PORTO UPDATE – Q2 ’20

We’re down 3.04% for the year which isn’t so bad considering we were down 22% in Q1. That was a quick recovery – one I thought would take two years. It’s almost as though it never happened. So in my head, I’m thinking that a recession is still overdue.

We’re not conservative in anyway – we’re about 87% stocks. But there’s more at stake now – a bit more money than in years past and a baby that’s brought about an increase in expenses and a decrease in income with Mrs. Gofi working slightly less. The baby starts daycare this week, and that costs about the same as our mortgage.

We increased our cash holdings this quarter to about 12% of our net worth. We sold out the non-retirement portion of Mrs Gofi’s Betterment account. It was a 70% stock allocation over the last few years that didn’t meet our expectation.

Besides, we want to keep it simple and move everything to Vanguard. So now only a part of our Roth IRA accounts are still with Betterment. We’ll move those to Vanguard too, as soon as I start working from my office where I have access to a printer. It is a poor excuse for not having done it already.

The cash holding does a few things for us. We now have some fodder in case the market dips again, this winter, should covid strike back, and after the elections.

We are also not averse to buying a single family home in the suburbs. We are currently in a 2 bedroom town home with no space for the baby to run around. Also, our town home would be our first foray into rental territory. We’d just about break-even after expenses and property management. Our initial plan was to start looking once the baby turned 3-4 years old. And that is still the plan, but should we come across something that suits us, the cash holding will help.

A rental property would also diversify our asset allocation.

Compared to past quarters, our investments in Q2 slacked a bit. Mrs. Gofi was on maternity leave so only a part of my income went into my 401K.

So what do we have?

My retirement account is 100% invested in WellsFargo’s S&P 500 tracking index fund (no ticker symbol). Mrs. Gofi has hers with Fidelity – 100% FXAIX. We have our Roth IRAs in Vanguard (100% VTI) and Betterment (pending roll over into Vanguard).

Our non-retirement investments are 82% VTI/VTSAX (82%), 10% VYM (10% ) and 8% VGT.

Our cash holdings are parked in VMMXX.

We do not have any bonds, or international exposure (other than those that come via VTSAX) at the moment. There is a case for strong home bias, but we believe the US to do well on the long run.

I am a little vary of covid, and how it’ll behave this winter. The year is already half over – and we still don’t have a remedy.

Our plan for Q3 are to continue saving as much as we can. It won’t be the same as before, but we should be able to max our 401 Ks by Q3 end. We’ll then split whatever remains between VTI and cash.

Pharma Cost, Reckless People

My wife and I decided to get her prescription of 42 Enoxaparin injections in batches of 10. The first 10 at the hospital cost us $260 – about 10 hours of work for a person making $50K a year.

A good doctor suggested we try goodrx. We tried the app and the next batch of 10 injections came for $60. We were ecstatic.

Then the other day, I went to Walmart to get the remaining 22 injections with the same coupon and I let the pharmacist know so. He went ahead and used his own app where the deal had apparently changed. It was now $60 for the remaining 22 injections.

Over a period of 3 weeks, the medication went from $26 to $6 to $2.7 per injection.

This is mind boggling. Then to think that even $2.72 per injection is most likely very profitable. I do not follow politics, but I realize why healthcare needs major revamping.

This experience reaffirmed for me the power of information. Those who have it gain from it.

But what do we make of those that don’t use information even when they have it?

People flocked inside the Walmart, leisurely and unmasked. Entire families with children, many herding to the non-essential areas.

The recklessness, selfish behavior is insulting to all the brave people who’re currently fighting to the curb the spread.

The Walmart employee, positioned at the entrance to limit the number of people entering and to clean the carts with the blue antiseptic bucket next to him, was doing neither. All along a loud speaker in the parking lot claimed to be taking those very steps, among others.

The priorities of an everyday man

Our daughter turned two weeks yesterday.

For two weeks, I woke up at 6, having woken up at least twice during the night, to begin a daily grind – prepare breakfast, move dry dishes to the cabinets, wash everything in the kitchen sink, tidy the place, help wife feed baby, prepare lunch, run around trying to find something, move things, prepare dinner, wash one thing or another through the day, prepare to go to bed, make a few more runs, move more things.

In my old life, I woke up, washed up and left for work. When I returned, I cleaned up, put something together and settled with my iPad.

My wife asks for as little as possible. But with a 3 degree tear, I’ve had to do some running around the house. At night, she lets me be except she’s hardly had any good sleep herself. But there’s little I can do when the baby wails. The baby’s inherited my appetite and temperament. Fortunately for me, my wife’s a fighter.

I’m not sure I’ve managed the last two weeks efficiently. My old life had time. I’m at the mercy of a baby now. I realize I must not allow myself to settle just because we have a baby. That I list things I must absolutely keep.

Because what gets listed gets done.

I’d like to be healthier and leaner:

  1. I’ve had a sudden urge to run ever since my daughter was born. I’m not sure why. In my head, I imagine leading a very active life with my wife and daughter. I’ve never ran, not as a runner. In fact, I didn’t think I could do distance until last year when I went from not being able to run a mile to running five.
  2. I want to bring my weight down from 175 lbs to 155 lbs.
  3. I’d like to eat less carbs, more fibers. That’d also simplify our eating habit – less time to prepare, less dishes to clean.
  4. I need a better sleeping habit. I’ll stop going to bed with my ipad.

I’d like to wealthier. There’s really three things anyone can do – earn, save and invest (ESI). All three if possible.

  1. We’ll continue towards maxing our 401ks and funding our taxable investments when we have any spare – regardless of the market.
  2. If you look at our expenses, the two areas we can curb on are on eating out and gift giving. The only time we ate out this year was on Valentines day. The gift giving is a sensitive issue for my wife. We gave away $13,354 in the last two years. That’s $556 a month. I say that’s steep.
  3. I want to side hustle, but only if it makes sense. I drove Uber for three days to realize it wasn’t worth the money and my time could be better spent.

I’d like to be very good at what I do. I have a good job. My manager is a reasonable person. My annual reviews are excellent – 8 on the 9 block performance rating – twice in the 3 years I’ve been with the company. I’m told it’s a real feat, ‘very rare’. My pay, however, has changed marginally. I feel the folks who decide don’t exactly see the level of complexities I fight to get their clean reports.

As in, I would write much shorter if I had time. And in this instance, the files are much cleaner because the demons have been vanquished.

I’m not sure if I should squeak, or be content. I’m not sure I want to risk seeking greener pastures either, not in the current environment, with a baby on board. I’m also not sure if I’ll make the same pay. I don’t have a barrage of ‘hot’ skills to list (or fake). And Rambo with a knife is just another person with a knife until we realize s/he’s Rambo.

I think I should continue working hard to up my game. My manager recently hired another person to do what I’m doing. It’s clear he wants my back up, he said so himself – and just in case.  Now the question is if he hired Rambo, or just another guy with a knife.

There’s a lot to learn and catching up to do. I lost 10 years after college to bit-of-everything-but-leading-to-really-nothing kind of ‘office’ jobs. If I didn’t think I could do a particular aspect of a job, I didn’t even try exploring the job. I wasn’t brave enough. Less smarter friends moved ahead in the meantime. I’m still not able to fake it.

