C40's Journal

Where are you and where are you going?
m741
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Post by m741 »

Congrats on breaking the 100k milestone. Only a few more to go :)


palmera
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Post by palmera »

Congrats! You've come a long way. Your journal is my favourite, I hope you don't mind if I copy your style of graphs when I start my own :)


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C40
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Post by C40 »

Thanks m741 and palmera. I won't mind at all if you copy my graphs. I pretty much copied them all from other places anyways.


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C40
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Post by C40 »

---------------------------------------
SEPTEMBER 2011
--------------------------------------
-- Income, after tax: $4,633 (three paychecks this month, normally get 2)
-- Spending: $1,464
-- Put in Savings: $3,200
-- 401k Contributions: $2,466
-- Saving: 80%

- Home Expenses: $547
- Food: $273
- Entertainment: $270
- Cycling: $0
- Transportation: $185
- Other: $37

Entertainment includes $140 for a football ticket. My old college friend came out for the weekend and we went to the a college football game. Definitely the most money I’ve payed to watch an event so far in my life. The game wasn’t worth the money, but it was a good excuse for my friend to come out, so I don’t mind. The weekend had Friday in September and Sat/Sun in October, so the extra spending I did on Booze, food, and gas is spread out in the two months. I didn’t spend all that much. My friend isn’t consumerish about eating and drinking, so when we left Saturday I packed enough food that we could carry around in our pockets and eat all day (a couple bananas and a boat load of trail mix kind of stuff - nuts, raisins, etc..), plus a flask, and a couple bike water bottles of mixed drinks. So we were set for most of the day with that stuff.
I mentioned in a previous post the trip I made in early September to visit family and friends made up much of the transportation cost. There’s $42 of booze in the food total. This trip was a good reminder for me that I need to focus on having a social life. I believe I’ll be discussing my progress on this in the upcoming months. The Transportation total for September includes gas for that trip - a bit over 500 miles each way, plus a lot of driving there. I’m wondering if I may have lost a gas receipt.

I’ve lost around $7,700 in my 401k in the last 5 months. ouch.


TABLE:


Image


SPENDING / SAVING:

Image



I like the trend on my expenses here. My changes are working out well.


EXPENSE PARETO & SAVINGS PROGRESS:

Image




I changed the Pareto so it only shows the average since I’ve moved. It’s just the last 2 or three months so far.

NET WORTH:

Image

http://farm7.staticflickr.com/6099/6210 ... 8e18_o.jpg



(I photoshopped this picture so the values don't drop off to zero. Maybe I'll do it for both this and the spending/saving on in the future)

FI CHART:

Image

http://farm7.staticflickr.com/6027/6209 ... 8d69_o.jpg



YEARS TO FI:

Image





_____________________
QUESTION
____________________
When people calculate their savings %, are they factoring in 401k contributions like I do?
Savings rate = Savings / Income

Where:
Savings = (After tax $ saved) + (401k contribution) + (Employer 401k match)
Income = (after tax income) + (401k contribution) + (Employer 401k match)

One thing that I've been considering is I should just take Income minus expenses for the "Savings" amount. Because otherwise I could be saving more or less in a month and my checking account just goes higher or lower. So the amount I move into savings isn't exactly the amount I "save", at least not in the short term..
_________________
HOBBIES
__________________
Since I’ve decided not to bike race, I’ve been thinking about what to do next. Here’s

