blackbird's Journal

[blackbird]

Hello again everyone,

It has been several months since I last posted (though I read the site almost daily) and I thought that it would be a good idea to post an update. I gave a brief introduction to my situation in this thread:

viewtopic.php?f=3&t=3467

Since that time I have experienced the following curves and detours along my desired path:

1. House situation = as discussed in the above thread, we purchased a smaller, less expensive home as a foreclosure at the end of last year. This has proved beneficial in so many ways. Unfortunately, our old house is still on the market. In six months we have had one contingent offer, and at this point we are honestly entertaining the idea of trying to clear it for only the amount we owe on the mortgage and in the process losing a substantial amount of equity. As a result, I have been hesitant to lock any of our money in long-term investments.

2. Savings = my monthly savings rate has fluctuated wildly. I track all of my after-tax paycheck expenses closely, and from March until July my overall savings rate is 16%. Pretty terrible. That number does not include pretax money taken out for different retirement accounts. Still, it is way lower than I had hoped for but I did increase my personal contribution into my pretax retirement account to 9%, with an additional 4% tacked on by my employer.

3. Metrics = while my spending and savings have been erratic, on the plus side I have done a very good job of tracking everything. This should create a solid baseline for comparison once the old house sells.

4. Eating = earlier in the year I saved a great deal of money on food because of prepared meals for the beginning of the week. I almost never drank sodas and rarely had alcohol. I'm consuming quite a bit more of both recently because of social activities. This is an area I have really failed at over the past few months.

In answering someone else's post I noticed Jacob wrote what I felt was a basic description of my last few months:

"ERE is complex. It has many facets. It takes a long time and maybe several attempts to get it." -- viewtopic.php?f=7&t=4042

The good news is that I'm still here.

Another issue that been thinking a lot about lately is what to do with my free time. I stay very busy, I'm the father of a young child and my wife and I spend much of our time together, but I've been giving thought to what I can do to learn a new skill or trade that might be beneficial from a long-term ERE perspective. For years and years, I have participated in a writing site (www.everything2.com) where I document my life, interests, etc. (and yes, I'm the one who wrote the short summary of ERE on there). But I don't feel that could become the secondary trade or skill I have in mind. Which leads me to this question:

How many of you consciously picked something that was not already a hobby for you and turned it into a skill or moneymaking venture for post-retirement or during semi-retirement? How did you select it, and you think it was more difficult to master starting from scratch?

[jennypenny]

I have your everything2 ERE description bookmarked. I've always liked it.

Why do you have to sell the house for a loss? Is it too expensive to keep both going for the time being? Could you hire a property manager to rent it out for you for a while?

[blackbird]

Well, I've taken a 24% pay cut recently, so there's that, but mostly I worry the situation is degrading, not improving. Our area is heavily dependent on military spending, and next year will be much worse than this one.

[blackbird]

[Update after 10 months]

Hello again everyone! My time on the website is still almost entirely spent as a lurker, yet I visit every couple of days at a minimum. This morning I thought I would take time to provide an update. Articulating ideas against a knowledgeable audience and getting feedback really helps me to focus when I stray from my intended path. And there has been plenty of straying over this past year, so I apologize in advance for what is sure to be a long post (and thank you to those brave few who make it all the way through a reading!):

The big news from an ERE perspective is that we sold our house finally in October of last year. While we did not get what we would have liked, after 10 months on the market with only one contingent offer I was happy to sell it for enough to cover the outstanding mortgage, all fees and expenses related to selling it, and a little bit extra. Still, not optimal, but moving from 30 miles out of town to only a few miles from both of our jobs and right next door to our kid's school has proved to be a very, very good decision. This move into the foreclosure we purchased reduced our housing costs by 75%, and our gas expenses somewhere between 80 and 90%, while returning over an hour each day back to family time instead of spent alone in the car. I attribute the decision to move largely to my reading of Jacob's book and this website, and if I never implemented anything else from here, I would still be thankful for that fact. So thanks guys!

The other big win in the past 10 months is that I have maximized my contribution to my employer's retirement plan so that I am reaching the full yearly contribution limit of my 401(k) and getting the maximum match from them. Additionally, I did manage to stuff an extra $10,000 into a Vanguard Total Stock Market Adm. Share Index Fund. So those are positives.

