cmonkey's journal

Where are you and where are you going?
cmonkey
Posts: 1814
Joined: Mon Apr 21, 2014 11:56 am

Re: cmonkey's journal

Post by cmonkey »

ffj wrote:
Fri May 04, 2018 3:13 pm
@cmonkey

Looking nice. I planted 55 tomato plants the other day, God help me if they all live. ;)
Thanks. Haha, that's a lot. I think we planted about that many a few years ago and have since scaled back a bit. I'm pretty sure we didn't waste any tomatoes either! Hence why we have several hundred quart jars scattered around our kitchen/attic.

cmonkey
Posts: 1814
Joined: Mon Apr 21, 2014 11:56 am

Re: cmonkey's journal

Post by cmonkey »

jacob wrote:
Fri May 04, 2018 3:37 pm
We ate this for several weeks. Monthly food budget was $50-70 for two adults at the time. Not entirely self-sufficient. I blame the evil cheese. Would have been less and healthier without the evil cheese.
I sometimes wonder why I cannot get my food budget down from where it is, when we eat so much from our garden. Then I remember this. The evil cheese.....mmmmm...

cmonkey
Posts: 1814
Joined: Mon Apr 21, 2014 11:56 am

Re: cmonkey's journal

Post by cmonkey »

Thinking About Taxes

So it's a given that we'll never pay federal tax again after I retire.

I think I've ALSO figured out how I can retire and pay zero in Illinois State taxes if we stay here for a while, which might be the case.

Illinois gives you exemptions for each federal exemption you claim in the amount of 2K each, so we get 4K off our taxable income.

I can harvest capital losses of 3K in excess of gains and offset our dividend income/IRA withdrawls.

Illinois also gives you a credit equal to 5% of your property tax, which for us would be 2200 * .05 = 110 / .0495 = $2,222.22 in additional income that is tax free.

So we are up to $9,222 in tax free income for Illinois, which is ALSO the amount of taxable dividend income I'll have when I quit. The other 5K I can take from IRA withdrawals and/or capital gains and harvest losses in my taxable account to avoid taxes. When I retire, I'll have about 260K in our single taxable account, which would require (at a minimum) 8K/260K = 3% of the account in the red each year. This seems entirely plausible for an actively managed account invested in individual stocks.

When we have a kid, add another exemption into the mix for a total of $11,222 in tax free income and then I only need about 3K in gains/withdrawals. If we have a second kid, it will be very easy to not pay taxes here.


A Problem?

The only "problem" I think I'll have is that I would not be able to withdraw much from my IRA accounts at this point, since anything beyond my harvested loss amounts would get taxed. When I'm done working, I'll have about 212K in retirement accounts. At 3% this is already earning 6-7K a year. It's reasonable to assume the accounts will increase by more than this.

One strategy is to keep my dividend income from my taxable account sufficiently low enough so as to maximize IRA withdrawals while staying under the Illinois tax radar. When I retire, taxable dividend income will be about 9K, but if I cut my yield in half, I also add 4.5K to the amount I can withdraw.

Another strategy to get the money out is to simply fund my HSA with equivalent withdrawals, but this is still just 7K per year. The transaction should be tax free.

Is it bad that I might not be able to get the money out tax free? They might be in run-away mode!

If we move to another state, this likely won't be as big of a problem.

FBeyer
Posts: 1069
Joined: Tue Oct 27, 2015 3:25 am

Re: cmonkey's journal

Post by FBeyer »

jacob wrote:
Fri May 04, 2018 1:39 pm
...PS: Dandelions mixed with old newspaper make for great worm compost food. I learned that worms produce a lot better if some effort is pent on the carbon/nitrogen balance.
Are you feeding them only dandelions and newspapers while dandelions are available then? Or are you still adding kitchen scraps?
We've nicknamed our driveway the salad bowl becase we really can't be bothered razing all the weeds growing there. It would be great if we could actually turn it into actual worm food.

