Frugal chicos journal - ERE in The Basque Country

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Nicolino
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Re: Frugal chicos journal - ERE in The Basque Country

Post by Nicolino »

I like the idea of the 10 $/week, it's gonna be really motivating for you to visualize the bike and longboard. The change in AA caught my attention, are you guys more conservative or leaning heavier on equities to face what seems to be a higher inflation environment? I am not aware of your previous allocation strategy. FWIW, I was 70/30, now splitted half of that 30 in bonds to 50/50 bonds and gold, so 70/15/15.

Western Red Cedar
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Re: Frugal chicos journal - ERE in The Basque Country

Post by Western Red Cedar »

The MF podcast with Kitces is one of my favorites in the FI sphere. At one point in the conversation he says that he basically addresses three topics with his clients before they leave their jobs:

1. What is the actual strategy for drawing from your funds? - What accounts will one tap, when, what are the tax implications, and how do things like social security and pensions factor in to the plan.

2. What is the plan for health insurance?

3. What will one do with their time? He asks his clients to break it down in terms of daily routine, as well as long-term multi-year plans.

I've found breaking it down into these three categories really helpful for long-term planning. He says that most people he's worked with that retire in their 30's or 40's end up doing some kind of paid work in the future. This interview, and some of the discussions on the ERE forum, have led me to be much less concerned about the numbers and more interested in contemplating a meaningful life outside of a career.

I also think that the if one is fairly happy with their career it makes sense to continue working for a little while to build an additional safety margin. I get the sense that is the case with you and frugalchica.

theanimal
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Re: Frugal chicos journal - ERE in The Basque Country

Post by theanimal »

I enjoyed reading the case study and looking forward to reading about you guys actualizing your dream! I seemed to have the same reaction to the Frugalwoods reaction to your asset breakdown/risk profile. Perhaps I'm more conservative, but I can't bring myself to down the kool-aid that stocks only go up. Whatever leaves you sleeping well at night and assured of future success is best, and of course only you two will be able to figure that out.

In regards to the question of foreign investments/rental properties, maybe @seppia could chime in? He has a good deal of experience with living in other countries and making investments internationally.

Frugalchicos
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Re: Frugal chicos journal - ERE in The Basque Country

Post by Frugalchicos »

@Nicolino
Originally, we were 90-10. Back in March, we initiated the change to 70-30 (we didn't sell anything, we just bought more bonds during this last month since we didn't invest much lately with the move and all the changes). And this last week, we decided to sit at 80-20. I see that as our investment strategy for the long run. And, I am not going to lie, it is the allocation that allows me to sleep well at night.

@Western Red Cedar
The only question we still have to figure out is
1. What is the actual strategy for drawing from your funds? - What accounts will one tap, when, what are the tax implications, and how do things like social security and pensions factor in to the plan.

I kind of have a draft in my mind of how everything will go, how much are the taxes, etc... However, more investigation and study is needed.

Number 2 and 3 are clear. Health insurance will be free for us as European. And my time...it will be dedicated to surf, hike, cook, nap, etc...I have no attachment/identity linked to work in any way at all.

Part time work will come with the time, we are both fairly smart and skilled. And I guess that once we more of a social network, an opportunity will come along.

@theanimal
Totally agree, the preferred asset allocation is that one that allows you to sleep at night. 80-20 is for us at the moment and I think it will work for the long run.

Numbers say we can retire, our heads say we still need a little bit more to feel totally secure that we can retire early not risking our wellbeing and our daughter's. Since we are not unhappy at all, we think that our future selves will appreciate we worked 3 more years. More money never hurts

Frugalchicos
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Re: Frugal chicos journal - ERE in The Basque Country

Post by Frugalchicos »

Time for an update. Not a frugal month in the FrugalChicos household...

JUNE INCOME –$10,590.70

JUNE EXPENSES – $6,073.81
- Rent: $1,150
- Groceries: $610 (includes pharmacy/medicine)
- Cellphones: $0 - both chica and I are using our work phones.
- Electricity: $33.37
- Internet: $66.40
- Misc./Entertainment: $996.03 ($447 in wedding related expenses – ouch!, $69 credit card annual fee & $213.79 in assorted ebay/aliexpress purchases)
- Day care: $1,585
- International Travel: $1,655.99 (flying to Spain in January – have to buy 3 tix now since little chica will be 2 this month and is no longer a lap child)

CURRENT ASSETS: $746.351 ($13,896 increase from last month)
Cash savings: $19,217
Investments: $551,209
Chico’s 401K: $617
Chica's 401K: $7,631.06
HOUSE EQUITY: $168,335