We moved to Colorado in 2017 after I took the first job I got. The hiring manager didn’t know exactly what he needed, and I’m still not sure why he hired me. Fortuitously, I discovered that I was decent at the reporting side of it (it wasn’t much), and the more I did it the more I was asked of it, so I stayed in it. I also got lucky I had a good data-driven manager.

I want to push this forward and see where it takes me. My plan is to use one more year to learn as much as I can, in a well directed manner, before making a move. For far too long, I flung myself wide. I now want to do a few things well.

On that note, the list, on all things Data Science:

  1. Python data libraries and coding techniques
  2. Statistics, Data Modelling, bits of Machine Learning
  3. SQL and Microsoft power tools (Excel, DAX, M, Power BI)
  4. One YouTube tutorial everyday
  5. My only personal and regular expense is a subscription to Medium that feeds most of my daily readings. I also follow many FIRE bloggers, in print and on podcasts, to keep up with personal finance

There are other things I should really add – like improving my guitar skills and blogging more often. I’ll keep these at the back burner for now.

I’m happy that the pursuit of FIRE does not demand for much. The higher the ESI, the faster you reach FI. But a decent level of ESI does the job as well. Possibly my favorite FIRE couple is wherewebe for that very reason.

Porto Update – Q1 ’20

We’re down 22%. That would’ve paid half our mortgage – fifteen years of payments.

But I’ve been surprisingly calm. I’ve inundated myself with the FI tenet of staying the course for so long that this has yet to unnerve us. I’m not sure it will. After all, what can anyone do? The only way to realize the loss is by selling, so we stay put.

Our plan was to nibble bits of VTI every time the market dropped ~1%. That happened so frequently earlier this year that by the time the big drops came, we ran out of what little cash we had set aside to do just that. We also want to be careful and build some more cash reserves at the same time.

More is at stake now – my wife and I had our first child, a daughter on 3/27. Our greatest gift to her will be to ensure she grows up in a happy environment. We hope she grows up curious, hard working and good. While we’ll always guide her, we hope she finds her own way. Over the last few days, I’ve felt like my days of carefree living are now over. That said, the need to improve is greater now than ever.

A colleague (and his wife) recently retired after 32 years at the company. Last year, when his father passed away, he told me, he began to question why he was still working. He’s a steady, good-old-fashioned sort of a guy. He could’ve retired a lot earlier.

I am very happy for him. He managed to somehow cling on to his job for 32 years. As much as I like him, and as much as he tried, a lot of what he did required post audits.

I’m not sure if he ever truly enjoyed his work. His greatest virtue was his old-fashioned-I-can-grind-through-32-years attitude. His actual parting words to me were, ” I’m happy I’m leaving on my own terms before anyone fired me”. There was a sense of relief in his voice, as though it’d been an ordeal. He managed to somehow weather and ride all the turmoils (at work and in the market) of the last 32 years and I can only imagine how well that has probably placed him (and his wife who’s worked equally long) today.

And early too – at 58. His wife and him are planning to do lots of RV’ing once this crisis is over. There was even a trip to Italy planned later in the year. I’m guessing that’s been pushed a year or two.

I’m not sure I’d like to work till 58. I love what I do, but things keep changing. People change. I’ll probably want to continue working after FI, but not if the nature of the work changes in ways that is not conducive to my intellectual growth. I do not want to be copy-pasting, or ensuring that lines on the charts are size 5 and green.

I want to create. I think that’s what gives people most fulfillment.

So after all the diversion, what’s changed for us this quarter? Our net worth fell by 22.12%. Our allocation remains aggressive at 86% stock. Our bond position has fallen to 4.3% of our net worth. This was due to us downsizing our Betterment portfolio (and moving them to Vanguard) which gave us all our bond exposure.

We hold 9.7% in VMMXX – this is our emergency fund.

Most of our taxable investments are in VTSAX/VTI. We have smaller positions in VYM and VGT. We are 100% invested in low cost index funds and ETFs. My wife’s 401k is with Fidelity so she has FXAIX. My 401K is with WellsFargo’s S&P 500 tracking index fund (no ticker symbol). We maxed our Roth IRAs when the market was on still on it’s way up, in January. We plan to max our 401Ks by year end.

My faith in the US economy remains strong. Businesses seek growth and our positions with the index funds ensure that we get a share of it, without really doing anything.

What I’m fearful for at the moment is what the Covid-19 might do to all our older parents. Other then being home bound, our lives have really not changed all that much. We can still shop, move about, and our day to day life remains unchanged. I’m incredibly grateful to all the brave people who make this possible. The same cannot be said of other countries. Things are dire in poorer countries, and they’re basically waiting for the more advanced countries to come up with a solution. And if that’s 18 months for the US, we can only hope that the fix does not take too long thereafter to reach them.

I have always believed that if we are able to invest (as we normally would) through one good recession (as in one really bad one), it would really boost our positions. For that to happen, we’ll need to ensure we hold on to our jobs. As such, our plan forward remains unchanged: nibble at VTI every time we get a paycheck – after a bit of it has already been channeled to our 401Ks.

gofi lists podcasts that’ll change your life

I am a podcast addict. In fact, I could probably do without a smart phone if not for my podcasts. I know this because on weekends, when I’m home, my phone usually does not get any love.

I use a $15 Panasonic ear phones. I’ve used the same kind for years. The one I have right now is in it’s third year. I’m not sure I’ll ever own a wireless one, although I could totally use one. The day I own one, I know I’m either FI, or nuts. 

On that note, we own OnePlus 5 phones that we got for about half the price of a Samsung or other android brands.  

Back to my list, sometimes I wonder if I’d grasp my work and readings better if I didn’t have them on ‘all the time’. Then again, I learn a lot from them. I stay current. And my cube is not exactly surrounded by like-minded-agreeable-folks. My tribe resides elsewhere. They say you’re the average of the 5 people you surround yourself with – hence, the podcasts.

I’m not sure if any of these need my validation. This is just my way of thanking them. So, the list (in no particular order):   

  1. The Stacking Benjamins Show – They’re fun. I enjoy the wit. But they’ve got to learn to say Pant the right way – ask Paula. And may be go easy on Dave. 
  2. Millionaires Unveiled – I really, really like this show. They’re crude, but to the point – no BS. I love the millionaires who come to the show. Like Jeff, the millionaire custodian.
  3. Motley Fool Money – I’m a Boglehead, but it’s important to know what’s happening, how folks are thinking, and why. 
  4. The Clark Howard Show – He’s a little easy. 15% savings is not ‘fantastic’, but I like Clark. 
  5. The Dave Ramsey Show – I won’t cut my card, but I like Dave. I like the folks who call into his shows. But I don’t listen to the show when he’s not there.  
  6. Fire Drill Podcast – the two (now one, why?) are young and ambitious. I’m older, and I’m keen to see where this goes.  
  7. ChooseFI  – This one’s serious – the old school way. Respect. 

There are other non FI podcasts I enjoy – mostly NPR and BBC stuff. All good. See the screenshots below for the complete list.   

gofi’s fear and plans to tread lightly, but brightly

Over Christmas dinner, a friend asked me what I feared the most. I could think of many things, but most were beyond my control – my parent’s health for example. Seeing me stumped, he went ahead – being broke, I fear being broke the most, he said.

