Dave's Journal - documenting the path to FI

Where are you and where are you going?
FBeyer
Posts: 1070
Joined: Tue Oct 27, 2015 3:25 am

Re: Dave's Journal - documenting the path to FI

Post by FBeyer »

Dave wrote:... So why was I feeling this anxiety to do something productive? I am quite literally doing exactly what I need to do to achieve my goals, and barring unexpected circumstances, I will achieve them. The progress in inexorable...
It's funny. The very first post of my Journal states that becoming FI is actually not a matter of 'if' for me. I'm getting there, fast, just being who I already am.

But still, I have the urge to spur progress on.

I can't shake the need to Always Do More. There is something about having kids that totally changed my leisure time wiring. After having my daughter I cannot sit still and relax anymore. If I'm not programming, reading, studying or actively doing something social/exercise I feel like I'm totally wasting my time.

I've yet to find the mental trigger that puts a lid on that need for More. Time to pick up regular meditation again I guess.

Dave
Posts: 332
Joined: Fri Dec 19, 2014 1:42 pm

Re: Dave's Journal - documenting the path to FI

Post by Dave »

Fall 2016 Update

Several months have passed since my last entry, but generally speaking not much has changed.

Financially, DW and I continue to hack away at her school loans. Progress has been swift, and I expect them to be paid off in less than a year. Our expense structure is the same as before, or perhaps slightly better as we have been eating better (IE eating out less).

I learned there are a lot of small tasks to be done when you get married! Name change and all of the associated document updates, combining accounts (we are "old fashioned"), updated estate planning, etc. Just recently, we have finished all of this work with the exception of estate planning. I am reading a book on estate planning right now, and I have drafted our wills, general power of attorney documents, and medical power of attorney documents. After I finish this book and do a bit more research, we will finalize these documents and all of it will be done.

Perhaps the biggest change to our lives has been a shifting towards a more plant-based diet. After following several of the nutrition threads here on the forums, discussing with Ego, and researching the subject, I have decided the combination of 1) the balance of evidence and 2) the risk/reward structure of eating a primarily plant based diet is favorable to the alternatives. It is not important for me to have absolute certainty in this area, but it seems to me there is a strong case for the healthy benefits of a plant based diet, even ignoring financial, moral, or environmental considerations. And, the risk of following a plant based diet (note I use the phrase plant based to refer to a diet heavy in whole plant foods, so I'm not talking about vegan dogs and other laboratory foods) seems minor to me.

Given that we were already eating a diet relatively heavy in plant foods, this is not a radical shift for us. It is more a tilting of the proportions. For us, this has not meant a 100% abolishment of animal products. What it means is we don't cook using animal products for ourselves, but we will eat them when they are served to us. We will generally try to avoid them when we can in these situations, but occasionally this is not possible. So far, it has been successful and I will say that the hardest part is, as seems common, the social component. What seems to work here for us is to not focus on saying that we only eat plant foods, but instead to say we believe we should be eating more vegetables, fruits, and whole grains. Most people have a hard time disagreeing with that.

Other than that, life has been pretty good to us in Chicago. The weather has finally turned up here, and I am very much enjoying the cool autumn air. Onward to a beautiful October.

Dave
Posts: 332
Joined: Fri Dec 19, 2014 1:42 pm

Re: Dave's Journal - documenting the path to FI

Post by Dave »

Spring 2019 Update

It's been a little while since I've posted. In light of some of the recent threads discussing lurkers not being involved enough, including the return of one of my favorites (Ego!), I decided to involve myself a little bit more.

Financial Review

A lot has actually changed since my last post. The relatively short version is...I left my job as a fund accountant at the end of 2016 to focus on managing my investments full-time. Since then, I'd say a plurality (and perhaps a majority much of the time) of my time has been spent studying stock investing, doing stock research, and managing my portfolio.

This was a little bit unorthodox in even the ERE world, as I was not at 25x expenses. But, I was at a point where I thought a relatively normal year of investing returns would support my expenses. This has proven to be the case. Since DW continued full-time work up until the end of 2018, we meaningfully increased the size of our portfolio as a result of additional contributions + gains. I should also clarify that I very much enjoy investing and I wanted to make a real go of being a skilled stock investor who could add meaningful alpha. I recognized that even if I earned a meaningful level of excess returns in these first few years, they would not exceed what I would have made as a CPA. But, at the same time, my thoughts were if I proved to be skilled, adding several % per annum would result in massive differences in wealth long-term. That was the idea, and continues to be the idea to this day.

Additionally, I did believe (and was right) that I could support myself at that level, and that I could pursue other interests during my free time. I have done so, including a small paid gig for a while in writing investment reports, helping my dad and my father-in-law with numerous projects at home, helping friends with all sorts of financial planning, and more.

So far, I deem my decision a success, as I have added alpha to the process. I'm not going to go into a lot of specifics of my financial situation for reasons discussed before, but let's say I am satisfied with how things are going.

For the record, so that one would not think me unaware, I am cognizant of the market's level. As a bottom-up stock picker I basically spend my days researching businesses, determining their intrinsic value, buying when price is far below value, and holding until price approaches value or opportunity cost drives me to reallocate to something cheaper. Therefore, I don't spend a lot of time thinking about "the market" and its potential to crash, as that wouldn't bother me so much. I hold some cash, but more relevantly I believe the intrinsic value of my investments are far above the current price, so whatever price the market is showing on any given day has no bearing on me. If the market tanks and the quoted value of my holdings tank, this would not bother me any more than a private owner of a business who is not looking to sell getting offers to sell way below what they perceive their business is worth. In fact, I would welcome a downturn as I do have some cash and we have external cash flow, and I would always be happy to shift my portfolio to cheaper stocks. But, the big picture is that I don't really worry too much about what the overall market does as I own shares of individual businesses and those businesses will determine my results, not "the market".

Nonfinancial Review

Some other big changes have occurred for DW and me. We moved to Honolulu in mid-January 2019. While it is meaningfully more expensive here, we wanted to do a bit of traveling and exploring before we settled down and start a family. So we're here. It's been fun, as we both enjoy outdoor activities. We have done a ton of hiking, swimming, we're getting into snorkeling and surfing, and more. It's been a lot of fun.

