March 11, 2019
I’ve been impatient and grouchy.
Reading Work Optional brought me back down to earth a bit. I should be grateful for being where we are today, after so many years of work and saving and fighting.
Truly, I am! I’m ever so grateful for the opportunities we’ve had, for the fruit our hard work has borne, for our little family, for our wide network of loved ones. For the useful things we have, like running water and plumbing, for a sound roof over our head, for a furnace. For the pain relief that my diet has brought me so that I can actually move day in and day out without more than a trace of a limp or a cacophony of crackling when I actually bend my joints. We even tackled the garden as a family over the weekend and may I say, we ripped out an impressive amount of weeds and weed roots. There’s enough blessing and joy to fill a week of gratitude journals. So … whence the crabapple attitude?
It finally struck me on a drive home. It’s the number. The number that’s lingered in the back of my psyche for these past several years like a whisper you can’t quite hear. (I didn’t try to hear it, naturally, I’m really good at blocking out subtle noises to concentrate.)
Mom got sick when she was in her 40s. She had several chronic problems, including dementia which is incredibly hard to handle on every level. We struggled to get diagnoses and/or treatment but nothing was terminal. (Feels familiar.) Then at 55, she died of sudden cardiac arrest.
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May 30, 2013
I love Vanguard. I love their service, the easy user interface, the fact I’ve never had to talk to anyone just to get simple things done. Most of all: I love their low expense ratios and the option to buy Admiral Shares to lower the expense ratios even more.
My accounts have mostly been lying fallow for the past few years as my employer sponsored plans were with another, much more expensive, company. It was, for a saving junkie, a pretty depressing sight: fund changes fully dependent on the whim of the market and not on my active saving. And my savings rate was dismal: I only put away enough to maximize the match because my cash flow needs were awkwardly high.
Three years down the road, my contributions, match and any gains totaled about $19k in the new account.
Time to clean house
1. We finally processed the rollover IRA paperwork, months after I should have done it. Stupidly, I couldn’t just take care of it myself, my former employer had to be involved. But: done.
2. Three years ago, my very first sub-$3000 401(k) had no place to go with Vanguard’s $3000 minimum to open any normal account. My only choice was a STAR fund. It had a whopping 0.34% expense ratio but that was still better than those other firms that charge nearly 1%. Into the STAR fund it went.
3. The new Rollover IRA money went into the STAR funds account and the whole shebang was used to buy up new Admiral Shares.
Voila!
I now have $74k split into three accounts across a variety of funds:
- 70%: split between a large blend (large cap and a blend of growth & value) and foreign large blend index funds.
- 20%: split between an emerging markets index fund, a mid-cap growth fund, a small cap investor fund, and a total stock market index investor fund.
- 10%: in treasury bonds. (Roth)
It’s no $100K saved by age 30, despite putting something away every year since I was 21, so I’ve got some catching up to do. Also, my current employer doesn’t yet offer a retirement savings plan so it’s time to research ways to put away money on my own.
On the plus side, we arranged for PiC to max out his plan this year to make up for my lack of a plan so that’s great.
How’s your saving for retirement or just plain savings going?
September 25, 2012
As usual, there’s a slew of things to take care of when leaving a job. I’m reviewing the list and slowly checking things off:
1. Health care: Already transferred medical, dental and vision to PiC, so I don’t need COBRA.
2. FSA: I kept this with my own firm.
A) I’ll need to make sure that I can be added to PiC’s account as a spouse. Pretty sure it’s not under the dependent clause. The language doesn’t sound like it but there does appear to be a provision for the spouse and family to use the employee’s actual FSA account.
B) I’ve got 90 days to complete any claims against my own account. Frustratingly, even though I still have access to the account administration system, there’s no way to tell them to stop emailing my old work email address if they need to contact me through that system.
3. 401(k): Time for another rollover IRA. All of my accounts are with Vanguard, and my last rollover IRA had enough in it to be converted to Admiral Shares (woo!) so I’d like this to go right into the Admiral Shares.
However! I have a baby Rollover IRA still sitting in a STAR fund because it was only a little over $3000 so it’ll never qualify for an Admiral bump of anything.
