What do you do when your reason for living has gone away?

The comments below reflect the thoughts and idea of myself, a 54-year old man, raised in that time period. Some people may question the assumptions or thoughts here, but they are mine, and I believe they reflect a certain percentage of the men my age in the FI community. Since the purpose of this blog is for me to discuss my thoughts on FI, and its impact on my life, I do not have any problem with voicing my opinions and thoughts on the matter.

As someone born at the tail end of the boomers/beginning of Gen X (1964) my general thoughts on men is that we are the providers in a relationship (I know, everyone has different opinions here – I’m talking in generalities here, so sue me). Men have the ability to generate excess resources beyond their needs. Anyone who has ever been to a bachelor’s home knows that they don’t need much to live. I once heard a female comedian call men “bears with furniture.”

A typical bachelor pad will have some basic furniture, maybe a card table instead of a dining table, and a functional bed. Not much on decorations, curtains, exotic cooking gear, etc. They will probably have a great TV/entertainment set up. Their clothes requirements will be simple and not excessive. After that though, they don’t need much. Yet they have the ability to generate large incomes and throw off excess money.

This is why the basic family unit worked so well. Raising kids takes an awful lot of time and resources, so by having two people working on it, the man can generate the excess resources necessary for the family to get what they need. In return, the man gets a feeling of accomplishment on his work, and the belief that he is contributing to the success of his family.

So where am I going here?

As you close in on FI, and you reach the point where you have sufficient resources to maintain your lifestyle, the primary reason for many men’s existence suddenly is threatened. If they have reached the point where the family has what it needs in perpetuity, then why is he needed? One of a man’s primary roles in the family is gone. What do you do?

I think this is a major reason why we see so many men dying shortly after their retirement. Their major role in life is gone, and they struggle to find something new. They’ve been working at this since they are 18, and for some, that is 45-50 years of life’s work that is suddenly gone. All they’ve known in their adult life……

I’m struggling with that right now. I’ve got 24-1/2 months left to go, and while I have some short-term goals (travel, writing, etc.) I am not sure what I want to do once I hit FI. I know I want to take some time off (sabbatical?) but then what?

An interesting book that I have just started reading is Find your Why, by Simon Sinek. The idea is to search for the core idea of “why” you do stuff, “why” your exist, “why” you act the way you do and what that gives you. Knowing your “WHY” gives you a filter to make choices, both at work and home, that leads you to finding greater fulfillment. The book is interesting (as is the TED talk) and I’m hoping the exercises it has will lead me to further revelations.

Other blog postings related:

I hope this helps

 

Mr. 39 Months

Tracking Lifestyle “creep” and what to do about it.

20 Something Finance had an interesting article on lifestyle creep (how its defined, how to track it, and how to avoid it). For those in need of an explanation, as defined by 20 Something “Lifestyle Creep (ˈlīfˌstīl krēp), noun: the very real, very unnecessary, and very self-defeating personal finance phenomenon of increasing one’s lifestyle spending as a direct correlation to an increase in one’s income over time.”

Basically, people start out with their base pay out of school (example, $35,000/year) and then get pay raises throughout their work life (3% here, 10% here when they change jobs, etc.). With lifestyle creep, folks just take that pay raise and roll it into their spending without thinking about it. Before you realize it, you are making $65,000, but don’t feel any richer (and aren’t any better financially) than when they were making $35,000. It is something that most of the western world suffers from. You get a nicer car, eat out at nicer places, move to a nicer neighborhood, and just don’t make any real progress financially.

He goes through various ways to track your lifestyle creep and then finishes with ways to combat it, including:

  • Continually monitor your expenses and be on the lookout for lifestyle creep
  • Trim and trade expenses (cut back on some things to pay for other things you want)
  • Practice gratitude and question every purchase
  • Pay yourself first (a FIRE staple)
  • Remind yourself of your goals

I went back and looked at my last five years of spending. I broke it out into our family spending (taxes, groceries, insurance, etc.) and my own personal expenses (clothing, gas, lunches/snacks, etc.). I also took out the mortgage spending for the first 2-3 years, as we are mortgage free now, and I wanted to get a good apples-to-apples comparison.

As you can see, we’ve roughly been running between $26K and $29K of family expenses. Remember that this doesn’t count medical insurance, just medical co-pays, etc.

For personal expenses, it looks like I’ve been trending down the last couple of years, and I’m running around$1,200/month.

 

Based on this analysis, I’d say I’m not really running a lot of lifestyle creep. When we paid off our mortgage, we dumped that right back into savings. We then found out a way in 2018 to put even more into savings and reduce our expenses (isn’t that the way it always is with FI?). I’d like to say we’ve avoided lifestyle creep, but I can say that from 1991 to 2000 (the first 9 years out of the army for me), we did experience a lot of it. I went from a $30K/year salary to a $56K a year salary, without a lot diverted to savings.

 

It wasn’t until 2000 (when I got a bump to $68K) that we started to dump all extra money into my 401K and our IRAs. From that moment on, we’ve kept our lifestyle fairly much around $50K – $55K a year (including mortgage) and all excess funds have gone into savings/debt payoff as we moved towards FI.