One interesting note was that we have really gotten into calisthenics training at a local outdoor workout park. They have dip bars, pull-up bars, and other assorted calisthenics equipment. In the tough Chiberian winter working out outside would have required...a lot of grit. Here, people would be there in January in flip-flops and shirtless. I took to calisthenics quickly and I've truly enjoyed learning a new style of training in some depth, outdoors. The fact that it is totally free and is more skill-based rather than paying based (i.e. pay to rent weights) are other great factors. The ocean and mountain views, birds, and sunshine are all nice, too!

I've stuck with my meditating, although I have not made a lot of progress. Since moving here we have cleaned up our diets quite a bit and I'm probably in the best shape I have ever been in. I turned 30 back in January, so this was a nice realization that although I'm no longer in my 20s, I'm physically better than ever!

As I mentioned above, DW left her job and took work as an independent contractor pharmacist for a health organization. The work is extremely flexible and she's working the hours of her own choice, at a reduced level. We aren't shooting to save a lot of money in 2019, but just strive to break even and hopefully continue to grow our portfolio rather than dip into it.

Life is pretty good on our front, and I continue to be grateful to the ERE community for their role in helping me get to this point.

Thanks, all.

classical_Liberal
Posts: 2147
Joined: Sun Mar 20, 2016 6:05 am

Re: Dave's Journal - documenting the path to FI

Post by classical_Liberal »

Greetings, I read your journal, very cool!

Sounds like the last 2-3 years you have been Semi-ERE, that peaks my interest as there is a subset of folks on here looking to follow your path. IOW save up a sum and then change focus from hard core accumulation to skill/relationship building, etc. I wonder if you'd like to elaborate on your life at all the past few years?

Not looking for anything financial, rather the emotional and mental states you may have gone through switching from a hard core accumulation mindset. Why you decided to move to a HCOL, but better lifestyle area, stuff like that. Personally, I'm also very curious how it worked with your wife, considering it sounds like she kept working full time at first. I'm in a similar situation with my SO.

Congrats on the big 3-0! Honestly, that's really where life begins 8-)

Dave
Posts: 332
Joined: Fri Dec 19, 2014 1:42 pm

Re: Dave's Journal - documenting the path to FI

Post by Dave »

Thanks CL.

It's probably fair to say I'm semi-ERE. I sort of fall in a weird space because I wanted to "work" at being an investor but also have time for other activities. But still, I have approached my investing like that of a portfolio manager, so I'm not sure it's accurate that I'm FI in the way that many folks who live off retirement income do. I spend a lot of time doing investment research. So, on the one hand you could say that I have a "job" that is me trying to create (above-market) financial value from my financial capital. But, it's still true that I don't "work" for anyone. And I rather enjoy it. Call it what you will.

The motivation for this focus on investing bubbled up years ago, in the last part of college actually. I read Ben Graham's The Intelligent Investor in my last year of college and sort of took to the idea of value investing. Over time as I learned more and got to a point where I was comfortable holding meaningful positions in individual companies. And then, the last piece clicked for me when I was reading the ERE book and looking at some of the graphs/charts/tables. It became really clear to me that if you could do just a few percentage points better (than other options, what you otherwise would do, etc.), the implications are huge in terms of how much you need and where you will end up.

It's taken as sort of doctrine in FIRE communities that something like 3% or 4% is a reasonable withdrawal rate depending on your age and other variables like interest rates or market CAPE levels and so on. I actually have thoughts on all of that, but I don't want to go into that here. But let's just say that if an average person shoots for a 3% withdrawal rate, but I think I can earn 3% excess annual returns, the math changes in dramatic ways. One way of thinking about that would be instead of needing 33x expenses you need 17x (this isn't entirely accurate, but is close enough). There are problems with this regarding drawdowns and volatility, but needing 33x rather than 17x is a huge difference. I would not advocate trying to FIRE on 17x expenses, but it just illustrates how much having excess returns changes things. In other words, in the FIRE community we tend to focus on the level of expenses and how reducing them is the key variable to change in driving early retirement, and accept returns as a fixed thing. In the short-run in getting to early retirement this is definitely true. But, in reading ERE years ago, it struck me that working really hard on increasing ROR could actually pay off in just as large, in not larger, ways, way down the road. This is likely to be increasingly more valuable if we enter a long period of sideways markets or market declines.

This all aligns well with the somewhat surprising idea that beating the market by even a few percentage points over a long time results in massive differences. Simple example: $250,000 growth at 5% for 40 years results in $1,760,000, $250,000 growth at 8% over 40 years results in $5,431,000. 3% annual return over 40 years results in an outcome with a factor of 3 difference.

That’s a long rambling response to something you didn’t directly ask about, but it does provide some background on why I’m doing what I’m doing. “Active” investing is not a topic much talked about here on ERE, so I wanted to go into a little detail on my thoughts on all of that.

Sure, I can elaborate a bit. My life has been quite nice the last few years. I never enjoyed being an accountant that much. I thought I was pretty good at it, but it didn’t fit with the life I overall wanted. So, getting away from the office life has been nice. Studying things that are interesting to me has been nice, doing other projects and activities I’m interested in has been nice. These things have added to my life. Being home more has improved the quality of DW and my’s household situation, as I’m around to do more chores, shopping, cooking, etc. We eat better, exercise more, and are more organized as a result of all this. I’ve actually been more social in this time, as I’ve had more time to meet people, either for coffee or lunch during the day, or at night (since I have more energy). All in all, I have enjoyed my life in all of the sorts of predictable ways you can imagine. The shift from being an employee to “self-employed” as my own “portfolio manager” has been great. I’m self-motivated and don’t enjoy meetings, needless reports, and all the fun baggage that comes with normal work, so that has been great. As an equity investor my “income” is very sporadic (and actually I don’t think about even something like 1 year results as super meaningful), which is very very different than before, but I think temperamentally I’m suited for it. For example, in the last 10 trading sessions, in April, I’m up more I spent in 2018. I’ve watched this level wealth “evaporate” in days before, and expect it to do so again routinely. So it’s a roller coaster. But that very level of volatility is a key contributor to what allows me to achieve above-market returns, and I’m happy to embrace it and not get too attached the idea of being up or down a certain amount.

