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checks

March 17th, 2018 at 07:17 am

Wow okay so I wrote over 50 checks last year. Crazy. I thought checks were a thing of the past turns out not. Check bill pay does not seem to work for me. I tried 3 times to have them mail a check to the guy who came and cleaned our gutters. I also am told to send a check to the school for activities. They don't seem fond of having an electronic check sent. Nor does the music teacher. Pretty much any kid activities wants a check cut unless they take credit cards.

I only realized this as I am looking over our annual spend and figuring out our taxes. I am pretty sure pre-kids we pretty much never wrote a check.

Oh well. I guess this explains why we run through checks a lot faster than I thought. When I told DH his eyes opened wide. Of course he pays no bills and hasn't cut a check in years. So he was floored. I can now see how many moms walk around with a check and comment "i am constantly cutting checks for every activity." More kids = more activities = more checks. Yes even if it's one activity it's still one check.

do i need an ef?

March 15th, 2018 at 05:46 pm

Years ago we ran so lean that every penny had to be accounted for so we didn't overdraw on anything. Our credit cards functioned as float but we basically ran it as a check register. No extra pennies anywhere. We squeezed dollars till they screamed.

But the things got easier for awhile and then we had kids and went down to one income and it was tight again for awhile. Then we decided time to get serious again and we started saving hardcore looking back we were at 50% savings again. We had made a plan in Christmas 12/2012 for 6/2016 that we were going to save 1 year of living expenses and move without jobs. We bumped it up to 6/2015 and we saved more than expected.

Anyway we lived on our savings (ie spent it the horror!!!), then knew we wanted to buy a house so we kept a lot of cash on hand for 2 years from 6/2015 to 6/2017 and then even after. We paid 100% cash out of pocket for our $75k renovations this year. No debt. We also bought a car and put down $8k.

But it appears we are unsure what to do about our saving again. We are back to having a "normal" EF of about 8 months cash. The problem is my DH I think feels insecure now and talks about having 1 year sitting in cash. I think not a good idea.

Second, I think that maybe we should start running lean again and have 1 month cash on hand and the rest we invest in something.

I'm struggling because I do think the stock market is high and I'm not sure I want to invest more in stocks right now. Second I'm really becoming interested in investing in real estate as a diversification in our overall portfolio. Not something we fall into but a real investment and bought solely with cash flow in mind.

But the the housing market seems red hot right now and I'm not sure it's the right time to plunk down cash. I mentioned the duplex a co-worker is selling that I've considered. It wasn't enough of a return to generate making it worth investing right now.

But if we are serious about getting into RE i think we need the cash to put as a down payment so investing it in stocks doesn't seem wise either. Nor does running with a lean EF. We probably should have a fully funded rental EF.

For people who invest in RE what's the wisest decision? For people not invested in RE is it because of the entry barrier in cost? Too much time? Too much risk?

I have been pondering this for awhile actually. What we should do regarding our Emergency Fund and whether to invest it for now or to wait and perhaps buy a property.

Overbudget and over time

December 1st, 2017 at 02:11 pm

Well we are officially over budget and way over time Well the timing thing is tight. The contractor told me Thanksgiving which I always thought was optimistic. Turns out I was right. As it stands we are hoping 12/20 before my parents arrive. Of course it won't be completely done the glass shower door and side won't be done. That is looking like January but hopefully everything else will be done.

We are currently framing the windows and just finished priming. We have to paint and do the tile of the fireplace and floor. Then there is still the upstairs work and attic, fan, insulation to still deal with, which I may tell them come back in January. We've got guests for the holidays and I don't think I can deal.

Budget wise we are over period. Over my "budget" not what they told me. When we started we were at $3700 for garage doors, $55k contractor, and $5k for designer and OOP. I figured we would come in around $75k. We are at $77k and not done. I knew things would come up and things would change But I was thinking 20% over was generous. I was wrong.

Things that changed? Our shower was rotted, we finished the garage, moved a door, found rot on the siding, replaced some rot and reinforcements. So our change orders are currently at $18k and we aren't done yet. Things happen when walls come down and you don't know what's behind them.

Oh well. I hope this works out okay. We are in so deep that we can't turn back now. Whatever it's worth I think if I escape under $100k I'll be happy right now. I don't think we should be that much further over I am going to guess $85k all in. But don't hold me to this. I'll continue updates and more importantly I'll post photos when it's done. I can't wait.

Quick Trip Summary

August 31st, 2017 at 11:54 am

So we just got back from our trip. I can't wait to post pictures. They were amazing.

Our entire trip was around $10,000 for 3 weeks - 2 weeks in Japan and 1 week in Hong Kong. The breakdown.

Tickets $2850
Hotels $1240 - my parents covered the hotels for the part we were were traveling with them except for 1 night. The total cost was $4500 for 14 days for both our rooms and theirs. So I covered the last night @ $179. Then we paid $745 for the week in Hong Kong and at the last minute we decided to do the last night @ Hong Kong Disney Hotel for $316. This is the most we've ever spent on a hotel by far. I mean $315 for 1 night. It was a little insane. We typically spend $100/night and Japan was expensive because it's Japan but we were spending around average there.