Kriegsspiel
Posts: 952
Joined: Fri Aug 03, 2012 9:05 pm

Re: cmonkey's journal

Post by Kriegsspiel »

Well, there are no more exemptions under the new tax code, right? I wonder if IL will take that as an opportunity to wring more taxes out of you?

jacob
Site Admin
Posts: 15906
Joined: Fri Jun 28, 2013 8:38 pm
Location: USA, Zone 5b, Koppen Dfa, Elev. 620ft, Walkscore 77
Contact:

Re: cmonkey's journal

Post by jacob »

@FBeyer - The worms get everything while it's available. Due to the population expansion, I've had to add another floor to the bin. It's made out of 2x4s and 2x6s, squares which are IIRC two feet on each side. They usually overwinter in my basement in a big plastic container (rubbermaid). This winter I handpicked them out and restarted them in the rubbermaid on a bed of wet newspaper and toilet rolls (the cardboard center)---similar to my original worm farm described in the blog post I once wrote. This was a good move. Before I'd just dump the contents of the compost, worms and all, into the winter container which did not work as well. Another thing I did was to dump some of them in the garden beds under a bunch of leaves I collected (held them down with sticks and withered plants). They survived that under a foot of snow and ate the leaves.

cmonkey
Posts: 1814
Joined: Mon Apr 21, 2014 11:56 am

Re: cmonkey's journal

Post by cmonkey »

Kriegsspiel wrote:
Sun May 13, 2018 9:04 am
Well, there are no more exemptions under the new tax code, right? I wonder if IL will take that as an opportunity to wring more taxes out of you?

Good point, I have not seen whether IL will eliminate them too. Ugh.

I realized after I had thought about all of this that a couple needs 16K in income just to qualify for healthcare subsidies anyway. If we have a child or two it jumps to 20K and 24K. So I'll probably end up paying some tax despite my best efforts.

Fish
Posts: 570
Joined: Sun Jun 12, 2016 9:09 am

Re: cmonkey's journal

Post by Fish »

cmonkey wrote:
Sat Mar 31, 2018 7:02 pm
So we have decided we are selling our house and moving closer to family. This means small-ish town Minnesota. Think 10k-15K population.

The only problem we need to figure out is how to do it and when to do it. But we aren't getting younger, and DW's folks are approaching 70 already. :?
Is there any chance you could live with family for a few months/years(?) to 1) build savings, 2) get familiar with the area, and 3) validate your desire to live there? Might be too close for comfort though :)

cmonkey
Posts: 1814
Joined: Mon Apr 21, 2014 11:56 am

Re: cmonkey's journal

Post by cmonkey »

Fish wrote:
Mon May 14, 2018 5:30 pm
Might be too close for comfort though :)
Definitely! ;) I also don't wanna seem like we "aren't making it" as dumb as that is.

George the original one
Posts: 5404
Joined: Wed Jul 28, 2010 3:28 am
Location: Wettest corner of Orygun

Re: cmonkey's journal

Post by George the original one »

cmonkey wrote:
Mon May 14, 2018 3:19 pm
I realized after I had thought about all of this that a couple needs 16K in income just to qualify for healthcare subsidies anyway.
Isn't that supposed to be 24k for a married couple?

cmonkey
Posts: 1814
Joined: Mon Apr 21, 2014 11:56 am

Re: cmonkey's journal

Post by cmonkey »

George the original one wrote:
Mon May 14, 2018 9:01 pm
cmonkey wrote:
Mon May 14, 2018 3:19 pm
I realized after I had thought about all of this that a couple needs 16K in income just to qualify for healthcare subsidies anyway.
Isn't that supposed to be 24k for a married couple?
I pulled those numbers from a quick search, and it looks like they are outdated. I guess it depends on your state. In Illinois it is 22K for a couple and 28K if I have a kid. Minnesota has their own marketplace, so I guess I'll have to look into it.

cmonkey
Posts: 1814
Joined: Mon Apr 21, 2014 11:56 am

Re: cmonkey's journal

Post by cmonkey »

May 2018 Update

May was a pretty good month, but it's been really hot and dry here. The back half of May got up into the 90's and was very humid and miserable. Despite this our gardens are doing well. I think I've got the least bit of 'bare soil' ever and we are finally eating from our dirt again.

Grocery expenses were way too high and I don't know why other than I might have rolled some from April into May because I bought them on the last day of the month.

TTM Expenses look much worse than they actually are because all of our 'high spend months' seem to be clustered together. We spent 200 more this May than last, but still only spent $950. It's hard to beat a really good month!

We are chugging right along though!! 49% of our TTM is covered by FAI.

FI Investments ended May at 203K and net worth sits at $365K. I feel like we are getting into "serious territory" now that market noise is +/- one month of expenses on a regular basis. I think the biggest swing has been about 7 months of expenses.


401K Fees!!!

I'm becoming very disgruntled with the fees being charged in my new 401K. The rate looks like it's about 1.5%, of which .04% is the fund fee. The rest is the "intermediary fee" because "they are managing it for me". :evil: :evil: :evil: To put this in perspective, my balance last month was about 7.8K and they charged $10 in fees! At my last employer, I paid $2 (yes TWO DOLLARS) per QUARTER on a 60K balance!