He was speaking from experience. He’d moved to Denver from NYC to be with his girlfriend (now wife) with nothing. She booked him a room at a cheap motel because her parents were not very keen. She got him a job at a restaurant – that was about ten years back. He’s a machinist now. I’m not sure what kind – but he’s now happily married with two kids, a suburban house and with enough to be financially savvy.

He’s ‘typical’ – as in the kind that eventually become millionaires.

We’ve met a few times over the three years I’ve been in Denver, and our shared interest in personal finance has secured a bond I think will last. I mentioned FIRE a few times, but did not over indulge him because he seemed in control of what he was doing – 401k plans, roth and some trading. I did tell him how he might want to get into index funds because it is just so much safer (and better) – but one really has to appreciate these things on their own. It cannot be forced.

For me, it is about asset allocation. S&P 500 index funds for stocks, some bonds and some cash reserve (when credit cards are not viable) – properly allocated.

I’ve had a few days to think over what I fear the most. And it became quite clear this morning. Of all the things I fear, I fear not reaching FI in time. The question is not if, but when we’ll get there. There are many good reasons why one may want to get there sooner than later.

To start with, it’s easier when we’re younger. It’s easier to find jobs, switch jobs and change careers when you’re young. I’ve had many old colleagues – good, honest men and women. But I do not want to be another old man in a cube. I want to be secure – and a job is just a job until it’s not. Older folks have a more difficult time finding and keeping a job. And companies don’t care that you’re old when they plan to trim down. So get there when you’re younger, then go climb the mountain if you want, or join the Trader Joes crew – whatever floats your boat.

I also want a second shot at success. I grew up with a lot of promise – more than my friends who’re now doctors, engineers, professors, even fancy civil servants. I do not envy them. I’m happy. Their success validates what hard work can do. That, some guidance, and luck (being at the right place at the right time). I also realize comparing where I am to where they are is to my own detriment. My goal is to make the most of myself. I want to be a better person today than I was yesterday. And FI is my first validation point – a proof to myself that I can grind and reach. Money is not my measure. Many late FI success stories will tell you that one of their mistakes was not knowing when to stop.

You can stop to smell the rose. Or better, delay it a bit. But not till either the rose withers or your sense of smell does.

Lastly, we’re having our first child in March which is all the more reason to pursue FI more aggressively. I tell Mrs. Gofi if she’d like to be one of those lovely ‘still-young’ ladies who participate in all their children’s activities – take them to school, to swimming practices, then go for runs in the middle of the day on weekdays.

Mrs. Gofi tells me that those would be lovely.

In reality though, our little girl will delay our FI by a few years. And few years means not just time, but all the uncertainties that those years may bring.

We’re expecting our savings rate to fall by 50% in the next few years. Mrs. Gofi will need to give up a quarter of her working hours because a full time day care is out of question for us. Even the part time daycare that we’ve decided on is like a second mortgage.

To lower our expenses, we’ve decided to cancel all vacations till it starts making sense to the girl. We’ll significantly cut down on restaurants and gifts. That should save us about $6K – nearly half the part time daycare cost.

I know we will eventually reach FI. The goal was to reach FI by 2026 i.e. to have enough to not worry about our jobs. I’m not keen on retiring – I would be bored if I didn’t do anything. 2026 though seems a little ambitious at the moment – but if we need to add a few years, it will just those few years and not one more.

Mrs. Gofi likes reminding me that our girl will bring her own luck when she comes. I’m looking forward to that – and to becoming an awesome father. She’d run wild in the rain, and laugh at me for falling in the mud. That, dear friend, is the plan.

what gofi has in mind for 2020

Perseverance, guts
because anything worth doing is worth doing well
I’ll keep learning, because the summit will never be in sight.

And that’s ok –
I’d like to be smart, in all ways, in the best of ways.

I’d like to be healthier
cut down on sugar and chips, fast intermittently
sleep enough, salads and fruits
walk, exercise, perhaps even get back to sports
shed ten pounds to get to 155 by year end.

I’d like to be great at what I do
more python – machine learning even
dig deeper into excel – dax and M
and I must make room for SQL, may be GIT
there are techniques and statistics to open to
I need to dig deeper and spread wider – both,
It will be difficult but it is necessary.

I’ll need to write more, read more,
make new friends and call on old ones,
rebuild bridges that were once so strong,
and move on from those that shouldn’t matter
the Joneses must be let go.

I’ll love my wife, my parents
I’ll smile, I’ll listen
I’ll sing, pick my guitar,
learn to sketch
cause I have that feeling I’d be ok.

I must make the most of myself
because there is just so much
that to waste any of it would be tragic
and because there’ll always be more for next year
It’s time I build steady steps.

 

***

Past Goals: 2019, ~2012 (I think)
And some inspiring quotes to go with those.

Porto Update – 2019

Happy New Year, Friends. If you didn’t make good last year, you probably did something horribly wrong. Reflect back on the gaps that need filling, and understand where you erred, and why.

We trailed the S&P 500 – 22.44% to 28.88%. For the first time, we made more from the market than we saved. The trailing has to do with our allocation having some bonds and cash, and not being 100% stocks.

We averaged $467 in monthly dividends – which is nice just knowing even though we’re not exactly dividend investors.

We saved almost the same amount as we did last year. We earned slightly more this year, and used that to make some extra mortgage payments, and fund a ten day vacation to London and Paris in June. Despite our frugal ways, I think our $72,463 annual expense is very high. But take away housing expenses and our expenses look rather impressive. Our non-housing expenses add up to $37,281. I’d say that’s pretty swell. Only our gift making and recreation expense need some curbing in 2020.

Our plan in 2020 is to max our Roth IRA and 401K accounts, and invest remaining funds to our taxable accounts in VTI. We will continue to push small amounts to VTI every time the market falls ~1%. Our taxable investments are now fully parked in VTSAX / VTI and VYM. I am tempted to look into VGT, but I think that ship has sailed for now.

We are 100% invested in low cost index funds and ETFs. Our Roth accounts are in Betterment with a 90% stock and 10% bond portfolio. We plan to open Roth accounts in Vanguard going forward. We hold S&P 500 tracking index funds in our 401Ks. Our emergency fund is in VMMXX and good for 3-4 months. But we want to add one extra month’s expense in my wife’s checking account because VMMXX is not immediately available.

Our asset allocation currently stands at 81% stock, 6% bonds and 10% cash. The remaining 3% is unclassified (but you could dig into it if you’re using personal capital).

Lastly, we are having our first child in March so we will alter our plans accordingly. We will try to commit to our strategy of living on one salary and saving the other. But Denver has high daycare costs, and my wife will not be able to work has many hours as she has in the past. So I’m not sure if this will hold. But thanks to our pursuit of FI, we’re better placed then we would be if we hadn’t pursued FI.

I didn’t think I could run

One of my goals this year was to run a mile without break.  I was always fast. I played soccer growing up. But running came to me in burst. I could never do distance or time. I’d spend an hour on the steps or the elliptical easily but on the treadmill, I’d just walk. I thought it was a combination of my flat foot, shin splints and genetics. I’ve since discovered I do not have flat feet.

I ran a mile without break for the first time on 9/17, and 2 miles on 9/23.

9/23, 2 miles / 25 min.

I ran 3.5 miles yesterday – 45  minutes  non-stop.

9/28, 3.5 miles / 45 min.