 

Good article to review for those folks looking for another metric to track their performance.

 

Mr. 39 Months

Sorry, been sick for a while…..

Cue the whining.

Sorry the posting has been light, but I’ve been battling a major ear infection (steroids, antibiotics) that has wiped me out, and I just can’t seem to kick this thing. For those who have had them (or have had children with them) you know how much pain they can cause, and how it is difficult to do anything.

I’ve continued to go to work every day (concept of duty drilled into me in the military). Work has been a little stressful, as I had to loan about 50% of my resources out to another team for the next 4 weeks, and my team’s workload actually picked up – so I’m doing extra work to cover, while sick and tired. Actually was asked by my boss on Thursday to take on a project for another team, because they’re even more swamped. I’m such a glutton for punishment that I said OK. When I get home, all I end up doing is watching TV/read for about an hour, then head to bed early. I also haven’t been exercising, so I can get an extra 30-60 min of sleep in the morning.

I tell you what, being sick sucks!

While trying to de-stress, I was reading online and saw some pictures of a Hollywood starlet that reminded me of Mrs. 39 Months when we were first dating. It lead me to think about how lucky I am, and how lucky folks are to have a significant other in their lives, not only when they are sick, but just to come home to and talk with, to have support them. We’re both looking forward to FI and what how our lives will change in the years ahead, as we grow old with each other. Kinda nice.

This also had me thinking about the recent/upcoming celebrity deaths in the US. Just this week, two celebrities committed suicide this week – Anthony Bourdain (chef, show host) and Kate Spade (designer). While we can argue the morality of committing suicide, I always wonder what drives people to the depths of despair that they feel this is the way out. I have tendency towards depression and have had suicidal thoughts (very minor ones that I think pops in everyone’s mind for 30-60 seconds). For the most part, I really can’t understand how bad it must be to do that sort of thing. Still, it is possible that it was a medical/chemical depression issue with their bodies, and since I’m not a doctor, I can’t find it in my heart to judge.

I contrast that with Charles Krauthammer, the Fox News analyst who announced this week that his cancer has returned, and that he has only weeks to live. Putting politics aside, here was a man going through Harvard Medical School when a freak diving board accident paralyzed him from the neck down. For the last 40 years, working through numerous illnesses and rehabilitation, he has built a life and worked hard to support himself. He beat cancer once, but it has finally returned, and he now has only weeks to live. He never gave up until the last moments, and then he announced to the world his status and how he intended to finish his days. He is being shown as an example of bravery and manliness in the face of adversity.

I don’t know how I would face either of these two challenges. I hope that I would do it well, and not do anything that would cause my loved ones pain or suffering. I can only hope that I would never be put in that situation in my life. I also hope that all of you escape it as well.

Sorry for the “downer” posting – guess it comes from being sick.

 

I hope you all have an excellent weekend!

 

Mr. 39 Months

Well, I suck……

…..at picking stocks.

Seriously, I appear to be pretty bad at this. For the month of May, I made back a lot on some of the losses for the year, but my few value stock picks really tanked, dragging me down. I mean -$4,387 (or -17.3% down)! I ended up 1.26% for the month of June, primarily due to the good performance of my index funds. Still down 1.9% for the year, not counting what I have put into the accounts for the last 5 months. Still, I guess I’m buying stuff on sale, so I have that going for me.

Retirement Accounts: Remember, my allocation for these is:

  • 30% Bond Index Fund
  • 17.5% S&P500 Index Fund
  • 17.5% International Index Fund
  • 17.5% Small Cap Index Fund
  • 17.5% REIT Index Fund

I ended up being about 1.7% up here, after my monthly inputs into the various accounts. S&P500, Small Cap and REITS were up, Bonds were OK, and International was down. Remember that International did well earlier in the year, so it balances out. Another reason for asset allocation. Note that these returns include reinvesting dividends.

My 401K/Deferred account at work was up only 1.1% for May (same as April). Again, I’m gaining back some of what was lost at the beginning of the year, and buying stuff on sale.

Dividend Income Account: Allocation:

  • 25% Dividend Stocks
  • 25% REITs
  • 50% Bond Index Funds

Another bright spot, up 1.9% for the month (including dividends). My stocks in this account didn’t do as well in May, but the REITs did, and the bonds were OK. I think part of this was the major jump up of my stocks in April.

Value Investing Account: Allocation (remember I refocused this at the beginning of February):

  • 40% in individual value stocks I picked myself (2 each, 20% for each) – SBS and GILD
  • 20% USAA Market Index (my brokerage is USAA)
  • 40% in Vanguard Value Index fund

Again, major disappointment in the stocks. Overall, the account was down -6.8%. The two index funds did OK, but the stocks just drove it down. I continue to see evidence that I am not a good stock picker (as most folks in the FIRE community can attest to). If I don’t see a major turnaround in fortunes by the end of the year, I’ll just sell my stock picks and go to index mutual fund investing (like so many other folks). Again, this is more of a “fun money” account where I experiment.

The allocations are not too much “out of whack” so I don’t intend to rebalance until July (unless something major happens).

How did you do in May?

 

Mr. 39 Months