Nesaro's Journal

Where are you and where are you going?
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nesaro
Posts: 12
Joined: Tue Sep 01, 2020 7:17 am

Nesaro's Journal

Post by nesaro »

Hello!

This will be my journal where I document my path to ER(E). I think this will be the place where I "think out loud", shape my ideas and share my strategies, plans and goals. Sometimes just writing down what occupies my mind.

So I typed the following wall of text into my first post in the "Say Hello forum" but decided it's better suited as on opener for my journal. Here goes:

A bit over two years ago my then-new girlfriend tried to buy a two-family house and we were discussing ways to finance her deal (renting out one unit to pay for part of the mortgage). I must admit, this was basically my first exposure to mortgages, finances, etc. and the whole subject was way above my head. I very much dislike feeling dumb and challenged myself to learn more about (personal) finance. Being a multipotentialite - a term I learned from this forum just recently! What a relief! - finance became my new hot topic.

I have never had to think much about money, I never had overly expensive hobbies and there was just enough money in my bank account during university times, sometimes growing, sometimes shrinking. I lived a modest life with my modest grad school compensation. I never felt poor or missing out on something. I do not tend to long for socializing, eating out or stuff like that. It was natural for me to choose my first flat for distance to work (<5 mins walk) and distance to supermarket (same building). I guess I am a born minimalist. Sadly, I had to give up the flat to work abroad for a bit.

So, the house deal did not happen and I pondered what to do with my own modest savings (approx. 15K), since one is supposed to obligue to cultural pressure and buy/do something with it, maybe a car, maybe a house or an appartement, right...?

I read a lot about finance, stock market investments etc. and being a bit contrarian (people are very conservative here, investing mostly in real estate or savings accounts) I figured that this could be worth a shot and opened brokerage accounts and deposited my cash surplus in individual stocks and ETFs.
Slowly but steadily it dawned upon me that this could be a big thing - a chunk of capital, likely growing if unattended, faster growing if properly fed and managed, and paying dividends. Only then I stumbled across the jlcollinsnh blog and the possibility of not having to work until 65(+).

After grad school I always longed to have that flexible schedule back again, being able to get out into the mountains on short notice when the weather is alright and enjoy nature. At this time I often felt being stuck inside at work, having not enough time to my own enjoyments. A flame lit up inside me. I wanted to try this. I want to make it happen. I want to do it.

nesaro
Posts: 12
Joined: Tue Sep 01, 2020 7:17 am

Re: Nesaro's Journal

Post by nesaro »

Hello again!

Ok so after giving some background and how I got into "thinking about money differently" - IOW my first step onto the path to early retirement - I will give a first monthly summary and try a layout of topics that seem important to my progress. Parts will likely be just me moaning, I hope to reduce it in the future as things will be sorted out.

August 2020

Finances:

savings rate: 81%
Relatively low expenses, although a car had to be repaired. Could keep the groceries' expenses low, cooked a lot at home. Did not buy much stuff - a pair of rubber boots for EUR 13, since getting flooded shoes a few times during my bike commutes was no fun. I have to work for about 75 minutes to earn them, and bike commutes take me about one hour both ways, so they are definitely worth it.

Physical:

Not much time for exercising properly - I manage to lift weights in the basement about once a week. Perhaps 1-2 times per week I do bodyweight exercises, sets of chin ups and dips, during lunch break. Lunch break runs about once a week, or twice when I substitute a body weight workout. Bike commuting 2-3 times a week. It sounds like a lot but it really doesn't feel like it - each workout is approx. 20-30 minutes. I would like to do more. I wish I had time to get into the mountains for a full day, but it hasn't happened this year yet.

Mental:

Feeling a bit worn out, as the girlfriend and I are going on vacation next week in our new RV (well, not new, it is almost my age, but we bought it only recently) and still need to clean it and get everything set. We made only slow progress as our jobs were draining a lot of energy lately. I am feeling a lot of pressure, having to get everything ready at work for me being away and get the RV ready. Sometimes I rather just went hiking in the nearby mountains, more fun in my opinion, and way less hassle. Anyways, looking forward to a bit of down time.

Job:

There's perpetually more work than I am capable to do. Plus constant influx of "tiny projects, that are not a lot of work", that keep me from progressing on important stuff for our contractors. This is aggravated by me leaving next week for vacation - everyone wants their stuff ready and done before that, but no way I can satisfy everyone. I need to learn to say "no" more often.