what I’m thinking:
-- GARDENING -- I live in an apartment and I don’t believe there’s a way for me to have my own garden. I did read about CSAs in a the reader comment section of the Mr Money Moustache blog. I did some looking around and there is one about 5 miles away. I can pay $300 per year for a bunch of weekly produce, or I can go work on their farm in exchange for it. I’m going to look into working there. The details on their webpage don’t clearly indicate the amount of hours, so we’ll see. I believe the $/hour will be very low, but it would be a good opportunity for me to learn gardening (I have no experience), and maybe meet some like-minded people. Since I can’t have my own garden at the moment, this might be the next best thing. Anyone have experience with this kind of thing?
-- PHOTOGRAPHY -- I’ve always been into photography and will probably start doing more again. There is some potential to make money here, tough I haven’t ever tried much before. I was thinking about trying to do Senior pictures for high schoolers this fall. I’m guessing it’s too late to start that now. I am good at nightlife (club) photography, but I don’t know if I could really make money doing that. I am also good at shooting bicycle races, but again, not much money. I’ve had a couple people who are local journalists compliment my pictures and say I could shoot events for news. I think I’ll ask them more about that. I would probably be good at shooting other sports also, though I’m guessing I’d need a 200mm lens for many sports, and I only have a 50mm now. Also, I did do some photography for my bike racing team this year and some of the pictures I got might be the type that other teams would pay for.
-- READING -- There are quite a few books I want to read. I’m halfway through “How I found Freedom in an Unfree World” and have enjoyed it very much. The first half of the book alone has helped me a lot and allowed me to look at some decisions I’ve made / am making with more clarity.
I have a Kindle, so I’ll start with older books that are free. One that I’ve seen mentioned in many places and sounds good from the conversations it gets mentioned is Meditations (Marcus Aurelius).
______________________
TO DO NEXT:
______________________
- Get my food expenses lower
- Move some of my cash into higher risk investments. I went into the PP with my 401k a few months ago (the mutual fund). It has since went down. That might mean it's a good time to buy more, though with my cash I could use the ETFs that I'd prefer instead of the mutual fund. I'm not entirely sure I want to do this, so the first step is to decide.
Last edited by C40 on Sun Dec 08, 2013 10:37 pm, edited 1 time in total.

George the original one
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Post by George the original one »

> When people calculate their savings %, are they

> factoring in 401k contributions like I do?
Yes, that is the usual way of doing it. A few people elect to not do so.


palmera
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Post by palmera »

I guess you could stand to lower your food budget, but you're on track. Your expenses are so clean and low (benefit of being childless and single!) - focus on your social life now (as you mentioned) and let your hair down a bit ;)
Do you like, care about certain causes and stuff? I met some AWESOME lifelong friends through volunteering...plus if you volunteer for events, they're often catered which means a free meal + take home leftovers!


jforest
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Post by jforest »

I absolutely love the layout of your spreadsheet. I have now shamelessly stolen the idea.
You look to be in fantastic shape so far, as one person supporting a family, I'm jealous of your ability to shrink your expenses ;)


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C40
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Post by C40 »

Thanks folks.
Palmera - No, I'm not really into volunteering. I don't mind helping people that I know well, but there aren't groups of strangers or some general cause that I wish to support. I think I'm more likely to meet people I'll get along with well at other places, doing things that I enjoy.


sshawnn
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Post by sshawnn »

Nice work C40. I appreciate your organization and detail in your journal. re: cycling photography. Each "big" event I have done in triathlon has offered for purchase a series of photos of myself and the race venue. The agreements for these events may be in place and held by a large company but you could possibly due contract type work for them. (brightroom.com) photography has done at least one event.


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C40
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Post by C40 »

Thanks for the suggestion sshawnn. I looked into brightroom and would be a bit hesitant to work for them. It seems they want you to shoot a TON of pictures. I only have one camera and I might not want to put so many actuations (many thousands) on it for one event, where I might work 8+ hours and make a couple hundred dollars.
Some Investing updates:
-- I moved some of my after-tax savings into a Permanent Portfolio (VTI, SHY, TLT, IAU). I do worry a bit about losing that money, but I'm pretty confident that it is a safe way to invest it.
-- I'm not too happy with PRPFX. I have all of my 401k money in it since I don't believe I can use ETF's like those listed above. PRPFX has not done very well this year. I think a problem with PRPFX is that it has a significant portion of Swiss Francs. I guess Switzerland recently decided to peg the Swiss Franc to the Euro. I don't know all of the details/impact of this, but I know I don't like the sound of it. PRPFX dropped significantly over the last month, and I don't know if that was more due to gold going down, or people bailing on PRPFX because of the Swiss Franc pegging.
I guess I'll start investigating more aggressively if there is a way to build my own PP with my current 401k. I also need to investigate IRAs and if it might be worth it to be converting my 401k (as much of it as I can) to an IRA so I can invest how I want.


