mooretrees journal

Where are you and where are you going?
bigato
Posts: 2113
Joined: Sat Mar 05, 2011 12:43 pm

Re: First Journal Post

Post by bigato » Sun May 12, 2019 6:50 pm

I suggest you organize the expenses from higher to lower. It helps to see the biggest offenders. I also like to put a percentage of total by the side of each category. And you should not count the part of the mortgage that goes towards the principal as expense, because it is actually savings. You only count the interest as expense. From your report it was not clear how you are doing.

classical_Liberal
Posts: 939
Joined: Sun Mar 20, 2016 6:05 am

Re: First Journal Post

Post by classical_Liberal » Sun May 12, 2019 8:09 pm

I would also suggest you annualized known, recurrent expenses, then divide it into monthly. Otherwise looking a a single month of spending is like running a single blood glucose at a random time of day to diagnosis diabetes.

Use whatever sub-categories that best reflect your lifestyle. For instance, I consider all fixed car expenses "transportation" (ins, licencing), but all non-fixed like gas and maintenance "entertainment". Basically because I can control the later with usage, and realistically I have designed my life where I could be car free. Hence having the ability eliminate the fixed, but would likely have different fixed costs for transportation (bus pass and occasional Ubers). However, I would try to lump these subcategories into the biggies. Housing, food, transport, healthcare, then everything else, cause anything else is mostly optional. Also please no misc categories :roll: that won't help you at all.

With the major categories separated you can compare yourself to mean US (tons of data on the interwebs), or to others here (your goal). For example, It's been suggested that an ERE'er should not be spending more than about 10% of income and/or net worth for housing. A quick google search of BLS spending patterns showed me that mean housing expense for family of three in US is about 30% of post tax income. Where are you on this spectrum?

mooretrees
Posts: 52
Joined: Sun Jan 27, 2019 1:21 pm

Re: First Journal Post

Post by mooretrees » Tue May 21, 2019 7:36 am

Thanks for the feedback, I'm slowly looking into each of your suggestions. I had to look up annualized, that's how much of a noob I am.

We sold our Honda Fit. It was pretty easy, but it got sorta uncertain if it was going to work (not the best communication with the buyer), but she pulled it together and now we are down to one, supremely inefficient car. But, a paid off car. I'll adjust the car insurance today and send the extra money (our loan was smaller than the asking price) to the last of DH's student loans. We have agreed to never buy a car with a loan.

I keep feeling such relief. One giant step to being out of debt (except the mortgage). Also, it feels like we are both embracing the less consumer lifestyle. Usually when we go to Portland, we squeeze in a visit to a store we don't have locally. This time we went with our friend to a local park and walked around with our dogs and let our son ride his balance bike for a sweet, chill time. It was relaxing.

Our non-mortgage loans should be under $10k. Three loans left;
1. $177 and has minimal interest so I'm not paying it off early
2. $4700 to my dad with no interest, so also not paying it off too aggressively (though I will increase the payment once the next loan is gone)
3. DH last loan (from a high of 21 loans, around $66,000) currently at around $6700, will make a big payment on this one later this week.

So, big progress. It's so important to make progress! I'm happy that we are spending less money on food, but damnit, cutting out $8500 of debt in one fell swoop is fantastic! And gives me hope that we'll get to saving money really soon. And it feels like we are entering the realm where we are making different (better) decisions about money than most other folks. So, we're getting weird! And that is awesome.

sea
Posts: 44
Joined: Thu Oct 29, 2015 10:28 pm

Re: First Journal Post

Post by sea » Tue May 21, 2019 1:11 pm

That's awesome about paying off the car! Sounds like you on the home stretch for paying off non-mortgage debt. I also have one inefficient but paid off car that is good for winter driving.

mooretrees
Posts: 52
Joined: Sun Jan 27, 2019 1:21 pm

Re: First Journal Post

Post by mooretrees » Fri May 24, 2019 1:13 am

Two days after we sold the car, the buyer contacted us with complaints and accusations of dishonesty. She had some cosmetic concerns regarding scratches, the mileage was higher than the two week old ad, and the lack of a second key had become a sore spot. We were floored. And really upset. We had taken the car to a local mechanic to get checked out and everything was good. She had had a chance to look at it, drive it and knew about the lack of the second key. DH responded to her email pretty quickly and not so gently called bullshit on it. He was upset about the accusations of dishonesty and I was worried about getting back the money I'd already sent to a loan.