I've been watching the increase each month and if this keeps increasing at the same rate in about 4 years I will pay more in fees than I'm saving in tax breaks if I keep maxing out the 401K (I put about 22K annually in between my deposits and the match I get). I don't know what to do about it either because there is no "cash" option. I'm sure they'd charge for holding cash too. :evil: Good thing I can roll it over at that point!



Expenses/Savings

Total Spend - $948.24
Total Savings - $6,861.14 ; 88%

Years Saved - 13.35
SWR - 7.49%

TTM Expenses - $15,266.70 (+ $204.25)
Total FAI - $7,536.03 (+ $261.01)


Image

Image

Image

Image

Image

cmonkey
Posts: 1814
Joined: Mon Apr 21, 2014 11:56 am

Re: cmonkey's journal

Post by cmonkey »

June 2018 Update

June of 2017 was a tough month to beat but we managed to do it by $12 ! We had a very good month expense-wise, spending only $477.71 outside of our first property tax payment of the year. Grocery expenses were down a lot as we ate a lot from the garden.

We looked at one house in MN via virtual tour but it turned out to have a major water issue in the basement. They had gotten 4 inches of rain the night before and the whole basement had an inch of water in the basement. We were super bummed because the house was super cheap and really unique. DW claimed she could have lived in it even as we had to do some cosmetic work. It was well under my upper price limit ( the number I'm expecting to get for my current home ). It also had a large sunny yard. But neither of us want to deal with a wet basement. I fixed the wet basement in my current house, but this one had mold and stuff too.

Our FAI is over 50% of our TTM now and our investment income is creeping closer and closer to covering our expenses for at least one month. In fact, our income this month easily covered all of our non-property tax expenses. I did make a correction to our TTM from last month, it was a little higher than I had updated actually.

Starting in July I have the ability to shrink our TTM value as high months roll off from last month. DW has been warned that I am going extreme. :lol:

FI Funds are at 215K as of today and net worth is 374K. FAI covers 51.06% of TTM expenses. I love seeing the remaining amount of TTM smaller than my FAI!


Expenses/Savings

Total Spend - $1,028.47
Total Savings - $6,761.52 ; 87%

Years Saved - 13.88
SWR - 7.20%

TTM Expenses - $15,459.79 (- $12.63)
Total FAI - $7,894.12 (+ $358.09)


Image

Image

Image

Image

Image

George the original one
Posts: 5404
Joined: Wed Jul 28, 2010 3:28 am
Location: Wettest corner of Orygun

Re: cmonkey's journal

Post by George the original one »

cmonkey wrote:
Fri Jun 29, 2018 9:54 am
We looked at one house in MN via virtual tour but it turned out to have a major water issue in the basement. They had gotten 4 inches of rain the night before and the whole basement had an inch of water in the basement.
Ah, you bring up my memories of house-hunting where one house had an open stream flowing through their basement/crawlspace. It even had a concrete channel for doing so. Came with an acre of swamp. Otherwise a nice house, LOL.

cmonkey
Posts: 1814
Joined: Mon Apr 21, 2014 11:56 am

Re: cmonkey's journal

Post by cmonkey »

George the original one wrote:
Fri Jun 29, 2018 10:11 am
Ah, you bring up my memories of house-hunting where one house had an open stream flowing through their basement/crawlspace. It even had a concrete channel for doing so. Came with an acre of swamp. Otherwise a nice house, LOL.
Hehe yea. A lot of places in that area get water in the basement and they either get a LOT or none at all. We are looking for a none at all.

We got super excited too....

Gilberto de Piento
Posts: 1942
Joined: Tue Nov 12, 2013 10:23 pm

Re: cmonkey's journal

Post by Gilberto de Piento »

I fixed the wet basement in my current house, but this one had mold and stuff too.
Did you put in drain tile and a sump pump yourself? How bad was it as a DIY project? Did it work?

cmonkey
Posts: 1814
Joined: Mon Apr 21, 2014 11:56 am

Re: cmonkey's journal

Post by cmonkey »

Gilberto de Piento wrote:
Fri Jun 29, 2018 12:11 pm
I fixed the wet basement in my current house, but this one had mold and stuff too.
Did you put in drain tile and a sump pump yourself? How bad was it as a DIY project? Did it work?
I put in both of those, yes. If you have an unfinished basement its not too bad. You need a jack hammer rental and need to dig a big hole for the sump. That's the hardest part because it needs to be 2-3 feet deep.