On the other hand, I’d say my biggest struggle has been social. This was not a surprise, as many have talked about these issues. But I’ve had a hard time explaining my life situation to other people. I’ve heard other people in similar situations say this but they either think I am some financial genius or a total bum living off my wife, where I don’t think either is accurate. While an awful lot of people don’t really seem to ask much about how your life is going, some do, and some find my situation very perplexing. I also believe it has made it harder to relate to some of my friends (and them to me, more importantly), as our finances are in very different situations.

Sort of related to that, at times I have felt like I am not doing enough with my life. I think this is a socially conditioned response in me that often follows after I talk to someone who doesn’t really get or approve of what I’m doing with my life. That can be tough and has been a challenge a few times. While I am not working at a company that is saving the world (or more likely, making widgets), I do try to be useful to people in my life and make a difference on a more local scale. I actually never felt my work as an accountant was especially meaningful in the big scheme of things, and that most jobs aren’t. So while I have these feelings, I have come to see that most of it is just socially conditioned in that it does not feel good to be an outsider, even if you think those you are outside of don’t represent the best way to go about things.

We decided to move to Hawaii because we really liked it here when we came for our honeymoon and a subsequent trip. We both love nature and aquatic activities. We wanted to do something a little more adventurous as our 20s were basically college->work->frugal and we wanted to experience a bit more of the world before returning to the Midwest and a more normal lifestyle. Hawaii is a way to do a lot of those things in a culture that we really, really like.

Yeah, DW kept working full time until this year. A lot of people actually ask me that. The assumption is she has to be jealous, resentful, or something. I talked to her a lot about me doing this beforehand and she was supportive, and she has been supportive throughout this time. I’ve asked her periodically if she’s still OK with it. And she’s always been fine. The thing to remember is that she can (and basically did) walk away from her job at any time. We have a very large financial cushion, and even if she just works part time that covers our cash outflows without need of touching the portfolio. I’ve told her for years that if she ever wanted to leave, do something else, or go part-time, do it and we’ll figure it out financially. Our at-home life has been better with me around more, and ultimately if I prove to be a skilled investor for the long-term then it will financially pay off much better than me being an accountant. And if anything changed where I needed to do a traditional job again, I totally would. That was the idea, and still is. So she’s good with it.

Thanks! 30 is supposed to be a big one, and celebrating mine in Hawaii was fun. I do feel like I am at the beginning in a lot of ways!

Dave
Posts: 332
Joined: Fri Dec 19, 2014 1:42 pm

Fishboning a Car Purchase

Post by Dave »

2019 has been going well so far. I’ll do a full update in a few months, but this post is actually posing a specific question to the hive mind of the forum.

Due to a couple of factors – my wife accepting an in-person job with an hour commute each way that recently went full-time and my personal desire to do a broader range of activities in my life - we are considering buying a car. If we bought this car, I would drive for Uber/Lyft on a part-time basis to recoup our expenses and earn a little bit of money.

I put together some pros and cons:

Pros:

-I would make money. Due to fixed costs, the amount of pay would be variable with the amount of hours I worked. I estimate that on an after-tax basis, I’d need to work 8-10 hours per week to break even. In the range of hours I’m likely to work, I will be making just a little above minimum wage, perhaps more if my hours are closer to 15-20/week.

-I would get out of the apartment, something I am always wanting to do, and develop my social skills. I have always been a little shy and wanted to develop my social skills for a long time. I believe driving for Lyft/Uber would be a way to practice this. This is a major benefit for me. I don’t want to oversell this, I know a lot of rides won’t do much here. But in general I expect this would help me develop.

-Driving would force me to decouple my identity further from being a “financial professional”. For a long time I’ve wanted to move more towards the Renaissance ideal, but truthfully even since leaving my accounting career I am still mostly a financial person. Doing this would help me get more out of that mindset and help me realize how many opportunities are out there, and along the way help me develop some humbleness as I do something I’m not already great at and where I am in service to others. Basically, I'd get out of my comfort zone.

-Save my wife ~1 hour each workday on her commute. Of course, I would be losing that hour, but since I have more free time than her, this is a good trade.

-Explore the island more often/in more detail. To date, we’ve taken the bus/occasionally rented a car, but having a car would meaningfully improve our ability to get out and explore things, which I’d really enjoy.

-Get to know this city and its people better. I enjoy this sort of thing, and this would be a nice benefit.

-Allow me to drive our guests around the island/allow our guests to use our car to save themselves money when visiting.

Cons:

-The biggest con is that I don’t know definitively how much I’d like this. I have driven a lot of our guests around the island and enjoyed that, and I generally enjoy driving. But I don’t have direct rideshare experience, and I can’t think of a way to do it on a trial basis. It’s possible that if I don’t like this, I would introduce some hours of annoyance into my life, or we’d be stuck paying the incremental cash flow for the car.

-Risk of lower pay/hour if various problems arise with the car. I tried to be conservative in my modeling, but I don’t know for sure how it shakes out. Honestly though, our cash flow is very positive, so even if the entire incremental costs stayed and I didn’t drive at all, we could easily swing it financially.

-Time spent dealing with car issues. Not having had a car for a long time, I’ve enjoyed not having the various tasks associated with car ownership. That will come up.

-It’s possible it could interfere with my investing, either personal or my work. I don’t think this is a problem due to my current excess time and the flexible nature of all my investment work and driving, but it’s possible.


All in all, to me it seems like a net positive. Basically, I see an opportunity for me to develop a bit personally, try a new type of work, make some money, and finance a car which saves my wife time and allows us to have more fun. It moves me forward (a little bit) along several dimensions that I value, and the downsides seem minimal and manageable in the worst-case scenarios (that I strongly dislike it and the financial outcome is worse than expected).

So my question to you all is what do you think of this? Do you think I am missing anything? Do you see this as a net positive? Does this seem like a move towards the Renaissance ideal?