In the middle ground, while my spouse and I live much closer to our jobs, we are not so close that we could do without cars. My car of 10 years and 206,000 miles finally started running into regular maintenance issues that were becoming increasingly more serious, so I sold it and purchased a new car (after A LOT of shopping around and test driving). After only a few months I've already paid it down to about 40% of the initial loan.

Going the other direction, I really lost momentum in other aspects of saving and frugality. Since my daughter was born I have daydreamed about taking her to Disney World. I'm fully aware of how crazy that is, but for whatever reason, it is something I've been waiting to do for years. This year we decided to go ahead and do it. Because of my job we ended up getting a large discount on the hotel and tickets, but it is still a massive expense. I could have finished paying my car off instead. But we leave next week and honestly we are all super excited about it. My wife has been making shirts with Disney designs, and we have been picking up movies at the library like The Haunted Mansion.

Big expense number two, and equally irrational, is that I have taken two out of town weekend trips related to hobbies. In both cases I made halfhearted attempts at saving money in the process, like sharing a hotel room one trip with two other guys (sleeping on hotel room floors is not super comfortable btw) or carrying my own food, but both were still unnecessary and expensive.

Probably the greatest ERE 'infraction' is the cessation of my expense tracking (outside of bills) from month-to-month. While I have started a spreadsheet for net worth that gets updated each month, I no longer break down my day to day expenses by category. I suspect I'm bleeding through a lot of little holes though.

The main driver for this lack of focus in savings is related to a much increased problem I've had for years now, namely, a painfully visceral awareness of my own mortality. Each day I think about the frailty of life, my inevitable death, and the utter randomness of the universe. While this does help me to be thankful for every single day and every single moment with my wife and daughter, it makes self deprivation of any kind a far greater challenge. For instance, there are hundreds of criticisms that can be laid against the concept of Walt Disney World, the idea of a vacation there, and even more things that that money could be used for in a better way. I have articulated many of them in the past myself. But, after lying awake night after night with tears in my eyes thinking about the indifference of the world, I am determined to lead a life with as little regret as possible. And because this is something that I, for whatever reason, want to do badly, I do it without regard to frugality for ERE. If this were an isolated incident it would not be a big deal, but that kind of thinking dominates many of my decisions these days and I'm not sure how to strike a balance between the two worlds. So that is a big problem. Obviously.

Well, after that rather heavy paragraph, I lost my enthusiasm for writing anything else in this update. Take care everyone!

[Hankaroundtheworld]

Wow, holy cow, this is indeed heavy towards the depressive side of life. So many times I noticed that people struggle with the "unbearable lightness of being", the fact that nobody's life really makes a difference in the end, we just go, and nothing will be remembered, or even if it is possible to remember (with technology in near future), then will it matter? Our selfishness also leads to destroying the world, talking abt indifference. Hell, your story really triggers the dark side But I intend to agree, no wonder that anti-depressive drugs consumption is growing in this world.... How to stay sane? I still feel that this ERE approach is one piece of the puzzle, an awareness that we need to change our life-style, more adapted to the capacity of this world.

Good luck with the road you are taking, and enjoy Walt Disney

[jacob]

Dabbling with the existentialist problem hasn't brought any positives in my experience so I've found it most useful to ignore this question altogether. Whenever I catch myself thinking about "the meaning of it all", I just stop it right there. Better to focus on something "practical", no matter how "trivial" it is, as long as it demands your full concentration.

[blackbird]

Sorry guys, didn't mean to be so down there. I don't take anti-depressives or anything like that, just something that hits me and can't explain it well. This is why I don't journal here regularly

@jacob: You are absolutely right. I throw myself into things exactly for this reason. But I have to rest some time.

Sorry again for the downer.

[Carlos]

Just remember to enjoy the journey (life today). It's not a race to ERE.

Congratulations on selling your house and lowering your fixed expenses so dramatically. If you want to treat your daughter to Disney and it extends your ER by some time that's okay in my book.

[blackbird]

Time for my annual check-in I guess

I still read the website at least every few days, usually more often. Here are the big changes since last summer:

1. My SO stopped working to be a stay-at-home mom. This is something we discussed quite a bit beforehand, tried to detail out our concerns and expected outcomes, and in the end still really struggled with the change. I was very nervous about dropping to a one income family from a resiliency standpoint since I work for the government and furloughs and sequestration have been a real issue in the last two years.

