MBB_Boy's journal

Where are you and where are you going?
MBBboy
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Re: MBB_Boy's journal

Post by MBBboy »

Looks like 2025 will be a pivotal year for us. A number of events will converge to be a great time to make a big lifestyle change.

Plenty of new income:
1. End of my initial grant vest and first year where 3 years of refreshers all hit at once - IOW, my comp at work will DROP after this year because I'll no longer be cashing in on my initial grant
2. CD comes due - have an unlimited add-on CD that pays 3.3% interest that will run out.
3. Projected exit on two real estate deals we've invested in
4. Projected exit on a private equity deal we've invested in

Expenses drop:
1. Student loan will be paid off - $2K a month expense removed
2. Car loan will be paid off - $899 a month expense removed

Also, we plan on having an additional kid (after our first next month) so 2025 should be the point where pressure to work will drop because both kids would be safely delivered, wife recovered, and we'll know if anyone is going to have a condition that requires special care.

What this means for me is that I'll want to have our land improvements completed at this point, so that we'll have the option to move out their full time. If we DO chose that option, then we'll get to sell our current house.....which will put a crap ton of money in our pocket and also make us debt free. So more income in the portfolio AND removal of our largest expense.

So I'll go ahead and pencil that in as our FIRE date - can would shave 2 years off of the spreadsheet date. A bit more motivation to get expenses down faster than baseline (all the stuff I wrote about for this year's goals)

MBBboy
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Re: MBB_Boy's journal

Post by MBBboy »

Interesting discussion with my wife while walking the dog recently - looks like 2025 is forming in my head as an important "transitional year". There are a number of things in motion that all come to a head in late 2024/ early 2025 which combine like Voltron to make a big shining neon sign that says "Make radical lifestyle change here".

On the income side:
1. We have two real estate deals that are projected to culminate (6 figure dump
2. A 5-year CD earning 3.3% that expires ($50K currently, still have the option to add to it)
3. The expiration of my final RSU tranche at my job, meaning that I'll make LESS money going forward, despite the refreshers that I'm already earning.
4. Likely the IPO of a company we've been invested in, which we hope to be another 6 figure dump

On the expense side:
1. Car loan will be paid off, which will save 899 a month
2. Student loan will be paid off, which will save around 2000 a month

In the "life" category:
1. Both planned kids should have arrived
2. The initial development of the land we bought should be completed (electrical, septic, well useful instead of just sitting there capped). I'll have to knock on wood that there will be a house there to live in though given how construction is acting...

Of course, this could just be daydreaming because we're in the "boring middle" of the FI journey. It's still the exciting beginning on the prepping side of the house. The danger is that we will divide our lives into the "Before" times and the "After times"......and then put off doing things for "After" which never comes because of a litany of rationalizations. We need to make sure we don't just "wait" to try out hobbies, pick up skills, take fun trips, etc etc.

It hasn't been an issue up until now - but that was because the FI "After" seemed farther away.

MBBboy
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Re: MBB_Boy's journal

Post by MBBboy »

Just realized that my last two entries were basically on the same topic - interesting to note A) I spaced and forgot that I had already written about this and B) see the differences in the two entries, the first of which was before discussing with DW and the second of which was after.

Picked up a copy of "Your Money or Your Life" recently. It's a book that I've
heard recommended for years, but something about it just kept me away. Some instinct that I just couldn't quite explain. Wish I had listened.

The first thing I noticed was that I had the "updated" version for 2018. That's a red flag - updated doesn't mean better. Given my general world view, updated in contexts like these probably means worse. But I decided to keep going.

Then I noticed that the foreword was written by Mr. Money Mustache. Can't stand that guy. Should have taken that warning and aborted reading the book, try again by finding the original 1992 version. But it was a nice day, I was all set up on the porch swing in the sun, so I kept going.

Now I'm about halfway through the book, and I've decided to just skim through the rest. I am undecided on if I will track down a 1992 copy and see if it's better. But I know that I won't ever re-read this book, and I certainly wouldn't recommend it to any of my friends. It feels like a cash grab where the author tries to jump onto a bandwagon (FIRE movement / MMM) and "makes the book better" by updating with a bunch of hip current slang. In this case, the slang is a bunch of PC, "psychology" and environmental stuff. It's grating and unnecessary. I wonder if the update would exist (or be different) if Dominguez was still around. How much of the stuff I didn't like was because Robin was writing solo, and didn't have the counterbalance. From her words, it sounds like his personality was more pragmatic / number oriented, and she had the "soft skills". The book is too soft and hippyish for me.

Writing that out, I AM going to see if the library has the 1992 version. My curiosity demands that I read enough to compare the two.

chenda
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Re: MBB_Boy's journal

Post by chenda »

MBBboy wrote:
Wed Mar 30, 2022 12:22 pm
Then I noticed that the foreword was written by Mr. Money Mustache. Can't stand that guy.
He wrote the intro to 'A simple path to wealth' too. I like him though.