We spent $660 on tickets to Tokyo Disney Sea, Hong Kong Disney, and other attractions. We spent $1360 in cash on who knows what eating out, stuff, etc. Finally we spent $1724 on our credit cards on eating out, uber/lyft from airport, etc.

Our total spending on the trip was $7835 for 3 weeks. About 50% of what I budgeted and expected. I actually thought we'd spend between $15-20k. Even if I added in the $2250 for hotels my parents very generously gifted us, we've still be at $10,085. Which for 3 weeks isn't terrible for a family of 4 traveling for 3 weeks without cooking a single meal.

But to get away with under $8k for 3 weeks? That included all the transporation, we used trains and cabs (which is were most of the cash went), I have to say we did well.

I'll discuss it more in depth later. Can't wait to share photos. But disney in Tokyo and Hong Kong was ridiculously cheap the tickets. For us 1 day at each place we spent $222 for 4 tickets and $246 for 2 adults, 2 kids, and my FIL senior ticket. Crazy. That's the price of entry to Disneyworld and Disneyland for 2 adults. Strangely the food in the parks was CHEAP. I've been to enough parks to be surprised that they were charging like $5 for a meal which in the US runs around $10-$20.


$5k loan followup

May 8th, 2017 at 11:00 pm

I told DH full disclosure. I ended up showing him a few emails and photos and he agreed she needed the money. She retained a lawyer today and was advised not to wait to file for divorce but most as quickly as possible.

Well things are worse than she thought. So she thought it was just cheating Nope. Well she went into their garage and started opening up all the mail they've been ignoring for years. She hasn't paid a bill since 2007 when they got married. They had separate checking and savings accounts and he paid all the bills. So she never bothered to open a bill or inquire how things were going.

Her husband has played her and everyone for a fool. He's built a house of cards spending money he makes as fast as he can and then some. As I've helped organize the paperwork and explained some of the debts I said to her it's time to cut her losses and pray she can get out of this without declaring bankruptcy. But it might already be too late. She is so far in the hole.

The lifestyle she's become accustomed to is too champagne taste for her beer budget. How will she go back and change her mindset? I can see it in the way she handles money now? I can't tell her right now but she needs to realize that the house of cards money even after the divorce won't cut it. Maybe the sale of the house will wipe the slate clean of debts. But the days of going to the grocery store and buying whatever she wants is probably over. I asked her once before how much they spend on groceries and she guessed for a family of 5 about $3k/month. She put down in the budget $2k/month on groceries. That's not counting the eating out, starbucks, take out. We've found receipts for an average of $600/month lunch at her husband's club. That's on top of his eating out daily.

I dare not say the truth, but perhaps she had a suspicion that the lifestyle they were leading was way more than $200k/year. That the spending was so over the top, but she thought they were making enough to cover it. Yes she was saving for retirement but she made much less money. I really wonder how she had no idea they were living an unsustainable lifestyle. Or maybe he has been burning through his inheritance faster than even he imagined.

I don't know but the unpleasantness of the money situation I think will be hard. I can't even fathom how hard this fall will be. Tougher still to realize that he dug them into a deep hole and if not for the hole she might have a chance. I know BK seems irresponsible, but I wonder if it's not the best option in this case? How do you live on a $50k salary when you've been used to 5x that or more?

We'll see how this all plays out. But it turns out that more people than you can imagine are living lifestyles they can't afford. I never dreamed that she would be one of those people.

Spend everything you make

January 19th, 2017 at 08:59 am

Okay people really do spend everything they make. You think they don't. Or at least I thought they didn't. Turns out people really do spend everything they make and then more.

I've now seen people making incredible salaries, still working, and drawing from a 401k. Paying 30% tax on their 401k withdrawal based on their income and somehow not saving. Being in their 60s and still have a mortgage with interest. I am floored.

It explains a lot about people talking about how will they retire? I mean I work in a tax office where one of the other tax people has admitted to it being too hard to save. So she gets a $8k tax refund to help them through the year make ends meet. She said it was too hard to save for college so they meant to but they never got around to it. Her kids have $8k saved at 16 and 14 and most of it was from her dad's initial contribution into a 529 of $2500. She said everything else just seemed more important.

Or another one said there's no way we'll retire before 65. My husband was hoping 60 but we have so many expenses. Apparently they have a couple of rentals that aren't really breaking even. I wanted to point out that perhaps they should cash in and buy rentals that actually produce income. But they see it as a long term investment of price appreciation. I'm not RE savvy enough but I can't help but wonder if this is a losing proposition? Sure you can write off depreciation and other stuff on rentals, but if you can't cover the mortgage with rent, I wonder if you shouldn't buy a different property?

These are supposedly financially savvy people and the clients who come in are in the top 2-3% of earners in the US. But they have very little savings. They spend it as soon as they make it.

I know we chose to live without income. But I have to wonder don't these people worry? Do they even have 3 months saved in an EF? From what I can the answer is no.

