Financial Advisor meeting #2

As you remember, I wrote how Mrs. 39 Months does not trust my numbers, and wanted us to meet with a professional financial advisor to bounce my numbers off of and to go through various scenarios. She is very conservative and concerned that we will run out of money. Longevity runs in her family (her aunt lived to 102, and the rest of the women on her side lived into their 80s and 90s). Therefore, I understand her concern – all my planning assumes she lives to 99 (and I live to 97).  

Some folks have asked about the fee we are paying for the advice. He is a fee-only planner, though he does manage some folk’s investments for a 1% per year fee. The fee he is charging us, for a New Jersey suburb of Philadelphia, is a flat $2,900. When we first engaged him, the financial advisor stated that it would be for four (4) meetings. The agenda appears to be something like:

  • Meeting 1: Share with advisor our info (typically in hard copy form, though I gave him ours electronically)
  • Meeting 2: Clarification of numbers, budget, situation, etc. Opportunity for the advisor to ask questions and get answers prior to doing the work, and to share some of his planning assumptions with us
  • Meeting 3: Sharing of the plan and some base scenarios that we have asked for him to run. After review, give him ideas for other scenarios to run
  • Meeting 4: Final meeting to run through any alternate scenarios, finalize the plan, determine next steps

He has also said we could come back “every so often” to update it, since it is already in his system. I am assuming there is a small fee for his work, but not sure.

I was hopeful that, since we gave him all our data electronically in advance, we might have jumped past meeting #2 and gone straight to #3. I wanted to get ahold of the three-ring binder with the big plan and analysis in it! I wanted to look at his planning and compare it to mine (and potentially share it with everyone here). No such luck.

Our planner had been dealing with some family issues (he’s the only child and his mother had to go to hospital for extended stay and many tests) so he was not able to really do the analysis. He still had a few questions and thoughts he wanted to share with us as well. So, no binder, not deep analysis. Still, some of the planning points that he shared/we worked out:

  • Inflation assumption: 3.25% – a little higher than the past 10+ years, but historically accurate in our lifetimes
  • Inflation for medical: 6% – very accurate historically, and something I didn’t consider in my initial planning
  • No inheritance planned – my mother is well off after a life of frugal living and excellent planning. However, we assume we won’t get anything (again, staying conservative with Mrs. 39 Months)
  • Changed the life assumptions from 90 years old to 99 and 97 (see above)
  • Discussed scenarios to look at, including immediate retirement, retire on my schedule of July 2020, and retire when I hit 60 and Mrs. 39 Months hits 62.

There were a few other clarifying questions and for the most part, we are making very conservative estimates and plans. While I am a little more willing to plan “to the edge” of retirement, I do not think we will go that route.

One of the biggest benefits to this is that it has gotten Mrs. 39 Months to open up with her thoughts about retirement, budgets, lifestyle and plans. Despite my prodding over the last several years, she really has not opened up too much about it – until we started to have these meetings. Now we have created a budget, discussed travel and lifestyle, and started working some of the details out. Mrs. 39 Months commented to me after the second meeting that it was a strange thought that, even in our conservative planning, retirement was just 4 years away.

The fact that this is enabling us to discuss it this way is worth the $2,900 fee alone, even if we did not get any analysis.

I will let folks know after we have our third meeting (late October) how that is going. In the meantime, I hope all your plans work out.

Mr. 39 Months.

Quarterly Update

Quarterly Update

October 2019

Well, it’s early October, and as fall hits, I wanted to look at my goals for 2019, and try and figure out where I needed to “sprint it in” in order to get some done. Only 3 months to go before the end of the year.