Thanks for any thoughts you can share!

User avatar
Ego
Posts: 5172
Joined: Wed Nov 23, 2011 12:42 am

Re: Dave's Journal - documenting the path to FI

Post by Ego »


SavingWithBabies
Posts: 711
Joined: Mon Aug 31, 2015 2:50 pm
Location: Midwest, USA

Re: Dave's Journal - documenting the path to FI

Post by SavingWithBabies »

Apparently, Uber has the renting built in too via Hertz if you're worried (as I would be without more research) about liability of just renting from any car rental place and using it for rideshare:

https://www.hertz.com/rentacar/misc/ind ... g_page.jsp

I like the renting idea to try it out. If you like it, you might compare the cost of buying a good used local vehicle with importing one from the mainland (more hassle but might be worth it). A friend of mine that lived there seemed to think local used vehicles were on the more expensive end but I don't know how that compares with shipping one over.

Dave
Posts: 332
Joined: Fri Dec 19, 2014 1:42 pm

Re: Dave's Journal - documenting the path to FI

Post by Dave »

Thanks for the responses, all.

@Bigato - That is a good suggestion, and I appreciate your additional comment about the potential for emotional influence. Your recommendation to rent through Uber (or Lyft, since they offer this too) is a good suggestion for testing out driving for a rideshare company.

However, I actually didn't miss that option in my research - I did think about it. I had ruled it out and didn't about it here because parking is very expensive on a nightly basis where I live, to the tune of $30+/night (or a few bucks less if I'm willing to hoof it a bit). So, even just two weeks of testing this would run to a 2-week parking amount of ~$420, in addition to ~$360 of rental costs. Of course, there would fares that would offset a good portion of this, depending on how many hours I end up driving. I can't be sure, but I could see it being a net cost of ~$450 to test this for 2 weeks, if I'm conservative on revenue and aggressive on cost assumptions. This is a pretty rough estimate - I'm obviously not factoring in everything.

On the one hand this doesn't seem like so much to invest to test a big decision, as you suggested, especially if driving for Uber/Lyft were sole/primary reason I was getting a car. On the other hand, as I said, driving for Uber/Lyft is just one part of this decision in addition to the other factors. Even in a worst-case scenario that I find over a period of time I don't really enjoy it, it is only a couple hours a week to break-even and the "worst case outcome" cost of us absorbing some extra cost for a year to improve our quality of life isn't especially high for a fairly short period of time.

Still, I do want to think about what you said and consider if I'm letting my emotions warp my decision making process and perhaps I internally dismissed renting from Uber/Lyft too quickly. This is a viable option, it's just not especially cheap to do so.

@SWB - Interesting, I didn't know Hertz would do this, just that Uber and Lyft would. I'll check this out, too. I have talked to a number of people who have shipped vehicles to Hawaii and have a sense of this, but it's worth doing some more research beyond a few personal stories to gauge whether that makes more sense.

Thanks everyone. I have things to think about.

Dave
Posts: 332
Joined: Fri Dec 19, 2014 1:42 pm

Re: Dave's Journal - documenting the path to FI

Post by Dave »

@Bigato

I live in a very densely populated tourist area with very limited parking where daily/overnight rates are much higher than buying a monthly parking pass. For example, the parking in the building I live in costs $35/day if you park overnight, but $200/month if you are able to get a monthly pass. The problem being the wait list is around 2 years for a spot here. While a 2 year wait list is not typical of all buildings, it is true that parking is difficult to come by here.

So the incremental cost of parking the car during this trial period relative to if I owned a car comes to the tune of ~$23/day more.

My point, though, was that when I looked at how much it would cost to rent the car from Uber/Lyft and also considered the extremely high cost of overnight parking, the net cash outflow flow from even just a two week experiment was substantial relative to what I considered the whole package of benefits/cost/risk in even a worst-case outcome. That's why I had written it off and didn't mention it in my original post. Still, as you pointed out, I am considering if I'm mentally over-weighting the other factors (saving my wife time, having the car to more easily explore on the weekends, etc.) because these are emotionally attractive to me. I think I might be pretty excited about the part of exploring more on the weekends and perhaps that is a distortion. But the piece of saving my wife time is substantial (her getting back 5 hours a week off a full-time work schedule), and this is obviously the biggest benefit to her. I don't really think I'm overrating that at all.

I have to say though, that what I am internally experiencing is the opposite of what you said: I think the logic of us buying a car seems quite sound to me for this period of our life (for all the reasons I listed in my original post, not just for the specific benefits tied to me driving for Uber/Lyft), but emotionally I am resisting it. I haven't had a car since 2014 (and my wife about the same) and on the net have greatly benefited from not having one. Getting a car sort of feels like capitulating on some level. But logically I think it makes sense for us - remember even in the worst case scenario if I don't drive at all for Uber/Lyft, my wife's incremental income from this work change that was the catalyst for analyzing this decision meaningfully exceeds what the cost of owning a car will be.

I was talking to my dad about it and I told him my reluctance and he laughed at me, pointing out the decisions I make somewhat regularly with investments are for much greater sums of money than buying a car in cash. True, but if I'm honest I think some part of my identity has become tied to not owning a car, and that's the piece of me that's fighting this decision the hardest.

Yes, we can make it work without one. Is it worth it, though? Is sticking to our current situation (status quo bias?) worth giving up the increased time, experiences, and opportunities we'd have? That's the question I'm trying to answer.

Frita
Posts: 679
Joined: Thu Mar 15, 2018 8:43 pm

Re: Dave's Journal - documenting the path to FI

Post by Frita »

How is your wife covering her commute now? For comparison’s sake, what are the pros and cons of that situation versus a personal car?

SavingWithBabies
Posts: 711
Joined: Mon Aug 31, 2015 2:50 pm
Location: Midwest, USA

Re: Dave's Journal - documenting the path to FI

Post by SavingWithBabies »

Have you looked for parking within near walking distance? Seems like you could find something that way more immediately, do the rental and try it out and then decide what way to go based on the outcome. It's more time on your part but it seems like you're okay with that anyway, right? I searched for "parking spot" on your local craigslist and at least one comes up for sub $200 (although some one time key expense). Not that many though so maybe it's not close enough to work but... Another place to look is Facebook Marketplace (seems like a lot of people have moved over there).

