December 14, 2015
As we bleed money this year-end, I want to put up Christmas lights. To remind myself not all is lost? Irrational? Maybe. It’s not like we’re going broke. It’s just a remarkably expensive close to an otherwise pretty good year. And it was a good year. (I jumped the gun on the yearly recap but being grateful for what you have and accomplished isn’t the worst perspective to wear before writing a wish list.)
Except for this disgusting viral thing that was so bad it knocked us all down for more than a week, badly enough we would have headed to the ER for the fevers if we couldn’t get them down. Losing that week was bad enough but the lingering aftereffects just rub salt in the wounds. Oh, right, salt and wounds, the bleeding money thing. This is what our Fall has looked like.
Annual expenses
Car registrations: $450
Life insurance: $900
Property taxes: At least $5000
Christmas presents: $260
Museum memberships: $350
My IRA contributions: $5500
*Increase in childcare expenses: $1500 (per month for now. Expect this to go up. Of course.)
One-time expenses
Estate planning, retainer: $4000
Miscalculated tax, $700
Stock purchase for Christmas, $10,500
Mortgage prepayment, $XX,000 (not prepared to put that in print yet!)
All this wouldn’t seem that bad, even, if it hadn’t been preceded by a few months of higher expenses (hello, Summer).
Still, it has sucked up every penny of our cash reserves, our incoming paychecks for a few more weeks at least, and even touched our savings. That was the last straw.
Looking at the due dates for the stuff I can’t change, you’d think I would have been smarter than to take on the voluntary stuff (life insurance, memberships, the lawyer) at the end of the year but noooo. Of course not.
Is it just me or does the end of the year bring you the gift of annual expenses?
November 6, 2015
Wealth inequality should be addressed from more than just a rich vs poor mentality, this WSJ post says, and shares several charts that look at wealth and age, race, education and generational money.
Disclaimer: I’m not an economist, and I don’t play one in my spare time. (What spare time?) It’s beyond my current brain to intelligently discuss the underlying factors that influence the wealth gaps right now.
Instead, charts! And data points!
How do we stack up? I’m comparing against the next two highest age markers because I feel 80 years old. Ha-ha yes yes, funny funny but no really, I do. And it’s not entirely because every bone seems to creak differently each day. But also because 40 adds an approximate handicap for our bigger extenuating circumstances: my poor health and related uncertain producing future, our three dependents of varying health statuses, our (my) penchant for adopting senior dogs, our high COLA.
Average assets: we are 1-2x the average
Average debt: we are 3x the average.
Wealth gap: I’m a bit miffed that just because whites and Asians trend along the same line we’re just all lumped in under white. I’m not even remotely white. Way to pretend we don’t even exist, WSJ.
Aside from that – I’m the first in my immediate family to have a college degree, while PiC’s at least the second, or third generation, even with a college education. The ability, whether we were self-funded (me) or not (him), to even obtain that education has to be an influence on the ability to make and keep wealth.
Millionaire?: I don’t know where to place us here. I don’t have a higher ed degree and PiC does. This only matters because I insist we’ll hit the million mark by the time I’m 40, come hell or high water. Admittedly, I likely won’t be comfortable with qualifying for seven figures based on a net worth including or even primarily relying on the stock market (our retirement and investing portfolio). That feels risky? No, that’s not the word. It isn’t as if holding everything in cash isn’t a sure way to lose ground, given inflation. It’s just that if the market takes a significant hit, at a certain point you run out of time for it to recover. I talk money with retired friends regularly and it was a sobering realization that even a very healthy portfolio isn’t any kind of guarantee against recessions. I grant we’re still a long ways away from retirement and relying on the portfolio, but it’s a factor.
Inheritance: Nope. PiC has some something from his family but I don’t count it on our net worth because we don’t consider it ours and likely it’d be funneled straight down to LB in some way if we don’t manage to send it back to his mom. I have absolutely no reason to expect an inheritance.
How about you?
October 27, 2015
It’s here!
I stepped WAY out of my comfort zone to do this interview with Jessica, and it’s now here, live!
Jessica’s made it really easy for you to listen:
I’d love to hear what you think.
October 26, 2015
Popular frugal finance says: Want early retirement? Live on less.
But I don’t want to! Been there, done that, still wearing the crappy free t-shirts because holes aren’t a good reason to throw them out. Obviously we CAN live on less, and boy have I, but given the choice, and I’m giving myself the choice, I choose to spend mindfully and selectively so we can spend on good quality or pay for expensive stuff when we have to. Besides, while I know frugality-focused Early Retirement folks enjoy their wage-working-free days, my desire to retire early has a lot more to do with freeing up time and energy to do things I care about like animal rescue, helping foster kids, addressing poverty, etc. That takes money.
Why not do both?
In an alternate universe, I could, so I would! But here in this somewhat crappy version, I simply can’t and I will not sacrifice health for wealth again when it’s not for survival.