We saved 42.65% of our income

ACHIEVEMENTS/HAPPENINGS THIS MONTH:
- Not a whole lot but spending a ton of money. We had a good meeting and we decided we need to get our expenses back under control.
- Chica and I had a gook and honest conversation about what and how much we are spending since we came back to the US. She felt been constrained and limited, with always a limited budget and being scrutinised by all her expenses. On the other hand I felt she was spending too much money in events/stuff her friends require her to do, therefore I never wanted to do anything because I was feeling we are adding up more expenses. We got to an agreement that she had to figure out a budget until April to attend/do whatever she wants to do with her friends.
Chica is setting aside $250/month for all her friends/wedding events until April next year. This is her budget, she will need to manage the related expenses only with that money.
We calculated that after paying all our hard expenses, plus $100 I put aside in our baby's investment account and my $40/month for future longboard and triathlon bike purchase, we have about $400-$500 of disposable income.
We will use that disposable income as something we can use to go out once every two weeks if we like and save the rest. I believe that doing this, we will both feel like we are doing something and having fun. I do not want to have resentment built from any of the sides. The goal after all is being wealthy and happy with a healthy relationship.
- I bought an acoustic guitar. I always wanted to learn how to play the guitar and I think it will be a good hobby for Chicago winter. I scored an amazing deal on eBay. Fender for $56.
- I am running 4 times a week. I have been running with my brother in law who just moved across the street. I am already investigating on how to keep running in the winter, trying to stay away from gyms.
- Deleted eBay, Aliexpress and Amazon apps from my phone
- Chica and I will keep our expenses closer and will monitor them weekly, having quick chats/meetings at the end of each week. We want to start building the habit of spending way less than what we currently do.
- Hopefully we get the construction permit this month or in early August. I would love to see the condo completely renovated in January when we go back to the Basque Country
- I have been enoying reading on my ebook a lot. I just finished The Four Agreements. Recommended book, it helps to have a clearer mind and be more kind with people without making prior assumptions based in our own fears and previous experiences.

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Seppia
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Re: Frugal chicos journal - ERE in The Basque Country

Post by Seppia »

If I may, be mindful of being too pushy with Chica on the expenses.
I think it is usually better to work on the reasons why the money is being spent rather than just trying to eliminate them.
The first is a “personal growth” mindset while the second is a deprivation one.

Plus, I believe that occasionally some selective “fun spending” that goes beyond the plan is ok.
Don’t be too hard on yourself, it was a “bad month” and you still saved 42%!

Frugalchicos
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Re: Frugal chicos journal - ERE in The Basque Country

Post by Frugalchicos »

@Seppia

Thanks for your words buddy. I agree 100%

The reason we had the conversation this month (a constructive and totally honest one) was because we both felt frustrated. I am happy and totally ok if she needs $250/month to feel happy and motivated.

There is no point to screw up a marriage for “the goal”. The goal is getting there healthy and wealthy. And I need her to get to that point

Nicolino
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Re: Frugal chicos journal - ERE in The Basque Country

Post by Nicolino »

I am all in for basque industriousness and stubbornness, but remember "Happy wife, happy life". I know I forget that more myself than what I should...

Anyway, good to see things are moving on the right direction!

Frugalchicos
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Re: Frugal chicos journal - ERE in The Basque Country

Post by Frugalchicos »

@Nicolino

Loved the way you described it “Basque industriousness and stubbornness”. But yes, have wife, happy life

Frugalchicos
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Re: Frugal chicos journal - ERE in The Basque Country

Post by Frugalchicos »

Alright, our July meeting just happened:

JULY INCOME –$12,209

JULY EXPENSES – $3,718.52
- Rent: $1,150
- Groceries: $400
- Cellphones: $0 - both chica and I are using our work phones.
- Electricity: $29
- Internet: $66.40
- Misc./Entertainment: $386
- Day care: $1,538
- Expenses related to our condo in The Basque Country: $149

CURRENT ASSETS: $754,324 ($7,973.64 increase from last month)
Cash savings: $21,272
Investments: $554,714
Chico’s 401K: $1,528
Chica's 401K: $8,476
HOUSE EQUITY: $168,335

We saved 69.54% of our income

ACHIEVEMENTS/HAPPENINGS THIS MONTH:
- Our new budget is working. We will have $400 for groceries and $320 for miscellanious.
- Chica is setting aside $250/month from her salary for her expenses. I will have $80 for my expenses (which I am mostly saving to buy a longboard and bike in the future).
- I sold a ton of stuff on eBay. Mainly stuff my father in law gave me or things I found on the street. I will put that money aside for future purchases (like bike, longboard, etc..)
- I feel we are off for a good start. We were able to put our finances in order and calculated we will be able to save $9,228/month between our salaries and 401Ks contributions. Calculating we will have about 1MM by June 2024.
- I referred my brother in law for a position in my company and he got hired. I will get a $250 bonus once he passes the 3 month probation.
- Mini chica turned 2 years. She is getting smarter everyday. She is already able to put sentences together and knows a ton of vocabulary. Understands everything in English and Spanish and a little bit of Basque.
- I run 5 times this week for a total of 17miles (27kms). Enjoying it so far.
- I bought a guitar! - I would like to learn how to play very basic songs. I will try to learn with youtube videos.
- I read The Old Man and The Sea...didn't like it at all. I found it boring and poorly written. The book could have been 30 pages instead.