My Goals for 2019 (some financial, some not):

Finance:

  • Save $75K in tax-advantaged accounts (saved almost $81K in 2018). 401K, Roth IRA, etc. Dropped this down a bit, due to a need to plus up my savings/emergency fund. Key part of this is using my company’s deferred savings account to push money out till I hit FI. Since the deferred account money will have to be withdrawn (and taxed) when I leave, it actually is a pretty cool FIRE solution for saving. Grade A. Saved $68K so far this year, so I’m in good shape to hit this goal, provided I continue to save at my current rate.
  • Save $5K in regular accounts (compared to $9K in 2017). This will go into my brokerage account. I withdrew a hunk of this to do my ROTH rollover (part of the “power of zero” philosophy). But I still have some bucks here. I have to take about $5K from my father’s IRA every year, so I just move it from there to my brokerage account instead f spending it). Grade A. Made the deposit in January
  • Increase dividend income from all accounts to $27K/year (compared to 26K in 2018). Grade A: Dividends year-to-date at $19,667, so should easily be able to hit $27K.
  • Passive income covers 40% of base living expenses in retirement (it was38% in 2018). My long-term goal is to get my dividend/passive income up to where it covers over 100% of my expected retirement living expenses, so my investments can continue to grow.  Grade B: I’m at 36.4% for the year vs. expected $18K/quarter budget. I usually get a big bump in 4th qtr, so it will be close
  • Beat net worth growth rate of 6% (it was -1.9% in 2018). This is my historical growth rate for the last 10+ years, so I want to beat my average. Grade A: Should be in the double-digits for the year, unless the market dramatically tanks. I’m up 14% in my investments, and they are the lion’s share (75%) of our net worth.  

Business:

  • Continue attending regular meetings of my local real estate investors association. They hold a regular monthly meeting, a monthly meeting for new investors, and a monthly meeting for my specific county. All three could be interesting, and it’s free for a paid member. Last year I attended, but it was spotty. Grade F: Did a cost/benefit analysis and deep look on my intentions to do real estate in the near future. Decided to drop out of REIA.
  • Double the number of blog visitors in 2019. Last year it was a little over 6,000. I want to get at least 12,000 this year, so I need to put myself out there more (i.e. comment) and write interesting topics. My thanks to everyone who stopped by, and I try to return the favor, and comment as well. Grade D. Only have around 5,700 visitors in the first 3 quarters. On track to beat my 6K visitors in 2018, but not by much. Probably need to spend more time on other blogs, commenting, etc.
  • Write/publish a book on finance.  I wrote one for new graduates in 2017, but I have identified an area of the community which hasn’t been served as well in the past. Hopefully I can assist with something here.  I’ve got the first five chapters outlined/partially done, but still have a ways to go. Grade F. I’m about 2/3 of the way done with the outline, but it doesn’t look like it will be done this year.

Personal:

  • Increase weight lifted by 10% from 2018. Due to my illness, I didn’t make much progress beyond that, but I’m back to full strength now, and lifting what I was in September 2018.  I want to continue to improve my strength as I get older, instead of just wasting away. Grade A. Weight increase of 10% already, and looking like I’ll bump it up another 5% before the end of the year
  • Average 2 hours of cardio per week (currently averaging about an hour). Again, want to improve my fitness. Based on my lifestyle, I don’t think I can push it past 2 hours per week. Grade C. New company HQ is allowing me to take daily walks of 20 min/day, so it looks like I might hit this.
  • Take part in at least one long bike ride, like MS bike-a-thon (80 miles). Didn’t do this last year, but really want to try. Grade F: Chose not to do this in 2019
  • Backpack over 100 miles on AT (did around 80 miles in 2018). Other aspects of life interfered with my ability to get on the trail. Really want to push it this year. Grade C: Getting further away from home, so its hard to get in miles. Got 82 miles in.
  • Continue volunteering at Pennsbury Manor at their joiner’s shop (woodworking). Really enjoyed this. Grade A: Continuing to volunteer at least once a month. Just completed my last one for the year.
  • Reduce weight by 20 lbs. from Jan 2019 (lost 2 lbs. in 2018). Again, I want to get in better shape as I get closer to financial independence. Grade D: Have only been able to maintain weight, haven’t really reduced it. I like sweets too much
  • Read at least one book a month. I surpassed this goal in 2018, and re-learned the joy of reading. Grade A. I got another five books under my belt for 3rd qtr.