My immediate boss is officially retired already and I am his last coworker. We are just working along on our contractor's project until that contract runs out next summer, then I need to have a new job. I got no debts to service, so I could take it easy and live from my emergency fund but I really want to make progress on early retirement. I need to make as much as possible as early as possible in my life.
I am contemplating about small side jobs to do on Saturdays but I am unsure about how to implement that. More efficient would be a higher-paying main job of course, but the move into the private sector would likely not improve that at first. Makes me feel a bit stuck.

My boss talked to a manager in the higher ranks of a company he's worked with and sort of advertised me. If I got a position there, it would require me to increase my daily commutes for up to an hour each way. Additionally my girlfriend wants to move into a small town in the opposite direction (its got beautiful views but it is expensive and impractical to commute from there to any employer; being an INTJ, this makes no sense to me. Future tensions for sure). Sent out two job applications at nearer-by companies. Trying to earn a bonus payment or two before I leave.

Free time:

Reading:

Finally found a translated copy of "Your money or your life", in the library of a local church, of all places. I was already doing most points of their 9 step program (I love to collect and visualize data, so tracking my monetary activies was natural when I started to optimize my finances), but it is always nice to get another perspective on the concepts I came up with myself, and to learn new techniques of course.

Found several books on canning and preserving food in the main library. Will try to stock up on preserved forms of produce of the season.

Random interests:

Picked up cooking/baking during the lockdown in March/April and am trying to get a handful of efficient, cheap and versatile recipes optimized. I got a bread recipe to the point where I am happy with the process (5-10' of work, 45' in the oven) and the result. Stir Frying is fun and very versatile and tasty.

Made a batch of colourful soap that I will distribute to relatives as gifts for christmas. Better start DIYing now than having to buy soulless stuff in late December.

As mentioned, off to vacation next week and a wedding the day before we leave. I hope I can keep the savings rate above 70% next month. I already updated the automated contributions to my brokerage account, so I will pay myself first and run out of funds before our "joint" vacation spending gets too bad.
I know I can't buy a single bit of happiness, not even on vacation, so I rather let the money work for my future freedom that I am longing for.

Cheepnis
Posts: 309
Joined: Mon Dec 31, 2018 11:52 am

Re: Nesaro's Journal

Post by Cheepnis »

Welcome Nesaro! Great job figuring things out under your own volition. I was in a similar situation to you 4 years ago. Found myself with a job, making money, accumulating some money. I've never been a super heavy spender and a consistent paycheck was starting to add up. I think I was just on the verge of succumbing to the pressure you speak of when I stumbled across MMM by chance. I lucked out, who knows maybe I'd be completely unsatisfied and directionless commuting in my F-150 if it wasn't for dumb luck. Props for getting there on your own.
Not much time for exercising properly
I feel you. It's almost like working 8 hours, commuting, and on top of that fitting in all other adult responsibilities 5 days a week leaves you with very little time to pursue your own goals! It takes some amount of constant vigilance to make sure you make the time to get done what you want to do and not just what you have to do. Sometimes it feels like half the battle.

RoamingFrancis
Posts: 342
Joined: Wed Oct 30, 2019 11:43 am

Re: Nesaro's Journal

Post by RoamingFrancis »

Welcome and good luck!

You say you found a translated copy of YMOYL; what language is it if you don't mind me asking?

nesaro
Posts: 12
Joined: Tue Sep 01, 2020 7:17 am

Re: Nesaro's Journal

Post by nesaro »

Cheepnis wrote:
Fri Sep 04, 2020 9:11 pm
I think I was just on the verge of succumbing to the pressure you speak of when I stumbled across MMM by chance. I lucked out, who knows maybe I'd be completely unsatisfied and directionless commuting in my F-150 if it wasn't for dumb luck. Props for getting there on your own.
Thank you! And Yes! There is definite pressure. My gf's father is mocking us because we "haven't managed to own" land or a house yet in our age. To me, buying the RV already feels like succumbing to this pressure, because I feel no intrinsic need to use it. So far it's been an (for me) unusually expensive indulgence, eating away money in the form of gasoline, insurance, spare parts, random equipment and spending time for cleaning, renovation, etc. I'd rather bike/hike someplace nice nearby. I hope we get the RV ready very soon.