My apologies if you've already gone this route and found it's not viable.

Dave
Posts: 332
Joined: Fri Dec 19, 2014 1:42 pm

Re: Dave's Journal - documenting the path to FI

Post by Dave »

@Bigato - It is true it would be cheaper to go that route, since ~7 days it breaks even between $200/month and $30/day. If it were easy to just go find a 1 month agreement reasonably close, that would be better, yes. In talking/meeting with people on Craigslist to feel this out, a good portion of the people are interested in agreeing to a term longer than this, but I'll dig more. It's also not proving that easy to find a spot that is reasonably close - there are not a lot of spots here, at least with my search process to date. Haha yeah, I mean I'm not going to use the option at my building for sure...I'd be surprised if I'm here in 2 years!

@Frita - My wife's current setup is a ~20 minute walk to the bus stop, a ~30 minute ride, and a ~10 minute buffer to get there early, each way. So ~2 hours round trip, via bus. This hasn't been altogether bad, as she's been able to do a lot of continuing education, call friends/family back home, etc. on the bus. The cost is $70/month for a bus pass, and this has carryover to our weekend bus trips and saves us a little money there. Compared to a car which obviously is much more expensive than $840/year bus pass. But, as a reminder, my wife is a pharmacist and recently went from 20->40 hours at a traditional job with regular pharmacist pay, so even with $0 of Uber/Lyft income if the analysis was just looking at buying a car for her new setup (which pays more per hour than what she was doing most of the year), it is meaningfully cash flow positive.

So on her side of the decision, the pros of getting car are saving ~5 hours a week of commute and turning another 5 hours into into a ride with me in the car rather than the bus, so basically she is getting back a fair portion of her free time on a full-time job schedule. This may seem trivial, but we are not here in Hawaii just to work and save, so we value our free time higher than we have in the past and likely will in the future given the unique opportunities we have here. On the con side, the incremental cash outflow if I don't drive is obviously meaningful relative to our current budget, but not nearly enough to prevent us from still saving a decent amount. She (and me, for some of the days) will miss out on 40 minutes of walking/day. And she will likely not be doing any continuing education in the car with me, but we can still call family/friends in the car. For what it's worth, she is strongly in favor of getting a car.

@SWB - The simple answer is yes, I have. I've been meeting with some people and talking to many recently to try to get a sense of this, but as I said in the earlier part of this post I'm not finding tons of options within a reasonable walk. Agreed on a rental basis that I'd be okay doing a bit more walking, so my net is a bit wider for a parking spot for a rental arrangement than it would be for a permanent setup. I'm certainly not afraid of a little walking - just this morning I did a 5 mile loop walk to get work out, get groceries at a few locations, and deliver some to my in-laws. I'd guess I'm in the 99th percentile of US citizens in terms of walking ;) . And that's not going to change after I get a car, the car will just be used for commute, Uber/Lyft, and weekend treks around the island.

Good tip on Facebook Marketplace. I haven't had Facebook in something like a decade, so I'll have to use my wife's. You're the 3rd or 4th person to tell me to look at that in the last year for various things, I guess I didn't realize it had enough network effects to reach critical mass/usefulness. Always behind the tech curve :lol: .

It may not be as clear to everyone as I meant it to be in my original post on the subject, but this decision isn't just about me driving to make $...it's part of a broader analysis of our life/web of goals, of which includes my wife's commute/lifestyle, in addition to other factors that I listed. So while driving for Uber/Lyft is the piece with the most uncertainty, it is the only piece that we don't have a good grip on how we feel about it. Maybe I wasn't clear that even if I don't like it, I think it would be good for me to do this for a while and grow as a person in an area that I've long felt like I need some work, so I don't see me disliking it for a 2 week period as being indicative that I should not go ahead and practice these skills for a prolonged period of time, even if it means ~10 hours a week until the car was cash-flow neutral. I'm just trying to frame this broadly from our overall lifestyle more and I know ERE'rs are good at analyzing lifestyle changes and how they affect a person's life beyond a single variable. Not that I don't appreciate the tips and suggestions on testing the rental - I definitely do, and this has made me go deeper here and test some of my assumptions/thoughts more, which has been valuable.

Dave
Posts: 332
Joined: Fri Dec 19, 2014 1:42 pm

Re: Dave's Journal - documenting the path to FI

Post by Dave »

2020 Update

Another year in the books.

Financial Review

As with my recent past, I am not going to post specific details regarding net worth, income, etc. But, I will say DW and I were among the lucky in that our income and assets grew and we had the opportunity to deploy significant capital into equities at very attractive prices.

DW continued to enjoy her job and spent much of the year working from home. She really liked working from home, and would prefer to do something like this on a go-forward basis.

On my end, a few things have developed over the past 18 or so months. I have been doing some stock research on a consulting basis for an investment company. This has been fairly intermittent, but the pay is attractive and the projects have been enjoyable and educational. It's felt good that I was able obtain such work based on my own investment self-education.

My prior posts discussed driving for Uber/Lyft. I have done some driving for Uber, but that was leading up the pandemic. In the last month, I have gotten back into it. I like doing this for a couple of hours every so often, especially if I see surge pricing is in effect nearby.

Additionally, related to Uber, last spring I reached out to my property manager and building manger (separate entities) to see if any elderly or sick folks in our building needed help getting groceries/medicines/supplies/etc., and I would do this for them at cost. I linked up with one older lady in our building, and over time this has evolved to more than just a periodic grocery run for her, to me also taking her around to places she needs to go and feels safe doing so. I charge her below market rates as I want to be helpful, but I do make some amount, get to connect with someone, provide her some companionship, and stay involved. I have another potential "client" coming up, so this has been an interesting development.

The combination of Uber + my personal chauffeuring/delivery has offset a decent portion of the total cost of the vehicle.