Travel:

  • Visit a national park (visited two in 2018) Incomplete. Planning on doing this in October
  • Visit family in Tennessee, Vermont and New York. Family is very important to me. One of the things I am looking forward to with financial independence is the opportunity to visit family more often. Need to get up to see my brother in Vermont. Grade A: Visited family in TN, VT, NY. Getting back to TN in October.
  • Take a week at the shore and just relax. Too many of our vacations are spent running around. I want to see if I can go somewhere (in this case the beach) and just sit and relax. Grade A. Did a nice weekend at the shore in July , though it was pretty hot.
  • Visit Ellis Island. Wanted to do this in 2018, but didn’t make it. As 50% Czech from immigrant great grandparents from the turn of the century, I believe they went through there, and I want to see it Grade F. Its only 90 min north of us, but we haven’t gone yet.
  • Go on an international trip. Not sure which one (Canada, Caribbean, etc.) but I’d like to get out this year. Grade F: Doesn’t look like I’ll do it this year.  
  • Visit the Asheville NC area. It’s one of the areas that we are considering retiring to (close to my old home in Tennessee, interesting crafts, shops & outdoor sports, etc.). Trying to learn more about the area (we’ve been there a couple of times). Incomplete. Still on track to go in October

Overall, I’d give myself a B. Got a lot done, but still have some left to do.  

How are you going on your goals for 2019?

Mr. 39 Months

Update on my income account

As many of you know, I’ve used my father’s inherited IRA to experiment with an income producing method of investing similar to the “old school” way that folks invested their money after retirement. This was laid out in Ben Stein’s book “Yes, you can become a successful income investor.” The idea was to create a method to generate enough income from the portfolio to live off of, without touching the principal (thereby letting it grow).

I detailed in a later post that, for the last 2-1/2 years, the stretch IRA was beating my vanguard allocation. I did note that this took into account the terrible 2018 year, which beat the Vanguard account down more than the income account. Over time, all my reading shows that the Vanguard account would do better – but be more volatile.

For the last three months, the account has not increase that much in value, but it has continued to throw off dividends. Investment value grew $2,194 for the six months (while the market was pretty stagnant), 1.7% (or 6.7% annual growth) while also throwing off $1,256.94 in dividends – the equivalent of 3.75% annual yield.

stock Details 1-Jul 1-Oct Yield Dividend
CVX Chevron $6,222.00 $5,614.50 4.24% $59.50
CSCO Cisco Systems $8,209.50 $6,984.00 3.01% $52.50
HR Healthcare Realty $7,830.00 $8,312.00 3.61% $75.00
PFF iShares $16,766.75 $16,912.35 5.24% $221.49
O Realty Income Corp (REIT) $6,897.00 $7,673.00 3.54% $67.95
SVC Hospitality Properties Trust $7,500.00 $7,498.50 8.64% $162.00
UMH UMH Properties $7,446.00 $8,622.00 5.01% $108.00
VZ Verizon $5,713.00 $5,891.00 4.09% $60.25
VBTLX Vanguard Total Bond Market Index $32,621.94 $33,248.71 2.69% $223.25
VBILX Vanguard Int-term Bond Index $32,787.96 $33,432.51 2.72% $227.00
$131,994.15 $134,188.57 3.75% $1,256.94

Not too shabby! Basically, its close to hitting the 4% withdrawal figure, while still growing sufficiently to keep up with inflation. What is interesting is that, while the stocks declined a lot (look at Chevron & Cisco) the other items (REITs,  bonds) helped to cushion the blow.

I’ll continue to monitor and see how this goes.

Mr. 39 Months

Investment Update Oct 2019

Only 9 months to go!

