Taemoo's Journal

Where are you and where are you going?
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taemoo
Posts: 22
Joined: Wed Oct 13, 2010 3:59 am
Location: Madison, WI

Taemoo's Journal

Post by taemoo » Tue Oct 25, 2016 1:27 pm

Hi,

I'm a long time lurker, I especially enjoy the journal section so thanks to all who contribute. Public speaking/writing makes me very uncomfortable but I heard public accountability and visualization helps reach your goals so I thought I start a journal of my own.

I'm 41, been married twice, divorced and widowed, no kids, no plans to get remarried. I'm ISTJ, 100% on the introvert scale. I'm more concerned with the How's to FI than the Why's.

I've had terrible track record with finances, been very unlucky on how my life was going during the stock/housing market crashes and recoveries. I should have been FIRE'd by now but life has been unkind. My personality is to dwell on the past but I would like to start moving forward.

My goal is to be financially independent in 5 years, move back home to be with my mom as a home base and then travel.
My magic number is $18K in yearly dividends from my after tax account. If tax rates are still favorable for dividend income in 5 years, I'll start rolling my retirement accounts to Roths. GoCurryCracker (on the ERE blogroll) has a great post on this strategy.

I'm a terrible stock picker/market timer so I'll just build a portfolio of dividend stocks from the aristocrats/contenders list. I get inspiration from Dividend Mantra, DGI, Dividend Geek, Warren Buffet, and many others in this area. Currently I have 11 positions, I would like to get to 40-50.

I'm not good at tracking expenses so I'll measure my progress on how much I add to my dividend portfolio and the dividends I receive. I'm hesitant to go 'extreme' on my budget because I'm trying to avoid any stress in my life. But will need to constantly monitor

Here are my numbers:

Dividend Portfolio = 78,765
401K = 256,767
Roth = 17,465
Pension DC = 66,075

Dividends = 1100 (rolling 12 months)
Started in Jan so not quite 12 months. Just added 36K this week so not collecting dividends on these additions yet.

Projecting my cash flow to be around 3K a month going forward not counting bonus/extra paychecks.

taemoo
Posts: 22
Joined: Wed Oct 13, 2010 3:59 am
Location: Madison, WI

Re: Taemoo's Journal

Post by taemoo » Thu Oct 27, 2016 12:46 pm

The past 3 months, I've been working on some of the items on the 21 day makeover. It's a great blueprint.

Finding a place to live
Downsized from a 2br apartment to a small studio, saving $1000 a month. Rent is still higher than I wanted but the location is great:walking distance to grocery stores, library, public transit, and lakefront path.

Decluttering and managing stuff
Downsizing to a 340 ft sq studio forced me to give away most of my furniture, half of my clothes, most of the kitchen appliances and all my books. I still feel like I have a lot of stuff I don't use, so will need to continually revisit and make cuts. Feels good to let go.

Grocery shopping
Stopped eating out 3 times a day. Started grocery shopping at Aldis, cooking, packing my lunches to work. Saving around $400 a month on food and eating out.

Cell/Cable
Have a family plan with 3 lines, I dropped 1 line to save $20, will need to throttle back the data to save some more. Plan to drop the cell plan completely when I FIRE. I got rid of cable, still kept Netflix and Hulu to tie me over, net savings of 100 on cable.

Find a free hobby
This has been a challenge. I spend a lot of time online reading finance and travel blogs/forums, this is the only free hobby I can think of that has me engaged. This is an area I have to actively pursue, see what sticks. I bought a Surly LHT bike based on recommendations from this forum and I've been having fun biking over the summer. Initially I bought it because I was pre-diabetic and needed to exercise, but it has turned into a fun hobby of sorts. After initial cost of the bike and brooks saddle, I haven't added any money to it. It was definitely worth the initial cost, lost 25 lbs and keeps me busy on the weekends.

Going car free
I sold my car this past weekend, it was a difficult decision for sentimental reasons but I feel good about it now. I instantly save $300 a month on parking, insurance and maintenance. Probably another $100 a month on gas, toll, and govt fees. Depreciation and sale taxes paid was a big ouch but I have to remind myself that those were sunk costs anyway.