Dominguez advice was sound but he was writing at a time you could get bond income at 12%, which would have made FI so much easier.

Biscuits and Gravy
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Re: MBB_Boy's journal

Post by Biscuits and Gravy »

MBBboy wrote:
Wed Mar 16, 2022 6:28 pm
[...]and we'll know if anyone is going to have a condition that requires special care.
Well... unfortunately that isn't accurate. By 2025 your oldest will be 3 and your yet-to-be-conceived-youngest will be, what, 1? Conditions such as asthma don't rear their ugly heads until the kid is 4 or 5 years old, and that's just one condition! Allllll sorts of things can and do go wrong, and their health is your responsibility for at least 18 glorious, glorious years. No, my friend, you have made a treacherous roll of some treacherous dice by having kids.

I'm sure that's not helpful and I'm not sure how to be helpful here, other than by pointing out a potentially big flaw in your plan.

Fish
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Re: MBB_Boy's journal

Post by Fish »

MBBboy wrote:
Wed Mar 30, 2022 12:22 pm
Writing that out, I AM going to see if the library has the 1992 version. My curiosity demands that I read enough to compare the two.
I also had a similar impression of 2018 YMOYL. My summary and comparison is here: viewtopic.php?p=177603#p177603

Also related, interview with Vicki Robin from 2017: viewtopic.php?t=8819

MBBboy
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Re: MBB_Boy's journal

Post by MBBboy »

Biscuits and Gravy wrote:
Wed Mar 30, 2022 3:06 pm
I'm sure that's not helpful and I'm not sure how to be helpful here, other than by pointing out a potentially big flaw in your plan.
No, it's helpful. You're right, there is the potential for a condition to arise at ANY point in the future - whether something medical that they have from birth, or a disability from a bike ride gone wrong. Same is true for me and the wife.

I meant that we would be past a point in development where a lot of known, testable issues would be in the rearview. But that age I picked is just a swag from life osmosis - I have done literally zero research into what ages things pop up. I'll make a note to ask our pediatrician when the time comes. Thanks!

MBBboy
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Re: MBB_Boy's journal

Post by MBBboy »

chenda wrote:
Wed Mar 30, 2022 12:34 pm
Dominguez advice was sound but he was writing at a time you could get bond income at 12%, which would have made FI so much easier.
Oh I'm sure the specific nuts and bolts will be different - but that's ok. I'm well versed on the nuts of bolts of the investing ecosystem and the financial plumbing that holds the economy together. That's not what I'm looking for in a book at this point.

MBBboy
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Re: MBB_Boy's journal

Post by MBBboy »

Fish wrote:
Wed Mar 30, 2022 3:52 pm
Thanks for sending me these. I actually finished it today, and it was all downhill. As noted in linked post, the updated version does mention the 4% rule....incorrectly.

I have a low opinion of whatever financial planning / investing firm helped her write that section, to let something so basic (yet important) flat wrong.

MBBboy
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Re: MBB_Boy's journal

Post by MBBboy »

Here's a stupid thing I'm thinking about now after commenting about drying racks in Scott2's journal:

I minimize wash cycles, so whenever we do laundry the machine is pretty full. With a kid coming soon, I expect to have more laundry, and sometimes we don't have enough space for everything I want to hang. So I've started thinking about getting a second drying rack.

But maybe we would be better off just drying more things - the dryer runs regardless, it just runs with less stuff in it. It's no more cost / time / energy used to throw more stuff in it, there's just the minor negative impact to clothes.

An alternative would be to do laundry more often, so the loads are smaller, so things fit on the drying rack. That just seems like more work and more instances of doing laundry. But I may not have a choice - kids throw up, pee on, and poop in clothes. The laundry frequency may increase regardless.

In a world where laundry frequency increases anyway, would another drying rack still be useful? Wondering if it would completely avoid a dryer cycle if I had two. But not sure we are going to be happy always having a drying rack out and in the way.

Obviously things are super slow right now if I'm sitting here drinking tea, watching birds, and fretting about the utility of a second drying rack

mooretrees
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Re: MBB_Boy's journal

Post by mooretrees »

We run our dryer more frequently than it sounds like you do but a set of extra hangers is extremely useful for shirts and pants. I've taken to using the drying rack for our son's clothing as it is easier to get more of his small clothes on it than an adults. Then I use the clothes hangers for the adult clothing. In a pinch, you can hang the hangers in the shower....

With a kid, it's not hard to get a lot of clothes used and that could be another solution, just up the amount of clothes. It's crazy how quickly they go through clothes.