It is an interesting thought/decision, once one acknowlegdes the possibility of ER(E): would I rather chain myself to a mortgage/fancy lifestyle or be free to do as I wish. (no offense intended - to expand on my personal perspective: housing/land is very expensive over here, yet most young people strive for their own houses. The generation before was the same, so that each generation takes on new mortgages to buy increasingly expensive and scarce land/houses)
Cheepnis wrote:
Fri Sep 04, 2020 9:11 pm
I feel you. It's almost like working 8 hours, commuting, and on top of that fitting in all other adult responsibilities 5 days a week leaves you with very little time to pursue your own goals! It takes some amount of constant vigilance to make sure you make the time to get done what you want to do and not just what you have to do. Sometimes it feels like half the battle.
Exactly! Constant vigilance. More often than not, making the time is more hassle than what I actually want done. I need to learn to say "no" more and to take care of my personal boundaries.
RoamingFrancis wrote:
Fri Sep 04, 2020 9:56 pm
Welcome and good luck!

You say you found a translated copy of YMOYL; what language is it if you don't mind me asking?
Thank you! I do not mind a bit: I found it in German, but it is the revised "modern" version and the translation of the new chapters is pretty bad

Update on the financial side: savings rate will take a blow this month due to the RV: with this week I am down to 79%, and vacation didn't even begin yet.

wolf
Posts: 1103
Joined: Fri Jan 06, 2017 5:09 pm
Location: Germany

Re: Nesaro's Journal

Post by wolf »

Great SR. Do you track it weekly?

nesaro
Posts: 12
Joined: Tue Sep 01, 2020 7:17 am

Re: Nesaro's Journal

Post by nesaro »

Hi wolf,

thank you, but I am not entirely happy with the SR right now, trying to control the damage!

I use a smartphone app to keep track of my expenses and bin them into categories like rent, insurance, groceries-staples, groceries-discretionary, gasoline etc. I usually have a rough idea of each month's income that I receive mid-month, so I can calculate and update my savings rate in a "month to date"-way, and on the last day of the month the final SR for that month will be saved into a spreadsheet.

I subtract all fixed costs like rent, insurance etc. from the projected income on the first day of the month and will get a number around 82% most months and then it will decrease with each expense until the clock is reset on the first day of each month.

nesaro
Posts: 12
Joined: Tue Sep 01, 2020 7:17 am

Re: Nesaro's Journal

Post by nesaro »

September 2020

Back from three weeks of vacation with the recently acquired RV. So this post is more a review of the vacation, since it is the dominant theme of this month.

We travelled domestically, since the covid-situation seemed to exacerbate quickly when we left and it was a good decision to stay relatively nearby (<4 hours drive). We had a week with very sunny warm weather, one week with deteriorating weather in the mountains, and the air got nearly freezing in this altitude, but the RV has a nice LPG heating system. The third week had mostly chilly and rainy weather.

The second half of the vacation was mostly spent visiting friends and relatives of my GF which I did not enjoy very much, it felt very energy-draining. I learned that as an INTJ I do not enjoy motor boat trips to lakeside restaurants the same way as other personality types seem to do.
I had the nagging feeling that I waste precious work-free lifetime that I earned for myself for activities that I do not enjoy. I rather use it as I wish and need to take better care of this (better/more planning before the trip). Lession learned.

We had an argument over how I paid for most (~90%) of our expenses, ran out of cash and asked her whether she could take over. I do not like her choleric traits. Usually we keep track of our shared expenses via a smartphone app and from this balance we decide who's turn it is to pay. I got the feeling she believes that spending correlates with happiness or fulfillment and I expect more tensions.

Finances:

savings rate: 62%

This was a very good month income-wise, but the vacation doubled my expenses, so this is not reflected properly in the savings rate.

I assessed my expenses in the YMOYL style and figured out that I value trips with the RV highly. They have the potential to be very fulfilling while being monetarily efficient if done properly. We spent much time on various camping sites which was convenient (infrastructure) but not needed as frequently as we did. Also, the eating out bills can be reduced a lot, since the RV has a modest but fully equipped kitchen and we brought a lot of food ourselves.
Before this relationship I spent my vacation days mostly to have long weekends with beautiful weather and went hiking/biking/climbing in the nearby mountains which I love. I'd still prefer this way to use my paid time off over RV trips, since it was much less hassle, I was more flexible and could pick sunny days and it felt more enjoyable overall.

Physical:

Had several beautiful hiking trips in the mountains. Apart from that I did not exercise properly at all. Starting again after a break is hard.

Mental:

Camping trips do not feel wholly refreshing/restful, of course. It shifts my focus on more basal needs but that does not solve any day-to-day problems. Such trips are very instructive for minimalism/ERE. I had a few insights regarding how I want to spend my precious free time and that encourage me in designing my life in a way that makes me happy (versus making other people happy). I intend to plan my vacations differently next year.