KevinW
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Post by KevinW »

Implementing PPs inside uncooperative 401(k)s has been discussed quite a bit on the PP forums. I added a section to the wiki page about some commonly-used strategies:
http://earlyretirementextreme.com/wiki/ ... 9_lemonade


akratic
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Post by akratic »

There were two problems with PRPFX that were exposed recently.
First, Swiss Francs were held as an inflation hedge, but you're right, they got pegged to the Euro, so they stopped performing this function.
Second, PRPFX is weak on deflation protection. The crawling road forums have long recommended an additional holding of EDV or TLT to balance out PRPFX. Example. And 30Y bonds have been up enormously recently. TLT is up 17% since August 1st, but PRPFX didn't get the benefit.
I suspect the underweighting of long term bonds hurt more than the Swiss Francs.
Still, to keep things in perspective, PRPFX is still crushing all the other passive portfolios this year, just not as well as the 4x25 ETF version of the PP.


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C40
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Post by C40 »

Thanks Kevin and akratic. I haven't figured out what I want to do yet, but I'll be investigating more soon.


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C40
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Post by C40 »

---------------------------------------
OCTOBER 2011
--------------------------------------


TOTALS:

Income, after tax: $3,086
Spending: $1,150
Put in Savings: $2,500
401k Contributions: $1,644
Saving: 101%


INVESTMENT INCOME:
Interest on 401k: $5,460
Interest on Savings: $169


SPENDING:
Home Expenses: $,590
Food: $183
Entertainment: $148
Cycling: $10
Transportation: $215
Other: $4
Sales: $1,106


I got pretty close to breaking $1,000 this month. My car battery died and I spent $114 on a new one. Without that I would’ve been really close.

I’ve been looking into using google voice on my phone to eliminate my monthly text message cost ($15/mo). Got the idea from a MMM post. I might get a phone in January from work, so my cell phone cost might go to zero for a while. Using google voice might work well with that situation because I can give my google voice number to everyone outside of work, and then control call forwarding as I wish.

-------------------------
FOOD
-------------------------

So I’ve been living in this small town where I work since April. Possibly the biggest drawback of the move is that the grocery stores here have horrible produce. You can’t buy a good apple in this town (even in the fall, up here near apple orchards). There’s a farmers market in town but it’s during the daytime on wednesdays and I don’t want to leave work for it. I drive to a big city every once in a while. Mostly to go to bars on Friday or Saturday night. I think I’ll start taking a cooler in the car and buy produce before going to the bars.

I haven’t been eating well at all lately since deciding to stop racing. I also have not been exercising much. I went on a really long bike ride (~120mi) last weekend with a bunch of local bike racers. I could tell 20 miles in that I am not nearly in the kind of shape I was in July (very very good). It was a really tough ride for me and once we got up to about 90 miles, I couldn’t even hang on with the group.

I knew I was losing fitness from not riding, but I also think all the crappy food I was eating had a big impact as well. I’ve gotten sick too - twice! Not very bad either time, but definitely more than I think I would’ve gotten if I was in top shape and eating better. And in general, I can just tell the difference. Being in good shape feels so much better, and the better in shape you are the better you feel - so with this quick drop off and getting sick, I've noticed the difference. I suppose it’s just a good reminder for me of how important it is to take good care of myself.


Image
http://farm7.staticflickr.com/6223/6296 ... 22d0_o.png



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http://farm7.staticflickr.com/6050/6296 ... 1702_o.png




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http://farm7.staticflickr.com/6223/6296 ... 92cc_o.png




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http://farm7.staticflickr.com/6234/6296 ... a04d_b.jpg



Image
http://farm7.staticflickr.com/6231/6296 ... 2d91_o.png




-------------------------
Savings Calculation
-------------------------


I made a change to how I calculate my savings %. While I used to use:
Savings rate = Savings / Income
Where savings = (After tax $ saved) + (401k contribution) + (Employer 401k match)

Income = (after tax income) + (401k contribution) + (Employer 401k match)
So savings was how much I actively moved into “savings” accounts. But fluctuations in my checking account would cause this to not be entirely accurate. So I now also include in the savings number: (Checking account value + Cash on hand at end of month) - (Checking, Cash at start of month)
My savings rate shows over 100% this month. This is because I sold some bike racing gear - just over $1000 worth. I don’t count these kind of sales as income. To me they are negative expenses (since in the past they were expenses, and now I’m recapturing some of the money). I use these categories, and the sales number is not included in my savings % calculation.