I’ll have my quarterly update on goals later, but thought I’d get my investment update out earlier. It was a fairly good month, and as my previous post on asset allocation noted, different investments are up this month vs. last month – but I am up overall, both for the month, and especially for the year!

The allocation for my retirement accounts (IRAs, 401K, etc) is pretty much index funds, spread out between the  S&P 500, small-cap, international, REITs and bonds.

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

My 401K doesn’t have REIT option, so its just 25% for each.

Stocks were up (S&P +1.9%, International +3.1%, Small Cap +1.5%) and REITs did well (+1.9%). Bonds were down -0.7% (though they were up last month). International was a surprise, as its been lagging for several years now. Good things to come? Overall, my retirement accounts were up 1.4% for the month.

My dividend account allocation is:

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

My individual stocks and REITs were up significantly (over 4%) while the bonds were only down a little. Overall, the income portfolio was up 3.8% for September, including dividends. I’m going to be interested in how it compares to my overall portfolio. Could the income portfolio beat out again in 2019?

The “fun money” account is primarily Value and extended market, and was up about 2.4%. I continue to invest in this one regularly each month, with leftover funds.

For September, I was up 1.17% overall, and I’m up 14.71% for the year. Continuing to plow along as I approach that magical FI moment.

Hope your September was good, and your October is even better!

Mr. 39 Months

Mrs. 39 Months Doesn’t Trust My Numbers…..

I have a wonderful marriage with a great wife who has supported me throughout 33 years of fun. I always talk about how brave she was for marrying me when I was 22, just graduating, and didn’t have much in the bank. A lot of potential, but pretty raw. We met in August, starting dating 5 months later in January, and then I proposed in May (5 months after we started dating). Six months after that, we were married and heading to Germany for a five-year tour with the US Army. Think about that – starts dating in January, and in December of that same year, she is married and leaving her family and country behind. That takes some guts (and a lot of trust).

As we have gotten closer to FI (ten months!) I have been talking it up a great deal, hitting our “number” and asking her what she wants to do once we get there. She has been patient, but not too forthcoming with her own ideas on what she wants to do once we hit it.

She finally expressed some doubts about how I had done the calculations, and if we actually would achieve FI. She is very conservative with her money (see some of my previous posts) and prefers to be 100% sure. We had gone to a retirement presentation about six months ago at our local library, and the financial analyst/counsellor who presented impressed us both. He seemed to concentrate more on the five years leading up to retirement and post-retirement, more than the “accumulation” phase that so many financial advisors do.

Some folks might have been put off (or grumpy) about having someone else go over your work and numbers, and potentially critique your information. I saw this as an opportunity to draw out Mrs. 39 Months into answering some questions, especially in terms of prospective spending/budget in retirement, travel and spending ideas for the first 3-5 years, and general thoughts on early retirement. This would be an excellent opportunity to get everything out on the table and share our views for the future years.

I went into the meeting fairly confident in my own numbers, but interested in seeing it from the analyst’s viewpoint. He had a laundry list of information that he needed, including:

No Description
1 2018 Income Tax Return
2 Payroll Statement: Mr. 39 Month
3 Payroll Statement: Mrs. 39 Month
4 Pension Info: Mrs. 39 Month
5 Mr. 39 Month’s 401K Statement
6 Mr. 39 Month’s Deferred Statement
7 Mrs. 39 Month’s IRA Statement
8 Mr. 39 Month’s IRA Statement
9 USAA brokerage account statements
10 Mrs. 39 Month’s Bank account statement
11 USAA Bank account statement
12 Mr. 39 Month’s Social Security Statement
13 Mrs. 39 Month’s Social Security Statement
14 Life Insurance (Mr. 39 Month’s)
15 Work Life Insurance (Mr. 39 Month)
16 Work Life Insurance (Mrs. 39 Month)
17 Health Insurance
18 Auto Insurance
19 Homeowner’s Insurance
20 Umbrella Insurance

As you can see, there is a laundry list of items, which shows the thoroughness of the analysis. Its going to cost us $2,900 for the analysis and four sessions (initial one, rollout of base analysis, two follow-up sessions where we deal with “what if” scenarios). The analyst also provides some annual updates for a small fee.