And today, I ran 5 miles. I have never been able to run more than a few minutes. Today I ran for more than an hour. It is an incredible feeling. The trick was to run slowly. In the past, I’d go 9/10 speeds right away and immediately get tired.

I think it helped that I didn’t eat before running. I ran around 11, on an empty stomach – other than 2 cups of tea. I also began by walking the first 5-10 minutes and not rushing to high speeds. I ran between 5-5.5 for most of the run, before increasing slightly towards the end to reach the 5th mile before the treadmill stopped.

9/29, 5 miles / >1 hr. 

Porto Update – Q3 ’19

We’re still decent YTD – up 13% to S&P’s 18.82%.

Our stock to bonds splits at 80% to 7%. Our holdings continue to be in index funds – VTSAX/VTI for our non-retirement/taxable accounts and US Stock Index Funds provided by our 401K providers – these will not change. We increased our cash reserves (VMMXX) to a healthy 10%. 

We maxed our 401Ks in Q3. We’d maxed our Roth IRA accounts earlier this year. For the rest of the year, we’ll contribute to our non-retirement accounts, splitting evenly between VTSAX and VMMXX.

Non-Financial updates:

I set a few goals at the beginning of the year. I try to learn something new every day – these are usually minute, but compounding works with knowledge as well. 

I picked up Python in March, and immediately started applying it to my work. I’m happy with my progress and I could not part with it now. I continue to hold on to Excel. I think it is the most underrated of all data tools,  and underrated mostly by those who have either not used it or know how powerful it is. Often things that look easy are discounted. I will always be grateful on how it has opened a whole new world to me. 

At the start of the year, my wife and I decided not to pay for gym since our neighborhood has some nice parks to walk around. I also started walking to work (2.5 mile one way, 5 miles a day). But that started to be a little inconvenient (walk in the sun, change in office, etc). So I joined a gym and I’m very glad I did. There is a lot to be said about being in the right environment.

Update: 9/17, I ran a 12 minute mile non-stop for the first time. 9/23, I ran 2 miles / 25 minutes for the first time. I was always a fast runner, but I could never do the distance and/or time. I realize I just need to run slow (for now). 

A few things are still amiss – I’m still not blogging enough. I’m not side-hustling, writing, playing the guitar or a sport. I used to do all these. I need to re-start these. 

In the end, I want to make the most of myself – not because I want to be better than someone else, or make more money. These are a lot sweeter when they just happen. There will also always be people better than me and keeping a competitive mindset is ultimately unhealthy. 

Porto Update – Q2 ’19

Our YTD numbers look good. We rode the market that’s up a magnificent 18.25% YTD. While our 13.57% YTD increase still trails by 4+%, we’ll take what we got and carry on with our Bogle ways.

Our stock to bond split stands at an aggressive 83.18% to 7.91%. Almost all our stock holdings are in index funds – VTSAX/VTI for our non-retirement/taxable accounts and US Stock Index Funds provided by our 401K providers (WellsFargo for me and Fidelity for Mrs. Gofi).

We have smaller holdings in VYM and Betterment (70%-30% split). All our bond exposure come via our Betterment allocation.

We hold 6.35% of our net worth in VMMXX – this is our emergency fund. But we’re willing to use it sparingly whenever the market’s down a percent or near abouts.

We maxed our Roth IRA accounts earlier this year. We’ll max our 401Ks mid-way through Q3. Once those are done, we’ll contribute to our non-retirement accounts, splitting evenly between VMMXX and VTSAX.

Non-Financial updates:

I want a side hustle. I’m not quite sure how to go about free lancing, and I’m not convinced if Uber’s good on the long run. I want to build on the skills I have, build an intellectual wealth that’ll help me at my work today, and something I can consult or freelance in the future.

While I see value in doing something that is completely unrelated to work, I don’t want to stretch myself thin at the moment. I want to do a few things, but do them well.

I haven’t been very good at blogging either – because better (and motivated) bloggers have already communicated all aspects of FIRE, from all possible angles. For now, I keep this blog to log our progress (expenses, dividends, personal goal).

I’m hoping that someday I can re-direct gofi.io into something more eager and engaging.

Porto Update – Q1 ’19

If you’re a Boglehead, you’re probably up 10-13% YTD. We continue to track the S&P 500 through both our retirement and non-retirement accounts. We trail the market by 3% — 10% to the S&P 500s 13%. Our stock to bond split stands at 79% to 8.81%. The rest sit in VMMXX that we call our emergency fund.

Our retirement accounts hold US Stock Index Funds provided by WellsFargo (for me) and Fidelity (for my wife). We maxed one Roth IRA account for the year and will max the other by year end. Betterment holds our Roth IRA accounts and our allocation is split at 90% – 10% (stocks-bonds). Given these are retirement accounts that will remain untouched for a few decades, we are comfortable with the aggressive split.

Our non-retirement (taxable) savings is primarily in VTSAX. We have smaller holdings in VYM and Betterment (70%-30%).

All our bond exposure come via our Betterment allocation. 

Our plan forward is to max our retirement accounts again. Then split the rest between VMMXX and VTSAX.

Porto Update – Q4 2018

Happy New Year, Friends. We hope you had a wonderful 2018 (despite the recent slip) and hope future years are steadier.

As for us, we were diligent savers this year. We lived on one income and saved the other (more or less). We maxed both our Roth IRA and 401K accounts, and while we don’t reveal our numbers, this one’s easy to calculate: $48,000.

We looked well set to exceed our savings goal for the year before the correction (?) set in last month. According to Personal Capital, we’re down 6.63% for the year (which is in line with S&P 500 that fell by 6.24%).

We didn’t sell – we’re not going to. We did, however, pull away from investing to start an emergency fund (VMMXX) earlier this year.

Our plan forward is to max our retirement accounts again next year. Then split the rest between VMMXX and VTSAX.

Our stock to bond split stands at 77.6% to 10.4%. All our bond holding comes via Betterment (see stock to bond split in the picture above). Almost all our funds are in low cost index funds (allocation breakdown is also in the picture above).

what gofi has in mind for 2019

A sharp mind and a healthy body, in short. I’ll walk, read and write.

In 2019,
I want to be able to run a mile without break, be leaner than I am
We’ll hike, the Mrs. and I – 3 14er’s the goal
We need to learn to love the outdoors.

In 2019,
I want to be great with Data – DAX, M, SQL, Excel
and end the year with some degree of comfort in Python
I want to be creative and unafraid

I also need to read. I read 12 books this year – I need to up that by a few more.

I certainly need to write – a story a month to make it to 12 by year end and call it my first book.
I finally have a story that ends.
I’ll write it in the spirit of Rule 17, Principles of Composition, The Elements of Style by Strunk and White: “Omit needless words” (I’ll need to follow the grammar as well).

All through,

We’ll FIRE along, as true Bogleheads
We’ll make more friends, call on old ones, and be closer to our families.


In queue for next week, Q4 portfolio.

The hair of the dog (that bit you)

The remedy, Mrs. Gofi exclaimed, is that I give it a shot.

For all our growing years, most of us know what it is about us that makes us, us. Few fortunate folks are tall and slender. A few look intelligent, which is a real tragedy when they’re not. Few look scarred, in a raggedly sexy way. Few look honest, and a few unfortunately don’t.

Of course you judge to you own peril.