Nope. I’m a forever fan of the multi-faceted approach.
Reducing our spendable cash flow: we were saving 25% of our salaries, net. That’s untouchable unless it’s paying down debt or keeping us afloat during job loss. We’re saving another 15% to account for LB’s expenses. Until / unless it’s spent on LB, it’s also untouchable outside of catastrophe or debt paydown.
The one-income life: replacing one of our incomes and benefits, or learning to live without one of our incomes for a while, isn’t going to happen through a side gig right away, but it’s a goal. I’m starting the income replacement with our investments.
Cutting our expenses ruthlessly: I negotiate our internet bill regularly, we don’t have a phone bill, we use the heck out of our cell phones and have the lowest plans appropriate to our usage. I’ve tried to refinance the mortgage several times, to no avail, but no fear! There are other ways to kill that mortgage.
With thanks to Nicole and Maggie for pointing me in the direction of a useful amortization spreadsheet, I’ve worked the numbers:
I love the potential for savings here. It’s time for a good hard look to see how much we could comfortably throw from savings in a big ole prepayment when each dollar is worth two in this scenario! There’s a serious temptation to throw all the cash at it but I’ll refrain from overzealous stupidity, I won’t deplete our savings cushion even if it feels like our jobs are relatively secure for now.
Update: Had a chat with PiC, we’ve decided that we can pull together cash from enough sources to make a big prepayment this month so we’re going all in. It’ll be worth almost twice the value in interest we don’t pay over the life of the loan so I’m over the moon about that. And you’d better believe I’m looking at ways to relieve my cash spending so I can throw more cash at it next year.
October 19, 2015
Daily #1GoodMoneyThing had a great run but, as expected, life got hectic so it’s good that I planned to ramp down to more of a weekly thing. Nothing like setting expectations accurately! Still, I got an awful lot done for not trying to do it daily.
Check, check, check:
Updated all my rental property income and expense transactions from the summer.
Submitted FSA claims.
Adapted a TMobile micro sim to match the ATT micro sim size.
Renewed our @MontereyAq membership for another year. Tax deductible and lowers the cost of entry each time we go!
Found an Amex offer for $15 off Chewy.com purchases. Check your card benefits!
Counting pills: Seamus is on a long term medication so I order refills in 6 month increments, 360 pills at a time. His annual bloodwork shows that he needs to be on a lower dose by 25%. 1-800-PetMeds is willing to exchange it for the lower dose but they want to know how many he has left. Damn, I just broke into the new bottle a couple weeks ago. Should have done his bloodwork in August. Better mark the calendar to check it in a year, before his next refill.
Travel budget strategizing: Paying for our upcoming travel in miles and points is a particular point of pride. I’m working furiously on the miles strategy that will put us in great seats on a good summer flight.
Home maintenance: where an ounce of prevention beats paying a plumber and then being traumatized by a stranger’s plumber’s crack.
I scrubbed the guck out of our tub drain, clearing up the build up out to let the water run free again. There was only one strand of hair in the much, incidentally, so I’ve been doing a great job keeping hair from clogging it.
Home maintenance: our dryer doesn’t like to stop when it’s supposed to. It could be the sensor, since the timer zeroes out at the end of the timed cycle, but it just doesn’t stop. I’m assuming the sensor is the thing that tells it to actually stop. More research needed!
Money maintenance: My last Citibank CD with a high interest rate (ha “high”) matured and that money is now being held for our investing portfolio. This drops my minimum account balance. Previously I had the Citibank Account package with a minimum balance of $10K across combined accounts. Since I don’t want to be charged a monthly fee, I’m converting it to the Basic Account package which has a minimum balance of $1500 across all accounts. That only took a solid hour on customer service chat, but better than an hour on the phone, I suppose.
Lots of good thoughts from y’all here
September 21, 2015
and featuring a Bonus Thought: Sometimes you don’t!
A friend of mine shared a listsicle signature line which made me chuckle. It’s supposed to be sarcastic reasons you don’t need life insurance because haha of course you do. It just makes a strong case for calling it When You Die Insurance because calling it LIFE insurance seems to confuse everyone, including the people who sell it.
Instead of being that know it all who tells someone their signature line sucks, I decided to be an adult and just blog about it. ;D
Six reasons you don’t need life (When You Die) insurance:
(According to the agent)
1. You are never going to die.
Ha ha ha … see that’s funny because it’s insurance for when you die. So you don’t need it if you’re not going to die! Get it?
The implication is probably that you’re going to keep working for the rest of eternity. But if you do die, I mean when you die, you don’t get to take this money with you. It stays here. Just sayin’.
2. You are going to inherit a fortune.
Inheriting a fortune is awesome and if you don’t blow it all, yes, that could replace your When You Die insurance. Let’s keep in mind this is not a good life financing plan because someone still has to die first and that’s just suspect as all get out.