In hindsight I should have sold my car before finding a place to live. I paid a little more for an apartment that offered parking. Now I have more options and location choices going carfree when my lease is up.

jacob
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Re: Taemoo's Journal

Post by jacob » Thu Oct 27, 2016 12:50 pm

I'm counting $1820/month or $22k/year. Good job!

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Gilberto de Piento
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Re: Taemoo's Journal

Post by Gilberto de Piento » Thu Oct 27, 2016 7:46 pm

Wow, very impressive!

taemoo
Posts: 22
Joined: Wed Oct 13, 2010 3:59 am
Location: Madison, WI

Re: Taemoo's Journal

Post by taemoo » Mon Oct 31, 2016 2:18 pm

Thanks for the kinds words Jacob and Gilberto. And big congratulations to Jacob on climbing the amazon ranks. I followed the link from MMM and see that the ERE book is a "#1 Best Seller" under early retirement and retirement planning, ahead of some notable authors. WOOT!

The MMM poster thinks the reason was due to a CNBC article. In the article, author's goal is to reach $750K in 11 years but he is getting hammered in the comments. The FI number is very similar to my goal, I thought I was being safe but not sure now. I have to tune out the noise and trust in my numbers and trust in my ability to adapt if needed.

I didn't receive any dividends for October so my rolling 12 months is still $1100

My dividend portfolio is $81,600. Selling the car and 2k contribution nearly doubled my fund and hoping to see the benefits later in the 4th quarter.

I changed my insurance to an HSA with max contributions in 2017. This will lower my take home pay but I like the idea of taking the account with me when I quit in 5 years.

I tracked my daily expenses for couple of weeks and found out that I spend more money on diet soda than food. Spending at a rate of $150-$200 a month. It's an addiction that's going out of control, my goal is to completely cut this out by the end of the year.

jacob
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Re: Taemoo's Journal

Post by jacob » Mon Oct 31, 2016 2:47 pm

Yeah, there's been two links to that article on the CNBC frontpage---one of them was under the 'most popular'-section, so that's definitely "patient zero". During lunch hour in NYC, sales went berserk. I've never seen anything like this and in terms of sigma-outliers, it was definitely a black swan. Total sales rank peaked at #16, just ahead of Rowling's Fantastic Beasts---a position that was held for one hour. I think my particular 24 hours of fame has peaked though. Several days ago, CNBC did a 2 minute TV break on the blogger and they had the usual "experts" in to comment. Apparently, the standard goal for early retirement is no longer $1M but "several millions"---which is obviously quite true for anyone who manages and expects to blow $100k+ on an annual basis.

taemoo
Posts: 22
Joined: Wed Oct 13, 2010 3:59 am
Location: Madison, WI

Re: Taemoo's Journal

Post by taemoo » Thu Dec 01, 2016 4:38 pm

Ughhh, my spending went out of control this month. I had a little trip to Las Vegas. It's a city I love and visit often...it has great hiking, food and shows. I hate gambling so that was never an issue until this trip. I was just trying to kill time at the penny slots and before you know it, I'm down a month’s expenses over a 3 day period. Such a stupid tax. Knowing that this month was already bad, I made a compulsive purchase of a pricey indoor bike trainer yesterday. I’m hoping it’s not going to be another giant paper weight.

November:

Dividend Portfolio $87,575
Rolling 12 months $1,175
Net Worth $438, 102

I’ve decided that I'm going to pull the plug on the job on or prior to 6/1/2021, 4.5 years away from today. I would like to do it in 2020 but I’m having trouble balancing my fears of not having enough money vs being too old for some of my bucket lists.

My post FI wish list:
*Appalachian Trail and Pacific Coast Trail (akratic’s journal has been a big inspiration)
*Learn Spanish – Extended immersion program in south or central America
*El Camino both the Spanish and Portuguese routes
*Learn snowboarding – I’m a beginner and would like to snowboard an entire season in a city like bend
*Expat living/slow travel in Southeast Asia, Nepal, India, Korea and New Zealand
*Camp and Hike New Mexico state parks for a year – low annual fee

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Chris
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Re: Taemoo's Journal

Post by Chris » Fri Dec 02, 2016 6:19 am

taemoo wrote:I would like to do it in 2020 but I’m having trouble balancing my fears of not having enough money vs being too old for some of my bucket lists.
This is a commonly-shared concern, including for myself. Worrying about having enough will draw you into the "one more year" syndrome, which is just a continuing annual excuse to not take the leap. But the bottom line is this: it will be easier to get more money later (if needed) than to get new knees/hips/whatever. I'm youngish person with a day job sitting at a desk. There are lots of old people also sitting at desks. So I can do the desksitting later; my main driver for FI is to be able to use my body while I still can.