It's been quite a year on the investing front. As a concentrated investor I experienced wild volatility, but kept my cool and 1) invested significant amounts as markets were declining and 2) reallocated my portfolio from things that were similarly risky and less cheap to those that were more cheap and from similarly cheap but more risky to less risky stocks. I'm very happy with how I held up during my first 50% drawdown.

Nonfinancial Review

2020 was a tough year for me psychologically. I found myself disappointed a bit in humanity, both in aggregate and in a number of individuals I know, for a number of reasons I don't care to go into but I think many can relate to. I learned some personal lessons, and ultimately it was a year of personal development for me mentally. My biggest takeaway is not a new lesson, but just a reminder that ultimately I am responsible for my own happiness and can't allow undue influence by things out of my control. Again, not a new lesson but some environments make this mentality harder to apply than others.

DW and I were planning on going to Japan in 2020, but obviously that did not work out. Instead, we travelled locally and visited the 5 other main Hawaiian islands: Hawai'i, Maui, Kaua'i, Moloka'i, and Lana'i. We didn't originally plan on going to the two latter islands as they are quite a bit smaller and with a limited budget/high opportunity cost of Japan and an active Southwest Companion Pass making it fairly cheap, we went for it. This was awesome for us to go deeper into the geology/geography/culture of the islands.

DW and I did a 5 month vegetarian stretch this spring. This pushed my cooking further to build out my ability to cook more types of vegetarian food. We continue to slide along the spectrum more towards whole food plant-based.

Health-wise, overall it was a mixed year. We definitely had our splurges on cheap pizza, alcohol, and various junk foods. On the net I lost some fat during the year, but there was definitely some yo-yoing along the way and I'd like to squash those habits, but I guess I can cut a bit of slack given the environment. We were able to consistently do our strength training, either indoors or at an outdoor workout park when this was allowed.

Unfortunately my meditation fell off a bit last year, but I am trying to get back on the wagon.

I've continued my "hobby" of picking up a bag of trash at least once per week. This was born by me walking along the nearby canal and observing all the litter that winds up falling in the canal and washing out to the ocean. So I figured why not pick up some trash using the various bags we and our visitors accumulate to pick some of this up while being outside, talking on the phone/listening to music, and getting some exercise. I also do this when I can while hiking around the island. I realize this makes almost no difference in the grand scheme of things and doesn't prevent the problem, but it seems worthwhile to this starfish. I also have a thought that the second-order benefits of people seeing me doing this hopefully outweigh my own individual contribution - it's along a busy roadway so lots of people see me doing it, and a lot of people excitedly say something to me.

All in all, it was another year of life with goods and bads. I'm pleased overall what how I handled it across the board. I'm also pleased with the direction my life is going, and how I spend my time.

I do read the forums actively and try to participate when I have something useful to add (which isn't often), but I want to explicitly say thank you to Jacob and the ERE community for all the knowledge and wisdom shared, and the difference it has made in my life.

I hope everyone has a good 2021.

Dave
Posts: 332
Joined: Fri Dec 19, 2014 1:42 pm

An ERE Wheaton Analysis of Fitness

Post by Dave »

I have been enjoying following and thinking about The ERE Wheaton Scale thread and the recent Systems!- Level 6 towards 7 thread. I would place myself at stage 5 progressing towards 6, and my wife a level or two back. Our spending is currently elevated given our current residence in Hawai’i and some of the aspects this adventure we have taken on, but when we move back to the Midwest I am expecting our spending to be closer to stage 6 than 5. All of that aside, this post is more about the paradigms of stages as applied to my interest in fitness.

Right now we have access to a fantastic gym as part of my wife’s health plan, and we have used it on and off since she got the job in mid-late 2019 (late 2019 through the beginning of the pandemic in 2020, and again starting in 2021). The rest of the time we have been doing bodyweight training at outdoor workout parks. Even though we have been going to the gym so far in 2021, I don’t use much of what it offers: I use a pull-up bar, the floor, and the TRX suspension training system, and I plan to continue to use it while it’s available and I can learn how to use it better. But it has made me reflect what I want to do going forward, when I am eventually back in the Midwest and no longer have access to the suspension system.

After stewing things over during the weekend, I have decided that going forward I am not planning on buying a suspension system or any other fitness equipment but rather I will focus on basic bodyweight training. This is a shift in thinking from stage 5 (“Optimization”) to 6 (Yields and Flows”).

Stepping back, multiple times over the last 6-7 years I have been trying to refine my approach to fitness with several cycles of efforts between trying to avoid the gym due to financial cost/time inconvenience/avoiding machines and equipment manufactured and transported for a single purpose vs. going to the gym because it is the “optimal” solution to strength and muscle. As I have learned more about progressive calisthenics over the past couple of years, through resources like Convict Conditioning and The Red Delta Project, I have come to believe I will never need a gym again, and that is liberating as I have now reduced the costs of fitness without sacrificing much (if anything) in terms of benefits.

As discussed above, over the last few months I have been thinking about how to approach the situation in terms of calisthenics with some simple equipment vs. more minimal approaches. There are two primary factors involved in this decision. First, some muscles are harder to work without equipment such as the biceps, triceps, and especially the lateral deltoids. Second, it is easier to progress many exercises using equipment. The financial solution set to this includes buying or making and using things like a suspension system, bands, and weight vests/belts. These things allow one to address these challenges in calisthenics. To be honest, this is almost trivial financially because even all 3 of these solutions would not cost very much money, even if one were to buy them new (and I could likely find some used).

However, just like the gym solution didn’t sit right with me for a number of years, these solutions like the suspension system I’ve been using at the gym the last few months haven’t felt right either, at least at this juncture. During my conversation with DW, it finally struck me why: using this equipment sits squarely under the Optimization paradigm whereby it maximizes fitness return at the very modest financial and environmental cost of a small amount of equipment (but far less than the gym for the full workout), but it is still very one dimensional in that these pieces of equipment serve no other purpose (unless I were training others for $ or other forms of value) and are just a financial solution (with other associated "costs") to a problem that can be solved with more knowledge – specifically progressive calisthenics and refined exercise techniques - while also benefitting me in other ways.