3. You are going to win the lottery.
That’d also be awesome. If you win and don’t blow it all in a year, it’s possible this could be your When You Die insurance.
4. Your children are going to support you.
In death? Is this for zombies? Is this undead insurance for zombies? Hint: Life insurance isn’t for your daily expenses.
5. You are never going to retire.
Does an insurance for When You Die help with retirement? Again, if you have to be dead to collect, it’s not much good to you when you’re alive, you’re working or not. Life tip: Life insurance isn’t your retirement savings!
6. The government will take care of you.
Again, in death? What care do you need after you’re dead and buried / cremated / scattered at sea?
REAL reasons you need life insurance:
- You have minor or elderly dependents who would struggle with one-time or ongoing expenses upon your death, or pets who would need a home and/or require care.
- You have debt that would fall to your survivors to pay without your income: a cosigned mortgage, cosigned student loans, etc.
- You intended to support someone’s major life change like buying a home or though college, whether it’s your own child, that of your spouse’s, or even another relative.
- And your savings won’t cover any or all of the above options that apply to you.
Final answer: When You Die insurance is to cover your debt obligations and to help the living that you left behind, if they need it and you don’t have enough assets saved to cover it.
Therefore, another truth: You may not need life insurance!
If you’re single, have zero dependents whether of the 2 or 4-legged variety, no debt, and don’t intend to pick up any of these things ever? Or you’re married, no dependents, no debt, and the surviving spouse has a good career? Or you have any of those obligations but you have a LOT of savings? Then you don’t need life insurance! Imagine that. Leigh and Linda can attest to that.
At a certain point, if we grow our assets appropriately, we won’t need our life insurance to cover our debt and support LB and Seamus in the event that we both disappear from their lives and deprive them of our incomes. That’s all it is: a guaranteed income replacement for a limited period of time.
But your local life insurance agent would rather you didn’t think that.
September 18, 2015
If you’d asked me, I would not have believed that we’d unload any of the stuff clogging up our closets and nooks and crannies. It’s perfectly good stuff but none of it is that high-end, high-value stuff that Personal Finance for Beginners exhort you to sell to make some Quick Cash!
This is one money-related bet I would have lost.
All of this sold like it was in high demand:
- Miscellaneous bike gear
- Random auto parts
- Used shoes
- My old rainboots that never quite fit
- My old but in near-new condition sports watch (btw, this was a surprise sale. Maybe a general rule should be to TELL your spouse before you sell stuff out from under them!)
- Still in the box, old navigation system. Ah useless technology gifts.
PiC is the Craigslister in the family. I just collect the proceeds, log them into Mint, for which he calls me Judy Jetson (Please tell me you remember The Jetsons
). Harumph! Oh, and also I provide the free service of fretting uselessly while he’s out, every time, as if all Craigslist buyers are serial killers on the hunt for their next hit.
… What? That’s not normal?
ANYWAY. He once walked me through some of his tips and tricks. I’ve never used them because this is his gig and he’s great at it but it’s good stuff nonetheless.
Writing your ad
- Be very clear in your description of the Thing and Thing’s condition. Don’t assume people have seen the Thing before or that they can view the pictures easily.
- Include some pictures taken in good light.
- Include dimensions or sizing if that’s relevant or useful. It’s always useful for furniture items. Not so much for books.
- If you’re open to offers, say so. If the price is firm, say so. Don’t waste your time with hagglers if you’re not willing to move on price and don’t lose opportunities to unload the Thing if you’re willing to accept an offer.
- Always refresh expired ads, a lot of selling is about the timing. Buyers for Thing may pop up 4 weeks after you list the first time, or in one case, 11 months.
- Always state in the ad: Thing is available if this ad is still posted. Remove ad immediately after a confirmed sale.
Making the sale
- We ignore all stupid inquiries: “Is it still available?” for one. “Does the $20 printer come with ink cartridges?” for another. Historically, those inquiries never bear fruit.
- CL buyers in our area are notoriously flaky. Never promise to hold an item for anyone. It’s always first come, first serve, unless it’s a very big ticket item and you’ve already met, haggled and agreed on a price.
- Safety, safety, safety! Please meet in a public place. Don’t do it in the dark if you can avoid that. The one time PiC did a sale after sundown I insisted on dragging my super-pregnant self along to protect him because that made sense.
- If it requires two people to lift and move, make sure you know if your buyer is going to handle that themselves (some bring a friend), or if they expect you to lend a hand (some will ask).
As regular Craigslist buyers ourselves, we do our best to be a positive part of the ecosystem by only making inquiries when we’re serious, paying in cash (duh!), arranging our own pickup, and of course, if the price isn’t firm, we do haggle! Obviously.
It really can be as easy as posting an ad, fielding calls or emails, and then pocketing some hard cash for things you don’t use anymore! Or won’t use, ever. As always, I record our sales in our tracker here so y’all know, it’s possible to make real money even if you have really weird old stuff.