Our water would come down the wall and so doing a trench with drain tile around perimeter of the basement solved it. What get's more difficult is when water comes up from cracks in the floor, which appeared to be the case in this house.

cmonkey
Posts: 1814
Joined: Mon Apr 21, 2014 11:56 am

Re: cmonkey's journal

Post by cmonkey »

July 2018 Update

July was an excellent month, probably one of the best I've had in a while! The weather has been fantastic for 2 weeks. 75-80 F during the day and 60 F at night with NO humidity. It's been amazing. The first half of August is looking to disappoint, however. :cry:

Gardens!

The garden has had it's good spots and bad spots. We have had about 2 inches of rain over the last 4-6 weeks, so things are suffering/stagnating at this point. I hate watering, so I do it maybe once a week or two. Despite this a number of things have gone well. Our beet crop has been fantastic, the best I've ever known. Beans were good, we canned about 15-20 pints. Corn is coming along and we're starting to eat fresh tomatoes. Almost everything else has been a disappointment, however. Potatoes were tiny, the peppers are not setting fruit yet, carrots were VERY tiny and just didn't grow.

I really hate the climate here! Looking at historical records, it's been like this for at least 10+ years too. Just very dry/hot summers here in the Quad Cities. Northern Iowa/Southern Minnesota is a bit cooler and much wetter. You wouldn't think it would be much different, only being 300 miles apart, but it is.

I'm starting to disconnect from our gardens a bit. I've realized that I don't want to spend 6+ hours tending gardens anymore. Something like 1-2 hours a day is enough for me and so we have starting pondering ways to shrink our garden space (flower and veg). We've started moving things closer to the house. As it is, our veg beds are about 150 feet behind our house, so it's a slight chore to walk out to them. We are also discussing ways to close down our fruit beds and move them closer/remove them since when we move we want to take a lot of stuff with us and make the place more "consumer friendly". This will help with selling the house.


We didn't look at any houses in July, but I did inquire about a foreclosure. Apparently the previous owners had issues with the sewer system in the house and didn't have the funds to fix it. Our realtor couldn't tell us more than that, as they don't have any details on it. I'm not sure where I could find out either, maybe county records? If it's still for sale next summer and has come down more in price, I might start digging. The house is currently priced about 40% under value according to numerous sites. Even if it required 15K for a sewer repair it would be a decent investment.

Chickens!

I sold half of my hens. :cry: Just too many eggs and they were ultimately a money sink as we were basically giving the eggs away. So now I have 5 hens and the rooster left. A good level!

Craigslist!

I've been selling a lot shit on craigslist in preparation for moving down the road. So far I'm over $600 in cash. :twisted:


Money!

We had a good month financially. It was one of my highest months for capital gains as growth stock money started flowing into my value holdings. FI funds ended the month at just shy of 226K, up 12K since last month. Our expenses were at a good level, despite needing to buy a lot of our staples for the month. FAI topped 8K, WHOOO HOOO!

We topped 15 years of expenses, and SWR is now under 7%.

I funded about half of my HSA for the year this month which is why FAI growth was lower than average. FI funds also would have been nearly 230K without the HSA contribution.

Also, TTM expenses dropped off significantly because Jul 2017 rolled off and we underspent by a wide margin. August will be pretty close to last year so we might have a small drop off next month.


Expenses/Savings

Total Spend - $880.88
Total Savings - $6,909.11 ; 89%

Years Saved - 15.07
SWR - 6.64%

TTM Expenses - $14,973.92 (- $485.87)
Total FAI - $8,080.82 (+ $193.32)

Image

Image

Image

Image

Image

User avatar
jennypenny
Posts: 6851
Joined: Sun Jul 03, 2011 2:20 pm

Re: cmonkey's journal

Post by jennypenny »

I must have missed a post ... why do you want to move after doing so much work on the house you're in?

cmonkey
Posts: 1814
Joined: Mon Apr 21, 2014 11:56 am

Re: cmonkey's journal

Post by cmonkey »

jennypenny wrote:
Wed Aug 01, 2018 10:08 am
I must have missed a post ... why do you want to move after doing so much work on the house you're in?
See "Stuck in Limbo" section viewtopic.php?f=9&t=5803&start=660#p164077

I think it mostly comes down to us never really feeling like we were at home here, but tried to make the best of where we were in life.

Post Reply