MBBboy
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Re: MBB_Boy's journal

Post by MBBboy »

I thought it was bad to put wet clothes on hangars?

mooretrees
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Re: MBB_Boy's journal

Post by mooretrees »

I don't think it's terrible, it's mostly t-shirts for us which are already sorta older. How wet are your things? We have an older washer but newer ones might get more moisture out than ours.

jacob
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Re: MBB_Boy's journal

Post by jacob »

MBBboy wrote:
Sat Apr 02, 2022 8:43 pm
I thought it was bad to put wet clothes on hangars?
Well, don't do it if it says "dry flat" or the item really stretches under "its soaked weight". Most knitted/fancy sweaters would probably fall under that. Otherwise, a hanger is just a fancier form of clothes pegs or just throwing clothes over the line.

PS: Still trying desperately to come up with a good airplane joke.

MBBboy
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Re: MBB_Boy's journal

Post by MBBboy »

Clothes aren't that wet, so might be fine. Old tshirts and stuff go in the dryer, so I'm really only hanging the nicer things / stuff I care most about. I think it's different from using a clothes peg because the hanger* could shape/stretch the neck / shoulders of things that are hung on it.

*I now see the hanger / hangar thing. You have to be really careful with airplane jokes - the bad ones never land correctly. *ba dum tsss*

shaz
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Re: MBB_Boy's journal

Post by shaz »

Are you strongly opposed to just stringing a line somewhere? It is the classic solution for a reason. I have mine on the deck hiding behind a string of lights so it isn't at all noticeable when there is no laundry on it.

MBBboy
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Re: MBB_Boy's journal

Post by MBBboy »

shaz wrote:
Mon Apr 04, 2022 9:43 pm
Are you strongly opposed to just stringing a line somewhere? It is the classic solution for a reason. I have mine on the deck hiding behind a string of lights so it isn't at all noticeable when there is no laundry on it.
Laundry room is upstairs, so primarily trying to avoid needing to go up and down the stairs for laundry purposes. Could do something in the guest bathroom over the tub (like in some international hotels) to have some extra space. Not sure how well things will dry in there though

MBBboy
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Re: MBB_Boy's journal

Post by MBBboy »

Read through a few other books to get the taste of YMOYL out of my mouth.

First was Wealth, Poverty, and Politics by Dr. Thomas Sowell. That man is a treasure. Anytime I've come across his writing or an interview I've been incredibly impressed. I was part of a book club last year that read Maverick, which is a biography about Dr. Sowell written by Jason Riley (another writer I've long admired). I didn't know anything about his past, and I'm even more impressed after reading about it. It's a good reminder to me that my son's future isn't predetermined just because of his race, and good intellectual backing to push back against elements of our culture that bother me.

Also read Disunited Nations, by Peter Zeihan. I read Accidental Superpower a few years ago and consider it one of the best books I've read. I gave copies of it out for Christmas that year I read it, and have loaned out my personal copy multiple times. Both books called out the future pretty accurately, especially in regards to Russia. I believe he has a blog as well - I'll have to consider reading it. I prefer books because those contain the most well thought out and researched thoughts of an author, as opposed to lightly researched surface thoughts like a journalist.

Next up is Guns, Germs, and Steel (I think). We are in "any day now" mode for baby boy to show up, so may hold off on picking up a new book when there's a high likelihood I'm going to put it down for a while.

Still non-committal on funding a 529. If I do, it'll be "lightly" funded for flexibility. One reason I'm not as interested is that under current law, my son's college will be paid for as long as he goes in-state due to one of my veteran's benefits. Of course, 18 years is a long time for things to change.

And since 18 years is a long time for things to change, I'd hate to put a bunch of money in 529s only for it to get stranded if the college system changes drastically.

It's extra work, but I'm pretty sure I could just open a normal taxable brokerage account in his name, and then simply invest there. I can harvest the gains every year or so for no cost (since his tax bracket would be zero), and then the money could be used for college when the time comes......or anything else if there's no need for college funding.

On the other hand, we do hope for a second child. The odds of needing college funding go up with two kids, and you can easily change the beneficiary. This would point to a path of doing a 529, and then increasing / decreasing the funding as the time horizon gets closer and the range of possibilities narrows.

Biscuits and Gravy
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Re: MBB_Boy's journal

Post by Biscuits and Gravy »

I did some research on this before: viewtopic.php?p=238816#p238816
We have a similar timeline, and I landed on the Roth IRA as my preferred approach to saving this far in advance for the kids’ college expenses. Upside is if they don’t go to college, hey, that money is all yours.

MBBboy
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Re: MBB_Boy's journal

Post by MBBboy »

Biscuits and Gravy wrote:
Fri Apr 08, 2022 3:47 pm
Thanks for sharing. We already max our IRAs (all tax advantaged accounts are full actually. I'm looking at the optimal way to save separately for his education.

Just keeping it in our own taxable accounts means we pay our tax rates, so sub-optimal. I think it's down to 529/taxable in his name as the most tax efficient options

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