Job:

The aggravating COVID situation led to job market shrinkage in my field (who thought this was even possible?). Received two negative replies on applications that are separate from my boss' plan.

Free time:

Was mostly spent with the GF or reading up on nearby mountain ranges and multi-day trips through them.

This month's subject will be whether/how we change our living situation and I will expand on this in the coming days.

nesaro
Posts: 12
Joined: Tue Sep 01, 2020 7:17 am

Re: Nesaro's Journal

Post by nesaro »

October 2020

This month was dominated by pondering whether we should move into a nicer flat in a nearby village (which consider posh and hyped). The flat would be a bit smaller but with a more efficient cut (one extra room) and much more expensive: approx. EUR 1200. It was very tempting due to better infrastructure (more frequent public transportation to town) but overall it is more reasonable to stay put where we live right now. We save about EUR 500 each month by this decision. Big time lifestyle inflation averted.

Finances:
Savings rate 81%, managed to reduce my spending by a bit and had a great month income-wise. Did not feel as if I was saving actually. This month made me feel happy about my spending decisions.

Physical: the start to regular exercising was hard but very manageable. I made it a habit to cycle to work whenever possible (it is a very enjoyable 30 minute ride and time-efficient exercise), 2-5 days a week. I ran about 2-4 times a week and lifted weights 3 times a week. Right now I feel a bit sluggish and need to get used to the work load again, i.e. enhancing recovery abilities. I would like to become fit enough to do the hill runs around town again, still a lot to do but overall I feel in great shape.

Job: no news, job market still declining

Free time: picked up several books at the library and plan to read more, instead of wasting precious free time with the smartphone. Topics: simple and slow living, minimalism, stock market, resilience and risk psychology. I would like to intensify my reading hobby with the aim to self-improvement.

Goals for November:

- finances: savings rate > 75%, which should be relatively easy, since a bonus payment is due. As close to 80% as possible
- exercise: build endurance and enhance recovery, lift weights and find a sustainable full-body routine
- miscellaneous: at least 7 hours of sleep, no smartphone before bed. No smartphone use as pastime or for amusement. Time is too precious to spend it like that!
- spend more quality time with SO
- think about a time budget

nesaro
Posts: 12
Joined: Tue Sep 01, 2020 7:17 am

Re: Nesaro's Journal

Post by nesaro »

I need to organize my thoughts and switch back from lurk mode to active to give you and future me an update to this journal.

So my current contract will expire in early summer and I was looking for a new job close to where I live (< 45 mins by bike or good accessibility by public transportation). It seems difficult to find a position with adequate compensation. There's a large-ish company that would hire people from my field, but that would involve commuting by bus and train for > 1 hour twice a day or the need to buy a second car. Seems unreasonable to spend a couple of paychecks upfront for a car just to get to the company, and it would be a huge hit to my net hourly wage a well (after factoring in time spent commuting, etc.).

I had luck and another project leader asked me to join their group for a 4-6 month project B. Shortly after I agreed (sans alternatives, I figured a short job is better than unemployment), my current boss offered me a 1-year extension for project A. So now I've got two job offers at the same institution.
I need to come up with a reasonable plan this week.

Financially it would be best to go double part-time to up my weekly working hours (max is 40h per position A or B, but with two contracts A+B I could increase to the upper limit set by labor law). That would be an income increase of 15-20% for about 6 months at the expense of less free time over summer and double the project related trouble.
It will be stressful, but only half a year. Half a year can be quite the drag though.

My goal for now is to invest as many funds as possible as early as possible in my life, since I expect them to grow exponentially. Money I earn at a later point in time will be worth less in the future, since it can't compound as long. My overarching plan is to be free from work obligations and to be free to spend my time as I wish, doing the activities that I love and learning new skills. Going the max income way serves this plan best, even though it is less pleasant now.

While job hunting I managed to get a side gig for a local marketing company. I wrote them a brief text that they will use in a blog for a website that they are in charge of. They seemed pleased with it and asked me to create content for a company website. So far it's been a lot of fun.

nesaro
Posts: 12
Joined: Tue Sep 01, 2020 7:17 am

Re: Nesaro's Journal

Post by nesaro »

Random topics that occupy my mind lately:

Numbers: crossed a net worth milestone this year. It should keep me afloat for about 10 years, which was a profoundly calming realization.
Exercise: the last few months I lifted three times per week, commuted by bike 2-3 times per week and ran 1-3 times per week. Looking forward to using the road bike again
Skills: would like to learn woodworking, soldering / building electronics and learn a programming language.

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