Two more days past and we get an apology/explanation email from the buyer. Long story short, she didn't ask questions when she had them (like what is the actual mileage right now, how much does a second key cost?), she ignored her own concerns about the car (again all cosmetic and mileage related, not mechanical) and then freaked out and blamed it on us. She apologized for accusing us of dishonesty, and wrote several paragraphs about how she didn't check something out when she had a question/concern. I feel for her. When I'm not angry at her. My take away is that she wasn't sure about how to go about buying a car from a private dealer, and when the situation required her to ask questions or perhaps be slightly annoying as a buyer, she didn't feel comfortable doing it. Not my problem, but damn it I didn't appreciate the rollercoaster! We haven't written back to her yet, not sure exactly what to say.

It was good of her to apologize, but I feel sorta like telling her, you need to learn from this. She had no obligation to buy from us. The key to a good feeling walking away from that situation was to be annoying, ask a dozen questions, and perhaps be honest that you are over your head and need someone's help. I hope she can enjoy the car and get over this bad start.

Anyway, on to other money stuff.

Debts:
1. $177.59 (should be paid off in three months)
2. $4525.00 (no interest loan)
3. $3756.93

Total: $8459.52!!!!!!

We are under $10k!!! We started out a little over four years ago pretty close to $100k in debt. We weren't as focused as we could have been, made some bad decisions (car loan), and good ones (had our son), but we are almost out of the woods.

I've had some boring days at work, I hate that. I've struggled to not leave early and to find projects. I have two days off and the farmers market this Sat. I love having the coffee cart. People come and visit, they give us feed back on the coffee, we drink coffee and eat fresh strawberries, we wander around and listen to music, and we make some money.

I'm thinking of hiring a local teenager to watch our son two afternoons a week. Partly to give DH time to work on projects, partly to give myself time to do the same. My paperwork is spilling over and I need concentrated time to organize/purge papers. I want to go trail running alone, and read a novel without interruption. I need some alone time.

mooretrees
Posts: 52
Joined: Sun Jan 27, 2019 1:21 pm

Re: First Journal Post

Post by mooretrees » Thu May 30, 2019 9:24 am

bigato wrote:
Sun May 12, 2019 6:50 pm
I suggest you organize the expenses from higher to lower. It helps to see the biggest offenders. I also like to put a percentage of total by the side of each category. And you should not count the part of the mortgage that goes towards the principal as expense, because it is actually savings. You only count the interest as expense. From your report it was not clear how you are doing.
The top three categories for us are housing, transportation, and debt. I'll focus on those right now.
We are doing just okay with the housing, compared to folks here.
Not including principal, mortgage and utilities = $980/month, 25.8%.

So slightly lower than the US average for housing for three, but an area to make progress in to reach an ere goal of around 10%. No big changes will happen with this category quickly, but within the year we should have a rentable basement and we are thinking of a school bus conversion for a big change.

Transportation: May had high car expenses that should drop significantly in June, due to the pay off of the car loan (196/month), some pre-selling expenses (getting the spare tire fixed) and dropping insurance on the second car. However, we have an older, fuel inefficient vehicle that needs maintenance. So, maintenance will go up, and likely fuel as well, though only for bigger trips and business related driving.
Transportation: $530.48/14.0%.

We've been pretty good in the two weeks since we sold the car with walking and biking in town. Our roaster is in a commercial space the next town over and we haul our farmers market gear in the truck. So, with the business, we have some built in 'need' for a vehicle. I think if we really tried, we could figure out alternatives. But, we're making progress and I don't want to ask DH to build a big bike trailer for hauling supplies yet, he's got other projects to work on.....

Debt: $3778.98/55.4.% this number is crazy.

We sold the car and had extra after paying off the loan, we also got our state tax refund back which I sent to loans as well. Our 'normal' monthly payment for the remaining loans is $373.52.

The percentages for the housing and transportation are based on an average month income, while the debt is actual money in for May because the extra money coming in were one-time in flows and I didn't think it useful to have artificially low percentages for one month.