Basically, I prefer the Yields and Flows (and this even fall under Systems-Theory) approach and using the absolute most basic tools for fitness – the ground, walls, and various sorts of bar/bar-like objects suspended in the air – that remove the single-purpose (meaning singular to fitness, but actually the tools I would buy like a suspension system can be used across many types of workouts) workout tools in favor of learning to use one’s body more intelligently to get a great workout with the natural surroundings that exist. So instead of always needing to rely on a band or a suspension system to work out certain muscles or to use a weight vest to increase tension in the muscle, I now need to go out into my environment and explore both physically and intellectually to find a solution, while also having the non-training benefits of doing so. Giving up these tools (suspension system, bands, and weight vest) is a fuller embracing of the web of goals approach that focuses on satisfying other goals within a single activity (fitness AND outside, free, physical exploration, mental creativity, and more) while not requiring single-use inputs like the equipment or negative outputs like time spent in a car going to the gym, dealing with the occasionally frustrating individual at the gym, or energy and material waste associated with a suspension system.

Fitting this fitness approach into the broader web of goals or systems thinking approach, I have a number of goals it aligns with and yields benefits towards. I have always been a person who loves being outdoors, I try to walk a lot each day (for mental and general physical health, and enjoyment!), I would like to build muscle, I would like to lose fat, I like exploring my broader neighborhood/city, I have been trying to meet other people who are into fitness as a focus for my social life, I really enjoy strength training and learning how to use my body better, I am trying to learn broadly accessible training methods I can teach friends and family (and maybe I will become a part-time trainer one day), I don’t want to be hyper-conditioned to a narrow band of (indoor) temperatures (easy to say while living in Hawaii, admittedly), and I prefer to live with fewer possessions.

Utilizing the existing capital in areas where I live or travel (workout parks, playgrounds, other bars/trees that can be used for pullups, etc.) allows me to make progress towards these goals by engaging in the activity “walk to nearby area and train progressive variations of pullup/pushup/squat/bridge/leg lift/lateral chain movement” with nearly zero financial and (incremental) environmental cost beyond depreciation on my clothes.

Tying the prior two paragraphs together, it checks a lot of boxes of things I want while not checking many boxes of things I don’t want. Frictions that existed before – paying for a gym, using equipment with an industrial product environmental footprint, spending time inside working out when I also want to spend time outdoors, working out at home when I also want to socialize with other people into fitness – have been reduced. From the system-wide perspective, I have very efficiently arranged an activity set that satisfies many of my goals.

Further, this activity is sufficiently broad such that it is not contingent on narrow conditions existing like a certain gym with a certain type of weight that breaks down when the gym is crowded or when travelling or on vacation or during a pandemic or whatever. It’s really more of a formula of something to engage in that is quite flexible. There will be challenges. For example, in the home environment it’s easier to have the go-to location to train, but even when traveling the activity, while perhaps challenged in the quality of the pull-up bar I can find, will be enhanced by the fun of exploring my environment and talking to new people. Also, in the Midwest winter it will be cold, so I will need appropriate attire. And so on.

However, there are multiple avenues for the activity to be done in almost any environment and it fulfills many of my goals including health, fitness, socializing, time outdoors, teaching, and education.

I believe the overall design laid out above is robust and will hold up well. There will be technical training details for me to work out as I continue on my path of progressive calisthenics, but I already have a clear path of the next few stages and do not see any issues in the near or medium-term future.

I should say that the above is just a theoretical analysis that I have tried to apply the ERE Wheaton framework to, and not some limiting prescription I am imposing on myself. I am open to using some of this equipment if I find myself with different goals or circumstances (maybe I decide to become a trainer and want some equipment to help train, maybe I find equipment at an insanely low cost, etc.) but this reflects some of my current thinking on fitness and ERE.

This is probably pretty basic stuff to a lot of folks here, but I thought it worth sharing in the event anyone found it useful.

basuragomi
Posts: 211
Joined: Tue Oct 15, 2019 3:13 pm

Re: Dave's Journal - documenting the path to FI

Post by basuragomi »

In theory a highly-WoG-integrated exercise regime would be sourced entirely from your daily tasks. Time spent on exercising with the only yield being fitness would be considered as time wasted as there is no other productive output.

The issue I keep running into is that if the goal is some functional level of strength, doing a task of X strength safely/reliably requires X+1 strength. Doing task X only trains up to X.

So the most obvious solution involves finding a new task that requires X+1 strength. But if this task can't be done safely or the yield from the task isn't really necessary, then it is not a functional target and more just practice - AKA wasted resources.

If practice is definitely in the picture, there's still a practical aspect that favours the gym. Greatest of all is the complete incremental aspect built into exercise equipment. Training for e.g. one-handed pull-ups is way easier with a weighted vest than just starting from a two-handed bodyweight strength base. Same thing with overhead press, once you can do handstand push-ups where do you go from there in a bodyweight regime?

Most non-gym things are designed to minimize energy input too, and things that aren't can be quite dangerous. If someone can deadlift 405 lbs, how can this be replicated safely without specialized equipment? Hauling tree trunks around and risking crushed toes? Carrying around gravel in a huge custom wheelbarrow?

Dave
Posts: 332
Joined: Fri Dec 19, 2014 1:42 pm

Re: Dave's Journal - documenting the path to FI

Post by Dave »

Hey basuragomi, thanks for the response.

I agree that time spent exercising for only fitness reasons (i.e. a single yield) isn’t a WoG approach. Unless I’m misunderstanding yields, my thought was that in my outdoor calisthenics training I am also “producing” several other yields beyond the pure fitness ones (strength/muscle/fat loss) that I desire and would strive to achieve anyways such as spending time outdoors (it’s an actual daily goal of mine, helps with mood/energy a lot), getting several miles of walking in every day, exploring different places, and (once I leave Hawaii) pushing myself to spend time outside regardless of heat/cold, that can occur without some of the “costs” of going to a gym. Some of the other benefits (socializing with other people into training, the enjoyment of bodyweight training, etc.) aren’t incremental compared to working out a gym, but are still yields to my exercise system. I also am toying with the idea of getting into personal training so I look at some of my training as moving up towards that break-even point on the skills curve that could result in income generation later, maybe.

