us at least half the cost of his fees by doing stuff like this for us. Then there’s simply no price I can put on the sanity that he preserves by doing his actual services: coordinating all the work, hiring and managing the subcontractors, picking up all the materials that we purchase and checking them for damage, making all the returns.

The power of a warranty

Pretty much everything in this place is old enough to be replaced but we have to pick our battles. The roof is old, the wiring is old, the plumbing is old, the water heater is older, the furnace probably has a beard.

However, our realtor bought us a warranty that will cover all appliances, minor roof leaks, the water heater failing. She’s not so sure how well it covers plumbing because her experience has been that they’re finicky on which bits of pipes they’ll cover. Neither of us are willing to play the odds on whether or not the old wiring will catch fire, either, so we’re attacking those items now.

We’ll cross our fingers that the roof isn’t damaged and the water heater keeps truckin’ – but if it does, the warranty is more straightforward on those.

Negotiating costs

There are two places where we can really run up the bills, according to Bob.

The first is our selection of the finished materials like cabinets, flooring, fixtures, and so on. You can choose a $200 toilet, or an $800 toilet. A $20 showerhead, or an $800 shower fixture. Oh yes, you can spend $2000 on a door! (We did not.)

There’s not a lot of negotiation to be done but there are some bits you can do, aside from asking yourself if you REALLY need that super awesome rain bath showerhead.

  1.  Ask for large volume discounts. Home Depot’s Pro shop gives a high volume discount on any orders that are over $1500 in addition to whatever other sales and discounts you can get.
  2. Ask for small discounts. Our contractor gets a small discount if you use his pro account. We do!
  3. Bob also advised us that you can often request a 10% discount at Home Depot just because if you go to the assistant store manager, or escalating to the store manager.
  4. Ask for discounts just because! I online chatted with the good folks at Build.com to ask if they could beat the pricing I had in my cart and they did.

The second place is scope creep, AKA those AWOs that pop up on our progress invoices: Add Work Orders.

Those come up when you’re taking down walls to studs, thank crepes that you did and howl a few choice curses at the moon for what you found: more dry rot. If you didn’t find it, you would have fallen through the floor in about 8 months. Or your new windows would have fallen out when the dry rotted framing inside turned into a pile of splinters. Or when you realize that there’s black mold creeping across the back walls that the seller’s piles of belongings covered up. These weren’t in your original contract and that’s how the Bobs of the contracting world really make their money.

I’m so grateful that Bob was upfront about this little detail – we restructured our entire plan in the first week based on that advice and the saving is clear.

Spending choices: charge it up!

I could have chased down discounted gift cards to pay for supplies, saving 5-7%. For this project, though, I wanted the price protection from my credit card.

American Express will make it right if a store won’t honor their return policy. If something breaks or goes missing, I have protection for 90 days. We are buying tens of thousands of dollars worth of merchandise. I do not need to expend any personal energy fighting with any single merchant, and paying with the credit card is my insurance against that.

:: Would you (have you) have made any decisions differently? Do you have regrets on hiring someone cut-rate or did you have a great success story in getting a deal?

July 24, 2017

A moment of gratitude and a spending check

Counting our blessings and taking the long view Maybe this would be more seasonally appropriate for Thanksgiving but it’s true now, and it’s never a bad time to remember the good things.

Driving home from another four hour trip to the home supplies store, that teleprompter style list of all the work still ahead of me started scrolling.

1:56 pm. 

Seamus needed dinner, a walk, his medications.

My work was piled up, the work that I had done little more about than shake a cranky stick at it in stolen minutes between bathroom vanity specs and researching and investigating flooring samples.

My stomach rumbles. Oh yeah. Also that.

Today’s purchases need to be recorded in the now 236 row spreadsheet where every single expenditure, delivery, pick-up, and delay was logged.

Drawing a deep breath to dispel the almost inevitable surge of rage-impatience, I let it out, surprised.

Nothing. I felt nothing.

Not an empty nothing but the nothing of calm and peace.

That was as weird as a new sore tooth – or the absence of pain. That’s when it dawned on me. I wasn’t irritated or grumpy or angry at the loss of half a day and interruption to my beloved routine. I was grateful.

I am grateful that all my hard choices and sacrifices to prove myself in a traditional work place up to now meant that I could have my days interrupted like this, that my career wouldn’t suffer from a temporary dislocation in my work routine. That my reputation was solid enough and my work relationships were strong enough up and down the hierarchy that if an email wasn’t answered in four minutes, no one was going to micromanage me over it.

That freedom was paid for in hard coin. Years of almost thankless toil in various corporate and non corporate jobs. Years of taking risks, pressing for well deserved promotions, negotiating for raises, knowing that women are punished for asking, then pushing forward to new ventures without being quite sure of the future.