I got a pay raise that should start with my paycheck tomorrow. I'm thinking of going to HR and increasing my 401k contribution at least 1% percent. I figure I'm still in the accumulation phase and locked into working and it helps with saving something and slightly reducing my taxes? It is a cost of living raise, 2.5%. Last year I did this and I was surprised how much it increased my contributions, without feeling any loss from it in my paycheck.
I'm off to clean the kitchen and drink coffee before work.

classical_Liberal
Posts: 939
Joined: Sun Mar 20, 2016 6:05 am

Re: First Journal Post

Post by classical_Liberal » Fri May 31, 2019 2:00 am

Many here are rather indifferent or even slightly opposed to tax shelters. This is mainly due to the short time frame of savings required to ERE and the fact that most retire so early they need "good" money. I'm of the opposite opinion. I think any money we can tax shelter we should. There are plenty of inventive ways to pull the money out, while in the meantime save on taxes now and allow the deferred amount to grow, particularly if needs/spending are low. One of my larger mistakes early in accumulation was not maxing out my 401K, when I could have, but instead elected to pay off very low interest, tax deductible, student loan debt first. I could have sheltered and invested an extra 20K or so back in 2014-2015. That mistake costs me about 15K in present $ between lost capital gains and taxes (that's almost a year of spending!). I won't lie, the paid off debt was a huge psychological advantage, but it wasn't the best way to go.

Good job on measuring the expenses! I can't remember, have you taken a look at the "Makeover" post on the ERE homepage?

mooretrees
Posts: 52
Joined: Sun Jan 27, 2019 1:21 pm

Re: mooretrees journal

Post by mooretrees » Thu Jun 13, 2019 2:44 pm

@classical_liberal
I have looked at the ERE makeover, first time I rejected it outta hand as unreasonable. That was some time ago and I've looked again recently. I will go back to it and see what I can glean from it, I can see eventually giving up the cell phone? And we're wildly excited to convert a schoolbus and get rid of the mortgage.

In other news, we sold another phone and that $350 plus another maybe $700 will go to loans. I'm two payments away from finishing my last federal loan and for both of the federal loans, our interest paid last month was $12.00. That's still too much, but a far cry from the days when it was several hundred dollars.
Living with one car has been a pretty seamless transition. We are on the bikes all the time and it's so fun. I love that bikes are super economical, but really, they're just so fun to ride. I literally have ridden hundreds of miles and every single ride was enjoyable. Not every second was amazing, but I've never regretted a ride. I can't wait to bike cross country in the next 10 or so years. ERE will be essential to making that dream happen.

I'm cleaning out our basement and getting ready for a yard sale Saturday. Sunday we will go cut our first firewood of the season, we spotted a few tamaracks on a recent hike and they are the best. Nice uniform trunks, very little branching and excellent burning.

And last but not least, I added an extra $100 to our mortgage. Should knock off around six years off of the mortgage, which is if we didn't make any extra payments. I plan on upping the extra principle payments once the last two federal loans are paid off, so in the next three to four months. That is exciting!

And I will leave all two of you reading, with my cold brew coffee recipe. It's warm out here and I'm making cold brew for the farmers market as I think we'll sell more of it than hot coffee.

The recipe is ridiculously simple and works equally well with good to mediocre beans.

4 parts water to one part coarsely ground coffee
Stir a little and put the container into the fridge for 24 hours
Filter ground out with (initially) coarse, I use a french press, and then if you really want to get the sediment out you can pour through pour over filters-this can take a long time, or use a cheese cloth folded over several times. I don't mind the sediment so I don't bother with the pour over filter step. Word of caution, this is STRONG!! as in a LOT of caffeine. It keeps really well for a long time so I make it for market and then keep it in the fridge until I drink it all.

Frita
Posts: 186
Joined: Thu Mar 15, 2018 8:43 pm

Re: mooretrees journal

Post by Frita » Fri Jun 14, 2019 10:39 am

@moretrees
Kudos, you are settling in to ERE and making some pretty big shifts.

Thank you for your cold brew coffee recipe. I can’t wait to try it. Do you drink it straight or mix with milk or something?

mooretrees
Posts: 52
Joined: Sun Jan 27, 2019 1:21 pm

Re: mooretrees journal

Post by mooretrees » Fri Jun 14, 2019 9:24 pm

@frita
I drink it straight, it’s usually very smooth and sometimes chocolatey (spelling?) so it doesn’t need anything added in my opinion.