However, as an example of positive outcomes from ERE (because that is essentially what has happened for her, though she does not see it from that perspective) she is far happier now. Her life revolves around serving as the "room mother" for our daughter's kindergarten class. She now has the time to be an active member of the PTA, and can focus on working out during the day (her big hobby) which frees up more time to spend with us in the afternoon. It has also helped her to become more financially conscious. So while I do miss the extra income for us, there were some really good things that have resulted.

I just want to be able to stay home with her

2. I am putting the maximum amount into my employer sponsored 401(k) (the Thrift Savings Plan for federal employees). This ends up being about $1400 per month before employer match, which (off the top of my head) is another 5% or so. Over the course of the last year I have doubled the total dollar amount in the plan. The expense fees are significantly low, so that is good.

3. In addition to maxing out retirement in the 401(k), I now also automatically pull out just over $1000 each month and put it in an emergency cash reserve. The idea is that this pays for unexpected family events but in the meantime as I hit certain levels I want to place excess amounts into my Vanguard index funds. At the moment this monthly savings accounts for 30% of my take-home pay. Together with my retirement savings from the 401(k), I guesstimate that my total savings rate per month is around 40%. I actually have the numbers written down somewhere but don't have them available at the moment.

In the past few weeks I've been giving a lot of thought to renewing my push for ERE. Currently I would say that we are on the path to early retirement, (for my generation anyway, mid-to-late 50s), but honestly I want to exit much earlier than that. In my concept, early retirement extreme would be me leaving the "bronze handcuffs" of my current good insurance / good retirement package job to do whatever the hell I want, but still do something.

I'm considering restarting this Journal in a more structured way with hard numbers. I already track the growth of individual savings accounts through a spreadsheet but by posting it here I would feel more accountable.

Anyway, I really appreciate your taking the time to read through this. This form has been a huge source of inspiration for me. Thanks!

-- blackbird

[blackbird]

Thanks for the recommendation, I'll look into that. One of my goals for this year was to also start a Roth account so I'll check this 457 thing out first. Appreciate the input!

Edit: it looks like those plans are only for state or local employees, not federal. Oh well, I still thank you for the recommendation!

[Peanut]

Hi, I've enjoyed reading your journal.

I was wondering if you enjoyed the trip to Disney World last year? Would you say it was money well spent? I read a study a while ago that found people who spent money on experiences typically got happiness out of them commensurate with the purchase whereas those who spent money on things tended to get only short-lived, if any, enjoyment out of them.

You never said (I think) how you feel about your job? Is that the source of your pursuit of ER? Did your wife dislike her job? Are you both working towards FIRE in different ways now even though you're the only one employed?

[blackbird]

@Peanut

Actually yes, while I understand that it is a very non-ERE thing to do, we had a blast. We still talk about it as a family, and without going on too much about it, it was everything I had daydreamed about related to taking my daughter there. I don't know if it would be the same for everyone, we saw several families arguing, mad, and in one case passed a husband and wife shouting at each other only to pass them again two hours later in a different spot and they were still shouting. So I doubt that was money well spent for them. In our case we obsessed over the planning leading up to it, had much of each day planned out in great detail, and when things didn't match the plan we just adapted and had a great time. I guess my memory may change with time, but as of the moment, I have zero regrets about going.

As I've said before, I'm not really doing a good job at early retirement EXTREME, but more of a being unusually thrifty / much higher than average savings rate type of person. My goal is to transition from the one to the other. Travel and experiences are both important to my wife and myself. I did not write about it here, but my wife and I saw a short notice post about severely discounted airfare to Japan through the Japan Travel Bureau last fall. The previous summer we had some close friends moved there for work, and we both had planned on going to Japan at some point. Despite having went to Disney World in the summer, we felt like the tickets were a good enough deal to go ahead and jump in. When I had priced tickets the few times before they ranged from $1500-$2000, we got ours for 900 bucks.

While there we did as much as possible to save money, eating the majority of our meals out of 7/11s instead of expensive restaurants (Japanese 7/11 =! American 7/11). We walked everywhere that we could not take a subway, never taking a taxi. Most of the things we wanted to see were free anyway (though I did splurge on a sumo tournament and photo shoot with a Japanese adult model, which is a whole story in itself...). At the end of the day the whole thing turned out to be amazing, and we are both grateful we were able to experience it. To me that is something that is well spent money, but there is no question it sets me back from retiring early.

I'll have to answer the rest of your questions later, as I got into that a little more than I anticipated and I am out of time.

Thank you again for reading and for your questions!