I am, and there’s no other way to put it, sort of round. I am ethnic and round. Some may say quite correctly that I eat well – which I do. It is my favorite hobby.

And I have wonderful, full hair. The genes seemed to work out a better blend for me. My parents have thick and dark hair.

And they grow thick and fast.

I absolutely detest my monthly trips to the local Great Clips. It’s really not great, or local for that matter. $20 a month can feed a family of four for a month in some parts of the world. Or if only Colorado Public Radio also gave hair cuts, I’d gladly take two a month. They keep asking for contributions and they sound like they’re talking directly to me. I’ve free ridden for far too long that it’s making me feel a little guilty.

May be I give it a try, my wife has mischief in her voice. Some secret malice even.

I’ll show you what you get on a stringent budget, she’d say, but does not.

How hard can it be? I’ll youtube first, don’t worry.

She’s actually pampered, Mrs. Gofi is, I tell you. If I could just stop talking about FIRE and all it’s possibilities, she wouldn’t think we’re keeping it tight – which we really aren’t.

But I am a true believer. I walk the talk. I’m prepared to let her have her way (because that, my friend, is almost always the right way).

We’ll see some action this weekend, when the garage is warmer. Unless of course you can chip in <figure out a way to insert a paypal donation link here>.

Where we are on Kids

We are in our mid 30s and we’re thinking of kids. In many ways, it’s looking like writing a paper a day before it’s due.

This is the year to have one if we want one, my wife tells me.

I’m not sure about next year, she says.

She would know. She’s a neonatal nurse.

But I’m not sure why we need kids.

I know we’d be incredible parents, if that’s reason alone. The kid’d have a great childhood, and if she’d be anything like her mother (I’d like a girl), she’d be pretty cool, and incredibly good looking (everyone sort of is thesedays). May be that’s reason enough.

I’m hesitant. I’ve been unsure for months. For one, my parents haven’t really put any pressure on me. They did, on my brothers, and they gave them four grand children.

I’m sure they haven’t forgotten me? But I don’t want to ask them.

I think of my friends who have kids. Two of my more recent friends do, two each. They’ve followed the typical template – get great education (phds), work work, marry well (phds), keep working, then kids (two at least, bang, bang), keep working, retire at sixty, play with grand kids.

Now that doesn’t look too bad. May be a little tiring just thinking through it. And if you’re impressed by their phds, don’t. It’s like choosing the most difficult route to climb a mountain when we (the FIRE tribe) know better.

But that’s coming from someone who does not have those credentials (so sometimes disgruntled). And who’s to say what experiences we’re after. It’s the journey, they say, and the sweat is always more uplifting, more lightening. Comfort and growth don’t go together says Ginni Rometty, and she must know.

But she has no kids.

Of my classmates from high school, only five have kids. A few aren’t even married. We’re all in our 30s. Surely they know what they’re doing. They’re all incredibly smart. The girls, in particular. All of them.

I think of my cousins. And some of them aren’t married either.

Surely I’d be okay.

When we’re old, I’ll look after you, I’d tell them.

In that, I’ll call on you, I clarify.

You do the same. Can we make a pact?, I’d tell them.

Please sign here.

We’re of one blood. Or close enough. We’ll even move to New York (or Toronto). New old folks in cold cities. Now that’d be something. I tell my wife she must start preparing.

Can you learn to start enjoying hot tea?

On our drive to the mall yesterday, my wife asked about adopting in the future. We’d always spoken of it, but this felt like an alternative.

I felt a sense of relief.

I’m not sure if I’m being fair. My wife deserves everything that she wants. If she’d push me just a little harder, cry, make a scene, beat me – may be that’ll strike some sense.

Or may be not – I’m not sure.

Porto Update – Q3 2018

We are a two income household. We try to live on my income and save my wife’s income.

We’re looking to max our individual retirement accounts for the first time this year. We maxed our Roth accounts early this year, and will max our 401K next month. In all fairness, this is only the third year where one of us have had a 401k account.

We make average salaries (we are a regular office dweller and a nurse, in a fairly expensive city). So meeting all expenses on one salary is not feasible every month. We also make generous gifts to our families.

Setting a savings goal at the beginning of the year has helped us stay in line. We’ve completed 80% of our goal so far and are likely to surpass it by year end.

We plan to continue funding half of our investable income into our emergency reserves (VMMXX) and the other half in VTSAX (and VYM). We want to “always be investing“, while also ensuring we don’t have to sell those should the economy turn south.

We also want our emergency fund as a down payment on a rental property if, when the economy turns, we’re both holding on to our jobs (and are relatively comfortable) and property prices fall.

Our Stock to Bond split remains unchanged at an aggressive 80% to 10% of our net worth. Almost all our funds are now in low cost index funds – see Vanguard and Betterment allocations below.

Jeff, the Millionaire Custodian

Jeff’s obviously frugal, but the guy’s bright in the best of ways – rooted to the ground, and fully aware of where he stands and where he can be. Jeff confirms the basic FI tenets – always be investing, in low cost index funds, keep them there especially in the worst of time and be true to yourself and to the world. 

Listen to the him speak on the Millionaire Unveiled podcast.

Another similarly admirable guy is Ronald Read.

Bullshit Jobs (I’m yet to climb my mountain)

This one’s wonderful – NPR’s Hidden Brain on BullShit jobs

May be why we have open offices, and hypocritical (of me) to post it on a Tuesday morning. But I actually wrote this yesterday 🙂

I’m all for efficiency – and I’m learning to space my work a bit. Weather it does anyone any good in the office (of the regular kind) is a purely subjective matter. Suffice to listen first, then act on it. Best to be efficient but refrain from burning down.

It looks like you have bandwidth this week – may or may not be a good thing coming from my manager this morning.

What do you say?

While I’m (sort of) settled now, my take was this once:

A new bout of existential crisis
amidst my labor
that is not entirely misplaced
nor entirely misguided
treads slowly still.

A reformation is overdue,
no, not doctrinally –
but to accept and surrender
may be the truth.

Or not –

I’m yet to climb my mountain.

Seriously, Amundsen –

My themes these last few days have been rather serious –

Passion
Akira Kurosawa’s Seven Samurai
Aging
Dr. Una Kroll

I came across Ernest Shackleton last week. I spent the entire weekend reading on the heroic age of Antarctic Exploration. And how incredibly they lived – then Roald Amundsen and Robert Scott. Their struggles, and that of their forgotten men, their will to plow through enormous obstacles, and their losses unmask of our own inherent, often hidden strength to traverse our personal journeys – to FI.

Our introspection never end.

On the parking lot of our remote library sits a solitary truck with its driver nowhere to be seen. A beautiful older woman browses through books on a Monday morning. My socially affluent friends on Facebook jump on beaches and travel to places like Azerbaijan on their weekends. The wife of a childhood friend abandons him for a smarter guy.

We make our strides towards FI. It is a wonderful diversion while we’re at it – call it Karma, instant Karma. No rebirth required.

On a more serious note, an unexamined life is not worth living. I’ve decided to examine my life on Saturday mornings, and focus on implementation on other days.

Fire in the belly

A small town could steal a life. Dennis is a small town man. He’s lived in one all his life. He’s been to Florida a few times. New York is just a day away, but he hasn’t really felt a need to see it. He tells me that he’s never been on a plane.