I’m excited to see what comes of this. Our next session is in 3 weeks, so I’ll let you know.

Mr. 39 Months

Investment Update Sep 2019 – The benefits of Asset Allocation

One of the key aspects of working towards Financial Independence is the asset allocation of our investments as we move towards FI, and after we have reached it. For many of the investment advisors we have talked with, their area of expertise is on the “accumulation” phase of investments, i.e. gaining the most and growing your investments.  This results in a larger weight towards stocks and reduced use of bonds and other fixed investments. The key with this is that if you have time, then ‘swing for the fences” and get the highest return.

But what happens as you close in on FI, or once you hit it? In some cases, folks continue to work, and so they don’t mind remaining heavily invested in stocks – as they can withstand a market correction like 2008/2009 – they just keep working and accumulating, and eventually it comes back.

However, as you get to the point in your FI journey where you are looking at the full “FIRE” reality (retire early) you start having to look at protecting what you have, and dialing back some of the stock investments. I don’t believe you should dial it back completely (after all, you could have 4+ decades to go before you pass away). This is where “asset allocation” becomes a part of your life.

For asset allocation, you determine the level of risk you are comfortable with at this time (it changes obviously as you move towards full retirement) and then determine the percentage of your investments you want in stocks, bonds, savings, and other assets. The objective is to maximize returns, while at the same time keeping your risk of major losses in line with what you are comfortable with.

As many of you know, the allocation for my retirement accounts (IRAs, 401K, etc) is pretty much index funds, spread out between the  S&P 500, small-cap, international, REITs and bonds.

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

My 401K doesn’t have REIT option, so its just 25% for each.

The folks more heavily invested in stocks have done better than me for 2019 (other than international stocks), though they did worse in 2018.

For the month of August, stocks were down (-1.6% for S&P500, 2% for international, and 4% for small cap) yet my REITS and bonds were up (+1.6% and +2.8%), so the end result for my accounts was only a -0.3%.

My dividend account allocation is:

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

So as you can guess, it actually was up 1.3%

Overall, I’m just down -0.3% for August, and still trending at +13.3% for the year. My asset allocation may not be as “speedy” as some, but it allows me to sleep as night as I close in on FI. Only 10 Months left to go!

I hope you had a good August, and your journey continues to go well!

Mr. 39 Months

Slow and Steady winds the race – Update for Aug 1, 2019

The standard story of the tortoise and the hare talks about “slow and steady wins the race.” In it, the hare runs fast, but then takes a lot of sleep breaks, while the tortoise just keeps plugging away. For the financial markets, the comment most often made is “Its not market timing, its time in the market.” The idea behind this is that you shouldn’t wait for the best time to invest, you should just invest.

There has been a lot of talk of an impending recession and market correction. We’ve been hearing that now for 6-8 years, and other than the slight “bump” in December 2018 (which the market has already moved beyond) we seem to be moving forward. My intention, like so many other folks in the FIRE community, is to stick with the plan and not deviate just because some “chicken littles” claim the sky is falling.

July was an OK month, with my investments going up 0.64% for the month (equivalent of 7.68% for the year). For the year, I’m up 13.77% overall, and this with 30% of my investments in bonds! I’m pleased overall. Down to eleven months before my FI date, if I don’t include Social Security. If I added in Social Security, we would already be at FI

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

For the month, I am up about +0.5%, slow and steady. International investments took a pounding, and bonds didn’t really move, but the REITS, S&P5000 and small caps did well. Remember that in June, International was up a lot, so its balancing out.

