B00GS'S ERE Journal

[b00gs]

Why do you take both protein powder and creatin? How did you calculate your numbers of grams, was it a result of factoring in your body weight and intensity of workout?

My protein powder doesn't have any creatine. I take the protein powder so I can make sure I get enough protein for the day. I try to have about 150-160 grams of protein per day. Each scoop has 20.1g and I have two scoops. My friend told me 7g for creatine is good for my body weight.

[Scott 2]

When I took creatine, it resulted in elevated creatinine numbers on my blood tests. From what I could gather, it wasn't a cause for concern. But something to be aware of if you get a skewed result.

[Veronica]

• Age: 26
• Location: Los Angeles County
• Occupation: Environmental, Health and Safety Specialist
• Compensation:
  • Base Salary: $133,900/year
  • Year-End Bonus: 15%
  • Roth 401(k) Match: 4%, 1:1
  • Profit Sharing: 3%, vested 100% after 3 years
• Assets:
  • Emergency

I know that comparison is the thief of joy, but this really depresses me. I feel as if I have just been taken advantage of all my life.
I'm 30 years old, and the highest salary I've ever made was 65k; that was as a drug development scientist in the pharmaceutical industry.
If I knew that EHS would double my salary, I would have probably taken a very different life direction.

But all in all, I'm aware that I gained valuable skills. I suppose that's intangible, and it makes me a rather interesting dinner guest due to my varied life experiences. But it also feels kind of bad to have spent all of those years in grad school, only to see someone 4 years younger than me over a decade ahead of me money-wise. Inspiration to do better I guess! Congrats, and make sure you keep going so you have a big margin of safety.

[b00gs]

I know that comparison is the thief of joy, but this really depresses me. I feel as if I have just been taken advantage of all my life.
I'm 30 years old, and the highest salary I've ever made was 65k; that was as a drug development scientist in the pharmaceutical industry.
If I knew that EHS would double my salary, I would have probably taken a very different life direction.

But all in all, I'm aware that I gained valuable skills. I suppose that's intangible, and it makes me a rather interesting dinner guest due to my varied life experiences. But it also feels kind of bad to have spent all of those years in grad school, only to see someone 4 years younger than me over a decade ahead of me money-wise. Inspiration to do better I guess! Congrats, and make sure you keep going so you have a big margin of safety.

I'm sorry you got let go from your job recently, Veronica! I hope you also see this as an opportunity to dive into something better! I think it's awesome you had a lot of experience and I'm jealous of that. My career path isn't SUPER exciting although I enjoy the field. Honestly, I got really lucky with this job. People in my field that have similar pay have more years of experience or are working in a difficult field such as oil and gas.

[b00gs]

I had leg day yesterday. I'm on my work trip so I didn't have access to my bike. I did dumbbell RDLs, hamstring curls with the cable, and bulgarian split squats with weight. I barely was able to walk after lol. I wore knee sleeves and actually my knee doesn't feel that bad. I feel slight inflammation but not that bad.

[b00gs]

I got a chance to talk to my dad about his plans for retirement. The situation is actually better than I thought it would be, but there still isn't a solid plan yet. I think my parents could retire now but they want to work a couple more years because they can and don't mind. Not sure why they would do that to themselves but that's what they want! I think it's because my sister and I aren't married yet and they want to help provide for the wedding and our future.

What do you guys think about QYLD or SVOL? These are ETFs that pay out large dividends (about 1% per month). My dad was thinking of using them to retire. I told him I think it's fine as long as he's okay with a worst-case scenario if his investment crashes 50% or more. I also told him he needs to have a backup plan. I was considering using these in the future if they are still doing well and their dividends remained the same or increased.

My dad also mentioned he's expecting $500/month from each of the kids (3 kids = $1500/month). My bonus will be able to cover that so I don't mind, but I think it's funny that he expects it when his current retirement plan (in his mind) will be more than enough to cover his expenses. I think he just wants to "live it up" lol, whatever that looks like. I have a good relationship with my parents.

[Veronica]

What do you guys think about QYLD or SVOL? These are ETFs that pay out large dividends (about 1% per month). My dad was thinking of using them to retire. I told him I think it's fine as long as he's okay with a worst-case scenario if his investment crashes 50% or more. I also told him he needs to have a backup plan. I was considering using these in the future if they are still doing well and their dividends remained the same or increased.