Dennis is a good man. He takes care of over two hundred units. Mine is one. He works all the time, gets no holidays or insurance from his work. He tells me he paid over six thousand dollars the last time he went to a hospital. That he took a beating on that one.

I ask him why he isn’t the property manager. I’m not good with numbers, he tells me. I suspect he never had fire in his belly. He’s never needed it. He’s hustled all his life, uncomplainingly. I guess he didn’t think it was a big deal. I guess he just didn’t see it all. A small town can do that.

I’ve never had great fire in my belly myself. I am efficient in my ways. And there were things (and there still can be) –

“With the things you could do, you won’t but you might
The potential you’ll be that you’ll never see
The promises you’ll only make” (Between the Bars, Elliott Smith)

I feel a small speck of some fire lately – in a light sort of way. I hope that I have the hustle for it.

You see, – I’m an idea man, a story man, a man with a song,
on Whitechapel, the hero turns the light switch a 150 times
I have my own creations –
I check my locks and gas – should they move, but how?
spit, lightly, 4 sets of 11s when I pass a cross on the road
a good 3 set needed, but I do the 4th to back the first 3, just in case
I kiss my wife 4 sets of 11s as well

I can do without these –
You see, I’m a steady man, an incisive man, a man with a mind.

This is what I have

Exhibiting FI qualities, by circumstance and design, circa winter 2012.

Remember that not getting what you want is sometimes a wonderful stroke of luck – Dalai Lama.

******

This is what I have

On a hard floor lifted by air
a sock here, a sock there
and three bananas on a red bag

In the freezer,
frozen noodles and dumplings
a fist of bok choy and two large red onions
and thank god for the frozen gyozas
and eggs and cheese and coffee
and a loaf of bread and oranges, if only someone would peal them I’d eat them.

In a rather large closet (the largest I’ve ever had)
stands a wicked, full length mirror that makes me look real sleek
a bottle of complete multi-vitamins,
more noodles,
three formal shirts, three formal pants,
t-shirts, towels and more socks
an oversized jacket, two sweaters
two tight jeans, and a new yellow corduroy pant I got yesterday to wear this Friday –
and hopefully when I see the girl, whenever that happens, where ever
O’ destiny, please intervene – and make it a lovely girl please – lovely eyes, slender fingers and all
a heart of gold, real friendly and happy to complement my sometimes somber fallings
A pair of boots, three times more expensive than the most expensive I ever bought before I bought it –
my old and faithful tennis shoes, and the converse I never thought I’d wear
one never knows what one may, will,

And the laptop and the iphone that have been the best of friends
my light in the dark –

And of course, the mind that is in two roads,
one in bhakti, devotional surrender,
the other in fighting through it all, no submission.
There’s victory either way
and how wonderful is that
that I have a choice,
that wisdom and experience is a blessing
and my scars only end up looking edgy
and real sexy.

everyday life must do

I made this list a few years ago. Here’s where these stand today:

  1. No podcast at work: I listen all day. They keep me in line with all that’s there, or was, and stirs the mind. I’ll list my favorites on a separate post soon. Some of the FI podcasts I like are here.

  2. Low carb, greens, fibers: I love greens – cooked, not raw. But I need to get better at it. You see, I really, really like meat.

  3. Calculus, Modelling, stir the mind, Betsy is an old programmer for god’s sake: This one’s ongoing. The idea is to stir the mind and to keep learning. I’m keen on becoming better at working with data. I’ve sort of started learning Pandas on Python.

  4. Put phone away at work: This one’s easy. I don’t have any social media apps on my phone. My phone is for podcasts, messaging my wife and talking to my parents.

  5. Read – no more fiction: I’ve read seven books this year. I’ll list them on a separate post. I spend much more time reading online – some FI blogs I follow are here.

  6. Listen to one good song everyday – get inspired: This gets me nostalgic, and I think of all that could’ve happened.

  7. Sing a few times a week, to cleanse the internals: I don’t play the guitar often enough. I’d love to get better. I finger pick.

  8. Run, run, run – sweat it out – feel light, the skin must glow again: I used to be athletic. I haven’t played any sports in two years – partly because we moved to Denver and we had other things to do. I do not have any excuses now. I bought a rowing machine last year that I need to start using. I rowed for a half hour this morning, and will row a half hour everyday.

  9. Smile, thank you, please, everyone, absolutely no bars, but restrain and take it slow and steady: This is inherent. I intend to be good in all ways. I read sometime back that you are what you are at 40. So if you’re a grumpy man at 40, that stays for life. I’m still a few years away, but I’d like to take a happy man forward.

  10. Sleep deep, enough and a little more: I need to work on this. I’m usually in bed by 10, but I watch YouTube on my IPad to sleep. I’m replacing that with podcasts starting today.

  11. talk clearly, cleanly, slowly enough – express, express: I’m a sucker of folks that barely speak, and gifted with silence in return so that they’re heard. Now that’s respect (and power).

  12. a paragraph every night to clean the soul, unburden and go lightly to bed: I should start writing everyday. To think one can (if one ever could) and to actually be able to are different. I need to keep practicing.

  13. finance, other plans, lay it out and patiently move forward: Yes, this one’s done – hense gofi.

And now these:

There’s a lot I want to do.

Get the gruff – but the love handles need to go first.

Write, but my days of melancholy have vanished.

Ditto for my songs.

And Sports.

Be awesome at work – everything seems to be possible.

All to bring out the magic that a mind is. 

“I am a true laborer: I earn that I eat, get that I wear, owe no man hate, envy no man’s happiness, glad of other’s good” – Shakespeare.

Random Quotes

Some random quotes saved as draft many years back. 

  1. Edna O’Brien: I think by nature I am lonely, in that I wouldn’t be a writer if I were not lonely. I think most writers [are], if you read their letters and sometimes read some of their lives. I’m not recommending it, but I know one has to be — to remain writing, not just to start as a writer, to remain faithful to it — one has to live so much of one’s life alone. And reflective. Certain people, I think, are kind of born lonely. I can tell lonely people when I see them, and I’m very often drawn to them, because I feel that they might have some secret to tell me.
  2. A hindu poet on Struggle: For one to see heaven, one must die oneself. 
  3. Einstein: A quiet and modest life brings more joy than a pursuit of success bound with constant unrest.
  4. A BBC Podcast: Inspiration comes from knowledge.
  5. Newspaper article: His thoughts and actions were one.
  6. An aunt: You don’t want to climb a mountain if you’re not going to reach the top.
  7. Ahmet Rasim: The beauty of a landscape resides in its melancholy.
  8. A friend – we must remain true to our values regardless of where society goes.
  9. Nature of Existence: A Chinese guy: Happiness comes from Hard Work.
  10. Kahlin Gibran: The deeper that sorrow carves into your being, the more joy you can contain.
  11. T.S Eliott: Poetry is not a turning loose of emotion, but an escape from emotion; it is not the expression of personality, but an escape from personality. But, of course, only those who have personality and emotions know what it means to want to escape from these things.
  12. Humboldt: I am more and more convinced that our happiness or unhappiness depends far more on the way we meet the events of life, than on the nature of those events themselves.
  13. HG Wells: I can’t bank on religion. God has no thighs and no life. When one calls to him in the silence of the night he doesn’t turn over and say, “what’s the trouble, Dear?”
  14. Florence Nightingale: To-day I am 30 – the age Christ began his mission. Now no more childish things. No more love. No more marriage. Now Lord let me think only of Thy Will, what Thou willest me to do.
  15. Epicurus’s idea of “the good life“: It is impossible to live a pleasant life without living wisely and honorably and justly, and it is impossible to live wisely and honorably and justly without living pleasantly.
  16. Robertson Davis: A happy childhood has spoiled many a promising life.
  17. A friend: Where does the faith come from, he asked … From events that seem life shattering, but a boon in retrospect
  18. Dalai Lama: Remember that not getting what you want is sometimes a wonderful stroke of luck.
  19. Maya Angelou: There is no greater agony then bearing an untold story inside you.
  20. Kahlil Gibran: Out of suffering have emerged the strongest souls; the most massive characters are seared with scars.
  21. Unknown: You’ll waste a lot less time worrying about what others think of you if only you realized how seldom they do.
  22. Albert Camus: To be happy one must not be too concerned with the opinion of others. One should pursue one’s goals single-mindedly, with a quiet confidence, without thinking of others.
  23. Unilever: Humility to create awe
  24. Our Idiot Brother: I like to think that if you put your trust out there; if you really give people the benefit of the doubt, see their best intentions, people will rise to the occasion.