Fortunately, you've already identified the numbers that work for you: $18k/yr and 6/1/2021. Financially, you're FI at $18k per year. You'll be able to quit then. But if you can't force yourself to do it, you've already set 6/1/2021 as your second trigger. I think you could convince yourself to keep working if only one of those is hit, but not if you hit both of them. It's a contract with yourself.

taemoo
Posts: 22
Joined: Wed Oct 13, 2010 3:59 am
Location: Madison, WI

Re: Taemoo's Journal

Post by taemoo » Mon Dec 05, 2016 10:55 pm

@Chris - I like the idea it's a contracts with myself. The 2021 goal has 'one more year' padded in so I'm hoping my mindset will be ready sooner

Investments:
Other than knowing the balance, I have pretty much ignored my retirement accounts the last 4 years. I finally dived in a little deeper over the weekend and found that my 401K performance has been very poor, lagging behind the S&P500 by half. It was too heavily weighted in international and growth. I transferred these funds to the S&P500 index, I will be more than happy with market returns going forward.

taemoo
Posts: 22
Joined: Wed Oct 13, 2010 3:59 am
Location: Madison, WI

Re: Taemoo's Journal

Post by taemoo » Tue Dec 13, 2016 11:44 pm

Redefining Goals

Not sure if this is a knee jerk reaction to the Chicago cold wave but I can't bear the thought of going through 4 more Chicago winters. Originally I was shooting for a dividend income milestone but I'm scrapping that for the traditional SWR target to shave off 1 year.

After extensively reading and re-reading my favorite blogs and journals of the travel lifestyle I want to live, I came up with 30K as my projected expenses.

Target goal of 4% SWR = 750K
Stretch goal = 750K + 60K = 810K

New FIRE date is 6/1/2020. Ideally I would like to reach my target before this date to build up couple years of living expenses in cash to ride out any future market downturns. Wow, 3.5 years doesn't seem so far away. I wasted 2 days of work stressing about this, crunching the numbers, researching health insurance costs, reading blogs, etc...but now I really feel good about this.

taemoo
Posts: 22
Joined: Wed Oct 13, 2010 3:59 am
Location: Madison, WI

Re: Taemoo's Journal

Post by taemoo » Mon Jan 02, 2017 9:04 pm

2016 Review

Happy New Year! It was an unbelievable year, my net worth went up 24% but not sure where all the progress was made. 401k under performed and didn't start making my cost saving changes until the 2nd half of the year so the math quite doesn't add up. Started using Personal Capital and Excel to track my progress better

This was my snapshot at the beginning of the year. I had the car loan in my net worth calculation but not the car itself so it's understated. Getting rid of the car was a huge relief.

Image

Tracking my 3 main asset classes, threw in the dividend income just because I like tracking it (not part of nw)

Image

2017 Goals
  • Net worth goal of $550K by year end - need help from the market
  • Add 50K by contributions to the dividend portfolio
  • Track my cash flow better. I would like my expenses to be around $2500 a month but having trouble keeping to this...but it's a new year
  • Continue to prepare 3 meals at home, eating out only for social occasions 2 or 3 times a month
  • Lose 20 more pounds and get my A1C under pre-diabetic level. Last physical was 6.4, need this to be under 5
  • Bike 1500 miles this year, start tracking the mileage
  • Read 2 books a month
  • Continue to do a monthly check-in even if I'm not on track to make my goals

taemoo
Posts: 22
Joined: Wed Oct 13, 2010 3:59 am
Location: Madison, WI

Re: Taemoo's Journal

Post by taemoo » Wed Mar 01, 2017 12:55 am

Power of FU Money

My mother was diagnosed with Congestive Heart Failure (stage 2/3) earlier this month and I decided to move back to my hometown when my lease was up. I wasn't ready to FIRE but I figured I had FU money so had no fear of quitting without another job lined up. So in my annual review this month I gave my notice that I'm moving in June and took a shot in the dark if they would offer me a full time WFH option. They gave me the approval...WOW...the power of FU money! I was floored.