As much as I hated the fees from this small company, we had a decent match so I contributed enough to get the full match. After 2 plus years, I have about $16,500.00 in this account. That would be more than enough to add to and convert the STAR fund into a respectable Admiral something.
4. Final Check: Last days worked and vacation are paid out. It’s standard that sick time, if separate from vacation, doesn’t get paid out. Action: Deposited that sucker, soonest.
Unlike my last job where I spent years not taking any vacation, and therefore ended up with about a month to cash out, I only had several days of vacation saved. It’s a nice extra bit of cash, I don’t need an unbudgeted cash infusion just because, and it’s not like I didn’t enjoy the vacation time I did spend!
Is that everything?
August 14, 2010
I’m now the proud owner of the Vanguard Star Fund.
The first two years of investing 2% of my paltry entry level salary on my behalf by my previous employer was, as expected, not highly lucrative. The grand total didn’t even reach Vanguard’s $3000 minimum on the majority of their Rollover IRA options so I had to go with the Star Fund for the immediate rollover.
Now I’m thinking of rolling the money from the 401(a) and 403(b) into the same IRA and reallocating. The allocation’s gotten a bit messy over the years:
Emerging Markets Stock Index Fund
Mid-Cap Growth Fund
Small-Cap Index Fund
Total Stock Market Index Fund
Vanguard International Value Fund
Target Retirement 2045 Fund
STAR Fund
And in the ROTH: Long-Term Treasury Fund
Overall, it’s crept over to 82% stocks and 18% bonds.
This brings me within squeaking distance of hitting the $40K mark in the retirement funds. Despite my previous resolution not to, I’ve started making contributions to the employer-sponsored retirement plan in order to get the maximum match. It’s not a lot, but I couldn’t stand going any longer without some savings dedicated to retirement. Once I streamline the three accounts above, and pick a new allocation, I should only have 3 accounts, instead of 5.
June 4, 2010
Will the cornerstone of Future Me’s Castle crumble to bits?
As excited as I was to start contributions to my new 401(k) as soon as I was eligible, the sad truth is that the plan carried by my company is less than ideal. By that I mean, the expense ratios start at .65% and go up, way up, from there. For any asset allocation, an investor would have to accept a hit of 10-20% of contributions along with the usual investing risks.
I’m a Vanguarder: no fees and low fees are my mantra! While we have an up-to-4% match with a 6% contribution, mediocre funds, outrageous fees and other additional fees I’ve not yet ferreted out are already eating up any possible gains. Is that now 2% or less worth it?
Certainly it’s 2% that I didn’t have to contribute but consider that my money won’t have the opportunity to perform in a stable fund like the ones I can find with Vanguard. There are 5 index funds and their online access is limited – witness the fine print disclaimer that access may be restricted and will be limited during peak times.
I’m not sure the pros [the match and the tax benefits] outweigh the cons [poor funds, many fees].
Alternatively, I could always take cash and dump it into a ROTH, which doesn’t actually give me any tax benefits right now, and also open up either a SIMPLE IRA or a SEP-IRA for the freelance income. It’s giving up the 4% match, but I can stick with Vanguard and not give up any of that match sacrificed to high fees.
It’s hard for me to say: I won’t invest in the 401(k) and will give up free money. But it’s harder to say I’m going to blindly follow conventional wisdom when I know it’s not the usual free money is great scheme.
June 30, 2009
Contributions for health, dental, other insurances, and supplemental retirement accounts are not taken from your final check; your contribution to the Retirement Savings Program is taken, and the university’s matching contribution is made. Other deductions such as parking citations, charges on your ID card, wage assignments, applicable taxable tuition assistance benefits, etc. will be deducted automatically from your final check.
Here we are!
After weeks and months of build-up, mood swings, job hunting, and all the other associated mumbo jumbo, we have survived until the final day without experiencing bodily harm (this was actually a little bit of a concern), completely losing my mind, or going stark raving mad. The latter two seem the same, but they’re not. The last option seems more permanent.