Still, I agree with you. If one had a life consisting of enough activities that were physical one wouldn’t really need to train at all. I don’t know, but I’m guessing most hunter-gatherers didn’t spend much time training. With that said, I do really enjoy strength training so I suppose we do the best we can to integrate. It’s not perfect WoG, for sure. But it seems a step in the right direction from where I was before.

To deal with the issue that you brought up about doing X+1 task being just practice and wasted resources, my thought would be that you need to make sure the process of the practice is useful for something beyond the task. If your situation involves being bored sitting at home at a home gym doing deadlifts or workout videos just so you can have some level of strength to do something that seems quite narrow, sure. But every morning I go to the gym/workout park I get a nice walk in, some sunshine, talk to some friends at the gym, have fun training, get a little stronger, and so on. Maybe I’m deluding myself, but it doesn’t feel that narrow in benefits to me, or that I’m wasting resources.

What do you think? Am I thinking about that too narrowly?

Old me would have agreed with you that the gym offers an incremental advantage in practicing, but having studied and practiced progressive calisthenics I don’t believe that to be the case anymore. Part of this stems from what I believe to be an overly simplistic model of strength training where doing more weight or more reps is the only way people know how to measure progress. This removes a world of nuance of technical variations in how the exercise is completed and leads one to viewing progression in calisthenics as only step-function jumps in difficulty (push up to one arm push up, etc.)

Some of the elements that can be regressed or progressed in bodyweight exercises include the amount of tension you mentally bring to the muscle during a movement, how hands and feet are spaced relative to the centerline (hands closer together or further apart), the angle to gravity (wall push-up->ground push-up->handstand push-up), extension/torque (e.g. do you bend knees or keep legs straight during leg raises), range of tension (i.e. full range of motion, can be modified with say bricks during pushups to stop chest early or hands on breaks to go lower), rep tempo, the duration of a set, shifting weight between limbs (2 arm pushups->archer pushups->1 arm pushups, note this one offers huge progression as you can very incrementally shift weight more and more to one limb over time to build up), and then finally adding/taking off weight via adding weight or using bands to remove weight.

There is also the actual technical performance of how an exercise done is done with given the above set of conditions. In pretty much any set ever done there is some amount of technical breakdown between the first rep and the last one. Actively fighting this and maintaining form itself is another tool to allow one to get more out of the same exercises. While this isn’t unique to bodyweight training, the point is we all know people who lift who have atrocious form that resulted from an attempt to do more weight or reps. Lifting more weight with worse form isn’t what I’d consider progression, and focusing on perfecting form at a given exercise and rep range can allow progression, too.

To your question about one-handed pullups, you can progress from standard 2-arm pullups to 1-arm pullups by adjusting the following, often in conjunction with each other: modulating the range of tension (doing a small part of the range of motion with one arm), changing how close hands are to centerline, and eventually shifting more weigh to one limb “archer” style where weight is shifted more to one hand from the other. Of course adding weight is a great tool as well, I don’t mean to say the others are better, just that they can work, too.

Haha well if one can do 20 clean reps of full range of motion narrow hand position handstand pushups that’s pretty impressive and that seems to approaching some limits, all that is left is progressing to archer and then eventually one arm handstand pushups :lol: .

The point is, there is actually a ton of variables you can manipulate to implement nearly endless progression via bodyweight training. It’s not as simple as adding weigh to the bar or sliding the weight adjustor down as in other types of training, but that’s what I love about calisthenics: you introduce knowledge and skill to progress rather than taking the simple solution of using “things”. Seems to have a nice parallel with DIY vs. turning to the market for a solution.

Those are good points in your last paragraph. To your point, I agree and I’m not aware of any great way to train so specifically and safely in a way to replicate the exact movement pattern of the deadlift at an advanced level, but to be honest I’m struggling to see that it’s necessary. I’ve deadlifted 405lb before but in my life never came across a task that it seemed very useful for. Maybe the closest was lifting a deer onto a 4-wheeler by myself, but my 1RM was far overkill for the task. At some point we have to be honest that strength/fitness training is Pareto-optimized for practical/functional purposes and is being done for other reasons, which is OK to me and why at some point the other “yields” have to be substantial on the activity to be a true WoG activity – something I need to keep in mind going forward.

AxelHeyst
Posts: 657
Joined: Thu Jan 09, 2020 4:55 pm
Location: The Mountains, USA

Re: Dave's Journal - documenting the path to FI

Post by AxelHeyst »

There's another dimension to "training" that I've only just begun to think about, due to conversations with my roommate. He is a serial masterer, meaning, he gets into something physical like climbing or freedive spearfishing, and he masters it in the same way one might approach mastering the piano (he does that too). He does care about "fitness", and strength, and this and that, but he's also looking at it from the perspective of Mastery and Creative Self-Expression. He's very interested in perfect movement - in climbing, he's not done when he gets to the top, he's done when he's done the route dozens of times and is able to execute every single move perfectly, which in climbing is defined by efficiency and economy of movement. He trains this way as well - how can one design a progression that achieves one's goals in the most efficient manner, with the least risk of injury, and fitting it into the rest of one's daily/weekly routine perfectly?

He takes "training" and physical movement to an art form, in other words. In "web of goals" speak, you might say that his "training" module has first-order effects/goals of "Creative Self-Expression" and "Mastery" in addition to "Fitness/strength", "Low Cost", and "Income" (because at the level he goes, he can switch to coaching whenever he wants to).

I'm completely on board with going minimalist and avoiding gyms, fancy equipment, and the like, but I think that we go too far to say that it's a mistake or bad or "not ERE" to exercise in a way that isn't useful/productive, like bucking hay or transporting kegs of beer or something. I think trying to restrict one's physical activity to *only* things that have an obvious and "productive" use runs too great a risk of keeping people away from highly effective forms of activity. (So, I think I'm agreeing and +1'ing your last post, Dave, hopefully without just being redundant).

At the absurd end of the spectrum we'd have "if you're really ERE you wouldn't do yoga, because you're not accomplishing anything else at the same time." That's too narrow to my mind!

Post Reply