Ok, not to monopolize the thread or anything but I have extensive thoughts on this class of ETFs (I was also active on QYLDgang reddit, where these are often espoused.)

Clifs notes summary is this:
1. There are many versions of these, all with slight differences in implementation. I collectively call these the YLDs.
2. All of them are at their core, a strategy which is roughly equivalent to holding a well diversified portfolio of stocks and selling covered calls on it. They simply implement this for you, in exchange for a management fee.
3. ALL versions of this suffer from a "payout crisis"; that is, the rate at which dividends are paid is higher than the CAGR total return of the strategy.
4. For some investors, it's quite probable that the payout mechanisms and hands off management are worth these tradeoffs. You can still do amazingly well with these, and you might be more comfortable with the way they operate than other strategies which will probably generate higher returns, but with much higher volatility.

The way to deal with 3 is to make sure that over the long term, you are not utilizing the full cash flow from the dividends (if keeping principal matters to you).
For example, if the strategy returns a "true" 6% per year, but the payout is 12% (1% monthly), then your investment will slowly erode away at 6% per year (assuming you fully spend every dividend). This isn't quite as scary as it sounds (I just ran some backtests on 100k and showed that you can spend 1% of the total account value every month and still have 15k after nearly 20 YEARS of monthly payouts).

I think they're a neat tool, and can make it very easy to wrap your head around how close you are to retirement, and to spend down your savings in a graceful way. But they do guarantee a lower investment return than uncapped strategies due to their extensive use of call option selling.

[b00gs]

I know points 1, 2, and 4. I was looking into it a bit more and it looks like most of the dividend payouts are not even profits or premiums they are collecting. It's majority investor capital, so you're just getting your money back in increments. Is that what you're saying in point 3? I have to look into it more...

I was thinking that I can keep my money in growth ETFs and then move over to dividends/YLDs when I'm ready to retire.

[loutfard]

I know points 1, 2, and 4. I was looking into it a bit more and it looks like most of the dividend payouts are not even profits or premiums they are collecting. It's majority investor capital, so you're just getting your money back in increments. Is that what you're saying in point 3? I have to look into it more...

I was thinking that I can keep my money in growth ETFs and then move over to dividends/YLDs when I'm ready to retire.

Ha. Here, foreign dividends are taxed at over 40%. Doing YLD etf's would mean getting taxed not only on the real underlying dividends, but indirectly also on the base capital. With no loss harvesting possible, that would not be the brightest fiscal move.

[Veronica]

I know points 1, 2, and 4. I was looking into it a bit more and it looks like most of the dividend payouts are not even profits or premiums they are collecting. It's majority investor capital, so you're just getting your money back in increments. Is that what you're saying in point 3? I have to look into it more...

I was thinking that I can keep my money in growth ETFs and then move over to dividends/YLDs when I'm ready to retire.

3 is sort of a hidden inevitability. You've have to already have experience investing to really wrap your head around it... which is convenient, because they are built so perfectly to capture the attention of novice investors.

Here's one attempt to try to illustrate the issue.
Consider SPY, a fund where by and large the gains come from a gain in price, not the dividends.
You start investing in 2018. You've got 100k, put it all at once, and never touch it again.

Year 1: 100k [-4.56%] -> 95,440
Year 2: 95,440 [31.22%] -> 125,236
Year 3: 125,236 [18.37%] -> 148,242
Year 4: 148,242 [28.74%] -> 190,847
Year 5: 190,847 [-18.17%] -> 156,170
(I'm sure there's some rounding errors, but it's illustrative.)

If you just straight up ignore the fluctuations year to year, and just look at the start to finish results, you can get an annualized rate.
Depending on whether you use geometric or arithmetric means, this works out to be roughly 10% per year. Try it for yourself by taking 100k * 1.1 five times in a row.
---
This rate of growth just discussed is CAGR, or total return. That is, how much did I put in and how much is it worth now.
Now the game becomes SIGNIFICANTLY MORE COMPLICATED when you start slushing funds in and out. But it all falls into three mathematical cases:
1) Withdrawals are less than the total return
2) withdrawals are roughly equal to total return
3) withdrawals are lager than total return.