  • S&P500: +1.4%
  • Small Cap: +1.3%
  • International: -1.9%
  • Bonds: +0.2%
  • REITs: +1.6%

My 401K/Deferred account at work is up a similar amount, with similar returns

Dividend Income Account: Allocation:

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

This is up 0.6%, so it was similar to my other investments. Some of my dividend stocks (Chevron, Verizon) were down a little, but overall not bad. I posted a study earlier where I compared my dividend portfolio vs. my vanguard IRA – and the dividend portfolio did better over the last 3 years. I’ll keep track and keep posting on the comparison, so folks can compare.

Value Investing Account: My value investing portfolio is up around 1.0% for July, probably because it doesn’t have any bonds in it. My new ETF, Pawz, is doing about that. I’ve got 55 shares, and expect to get another 25 in August.

Again, I’m up 13.77% for the year, which equals about $133K in returns – for just the first seven months. Its more than Mrs. 39 Months and I made in salary for the first seven months, which is a good sign. We are on track and moving forward – as I hope all of you are.

Mr. 39 Months

Purging your Blogroll – Aug 2019

I’ve written before about “purging your blogroll”. As I noted then, one of the things which has always brought me a lot of pleasure is reading other FIRE blogs and seeing the different facets of the subject. It seems each blogger has a topic which motivates them, and they concentrate a great deal of energy on that topic. The result is some excellent reading and the opportunity to learn in-depth of a wide variety of topics.

It’s a sad thing that as people seem to hit FI, they take off and the level of blogging activity seems to drop. I’ve heard it said that many bloggers (and podcasters) don’t make it past six months. They say what they need to say, and then run out of ideas. When this happens, we often lose an interesting voice and set of thoughts. One of the reasons I enjoy the Post-FI blogs (near the top of the blogroll) is to see what life is like once folks hit the magic number/date.

What is nice is that there are always new people joining our community, and I want to make sure that I can include those in my blogroll (at right) so others can link to and see what they are saying. So I typically every 6-12 months do a blogroll “purge” where I clear out those blogs who haven’t updated stuff over the last 3+ months, and this frees up space for newer bloggers. So today, I’ll be doing my blogroll “purge” and trying to identify new and interesting folks for you to see.

Enjoy, and I hope you enjoy my writing and the writing of those I point out. Enjoy the rest of summer!

Mr. 39 Months

Mid-Year Update: July 2019

July 2019

Well, its early July, halfway through the year, and a perfect time to compare my goals for 2019 to what I’ve actually done, both financial and personal/other. A lot of folks don’t like to do this sort of thing, but as an engineer and amateur financial junky, I actually love taking a look at these sort of things. Even when I’ve had a bad quarter (or bad year) I like to look at the numbers and see what my situation is, and the future outlook.

Ok, I’m a numbers geek.

So how am I doing in comparison to my goals for 2017 (the ones that I listed on April 30th)?

My Goals for 2019 (some financial, some not):