Happily, we’ve arrived. But there’s still work to do! Namely: deposit checks!! [oooh yes, *rubbing hands* I’ve been waiting for this moment.] By 3 pm of this day, I ought to receive my (a) final paycheck as detailed in the above quote, (b) a severance and vacation payout, and (c) quarterly supplemental income. I also sort of expect a (d) supplemental check to match the severance and vacation payout, but am not sure when and if that will appear. The HQ hasn’t exactly got their you-know-what in order, most of the time.
Secondly, investment accounts! My 403(b) and 401(a) are both with Vanguard, and I’ve accumulated enough to just leave them be. No rolling over, no cashing out, no losing about 40% of it.
There’s one more investment account coming due. In my first two years of employment, non-exempt employees had access to the We Think You’re Stupid Plan. I’ve spoken to the folks responsible for dealing with the now-obsolete WTYS Plan, and have found that they will roll the account balance over into my existing Vanguard account. Since they froze the plan, everyone was immediately vested! She wouldn’t tell me what the balance was at the time, but it’ll just be a nice surprise, whatever it is.
Thirdly, benefits! I’ve stocked up on my prescriptions for now, and should have enough to last me until September. Unless I have to do it sooner, I’m going to wait until about 40 days before signing into COBRA. If there’s no immediate need, and I manage to land another job, why waste the premiums? Reduced or not, that’s cash. There’s no problem with waiting since you can activate it retroactively so long as you pay the premiums for both months.
Also under this heading: life insurance. The life insurance policy I settled on is a measly $200k policy that I can port from my employer. It was the easiest option available to me, and while I’m no fan of PF guru-isms and simplifications, sometimes I just have to take the easier path so that the job gets done.
There you have it, folks. As prepped as a person can be, I’m walking out of this home away from home of the past 4.75 years and grateful that I can.
“What’s next?”
–Jed Bartlett, West Wing
May 30, 2009
Ah yes, hindsight. I knew this layoff was coming, most likely mid-year, yet it took me until April to start making appropriate adjustments.
Earlier this year, it was important to have cash on hand, so I cut back on retirement contributions to a bare-bones 3% (not including company match, which was maxed). My reasoning at the time was sound, but flawed due to incomplete knowledge.
Error One: I’m entitled to severance equal to one month pay when I separate from this employer, as well as over 200 hours of vacation pay. Didn’t take that cash payout into consideration. I made this assumption because I hoped to quit before the layoff which would have meant no severance.
Error Two: For another, my cash savings program was much more successful than anticipated. In January, I had $7000 for routine monthly expenses and $23,000 in savings. Since then, I’ve added ~$10,000 to those accounts, all while still paying bills. I could have spared a few thousand for retirement savings, considering the “sale prices” of the past several months, without being cash-poor & investment-rich post-employment.
Error Three: I didn’t consider that I’d be eligible for unemployment, and that it’ll cover all my monthly bills. At the time the plan was conceived, monthly expenses were well over $2000/month, so I estimated needing at least $35,000 in cash for 12 months of unemployment. In the meantime, the truck was sold, the family car was totaled and if nothing else, my monthly needs improved tremendously thanks to both events.
Being that pessimistic means I have an unusual stash of cash, just sitting around, while only having made just a little over $2000 in retirement contributions. Ergh. I hate throwing away both the opportunity to invest at lower prices and the tax benefit.
Don’t get me wrong, I’m certainly not bemoaning doing better than expected, for heaven’s sake. I’m just wishing I’d done a little better at making decisions based on the long-term, or at least considering the whole fiscal year. I subscribe to the “hope for the best, plan for the worst” mentality, but I clearly need to work on my automatic worst-worst-worst case scenario planning reflex. It’s a little dire. After all, it’s not like it’s the Zombie Apocalypse.
Of course, I haven’t hyperventilated about being a bag lady in a while, so maybe that was necessary for peace of mind.
For now, I’ll make a small adjustment to my contributions for the last check and leave payroll alone. Maybe I’ll make a few smaller investments, in addition to the CD I just bought. No sense in fussing too when we have so little time left, not until I learn how to read the future!
[Dear Magic 8-ball: will I find a good, well-paying job with benefits adjusted for COLA this year? What’s that? “Concentrate and ask again”? Hmph. I prefer Neil Gaiman‘s Magic 8-ball. I miss it.]