Case 1: Withdrawals less than total return (~3% annual withdrawals vs a 10%ish growth rate)
Same trade. Spy 2018 through 2022. But we take out 250/month. Maybe we want to start buying supplies for a community garden, or just go out and do a random act of kindness every week, and this is just the cost of a good habit

Year 1: 100k [-4.56%, and withdrawals] -> 92,615
Year 2: 92,615 [31.22%, and withdrawals] -> 118,074
Year 3: 118,074 [18.37% and withdrawals] -> 136,029
Year 4: 136,029 [28.74% and withdrawals] -> 171,417
Year 5: 171,417 [-18.17% and withdrawals] -> 136,869

Annualized Total Return: 7.3%.
You successfully took some money every month; and since it was less than growth rate you also got to enjoy a little bit of growth as well.
---

Case 2: Withdrawals roughly equivalent to total return (~8.5% annual withdrawals vs a 10%ish growth rate)
You decide to pull out about 700/month, maybe to help pay some bills for a kid going to grad school.

Year 1: 100k [-4.56%, and withdrawals] -> 87,526
Year 2: [31.22%, and withdrawals] -> 105,170
Year 3: [18.37% and withdrawals] -> 114,024
Year 4: [28.74% and withdrawals] -> 136,406
Year 5: [-18.17% and withdrawals] -> 102,103

Annualized Total Return: 0.4%.
You successfully pulled out a significant chunk of money each month; however, because the number you choose very closely matched the underlying strategy, you received virtually no growth.
Or perhaps, viewed in a different way, you could think of it as you having spent your future growth along the way, in monthly chunks.


Case 3: Withdrawals exceeding the total return rate. (18% annual withdrawals, vs a 10%ish growth rate)
You decide to start pulling out 1500/month. Maybe you're finally going to buy that camper van and travel the US, or you're going to finally get that piece of property you've always been dreaming of. There's some really significant things, and life experiences you can have at this level (most people have a family member whose entire life would change and would have your undying loyalty if you simply gift them amounts approaching this for example).


Year 1: 100k [-4.56%, and withdrawals] -> 78,477
Year 2: [31.22%, and withdrawals] -> 82,231
Year 3: [18.37% and withdrawals] -> 74,905
Year 4: [28.74% and withdrawals] -> 74,163
Year 5: [-18.17% and withdrawals] -> 40,297

Annualized Total Return: -12%

You spent an incredible 90k (1500/month for 60 months straight!), and you still have a sizable chunk left over. Clearly this isn't going to last forever.
But it's important to keep in mind how much spending you got to enjoy over this time period. Also note that this rate is fairly close to what a 1% monthly payout would be (1k/month vs 1500/month)
---

What ends up happening to most investors is that they don't realize that the 1%/month payout rate of YLDs are almost always Case 2 AT BEST, and Case 3 in most other scenarios. That does not make them a BAD investment by any means. It just means that you have to realize that if you fully spend the monthly dividend, you should expect a graceful spend down. For many people, this is actually fantastic. But novice investors will never sit down and run the math on these to understand this fundamental reality of how the funds operate.

In my opinion, they are best suited for getting novice investors involved in the market as quickly as possible. They just make the owners feel so good (You mean I'm going to get a check for over 100/month? EVERY MONTH??!?! This is GREAT!), and it just makes them want to invest more and more to see how high they can push up that monthly payment. Mathematically, it's not as good as just putting into an index and chill. But that requires a level of commitment a lot of people aren't ready to sign up for. Imagine if you started in year 5, and watched 20% of your total net worth disappear in a single year. Are you SURE you won't have your faith tested a little? YLD owners don't care; they just shrug their shoulders while their 1k/month payment just keeps rolling in. It's easy to be disciplined when you're getting checks direct deposited. It just has a psychological effect on holders that cannot be underestimated.

[b00gs]

October 2023

NW
$184k (+$0k)

Finances
Reduced tithing to $100.

September 2023 Spending
I spent $900 on my vacation. Spent total of $2000 for the month.

Health
Recently got covid so I didn't work out for a 1.5 weeks. Planning to get back into it today. I was inside my room for a whole week and barely went out so I feel meh physically and mentally right now.

Physique -
I'm thinking of changing my workout split so I can add a day of rest while the time between muscle groups stay the same.
Back and Shoulders, Legs, Chest and Arms, Rest
I had a doctor appointment to check for arthritis. Tests indicated no signs of arthritis. I couldn't go over my results with the doctor due to covid.
Instead of gaining weight, I lost about 5 lbs. Probably due to covid and staying inside my room. I couldn't work out and eat normally.