Another benefit is that cold brew is not as acidic as hot brewed coffee and easier on the stomach. I hope you enjoy it!

Frita
Posts: 186
Joined: Thu Mar 15, 2018 8:43 pm

Re: mooretrees journal

Post by Frita » Sat Jun 15, 2019 8:16 am

@moretrees
Interesting, I love chocolate undertones. Later this week I am visiting scoffers plantation so I will get some coffee to try it. For some reason, Guatemalans drink mostly instant.

mooretrees
Posts: 52
Joined: Sun Jan 27, 2019 1:21 pm

Re: mooretrees journal

Post by mooretrees » Wed Jun 26, 2019 7:50 am

I've been thinking quite a bit about status. I was raised solidly middle class and my mother especially, is very class conscious. She recently told me that my in-laws are lower class. It was a statement out of the blue with no real relevance to what we were talking about. I was surprised and somewhat disturbed. It fits in with my moms lifestyle now of country club living, expensive travel, show-offy jewelery, etc.

I've felt like the black sheep of the family since college as I wasn't interested in getting a career, lived with roommates and did bicycle tours for vacation. But, I think there must be some residual to deal with being raised by someone who cares so much about class and status. We have friends coming in for the Fourth of July and I found myself making a plan to fix up our upstairs bathroom and get the garden in a much nicer state to impress them. It's silly as I know these friends would not care at all.

Six years ago DH and I sat down to seriously decided if we would try to live in a tiny house or a bus, and I remember clearly thinking that it would be harder for me to transition to that coming from my upbringing. Nowadays, I have all the appearance of middle class living, house, truck, career and I can tell that I don't have that same concern about moving into a school bus. Maybe it is because I've tried out the trappings of middle class living so it is easier to reject them? Maybe my son helped me shift my thinking? I don't know, but I'm sure I have more work to deal with regarding this. I found Alain de Botton's book Status Anxiety and I couldn't get it at the library so I finally just bought a used book.
It will be interesting to see what he writes, if it is helpful at all. I think what will help me the most with recovering from my upbringing is sticking with ERE and deeply absorbing the fundamentals of the philosophy.

Also, any advice is welcome on this and how much I should put into our HSA, I'm considering upping the amount to lower the taxes and sneakily save some more money. Thanks all!

classical_Liberal
Posts: 939
Joined: Sun Mar 20, 2016 6:05 am

Re: mooretrees journal

Post by classical_Liberal » Thu Jun 27, 2019 1:26 am

mooretrees wrote:
Wed Jun 26, 2019 7:50 am
But, I think there must be some residual to deal with being raised by someone who cares so much about class and status.
I absolutely relate to this. My folks both grew up lower middle class, worked hard to show they were middle class. It was important in our household to maintain the appearance. This definitely leaked into my early adult thinking and career choices. Luckily, by the time I was late 20's, I began to realize how much I hated suburban, middle class lifestyle. The whole thing was exhausting to me. I'm not as bright as most of the people on this forum, so I didn't have much of a solution. However, I did have a breaking point and eventually just said F-it!. I gave up an upper middle class income/career path, got rid of my house, and started slumming it up. I worked on an assembly line for awhile, a halfway house, even delivered newspapers to make ends meets. At first I felt humiliated... like, what had I done to myself? What was wrong with me? My parent's were separated by that point and both of them, individually, made it quite clear I had done wrong. The interesting thing was, despite all of this, I began to grow much happier. Social relationships were more meaningful because I just hung out with people instead of "networking". It was very much a cold turkey, learn not o give a s**t year or so, but afterwards I felt free.

Edit: Interestingly enough, I now take a ton of pride in my frugality and lifestyle. So it's almost opposite as before.

mooretrees
Posts: 52
Joined: Sun Jan 27, 2019 1:21 pm

Re: mooretrees journal

Post by mooretrees » Thu Jun 27, 2019 5:18 pm

classical_Liberal wrote:
Thu Jun 27, 2019 1:26 am
Edit: Interestingly enough, I now take a ton of pride in my frugality and lifestyle. So it's almost opposite as before.
Thanks c_l, I really appreciate your thoughtful responses in my journal and elsewhere. I can tell I'm sorta between paradigms. I'm moving towards ERE, frugality and a less wasteful life, and away from consumerism. I look forward to frugality being deeply ingrained, but I'm not totally there yet. I know continuing this path we've started on will take us there, but it's sometimes difficult to leave the consumerist habits behind. I've read about how to deal with friends and family when you've changed and they're still the same. It helps to hear how others navigate those relationships.