Odds and Ends

December 29th, 2016 at 11:58 am

I'm struggling with auto-bill pay. I am so annoyed by it. I put things like the internet, cell phone, garbage, water, electric bill on auto-bill pay. The problem is that the CC it's hooked up to keeps getting changed and I have missed payments because I forgot to update the credit card. The real problem is that these credit cards discover, citibank have been compromised so much that we were trying to update our accounts over the summer every month. It's so frustrating.

Plus I'm pissed at Capitol One now for not paying our CC in full even though I have confirmation numbers of payments. So now we are hit with finance charges and late fees and I'm dealing with paying everything manually and calling the card companies to deal with the fees. I'm just annoyed that it's taking so much time. Plus they refuse to help me when I have confirmation payment codes. Seriously? So I've been dealing with all of BS all morning.

I need to still evaluate our investments and rebalance our accounts. I think we're a little to aggressively invested. Of course it probably doesn't matter too much long term. Staying invested is most important.

But TD Ameritrade lost $60k of our money for 2 weeks. They couldn't find the check we mailed for our Roth IRA conversion. But after we called and complained then they suddenly found it in processing. I am ready to shriek.

The US needs to become more automated. They literally cut checks from checking accounts and mail them. Other countries do immediate electronic debiting when you pay bills. I can't help but wonder how the US is so far behind other countries with processing of banking?

At least the year is over and we have some potential good news. DH might not be the executor of his uncle's estate. There might be a will. So he doesn't have to deal with anything. Cheers. So much better because he won't have to deal with any ramifications from being executor. YES!

November 30th Net Worth

December 1st, 2016 at 10:00 am

It's almost the end of the year and it's been good. So we hit our peak NW in June 2015. And since then we are down about 12%. From when we moved because we had a lot of costs moving, selling house, etc September 30th 2015 we are down 0.7%. So we have made up the difference. At our lowest point we dipped 19.4% from 6/15 or 9.1% from 9/30/15.

Part of it has been saving and part has been the market. We managed not miss a beat and maxed out DH's 401k and Roth IRAs for 2016 and kid's college funds $4k. We also saved our signing bonus. We hit a new high of $600k+ in retirement savings. To just show what holding steady does in DH's old 401k without contributions after August

June 2015 $332k,
9/30/15 $301k
10/30/15 $325k
1/28/16 $288k
3/24/16 $311k
5/15/16 $314k
6/7/16 $324k
6/27/16 $306k
11/3/16 $321k
11/30/16 $340k

In one year we had quite a ride. So shut your eyes and let it ride. A stretch goal for 2017 will be if market cooperate $700k in retirement.

We are right now in a holding pattern until we settle into a house. It'll be interesting what the next year financials hold with proposed tax reform. I can't say I'm upset because I know we'll benefit a lot. We pay a ton in taxes and this year more than ever.

a year in financial review

October 8th, 2016 at 07:56 am

It's been a great year. I'm doing it now a little late because as of September 1st we spent a whole year in our new life. It's been amazing for all of us. We got to get closer as a family with DH not working for 11 months. He pretty much did not get a paycheck for 12 months. But he was unemployed from August 15 2015 to July 25 2016.

We burned through $91.5k. Yes you read that right in 11 months. Granted $17k was tuition but still that $74.5k. We spent around $6700/month including our fees for renting our place which was $8k up front costs. So we spent around our normal $5500/month rate we had budgeted. Lucky for us a signing bonus helped bump our spending for the year up to $71.5k including the $17k tuition.

Was it worth it? Yes. We had a great time. I think perhaps our spending will force us to delay "retirement" by 1 year.

I forgot that from our $91.5k we direct $4k to college for kids, $11k to Roth IRA so I guess we "saved" $15k out of the $91.5k. Also we're maxing out Roth IRA and 401k this year on a compressed 5 month paychecks. So we're still on track to save for retirement even if we aren't saving our normal cash cushion.

But the real goals were met. Move and be able to be closer to family. Get job that DH loves. Buy a house. Check on first two and working on the third.

Sometimes in life as I'm reflecting on the past year you have to spend money to make money. You have to invest in yourself, maybe start a business, buy a rental property, go back to school and retrain to get to where you want to be. It's a HUGE risk and it can cost you a lot of money. But the rewards can be significant, not just financial but pay dividends in other ways.

I suspect our net worth might be able net zero with gains in our retirement accounts. But back to regular programming of saving now. I have to admit it was REALLY daunting spending all this cash without any income. To go from being a saver to a spender. This could be why my DH and I are not meant to be true early retirees, we are too nervous nellies and risk averse to pull the trigger. We're actually very close to being able to do it but would rather pad our accounts.

quick check in

August 29th, 2016 at 10:13 am

I have so much to do. We are back from almost a month away. We have new budget to work on, school to start, and house hunting. I think I am dreading the house hunting.

I need to iron out the kids schedules and figure out where we are with activities. It's weird this year we have so much more to do it seems than last year.

We blew August budget out of the water obviously but it's okay. Back to the grind. I'm so excited we have medical insurance and income again.