Now? The payoff. I don’t have to apologize or atone for taking the time to make my life work because I’ll still  make sure the work gets done. The striving, even when it wasn’t crystal clear what the striving would be in aid of, was worth it.

It’s imperfect – of course. This isn’t easy, or fun, by any means working on the timeline we have ahead. But it’s considerably easier than if I were still doing shift work, or working for the unreasonable manager who played favorites like Russian roulette, or that manager who thought it was my professional duty to read his mind and be his best friend, confidante, and free babysitter. Until I’ve got Jean Grey’s powers and not Dark Phoenix, that will never be my job! Actually, even with Jean Grey’s powers, I decline that job.

I am grateful.

I’m grateful that I can take care of my family, that I have a family to love and care for. That I can take care of our needs under stressful circumstances. That I can do what I need to do, when I need to do it. That PiC and I are in this together and haven’t killed each other over the neverending details and decisions. That we can and have found ways to afford doing all this work without having to move in and expose our toddler to an unsafe living environment.

That our checks written in the first 3 weeks after closing have all been safely cashed without even a little bouncing: $45,000.

!!!

Labor and materials are $$$$$.

Our contractor wisely reassured me that my spending projections were correct – it will look something like an inverted pyramid. The worst of the scope creep and the labor costs are going to be in the early phases of the work. That’s when you discover terrible things lurking in your walls and foundation and roof. Once you pass the midway point, the weekly costs become less and less, until you’re just paying minimal costs at the very end to finish up.

He was also wise enough to tell me not to expect the site to look anything like a house until after the fifth or sixth week of work. At week 2.5 I felt some flutterings of we paid that much for this shell of a house?!

This too, shall pass. 

:: How do you keep yourself grounded during times of stress? Does it help to remind yourself of the long term things you can be grateful for? 

 

July 17, 2017

On the home(buying) front: rolling up our sleeves

Rolling up our sleeves, rehabbing an old, neglected house We’re officially the mostly apprehensive owners of a new-to-us home.

Without even taking a breath to let that sink in, we don’t have time!, we’re nose-deep in demolition and renovation work. Our final walkthrough revealed even more work that needs doing, if you can even believe that there’s yet more to do, and it’s been nothing but stress.

My credit card is melting from all the swiping, American Express’s emails about Large Purchases are tinged with a sense of alarm, and let me tell you, Mint.com is JUDGY. Yes, I know our household spending is above average!

The contractors are hard at work tearing out walls, digging out dry rot and black mold, and filtering the air with air scrubbers until it’s habitable.

Our job is collecting all the materials that we need ready for installation once the demolition dust settles. We’ve bought: kitchen appliances, kitchen cabinetry, bath tubs, plumbing fixtures, lighting – soooo much lighting, doors throughout the house, and vinyl windows. We still have to buy kitchen countertops, bath cabinetry, flooring, paints, more lighting there is no end to the lighting purchasing this will be the most well lit home in the universe, tiling, closet doors, and about 23 million other bits and bobs and joes and marks and michaels.

Everyone who isn’t paying the bills says “oh it’s great, you can get the home you wanted, just the way you wanted it!”

I think “When will this horror show be over???”

The money is flowing out so fast, even though I have the ready cash to pay the credit card bill, it’s like watching a tornado slowly rip apart my home. It’s fascinating, and terrifying, and impossible to look away. We came within $900 of my generous credit limit which has never happened before.

Our styles are clashing

For me, and partly for PiC, the worst part of the process (even worse than the spending so you know it’s bad): having to research every single thing we’re going to buy – did you know that there were so many toilets you can buy? Did you know that toilets have lids that opened automatically? Did you know how creepy it was to walk down an aisle of toilets and have them all open their lidded maws as you pass through?

And LIGHTING. Holy mackeral, lighting. PiC spent one Sunday looking at 1000 chandeliers and lamps. That’s not hyperbole. Literally, 1000 lighting options. And that’s only one of 17 research sessions.

The sheer volume is one problem. Our approaches are another.

I research a thing, find out the quality parameters, and armed with a fair amount of information, choose the three I like best and ask PiC to pick his favorite.

PiC researches a thing, researches its history, the history of its history, the entire range of possibilities that exist, he researches down to a molecular level and then presents me with a dozen choices. His way drives me crazy. My way drives him crazy.

Shockingly, we have managed to negotiate our differences with only one tiff so far.