In regards to the auto-imposed budget, I think it is a great idea. That is the money I have to spend and I have to work around it. There is no excuses. Before, I used to be more flexible because a $4 or $20 expense goes unnoticed when you have $9k of savings. The budget is helping me out to be less impulsive and think more about what I actually want to buy.

Western Red Cedar
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Re: Frugal chicos journal - ERE in The Basque Country

Post by Western Red Cedar »

Frugalchicos wrote:
Sun Aug 01, 2021 4:18 pm
- I bought a guitar! - I would like to learn how to play very basic songs. I will try to learn with youtube videos.
That's great! I bought my guitar with my first tax refund when I was 16. Fortunately the guy at the guitar shop talked me out of what I was initially looking at, and set me up with Martin acoustic guitar that was in my price range. It is probably the best purchase I've ever made, and one of the few items I'd make sure to grab if there was a house fire.

I've never taken lessons and mostly relied on YouTube videos, so that is a great route to go. I'd also suggest trying to connect with a friend and playing together once or twice a month. You could make him some delicious Basque food (or bring the cervezas) in exchange for some lessons.

I made my biggest leaps on guitar each year while I was living in South Korea. I had colleagues who also played, and were better than me, but loved to hang out and play songs. Even though they were better, they also grew a lot from the exchange.

What kind of songs/style do you want to learn? Did you pick up a classical, steel string, or electric?

Frugalchicos
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Re: Frugal chicos journal - ERE in The Basque Country

Post by Frugalchicos »

@WRC
Hey! I bought on eBay a brand new Fender starter kit for like $56! It is a classical acoustic guitar and it came with a free 3 month app for beginners.

So far I only played twice since our apartment is quite small and the baby is asleep by 8pm. But my brother in law lives next door and also plays. Planning in playing with him during winter

I would like to learn how to play a few of Jack Johnson, The Cranberries, Lynyrd Skynyrd, Oasis, Red Hot, Nirvana…

Any Youtube Channel recommendation?

Western Red Cedar
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Re: Frugal chicos journal - ERE in The Basque Country

Post by Western Red Cedar »

I've always thought Marty Music is great for beginner/intermediate guitar lessons. He does tutorials on songs, but also has videos on different guitar licks and theory if you want to do your own thing. Most of them are under 10 minutes and I know he covers some of the artists you mention.

https://www.youtube.com/results?search_ ... arty+music

After you pick up 5 or 6 basic chords, and get comfortable with chord progressions, it will be pretty easy to play a lot of popular songs. My main recommendation is to get comfortable playing some of the most common chords that aren't too tough (G, C, D, E, E minor, A) and then figuring out songs that use those chords. Jack Johnson, for example, uses a lot of bar chords which can be challenging for beginners. After you have some chords you feel comfortable with, you can slowly add new ones to your repertoire. (Classical/flamenco is a different story but also beautiful). Based on the artists you mentioned, you might check out Simple Man by LS and Wonderwall by Oasis. Both classic and relatively easy to learn.

Perfect situation with your BIL. After teaching English as a second language, I noticed a correlation between learning an instrument and learning a language. Some people have natural talent, but I've noticed the most progress when people put in the time and effort to learn.

Good luck and keep on rocking in the free world!

white belt
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Re: Frugal chicos journal - ERE in The Basque Country

Post by white belt »

I'll echo what WRC said. Another channel I recommend that has loads of good lessons is JustinGuitar.

I recommend starting with some beginner songs that can get you some early wins by just playing the chords. Of the artists you listed, I'd note that RHCP and Jack Johnson can both get a little tricky but for different reasons. Jack Johnson plays a lot of fiddly lead lines and mostly uses bar chords or a capo (not realizing JJ was using a capo, as a teenager I transcribed and learned how to play "Do You Remember" without a capo which definitely made it a lot harder to play). RHCP are a whole different beast in that John Frusciante is sometimes regarded as virtuosic and some of the songs are quite tricky with funk rhythms and Hendrix-esque thumb over the neck chord embellishments (which I learned how to do from JustinGuitar videos back in the day). This isn't to discourage you from learning the music of either of those artists, just understand that patience will be necessary and for now I'd just focus on getting the basic chords down so you can play along and have fun.