Porto Update – Q2 2018

Our stocks to bonds split stands at an aggressive 81% to 11%. We started an emergency fund (VMMXX) late in the quarter. We will continue building it up until it equals a few months our expenses. This has temporarily halted our non-retirement investments. We continue to contribute towards our 401K and should max those by year end. We maxed out our Roth accounts a few months back.

Our expenses continue to be quite high to my liking. There’s not much we can do to cut cost, other than moving someplace cheaper. That is unlikely at the moment.  

Uber’s not for me

I drove Uber for a few days last year – just for kicks, and quickly realized my time was better spent elsewhere.

I drove for 8 hours, spread across 4 days and made $151. Shockingly, only 3 of the 17 riders tipped.  The tippers included a nice lady from New Mexico, a younger woman from Connecticut, and a young accountant from Ohio. Non tippers included seemingly well to do professionals – two consultants in suits, start up guys, hipsters, and IT consultants.

I’m not sure if Uber makes any sense for drivers who use their personal cars. 

Porto Update – Q1 2018

Asset Allocation, Q1 2018  (as of Apr 18)

The spread between our taxable and tax-adv accounts currently stand at 61% and 39% respectively. Since we will not be accessing our tax-adv accounts until later in life, we are comfortable with this mix at the moment.

Our stocks to bonds split stands at a moderately aggressive 83% to 12%.

We hold a few stocks in our Merrill Lynch Edge account, which we mean to liquidate over time. We recently filed our taxes, and took the opportunity to liquidate some of it to pay our taxes. We’ll probably do the same next year.

We also had replace some appliances (washer, dryer, refrigerator) which were all over 12 years old.

Our 401K accounts hold target dated funds (2040 and 2045) even though we’re looking to “retire” a lot earlier. Since we will not be using it until we’re 60 +, we  figure it’s best to keep it stock heavy. I’ll be 58 in 2040, so this is actually not quite as aggressive. My wife, of course, has decided to always be thirty.

We have a tendency to move spare funds to one of our investment accounts. So our emergency funds are almost zero. Then again, smarter folks have agreed.

 

Asset Allocation, 2017 – Year End Update

Our allocation was passive (and automated) through the year. We did not max our 401(k) and Roth contributions. But we managed to save all of Mrs. Gofi’s income. We plan to continue living on one income.

We use Personal Capital to track our personal finance. According to Personal Capital, our investments gained 19.46% in 2017 – this is in tandem with the S&P 500 which gained 19.42%. Our stock/bond split currently sits at an aggressive 83% to 12%.

 

 

Conversations with Mrs. Gofi

Do you want to go the mall tomorrow?

Sure, it’s been a while.

Great, it’ll be fun. But lets not buy anything.

I know. Next time don’t say it before we go.

(We actually don’t keep it too tight. Just in case you’re curious, out clothing expenses are included in HomeExp. We averaged $434 a month this year, which isn’t too shabby I say. That included a refrigerator, a washer and a dryer.)

***

My sisters are visiting us over thanksgiving.
How long are they staying with us?
Three days.
Can they sleep on the floor?

***

I’d like to set aside some money for when I go out with my sisters, she tells me.
That, sexy girl, has to come out of the 2% we’ve allocated for recreation. You can probably go out a few times. Choose wisely.
Can you take them to the Chinese buffet?

***

Would you do this if you had a million dollars?, asked my wife as she came home from work this morning.
Yes I would, I tell her. I’m staring my the spreadsheet.
How about ten million?
Yes, I would.
I’m going to sleep now, you incorrigible boy.

 

The Alternatives –

 

My wife had a conference call with her sisters a few days back. Someone they know had recently made good on Bitcoin and was celebrating in Hawaii.

We could’ve been in Hawaii, she tells me.

We could’ve paid off the house.

Looking back, I’m not sure if missing the bull was all that bad. If I had struck gold when I was younger, I would probably not have been what I am today.

I would not know who my true folks are –

I’m wiser today. My resolutions (on people and events) stand on firmer ground today. A few things are important to me. Those are honest and must be met.

That said, we reached our financial goal for this year earlier this month, and we want to walk with the times (we don’t want to be left behind – which, by the way, was also the reason why I joined the lottery pool in my last job).

This is our gold rush – We’re mining on CoinBase and Bittrex.

The need for relevance killed Gatsby, not love –

I read of Huntington Hartford of the now defunct A&P supermarket this weekend. Leading me to Hartford was an article that implied how inheritance and windfalls generally make less overall good to the inheritor (and by extension to the world) than to those who’ve accumulated their wealth over a long period of time. The grind and toil are necessary if anything is to become of the wealth.

My personal observation and experience confirms this. I’ll start with a disclaimer: I am an Asian. I have many relatives who went to the most expensive international schools, then to colleges paid for by their parents, all while living an Instagram lifestyle in houses paid for by their parents.

“A happy childhood has spoiled many a promising life” (Robertson Davis) that by the time they come to their senses (a full thirty, sometimes forty years later), there’s a supposed shame and embarrassment of starting at an entry level position. That the first step must be taken to reach the second is missed on them.

Contrast that to my Tibetan neighbor – thirty-two, registered nurse, owner of a nice townhome (on a fifteen-year plan, 20% down), but also a refugee, who shielded his younger sister from bullets while on their escape to India through the Himalayas. Once a yak-herd, he entered his first classroom at thirteen, and is now an accomplished nurse.

He defined himself in humbler ways than did my privileged relatives who had a “sense of entitlement”, and so prospered over time. His younger sister, he ensured, also became a registered nurse.

All that aside, the guy’s pretty hip – drives a Subaru. He recently left for India to see his mother after nearly twenty years.

Theirs is a confirmation that the American dream is alive. Why the same can’t be true for everyone else most certainly has to do with the different ways we live and the perspectives we keep. “The most massive characters are seared with scars,” said Gibran – talking of people much like the Americans that saw through the great depression and made successes of themselves.

I grew up in one “Asian” country that does not do working while in school – and you wouldn’t be in school if you were poor. There’s a clear class distinction. Over the years, the internet has drastically changed perspectives, and made the world more homogeneous – but the idea of waitressing is still frowned upon. There’s a family name to uphold.