Fortunately my mother is doing great financially, she wants me to move in with her and save money on rent and utilities to help me pursue my FI goals. This helps me move up my FIRE date to 2019 from 2020.

February

Expenses - Personal Capital has been very helpful in monitoring my cashflow. This is the first month I came under my budget of $2500. I saved a lot by cooking all 3 meals, it was hard at first but now it's harder to part with $6-8 for lunch during work.

Image

Net Worth
February has been great for market returns. I'm ahead of schedule of meeting my yearly NW goal but I'm hoping for a pullback. March will be a big month, projected to hit the $500K milestone. WOOT

Image

Jason
Posts: 296
Joined: Mon Jan 30, 2017 8:37 am

Re: Taemoo's Journal

Post by Jason » Wed Mar 01, 2017 5:38 am

We seem to have a lot in common except that I am married and you can spend time in the same house with your mother without her threatening to call the cops on you.

Good job and good luck.

taemoo
Posts: 22
Joined: Wed Oct 13, 2010 3:59 am
Location: Madison, WI

Re: Taemoo's Journal

Post by taemoo » Tue Apr 04, 2017 12:19 am

Jason wrote:
Wed Mar 01, 2017 5:38 am
you can spend time in the same house with your mother without her threatening to call the cops on you.
Lol, yeah, relationship is good. And if cops do come a-knocking, I guarantee it's all my doing.

I'm not a big fan of working from home. My discipline is sh*t, I end up watching TV and eating all day. So plan to rent a co-working space for $100 a month in downtown Madison when I move in the summer. It will force me to get out of the house and the 3 mile bike commute would do me some good.

March


Net Worth

With the help of 3 paychecks and a yearly bonus, I hit the 500K milestone in March. This puts me at 6% SWR. I needed this win because work has been brutal mentally this month. My company is going through the process of replacing 50% of the full time IT workers with consultants and I'm in charge of doing the knowledge transfer for my area. Apparently my job is safe, I don't really care at this point, but the entire transition/training is depressing.

I want to move up my FI date but the health insurance issue is still up in the air so still sticking with 2-3 years depending on the market.

Image

Expenses

I kept my expenses under my goal of $2500. I felt like I wasn't that frugal this month so this budget has more room for improvement. I feel like I'm not earning the 'extreme' part of ERE.

Image

taemoo
Posts: 22
Joined: Wed Oct 13, 2010 3:59 am
Location: Madison, WI

Re: Taemoo's Journal

Post by taemoo » Wed Aug 09, 2017 10:58 am

Expenses:

April $5,223
May $3,186
June $2,808
July $1,833

Ugh, due to crazy job stress, I went on a spending binge on travel. Came back rejuvenated so was worth it. It was only my second solo travel, still a learning process but I like it enough where I want to do this full time after FIRE. Only big drawback is that I love eating out but I hate eating out alone.


Chicago

Finalized my move out of Chicago to Madison and already missing the big city more than I anticipated. Missing the food, the walkability, diversity, lakefront bike path, co-workers, public transportation, free activities, the airport.


Net Worth

I had a net worth goal of 550K for 2017 and crossed that this week. Barring any major setbacks, target date is March 2019. Starting to lose patience, time is going by slow, fighting myself from bringing that date even closer.

MDFIRE2024
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Location: Germany

Re: Taemoo's Journal

Post by MDFIRE2024 » Wed Aug 09, 2017 11:29 am

taemoo wrote:
Wed Aug 09, 2017 10:58 am
Expenses:
April $5,223
May $3,186
June $2,808
July $1,833
Great progress. Impressive cost savings during the last few months. I have just now discovered your journal. Also your FI-target year 2019 seems really good. I guess the FIRE progress was faster than you anticipated? Keep on saving. Would you do something different now in the journey to FIRE? Are there some lessons you have learned along the way?

Jason
Posts: 296
Joined: Mon Jan 30, 2017 8:37 am

Re: Taemoo's Journal

Post by Jason » Wed Aug 09, 2017 1:52 pm

Great job on the savings. If I didn't know better I would have thought you spent the last four months knocking down a pharmaceutical grade cocaine habit after throwing your ex-wife off the side of a cruise ship.

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