I don’t want him to feel rushed and like he’s compromising on pieces that we both have to live with – I would hear the grumbling for the rest of our natural lives. I also don’t want to feel inundated with information, bombarded in fact, and short circuit every time someone asks me a question because it’s one question too many – some unlucky soul would eventually lose a limb, or a face to my severely compromised temper.

Solution! He is now the man in charge of all the initial research, I only have to give occasional input to steer his selections and then we finalize our choices together. I am the woman in charge of all the money: paying the bills, approving budget for each item, finding discounts and promo codes, tracking all receipts, returns, exchanges, deliveries, and arm-twisting when something goes awry.

On that note… savings!

Or at least savings on spending we had to do – not to be confused with money that we keep safe in the savings account, there to stay, grow, and flourish.

We have ordered a handful of our materials from Build.com and Houzz.com. I was skeptical at first but a friend confirmed that he’d ordered furnishings from Houzz and while it was imperfect, their customer service was good, so I was willing to give them a shot.

How I saved at Build.com: At the time of this writing, you can get 2% off at ebates or 3% cashback at MrRebates. Check both to choose the higher rebate, of course.  That was stacked with a summer sale coupon code, and I asked their chat associate to give me the 5% discount from signing up for the email list which never arrived. They did me one better, assigning a discount that was equivalent to another 7% off the total.

The key here is to create your account and fill up your cart first, stay signed into your account, then hit up the sales associate. If they dig up a good discount for you, ask them to send you the link to the saved cart with the discount instead of letting them complete the order. Close the tab with your own cart, load the link and make sure it’s showing the right items and discount. Close that link, and then go to ebates/MrRebates to reopen Build.com. You should then be able to load the cart from the newly reopened Build.com to show both the discount and proceed with your purchase.

Reminder: Gratitude

Even while the money flows out like heart’s blood, here’s perspective for you: We could be in Make Smarter Decision’s boat – budgeted but without anyone to hire! We have acquaintances who have been paying double mortgages for months and still don’t have a good contractor on board. We know people who chose to manage the whole project themselves and hire the subcontractors themselves, they’re all in a world of hurt. Demand is so high that it’s not uncommon for subcontractors to walk off a job for a better paying one without a word, and they just don’t care!

Yes, we are paying big bucks for this work to be done, but at least it’s getting done. Those folks carrying double expenses have spent nearly half our budget on just owning two properties and that’s before a lick of work has been done.

:: Have you had good or bad experiences with contractors? Are you into Do-It-Yourself for home repairs and renovations? Would you splurge on the best fixtures and appliances and doo-dads if you were outfitting your forever home?

 

July 3, 2017

Spending regrets and happies

Shopping, man alive I hate shopping.

We’ve been doing a lot of it for the new place but it simply isn’t growing on me. Obviously it’s still a necessity, even if my budget and energy reserves prefer MacGyvering a way out of the need to buy, but every so often, I reconsider whether we’ve been making good choices. Going through our belongings to winnow them down reignites that feeling that the less (trivial) stuff we have, the better, though we don’t have as many regrets as I thought we might.

I’m glad we didn’t buy ….

  • Custom blackout curtains for JuggerBaby’s room: $300. We bought cheap paper accordion blackout shades to see if it would help zir sleep better for about $10. They’re inconvenient, being cheap paper with absolutely no frills whatsoever, but they’ve done the job and we won’t have to regret leaving them behind.
  • A bigger car. None of the garages that we’re seeing in our region are big enough to handle both of our current cars without a squeeze, much less a massive SUV.
  • An address stamp and embosser. The stationery lover in me desperately wanted one of each – so pretty – but the commitment phobe in me kept saying don’t do it. Turns out the commitment phobe was right.
  • Custom designed checks. When my first 50 checks ran out, there was a $5-20 upgrade available for some awfully cute checks. But I’ve learned my lesson. In 2002, I paid $12.95 for 1200 adorable baby animals checks and by 2012 I still hadn’t used them all. It broke my heart to shred them when I closed that checking account. Because once in a while I’m achingly softhearted.

I’m annoyed that we bought ….

  • All hair accessories that aren’t the standard clip-free hair tie, or tiny claw clips. I can use absolutely nothing else successfully but yet I still wasted money on a really nice and soft Blom headband that I never use, these nice black thin headbands to hold back hair that don’t fit my tiny head, and these cool spin pin things that would have held up masses of beautiful hair if I were Jean of Extra Petite, but I’m really not.If you noticed a pattern here, it’s that I foolishly fall into the pit of thinking that my hair and I are meant to coexist peacefully. We’re not and it’s well past time I learned that.
  • A dozen undercabinet replacement light bulbs. Now that we’re moving, we have no use for this particular type since we’re designing our lighting to be as energy efficient as possible. I suppose we’ll leave them as a little gift for the incoming buyers if they pay top dollar.