Since c_l threw down the 21 day makeover gauntlet recently, I decided to look into it more. It certainly won't be 21 days, but maybe 21 weeks/months? Here goes: day one: Housing:

We are going to have a short term renter starting in Sept, so that means we will actually be able to make some money off of our house and reduce our portion of the mortgage from $891 to $541, in line with $200-$300/month/person. This renter will leave in mid-December but that also means the basement renovation will be complete and ready to rent to the next person. I can see us trying airb-n-b for the holidays as it could be 'easy' money and give us a break from a constant renter. A neighbor rented a room last year and had many travelers use it just for a spot to sleep while on the road.

Our house is a three bedroom, two bath with a full basement and a one and a half garage. The basement rarely gets used except for laundry and when we had the coffee roaster down there. We have toyed with the idea of making it a separate apartment altogether with its own entrance. That idea is not super attractive as we would be sharing the outside space with someone, but it would be a solution to the high housing costs.

The other idea we've seriously considered is renovating a school bus. The attraction of that idea is that it has been one of DH's dreams to build his own home, it would be VERY cheap to live in as we'd hardly have any rent (I assume we'd stay on someone's land nearby and pay minimal rent), we'd be mostly off grid, and it would be a a way to minimize our stuff, minimize the time cleaning and maintaining a house. Now, people do these skoolie (as the cool kids say) conversions for beaucoup bucks, 20-40K. Now, that would not make sense as a solution, so we would have to get it done for less than 20K. And since we're thinking of renting the house, we'd also need to rent the house for more than the mortgage as again, it wouldn't make sense any other way. Once we pay off the last of the federal student loans, we'l start saving for buying a school bus. So, in summary, coming soon we'll have a brief stint with reduced housing costs and in the next year or two, a solid exit strategy for getting into much lower housing costs.

This is a school bus conversion we really love: https://www.youtube.com/watch?v=svMsXj0W5N8

mooretrees
Posts: 52
Joined: Sun Jan 27, 2019 1:21 pm

Re: mooretrees journal

Post by mooretrees » Wed Jul 03, 2019 1:37 am

Day 4 of Makeover: drop the cell phone.

I think I’ve given up my cell phone, sorta. I was on a prepaid phone plan and it was due yesterday. It annoyed me to pay it, so I didn’t. I'd looked into using the phone only on wifi, and well, I'm going for it. I have had no problems with texts so far at home. For now, it’s relaxing to not have the phone on while I’m away from home or work. While I am an extrovert, I really dislike the interruptions of cell phones. Now, with a phone that is only wifi, I'll not bother taking it anywhere so it will be more like an old landline than a cell phone.

Jacob had a comment in @Lemur's journal that really struck me. How people with high savings rates haven't just figured out how to reduce spending, but totally eliminate certain areas. As opposed to folks like me, who have a dozen and a half categories and a low savings rate. Maybe that contributed to getting rid of the cell phone plan? It's a drop in the bucket cost-wise, but likely a big gain quality of life-wise. I'm also thinking that DH's phone plan should be paid for by our coffee business as it is the business phone number. So, I'll move that bill to the business and that will shift the savings rate up a teensy bit. Baby steps.

bigato
Posts: 2113
Joined: Sat Mar 05, 2011 12:43 pm

Re: mooretrees journal

Post by bigato » Wed Jul 03, 2019 2:07 pm

There are apps on both android and ios that list open wifi spots around the place. They make the phone keep some of the usefulness while you're out even without actually having a line. It's not as convenient, but better than paying for mobile data.

Sclass
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Joined: Tue Jul 10, 2012 5:15 pm
Location: Orange County, CA

Re: mooretrees journal

Post by Sclass » Wed Jul 03, 2019 3:08 pm

I really liked the car story. I’ve bought and sold a lot of used vehicles. Having somebody come back and complain about things they should have noticed about an “as is” sale is not unusual. What was unusual was the apology. Wow. That person was pretty big to come back and realize how messed up she was. That seemed a bit out of the ordinary.