- Normal Income
- Extra income
- Sales
- Expenses

-------------------------
INVESTING
-------------------------

I moved $15k of my after-tax savings into an ETF PP. Made $200 on that ($160 after taking out the cost of buying the ETFs), or more than I made all year so far on money market interest. I have this great Bloomberg app on my phone where I can input how much of each ETF I have. Then when I open the app, it shows how much the prices have changed today, how much money I gained today, and how much I’m up/down in total. It’s something nice to check at work to see I’m making this other money on top of that.

PRPFX did go most of the way back up, after dropping a whole bunch last month, but I’d still much rather use a real PP. Haven’t made any recent progress investigating how to do this with my current 401k limitations... I’d like to kind of figure this out by the end of the year.

-------------------------
PHOTOGRAPHY
-------------------------

In a funny coincidence of timing, I got a random Flickr message from an art director of a small local newspaper asking to use a couple of my pictures from last year’s Halloween for an article. They used two of my pictures and I got a small check in the mail 2 days later.
Last edited by C40 on Sun Dec 08, 2013 10:51 pm, edited 1 time in total.

ExpatERE
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Post by ExpatERE »

First I want to say I love your charts!! Very nice.

Keep an eye on your fitness levels. It's very easy to take it for granted, but your health is something that will always be of value to you and I believe an investment in itself. Best of luck...


FreeUrChains
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Post by FreeUrChains »

Quite an Amazing journal with fun Chartls. I like your Style of summary Posting too for the month to month updates!. You've accomplished $100k, now can you get past a quarter of a Million?
Since your engineering, try a few more income streams, like App creations, XNA creators club/ Unity 3D, Your photography hobby made a bit of money randomly, but keep taking pictures. Youtube revenue is up for grabs if you have any cool videos. Also DIY Patents and written Instructions can make you some nice passive income on the side too! I'm in the same boat as you but just trying to clear out my student and car debt now by the end of the year. Over the last 6 months I have lowered my expense dramatically. Check out my Journal soon to come! Inpired by yours!


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C40
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Post by C40 »

Maybe I can just roll over some of my 401k into an IRA. I'll check on this with my plan...
http://gyroscopicinvesting.com/forum/in ... opic=564.0


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C40
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Post by C40 »

So the first requests with my 401k provider (ING) have been unsuccessful. I sent an email and also called. Same response from both - that it is not allowed in the plan rules. I might keep calling them to see if I get different people and eventually a different answer. Not too likely, but I should at least be asking for what I want.
I find myself worrying about PRPFX. Particularly when I see news about Greece and think about how the Euro could fail from situations like this. Might need to consider other options.
If I do stay with PRPFX, I'll probably try to add more LT Bonds, as suggested at the PP forum. Since I can't use ETFs (the reason I have PRPFX in the first place) I'd need to find an acceptable mutual fund. I don't expect to find exactly what I want, but it looks like there are a number of bond funds made up entirely of medium to long term US T Bonds.


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C40
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Post by C40 »

---------------------------------------
NOVEMBER 2011
---------------------------------------
TOTALS:

Income, after tax: $3,086

Sales: $212

Spending: $1,208

Put in after-tax Savings: $2,000

401k Contributions: $1,644

Savings rate: 80%
INVESTMENT INCOME:

Interest on 401k: $-3,224

Interest on Savings: $149
SPENDING:

Home Expenses: $639

Food: $203

Entertainment: $163

Cycling: $0

Transportation: $133

Other: $71
It’s gonna take a fairly special month to break $1,000. I’ll get it one of these times. in 2012 I’ll keep all or most months under $1,500.
Transportation includes $95 for yearly auto registration. I forgot to renew it and got pulled over while driving back from the Chicago meetup. The ticket is $175. WHAT!? The Traffic Court Clerk that I got ahold of on the phone the next day (after renewing my registration) told me that in order to get the citation dropped, I have to go to court... no way to do it sooner. So I guess on February 8th, I’m be spending a few hours driving and going to court. I set up a yearly reminder in Outlook at work so I don’t forget it next time.
This month I finished reading How I Found Freedom in an Unfree World . I liked this book and learned a lot. It helps me to think through situations faster and more clearly. It took me a long time to read it because I was taking summary notes as I went. Now I have a 20 page summary I can read through quickly if I want a refresher other than reading the whole book.
Right now I’m re-reading How to Win Friends and Influence People . I read this book the first time when I was 21 or so, and it helped me more than anything else I’ve read about interacting with people successfully. Over the last few months, I’ve caught myself too many times snapping at people, speaking too negatively, or not handling situations as well as I’d like to. So I’m reviewing the book and trying to re instill the principles in my habits.
I’m also re-reading the ERE book. It’s been about a year since I read it the first time. I think this will help as I have free time previously used for bike race training - so I’m deciding on hobbies and on what to learn about. I’m going to make a big list of all the skills/knowledge/habits I’d like to acquire, and start working on some of them.
I've started lifting weights again. Deadlift is at 150lbs x 20 reps after a month or two of getting used to deadlifting again. Grip is my biggest limiter right now. I'll make 2012 lifting goals in December. They will probably include deadlifting 225x20.
--------------------------------------

CHICAGO MEETUP

--------------------------------------
Last weekend I went down to Chicago for the ERE meetup. Akratic hosted at his apartment. Jacob was in town. And we had a number of others (The Dude, Seabourne + GF, Lucky12, and ChicagoERE). So 7 people total. It was fun. I was there 5 hours and we spoke about all kinds of different stuff. Some of the things I learned included suggestions on books or blogs to read, advice on money making hobbies (including Akratic’s extremely well thought-out T-Shirt design strategies), methods of finding other like-minded people, and many others.
------------------------------

CHARTS

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(with links to bigger versions)






























-----------------------------------------------

DECEMBER PLANS

-----------------------------------------------
--- Going down to my Mom’s for Christmas. Plane tickets were too expensive ($450), so I’m driving the 14 hours each way. St Louis is about halfway, and I have some friends there. So I think I’ll see if I can crash at their place overnight on the way out and the way back to break up the driving.
--- Map out plans and goals for 2012. These will include goals for money, health/fitness, skills/knowledge, and relationships.
--- Update or revamp my budget file for next year. If I don't change it much I won't need to make the changes until the end of January.
--- Finish reading the How to Win Friends book and the ERE book... I might start reading Meditations over X-mas holiday.
--- Need to figure out if I want to put money into an IRA or Roth IRA. I know for at least one of them I can still do so for 2011 up until I do my taxes. But the sooner the better. I need to just dive into this stuff and get a good understanding of certain laws and rules. I read a small book on it but it was basically just an introduction.


akratic
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Post by akratic »

Hey C40,
It was nice meeting you last week! I skimmed your journal this morning, so here's comments on various things:
I view 401k as savings and add it to my savings rate. I actually contribute ~75% of my salary into the 401k until it gets capped out at the start of the year. I think more ERE people should do this. You're basically trading dollar cost averaging and cash in hand in exchange for an extra year of tax protected earnings, and also if you quit your job or get fired before the end of the year, at least you capped that year. I only look at savings rate yearly though, not monthly.
If you go down the photography hobby path, you should upload your best photos to istockphoto.com. I get the impression making it on that website is fairly competitive, but there are definitely some people getting rich. If you do a search for a generic word like "woman", sort by downloads, and at the bottom of the page go Display Settings => Downloads, you'll see that some photographs are being bought 10,000+ times, with the photographer making a few dollars per download... When I develop websites I buy almost all the art on the website from istockphoto.com; it's a great business model both for the photographers and for art-challenged engineers.
In my opinion Roth IRA > Traditional IRA, because you can withdraw Roth IRA contributions without hassle at any age, because you can contribute more to Roths than Traditional, and because I speculate that income taxes are going up.
If you change the x-axis every month on your charts to only include january until the current month, you won't have that phantom drop off at the end.
Anyway, nice progress, enjoying the journal!


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