Mental -
I wasn't able to journal this month unfortunately.

Work/Job
It's been pretty slow past few weeks.

Thoughts
Not in relationship anymore.

Web of goals - what's something I can do that will satisfy multiple goals so I don't have to go do or spend money to do one thing at a time? If my goal is to be more handy, what if I learn/serve in another country, learn their language, build community, stay active there? Interesting...

What are my goals? I don't think the goal is to just be FI... Reading some other posts, I think FI gives you the freedom to do certain things. What are they for me? Family? Language? Skills?

Short-Term Goals
Continue working out. Spend less on food. Journal again. Read more.

[b00gs]

November 2023

Oops, I'm 2 weeks late.

NW
$189k (+$5k)

Health
After having covid, I got one of my wisdom teeth taken out, so I couldn't workout for another week. During that week, I got sick again with the flu, so I couldn't workout for another week.

Mental -
I was super drained from being sick, and having mouth pain. I had something going on for a month straight. My mind was so drained and I needed a break. I'm doing fine now.

Physique -
I probably lost some muscle due to not working out, but I'll be getting back into it. I'm still around the same weight. I'm trying to find high calorie meal prep ideas.

Work/Job
It's been pretty slow past few weeks. I'm just browsing the internet pretty much all day. I read a journal on here and they talked about doing a no/few hours of internet per week. I might try that.

Thoughts
Sometimes I feel like I should spend more money and save less to improve quality of life. But I was also thinking about what quality of life looks like for me. Everybody does different things with their time. What will make me feel like I'm living life well? Am I just suffering now (delayed gratification)?

[delay]

Thanks for sharing your update! A no internet week is highly recommended. Time slows down to a crawl. It's kind of scary at the start. I was able to make progress in books again.

Come to think of it, I should really do one again. It's so easy to slip back in internet browsing...

[Rags2Freedom]

New reader of the blog, great read and you’re doing amazingly well !

[b00gs]

April 2024

NW
$262k (+73k since November 2023)

Increases due to market rising, crypto, consistent saving

Finances
Increased tithing to $150 every other week.

Spending
I have not been spending well. I'm still able to save the planned amount every paycheck, but I haven't been trying to spend less or think more frugally. Spending the past few months have just been food, activities, dates, car repairs/registration, copayments, etc. Windshield chipped on a business trip. Car registration was about $500. MRI was about $200.

I'm going on another vacation with friends to Korea and Japan. My flights were free from credit card points. I'm using my bonus money I received in March for the trip.

Gave my parents $5,000 from the bonus. This definitely helped with dynamics at home. Less stress overall. My parents were very grateful so I was thankful they responded in that way.

Health
I actually dislocated my shoulder again in January 2024. Huge bummer. I was working out consistently and bulked to about 175lb but it's been 3 months since working out and I lost all my progress. Kept all the fat though...

I got an MRI done in March but I got a bill in the mail saying I have to pay more. Called insurance and they refiled the claim. Hopefully I don't have to pay the full amount (about $450).

I've been happy with my skin though. I use tretinoin and I think it's finally doing its job. I use 0.05% concentration cream.

Since I haven't been able to work out, my lower back has been bothering me more.

Cut out alcohol since January. Huge step for me.

Cut out Instagram in January. Pretty easy.

Mental
Mental health has been really good these days. A couple weeks ago I was super stressed. I'm not sure why. Probably a combination of things.

I've been reading the Bible everyday and it's been great. Today's reflection:
Romans 3 - I was convicted by the idea of repentance. God literally has every right to judge me, strike me down at any time, and punish me for my sin. There's nothing good that I can do to save myself. I'm at God's mercy. This is what David's heart was like in Psalm 51. I think this will really change the way I repent.

Work/Job
Work has been busy since January but it's finally slowing down. I'm just waiting for my vacation at this point. I was pretty upset that we only got 3% raises while Chipotle raised their prices 9% due to the fast food worker wage raise in April.

Short-Term Goals
I'm going to ask the girl to be "officially" my girlfriend.
Try to start working out again. Probably start with push-ups to ease my shoulder back into it.
Have fun on vacation!