I’m glad that we bought …

  • My new cell phone. I’ve been able to download some money-making apps (Achievemint and Poshmark), take a ton of great pictures and video of my family, work while on the road.
  • Two tank tops from Target. They cost a grand total of $12 but they fit just perfectly and look great. They won’t last forever so it’s sad that they immediately went out of stock.
  • This simply perfect, though slightly pricey, Barefoot Dreams cardigan. I used a gift card to reduce the sting. It was my plane sweater for our most recent big trip, and it was perfect! It was warm and cozy, but not too heavy, snuggly enough to wrap around myself and JuggerBaby who allowed it, and it has pockets which is a lifesaver as for a mom with only two hands. After our trip, it was exactly right for wrapping up when I was down with the flu, or when the weather turned unexpectedly chilly. This probably doesn’t seem like much but I don’t have any clothing that’s both ultra comfortable and suitable to be worn out doors in the presence of other people.
  • Our recliner before JuggerBaby was born. It was expensive, and new, but it was the only way we managed to get zir to sleep some nights as an infant. It’s now a cuddle spot when we have visiting infants, and when JuggerBaby needs a comforting rocking.
  • Comic-Con badges for this year. It’s a combined family visit and cherished tradition.

I’m still on the fence about whether I’m happy about buying a new home – it’s the source of quite a lot of stress right now!

There’s a theme here, of course there is. I tend to appreciate very utilitarian things over time, and fail to appreciate things that are mostly for form, and less about function. Here’s a conundrum: my need to have a stockpile of supplies that we’ll use versus my need to have less stuff and not waste money on stuff we don’t end up using.

:: What are some of the best things you’ve ever bought? Worst?

June 19, 2017

What’s the right retirement age for you?

Listening to the West Wing the other day, Toby’s yelling about the need to consider options to save Social Security such as raising the minimum age penetrated my conscious brain. He pointed out that people are living decades longer than they used to, and Social Security was predicated on a life span that was considerably shorter.

As I understand it, you can start claiming benefits at 62 if you’re willing to accept a lower amount but for each year you wait until age 70, the amount increases 8%.

The archived Social Security site says:

If we look at life expectancy statistics from the 1930s we might come to the conclusion that the Social Security program was designed in such a way that people would work for many years paying in taxes, but would not live long enough to collect benefits. Life expectancy at birth in 1930 was indeed only 58 for men and 62 for women, and the retirement age was 65. But life expectancy at birth in the early decades of the 20th century was low due mainly to high infant mortality, and someone who died as a child would never have worked and paid into Social Security. A more appropriate measure is probably life expectancy after attainment of adulthood.

It goes on to point out that if we look at the life expectancy after reaching adulthood, then we are indeed living a few more years than we used to.

Obviously, we have many awesome FIRE bloggers who would dispute this retirement age as the appropriate one but they’re (we?) an unusual segment of the population right now.

In my family, we either live well into late 80s and 90s, or we die before 60. If you make it to 60, there’s a solid chance that you have another 20 or 30 years ahead.

Whether they’re good years depends on whether they worked physically demanding manual labor jobs (high likelihood), how good their basic health was, whether they had access to appropriate health care if it was needed. Last and maybe the most important: did they save enough to last them during their later years?

I’d say the latter is a complicated question because, until now, retirement plans in our family have been “move in with the kids and be their childcare in exchange for full support.”

There have been some exceptions.

My amazing grandmother worked her own farm well into her 80s. She had enough saved to last her until her death and still leave a healthy inheritance. One aunt did the usual childcare thing but then moved out when the grandkids were too much of a pain – that’s pretty much unheard of.

PiC and I are the first couple in my family that I know of to actively plan to not follow the usual game plan of have kids, work all our adult years, missing their childhoods, and then depend on them for support while raising their kids. That model simply doesn’t work when there isn’t a cohesive community all around you doing the same which equips them to provide support as needed. We’re hundreds of miles from our dearest friends and relatives, and that’s not likely to change any time soon.

JuggerBaby may be an only. We may want to grow the family more. We may try to foster and adopt if my health allows. There are so many possibilities and it hardly seems possible to plan for them all, but it must be possible.

We have been saving for retirement for years, I started when I was 21. I don’t have a FIRE date in mind but once the dust settles, I’ll decide what it is and our salaries together will work on reaching it.

I’d love to set it at age 40 but that’s just a pie in the sky number right now. We have to let the dust settle with the house, the renovations, the mortgage, and all that jazz before I dive headfirst into another massive plan.

:: When you plan to retire? Do you have grand plans for that time of your life or is that still hazy?

 

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