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

The Long and Winding Road….

Cue the Beatles Music.

What do you do once you’ve gotten all your investments in order, your spending in control, and you have maxed out how much you can put away towards your FI goal? You have run the numbers, and now you just have to wait the 2 years, 4 years, etc. till you hit your FI number. What do you do in the meantime? I’ve seen this topic covered a couple of times in the FI blogs that I read.

I would say one of the major things people do while on the path is worry.

  • Did I choose the right investments?
  • What if there is a market correction?
  • What is going on with healthcare (primarily a US issue, but other western countries have their own health care issues)
  • Is there any more money I can squeeze out of my income to put towards FI?
  • What do I do once I hit FI? Retire? Continue to work? Move to another job?

I can say that these and many other issues continue to bubble up in my head, now that I have worked through the basic numbers and have a date – as well as quite a few others. Each of them can involve hours of going around in circles, trying to determine if the decisions made were correct. What is a more productive use of your time while you slowly wait to hit your FI number?

Here are some ideas on what you can do to occupy yourself while the clock ticks down:

Determine travel you want to do once you hit FI, and determine basic costs for it: This is probably one of the most popular ones. Most FIRE people dream of travel – going to exotic places, seeing the world, visiting with friends and family. Since most of us are research fanatics, this is a way to get your jollies by doing research and pricing stuff out. It is one of the best ways we can dream while waiting to hit our date.

Continue researching FIRE via Blogs, Podcasts, etc. to glean additional ideas (travel hacking, etc.): The FI community is growing larger every day, and everyone has their own “spin” on the topic. One of the things I love about it is that I am almost constantly learning new ideas, new thoughts on the subject. While many of the topics don’t get me closer to FI (I don’t change my plan) I do take them to heart – and occasionally I do find something that will help me.

Research potential alternate career fields/jobs once you hit FI: You often hear people talk about hitting FI, so they can pursue a career in what they really love to do. Well, while pursuing FI, why not take the time to do the actual research on the career field, so you can find out if you really will love it?

One of the best books on doing this sort of career research is “What color is your parachute.” They called it informational interviewing. You find someone working in the career field that you are interested in and ask them three questions:

  • What do you like about it?
  • What do you not like about it?
  • Who else do you know that I can talk to about it?

By doing the research, you can narrow down the wide range of possibilities into things that are more manageable, and identify career paths that looked great, but ended up not being so “sweet.”

Look for ways to teach, even for free, in order to share: There is always an opportunity to share the lessons you have learned on your path, either in FI or in your current career. Take the time to share them, through writing, lecturing, etc.

Look for additional ways to reduce stress in your life: Even as we approach FI, there are other things causing stress in our lives (family, health, etc.). As you slowly eliminate the stress of finances, look for other ways to cut the stress out of your life.

What are you doing to take up your time while waiting to hit FI?

 

Mr. 39 Months

You gotta have hobbies – sticking mouldings!

I continue to pursue my woodworking hobby, with emphasis on using hand-tools to do a lot of the work. In some ways it is slower than using power tools (ex: when doing repetitive cuts of the same dimension on a table saw). However, for most of the “one-off” items or joinery, the hand tool solution often is faster. It takes a long time to set up a machine to make a cut (initial setup, test cut, adjust, test cut again, adjust…..). When you are doing a few items with one task, it’s often quicker to just pull out a chisel, hand plane or saw, and do it.

It’s often more fun and more quiet as well. I can do this at 6am on a Saturday, or 10pm on a weeknight. I get the thrill of producing something by hand, and being able to see it in my home constantly. I urge everyone to pick up a couple of hobbies so they can improve their skills and gainfully occupy their time – instead of just sitting in front of the TV.

Most homes have mouldings in place. These are the pieces of wood around doors, edges, or places where two planes meet (between ceiling and walls, floor and walls, etc.  They are mostly used to reduce damage and wear at key points in the house which might suffer too many dings and hits. For some home styles, like Victorians, the moulding/trim was quite extensive.

The way these are made nowadays, for the most part, is by running the wood pieces through a powered machine called a shaper, or in some instances on a router table (a less-powered version of the shaper). You can often buy large lengths of specific trim pieces at Home Depot/Lowes, or get special trim pieces made by a lumberyard/specialty shop. This makes sense, because once you set the machine up, you can run large amounts over the time, and get economies of scale.

Before the age of powered equipment, the way this trim was produced was with a “sticking board” and moulding planes – wooden planes with profiles ground into them to cut the trim the way you wanted it. The joiner/woodworker would start at one end and run the plane down the length, taking off some of the wood and then go back. As he continued to run it down, the profile would take shape until eventually it reached the final version. Some wooden planes had a built in “depth stop” on the plane, a section of the plane which would prevent it from cutting any deeper once the final shape had been reached. After that, the trim would be cut to size and installed, just like it is today.

Well, I’ve recently built my sticking board (some straight lengths of wood with screws on the end to hold the wood trim pieces) and had built a cove moulding plane (the light brown item you see) and tried it out. It was a lot of fun, and some good exercise. While not really great cardio, it certainly forced me to do some walking in the shop.

I’m satisfied with the results. I intend to use it to build some frames for two posters I got on our vacation to the Redwoods and Crater Lake National Park. We’ll see what other things I can make with this setup in the future.

How have your hobbies gone?

 

Mr. 39 Months

Frugal Win – fixing your own stuff!

One of the interesting sub-plots in the FI community is the number of people actively working on ways to “out-Frugal” the next person, or as Mrs. 39 Months calls it, being “more frugal than thou.” Its all in good fun as we all travel different paths to our final destination.

When I was younger and not making as much, I often did most of the construction work around the house (deck, bathroom remodel, kitchen remodel, electrical, etc.). I had a detached garage (that flooded) that was my shop, and I tried to build minor bits of furniture (mostly bookshelves) and other things. While, one of the things I never got the hang of was repairing the items that I had. It didn’t help that a lot of the tools I had were not the best.

As you get older, more frugal, and have a little more time on your hands, it starts to be kind of fun to try to fix something, instead of just contributing to consumer culture, tossing the old one out, and buying a newer, cheap  version of it.

When we first moved in 20+ years ago, my father bought me black & decker workmate, one of those basic tools that it seems like every homeowner in the US has. Good for setting up around the home, doing basic tasks, etc. I used that thing a lot over the last 20 years (look at the top, with its paint, saw cuts, holes, etc.). About 10 years ago, one of the parts supporting the leg in its “up” position broke, and the leg just dangled after that.

It didn’t really affect the workmate when it was up, the leg was in its regular position, but when I went to set it up, or put it up, it flopped around and made the setup a little challenging. About a month ago I decided to find the required part online (found the item master list, identified the part, ordered in and got it delivered). Part and shipping was less than $5. After about 5 min of work taking out the old part and re-installing the new one, I had a perfectly functional workmate. Made me realize what an idiot I was for letting it sit like this for 10+ years.

Nothing major, no great victories, but at least one less item in the landfill, and a great feeling of accomplishment. OK, so what’s next? Maybe take apart that weed whacker that has been sitting in the shed forever…..

 

Have you fixed up anything instead of just buying something new?

 

Mr. 39 Months