Most people feel it’s their god given right to gripe. Those who have remorse are usually too embarrassed to come back and apologize.

That was an interesting interaction. Buying and Selling cars is stressful. You get better at the “dance” the more you do it. It is kind of like dating in some ways.

mooretrees
Posts: 52
Joined: Sun Jan 27, 2019 1:21 pm

Re: mooretrees journal

Post by mooretrees » Fri Jul 05, 2019 9:41 am

@Sclass Yah, it was big of her to apologize, fairly surprising too. We've bought and sold a fair number of cars too, but always pretty obviously junker cars. This was my first experience trying to sell a decent car. The buyer was an interesting lady, she has a business of tying glitter strands into peoples hair. Fairy strands is what she calls it. It's hard to believe she can make a living that way, but she evidently has a lot of demand.

I'll post numbers soon, but we didn't do so well in the food and eating out category. I've put some thought into it and realized that while I made some goals here, I wasn't tracking them in real time. So I put a piece of butcher block paper with several goals in the kitchen and I'll update them as needed. This, I hope, will help give me daily exposure to the goals and real time ideas of where I am with them. So far, the goals are:
1. <$400 on food at home
2, < $50 on eating out
3. three runs (one down already)
4. < $100 fuel for truck - we did a lot of trips to the woods last month to haul firewood and that added up.

I've been reading Status Anxiety by Alain de Botton. I've enjoyed it so far, and likely will reread it again. My big take away has been that so much of status anxiety comes from who you compare yourself to. I haven't finished it yet to see how he suggests solving it, but he has talked about using art and humor to try and gain perspective.

Over the last few months, I've reread Jacob's post http://earlyretirementextreme.com/why-s ... cceed.html

I reread it yesterday to see what else I could gleam from it. "I would say it takes an extreme level of independence, confidence and leadership to go against the stream." I realize in my situation I haven't been providing the leadership I need to get to early retirement. DH is willing to be led and as long as I make sure he gets some of his dreams realized (Alaska motorcycle trip, build own house), he is flexible about the day to day life. I've long been fascinated with him, he is so different from me. He has very little agency, sorta just accepts where ever he is at, and in general, might be a happier, kinder person than me. He is exactly like his mother. I've heard them both say at separate occasions "we'll see what the day brings." I don't understand that on any level. I have plans, things to cross off, and I believe I can make it happen. So, knowing that he'll just accept where ever he is at, I realized I need to lead more with this journey. He is a much kinder person than me. More patient too.

I've been reading journals with married folks who struggle with their spouses spending or unwillingness to commit fully to ERE, and I don't have that problem. My problem has been that I was treating him like how I wanted to be treated, but it isn't how he wants to be treated. He doesn't want to talk about money or goals or investing. He wants to talk about motorcycles, building things, trees and our son. So, going forward, I need to act like the leader in the family. Also, I need to do the food shopping.

Frita
Posts: 186
Joined: Thu Mar 15, 2018 8:43 pm

Re: mooretrees journal

Post by Frita » Fri Jul 05, 2019 1:52 pm

@moretrees
Relationships change over time so your spouse may surprise you! DH is not as frugal as I am but he’s a saver too. He was able to quit working easily and just turned off his love of status items in the process.

mooretrees
Posts: 52
Joined: Sun Jan 27, 2019 1:21 pm

Re: mooretrees journal

Post by mooretrees » Tue Jul 09, 2019 7:44 am

Goal check week one:
groceries: $121.88 pretty high due to visitors with teenage boys, they didn't bring any food and we went food shopping, they spent three times as much as I did, and then left a bunch of food. Also, made a yummy glass noodle dish with a peanut butter/lime juice sauce that hubby loved - good one for later as I have some leftover glass noodles from an old roommate
food out - $0
Run three times: 1 run down (might go tonight with son...)
sell stuff: I've got a buyer lined up for our cloth diapers, will be seeing her hopefully in two weeks, need to list our highchair locally.
fuel: $30 was pretty bummed that for our recent visitors we couldn't combine all of our stuff (camping gear, paddle boards, etc) into our big truck, and share fuel costs. Too many people and if we had a roof rack we might have been able to do it...

So, other than the really high expenses for food so far, we are on target. As far as food goes, I'm trying to eat down the misc items in the pantry and clean out the freezer.

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