  1. Put in $75,000 in tax-advantaged accounts throughout the year. Grade A. I have put in over $55K this year so far, and I am on track to put in close to $80K by December.
  2. Put in $5,000 in regular accounts: Grade A. Took my rollover from my inherited IRA and put that into my brokerage in first quarter.  
  3. Increase dividend income from our investments to $27,000/year (and reinvest them): Grade B. I have $13,298 in dividends so far this year. Going to be touch and go to see if I hit this, but I usually get a big dividend “bump” in 4th qtr.  
  4. Get Passive income up to 40% of living expenses: Grade C. I am currently at 36.9% with dividends vs. an assumed $72k annual spend. To hit the goal I have to hope for some major dividend payouts in December.  We do continue to keep our living expenses low, though we did have to spend some money on home repairs which bumped it up a bit.
  5. Beat at 6% growth rate on our net worth: Grade A. With the market upswing, we are hitting this out of the park. Looks like we might go as high as 10% increase for year, which will make up for the poor showing in 2018, where we actually lost net worth.
  6. Continue attending local real estate investment association meetings, to learn about and begin preparing for real estate investing in 2018: Grade F. I chose to discontinue this, as I was not looking to do any investing like this in the near future, and wasn’t gaining a lot of knowledge from the meetings at this time. May revisit in the future.
  7. Double number of Blog visitors from 2018. Grade D. I had 6,000+ visitors in 2018, but only 4,100 visitors so far in 2019. Not sure if I’ll hit 12,000
  8. Write/Publish HS graduate book. Grade F.  I have only written 2 additional chapters in 2019. Other things have jumped onto the radar, keeping me from working on this
  9. Fitness: Increase weight lifted by 10% over the year. Grade D. Due to work trips, vacations and other life instances, I haven’t been able to push beyond my current lifting level. Need to concentrate on this.
  10. Average 2 hours of cardio each week. Grade F. Still only averaging around 1 hour.
  11. Take part in at least one long bike ride: Grade n/a. Maybe will do MS bike-a-thon in September
  12. Backpack over 100 miles on Appalachian Trail. Grade C. I have done about 81.5 miles this year, and unfortunately, it doesn’t look like I’ll be able to do any new miles this year. The problem is that I’ve done all the trail within a 5-hour driving distance, so any additional miles are difficult to do for a weekend. May have to cut my goals for 2020 and beyond till I retire
  13. Continue volunteering at Pennsbury Manor: Grade A. Been going fairly regularly
  14. Reduce weight by 20 lbs from Jan 2018: Grade F. Haven’t lost any weight. Any weight lost during backpacking has been gained back
  15. Read at least one new book each month: Grade A. Five books in 2nd qtr. Going to read a lot more later this month at the beach
  16. Visit one national park. Grade n/a. Haven’t visited one yet. May visit the Smoky Mtn park in October.
  17. Visit Family in TN/VT/NY: Grade A. I’ve visited NY and TN so far, and plans in place to hit VT in August and TN again in October.
  18. Weekend at the beach: Grade A. Visiting the beach this month for a week. Hope to spend time relaxing instead of having a frantic, running from site-to-site vacation (our typical one)
  19. Visit Ellis Island: Again, job situation hurt this. Have never been to Ellis Island, so may try for this.
  20. Go on an international trip. Grade n/a. Wanted to do something bigger this year, but Mrs. 39 months job situation killed chances for larger trip.
  21. Visit Asheville area: Grade n/a. Plan is to visit in October. This is a potential retirement location, so this is more research.

So in looking at this, I think I am tracking well for the first half of the year. Still got some work to do (especially in terms of personal fitness).

How were your first six months of 2019?

Mr. 39 months

Re-balancing: make it regular and timely

Its July, and as folks know, I tend to re-balance on a time schedule (ex. Every six months) versus on a percentage “out of balance” where you check your investments and when they are a certain % out of whack, then you re-balance.

African elephant female and her baby elephant balancing on a blue balls.

If you remember, I wrote about re-balancing back in January, and there, I ended up selling off my bonds (and some REITs) who had been more successful (or less sucky) than stocks. The result was that I sold high, and bought stocks at basement prices. Since then, stocks have shot up dramatically, and the result has been some accounts out of balance again.

By rebalancing now, I can sell off some stock winners when high, and buy some bond/REIT losers.

My standard allocation is:

  • 30% Index Bond funds
  • 17.5% S&P 500 Index
  • 17.5% Small cap Index
  • 17.5% International stocks index
  • 17.5% REITs index

When I reviewed my numbers, I found that my S&P500, International and Small Cap stocks have shot up, and the bonds/REITs have not done as well. So I’ll be selling off about $11K in stocks and re-investing in bonds, mostly in my TRowePrice accounts. Plan is to do that work this week, so its done by early July.

Remember to consider rebalancing, so you can “buy low and sell high” yourselves.

Have a great 2019!

Past Posts on Re-balancing

Other links on rebalancing

Mr. 30 Months