Frugalchicos
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Re: Frugal chicos journal - ERE in The Basque Country

Post by Frugalchicos »

@WRC and White Bet

Thanks for the recommendations! anything at this point is helpful since I am a complete musical illiterate (maybe that is the reason I wanted to learn)

Realistically speaking, I can dedicate 1-2 days a week. Work has been too much (like 10:30-11 hours a day), baby, and average daily stuff. However, I have been introducing things in my life that give me joy and calmness. I have been running very early in the morning, reading almost every night and trying to play the guitar once a week.

I will listen to you guys and start with the very basic for now. Thanks!

2Birds1Stone
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Re: Frugal chicos journal - ERE in The Basque Country

Post by 2Birds1Stone »

Y'all are killin the raiding!

I just reread your Frugalwoods case study and enjoyed it even more the second time around. My gut feeling says you will cut your timeline shorter and reach your $1.1M much sooner than anticipated :)

Frugalchicos
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Re: Frugal chicos journal - ERE in The Basque Country

Post by Frugalchicos »

@2birds1stone

I really hope you are right!

The raid is going pretty well. Happy at work, making a ton pf friends and mini Chica is growing as a healthy an smart little girl.

It would be amazing if we reach our goal by mid 2024, so mini can start her first year of school in The Basque Country. Chica seems to be missing her life in The Basque Country (which is a great thing, so she wants to go back :)) She misses the lifestyle and acknowledges that life in Europe is richer in many ways and more affordable and relaxed.

We will try to continue killing it and making the most out of any situation!

Frugalchicos
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Re: Frugal chicos journal - ERE in The Basque Country

Post by Frugalchicos »

Today, I felt like stamping my thoughts in here. It is also the first day in months that I am alone and have time...

This last week has been tough since mini chica had to be quarantined. One of the kids in her daycare class tested positive and every kid was sent back home for 2 weeks. We both WFH and having a 2 year old toddler in the house while you are trying to work is pretty hard. Work is good, but my load of work is rising. Also, one of my teammates is a difficult person and I am totally convinced she has some short of crusade against me for whatever reason (maybe she feels I am a threat since our client loves me and I have been crushing it since I joined the company 5 months ago?). Anyways, that is why we have the FU money and are working towards ERE. She will continue hating people at work while I am surfing waves on a Tuesday morning in The Basque Country.

I am getting back into running shape. Run 18 miles this week. I try to do 3-4 3 mile runs during the week and a long 7 mile run on Sunday. It is feeling great and I feel proud of getting back at it so quickly. my average pace goes from 8:30 - 9:20, depending on the day, if I got to sleep properly (baby waking up multiple times at night), etc...Another note in regards to health. I have been drinking a beer here and there after work when in picnics. I have decided to take a break of drinking for a while.

I am reading a book every 2-3 weeks. Most of the books are non-fiction but sometimes I like reading a good story. I just finished The Kite Runner and today started The Great Gatsby. Book suggestions are welcome :)

I have also been playing my guitar on Sundays. Followed WRC and White Belt recommendations and subscribed to Marty Music Channel. Very recommended!

Our finances are stable again and are investing the same quantity every two weeks. Along with our 401Ks, we are investing a total of $9,200/month. I feel confident our raid is going to be successful.

I have been feeling pretty good mentally and emotionally. This time around, I don't really feel homesick. I know exactly why we are here and I feel we are actually enjoying our time. We made good friends very quickly and mini chica is having a great time. We go to the park, beach, do picnics, etc...I only miss surfing...very much

Oh, I just bought a longboard skate! I can't wait to use it and cruise around the park by Lake Shore Drive. I know it is not surfing, but at least I will keep improving in balancing. Hopefully, skills are transferable and it helps me to be a better surfer!!

Nicolino
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Re: Frugal chicos journal - ERE in The Basque Country

Post by Nicolino »

Everything sounds great! God knows I should cut back on the drinking too... During the pandemic I picked up a lot of it, and have been trying to cut it back the last couple of weeks. I have managed to keep it to a couple beers on Fridays and Saturdays, and maybe some cooking lager on Sundays, more than that and I see rapidly diminishing returns.

Enjoy the rest of the beautiful Chicago summer!

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Seppia
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Re: Frugal chicos journal - ERE in The Basque Country

Post by Seppia »

Good for cutting back drinking, I just did a 12 day “dry run” and felt great.
The point (at least for me) is not to completely stop drinking but keep it occasional, like once a week.

You seem to have a clear direction, that plus a good routine (kids help with that I noticed!) makes for a healthy life mentally.

Some book suggestions:

1/ Starship Troopers and I Am Legend: my two favorite “fantasy” books. They couldn’t be more different from the movie versions.

2/ 1984, Brave New World and Fahrenheit 451: if you haven’t read them, do it already! The best dystopian world novels ever.

3/ The Big Short: even better than the great movie that followed.

4/ Early Ratirement Extreme: it’s this cool book from a danish guy who talks about lowering your consumption so that you can spend less and do better things than working with your time. It also has a great recommendation on how to do laundry using bumpy roads :P

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