Just the other day, I wrote about my $35 wedding, and my mother’s insistence on a “real” wedding. I do not blame her – it is difficult for her, especially since my parents are still part of a community where the Joneses must be beaten, in more glitter.

This is how marriages in my community has evolved in my lifetime – the first wedding I remember was my uncles. I was about ten. There was (and still is) a reception hall in town where everyone got married. Weddings were a communal event. Every wedding had the same people, and the same food. The same men got drunk. 

That changed when few marriages moved to hotels, and to five-star hotels. The precedence was set. Now everyone who’s anyone marries in a five-star hotel. Often times weddings are held on separate days, for the different sets of guests – the subtle placement is not missed on any of the guests.

I left my community for college many years ago. The years and the distance has steered me towards ways that made sense to me.

They no longer call on us – my mother speaks of an uncle, who for years circled around my parents.

Money dictates – she tells me. I feel for my parents, once prosperous, now decent, but on lower rungs to their peers – financially middle class, socially upper middle.

Sensing that it bothered me, she adds: These don’t bother us. You remain humble and steadfast. These will change as well.

I believe my mother’s calm conviction, and I sleep well that night. My parents are wise to realize they shouldn’t be bothered. I want my parents to be immune even to inconsequential prangs like these. I want my parents to be relevant, even in the superficial ways I don’t adhere to.

For myself, I try to cultivate my belief that there is more to life than my relevance in my community. Our pursuit of FI helps our cause – our true calling is to the greater good of more than ourselves, in our own small ways. That will define who we are, and our relevance in the truest.

In the end, the need for relevance killed Gatsby, not love. 

Our $35 wedding needs more telling –

My sisters are visiting us over thanksgiving.

How long are they staying with us?

Three days.

Can they sleep on the floor?

**

Earlier this week, we documented our $72 K savings goal for next year. Our plan is to max our retirement accounts early, then hit our taxable accounts. We’ll be on a tight budget, but we feel equipped for it.

Then just the other day, I came across Mustard Seed Money‘s post on the average American’s top 10 financial goals based on a recent NerdWallet study. The NerdWallet study found that most people (71% of those surveyed, across income levels, age and gender) regret how they have managed their money. 89% have one or more of the following financial goals (in bold below). Taking the cue from the list, I wanted to check how they stack up for us (and how we’ve dealt with them).

The goals (% of Americans saving for the goal) and our position:

Saving for a wedding (8%)

We never did. We married in court, for $35 – a college friend and two sisters-in-law witnessed and signed. They paid for a dinner at Johnny Carino. I even worked a half day before we married. My mother pestered me for a year – for a “real” wedding. A few folks called, messaged and sent us money. They now get a yearly card from us. One uncle (whose story needs telling) sent us $500 Canadian, just about his weeks’ pay. We intend to give it back when his daughter marries, with whatever the money gains and compounds in the time.

A $35 wedding is perhaps the best way to filter the people you should have in your life. The rest can be an afterthought, for when you’re feeling particularly kind. 

An average American wedding in 2014 was $31,213. This insanity is universal – an Indian Colleague spent $60,000 when he married two years back. The Chinese are also going berserk, as the BBC points out here, here and here. A Sudanese man was about 20 cows behind on payments for his wedding.

Saving to have children (8%)

We do not have any children. We all have our own reasons for why we want or not want children – a beyond belief episode explored this issue a few months back. That said, one of our motivations for pursuing FI is so that we can adopt two children later. FI will allow us to dedicate ourselves to them, and to our other noble pursuits.

Starting a Business (10%)

Does a rental property count? We want to invest in a rental property when the Denver market cools down. The numbers do not work in our favor at the moment.

Buying a Home (23%) 

We bought our first home this year. We put 25% down and went slightly over our initial budget. It is just the right size and structure for us. The neighborhood’s not bad either.

a suburban feel in a city

Buying/Leasing a Car (27%)

Our beloved Honda Fit has given us so much and asked for so little.  We’ve traversed much of the country (baring the northwest), criss-crossing it twice (DC to SF, and back) and even venturing into Canada once. The beloved has averaged about 10k miles a year, and currently sits on 70k. She should continue running for a long time. We use public transportation for our daily commute.

Starting/increasing retirement contributions (28%) & Saving more in general (53%)

The generally recommended 10% – 15% savings will give you a retirement when you’re 65. Retiring earlier requires a more aggressive approach. Dave Ramsey’s investment calculator can help you determine how your savings will grow based on what you intend to save.

We live on one income and save the other. That, if the market remains steady, should allow us to be FI in ten years. We are not frugal, but we live within our means.

We have not maxed our retirement accounts so far, but we intend to next year.

Saving for Vacation (31%)

Vacations are great, and we’re looking to do that to perpetuity after we reach our FI. For now, we’ve allocated 2% of our gross pay towards our recreational expenses that includes eating out, movies, vacation and the likes. We have a few trips planned for next year – and those will have to stay within the allocated fund.

While the 2% seems low (and it is), we actually travel quite a bit. We feel we’re better traveled than most people we know.

Not accumulating any/more debt (42%) & Paying down debt (58%)

We live within our means. We do need an emergency stash, which we intend to build up next year. We carry two credit cards, but pay them off almost immediately. So I’m not sure if we’re using our credit cards the right way.

We have a thirty-year mortgage, but we intend to pay it off in twenty. Refinancing to a fifteen year is an option we want to explore next year.

For all the rest, I’d create a budget. The money map is a fun exercise to trim away the fat.

The GIST

Living ordinarily is key – we certainly do not feel we miss out on anything. Learning to love where we are in life and what we have, if those do not come naturally to you, is critical to a happy life.

My Money Map, Sir!

Would you do this if you had a million dollars?, asked my wife as she came home from work this morning.

Yes I would, I tell her.

How about ten million?

Yes, I would.

I’m going to sleep now, you incorrigible boy.

But this, the official money map chain gang, is a wonderful exercise. Thank you Apathy Ends and  Budget on a Stick. And thank you Good Life. Better for pointing me to PowerPoint – at last some good use.

So here’s mine – the money map – someday to be worth something.

And following the customary tradition that is now 34 links strong –

The Official Money Map Chain Gang:
Anchors: Apathy EndsBudget on a Stick
#1: The Luxe Strategist
#2: Adventure Rich
#3: Minafi
#4: Othalafehu
#5: The Frugal Gene
#6: Working Optional
#7: Our Financial Path
#8: Atypical Life
#9: Eccentric Rich Uncle
#10: Cantankerous Life
#11: The Retirement Manifesto
#12: Debts to Riches
#13: Need2Save
#14: Money Metagame
#15: CYinnovations
#16: I Dream of FIRE
#17: Stupid Debt
#18: Spills Spot
#19: Making Your Money Matter
#20: Life Zemplified
#21: Trail to FI
#22: The Lady in the Black
#23: Smile & Conquer
#24: Her Money Moves
#25: Full Time Finance
#26: Abandoned Cubicle
#27: Freedom is Groovy
#28: Millennial Money Diaries
#29: All About Balance
#30: A Journey to FI
#31: Present Value Finance
#32: [HaltCatchFire]
#33: Good Life. Better.
#34: gofi

 

Middle Class or Middle Income*

A surge of articles on “middle class” hit my Feedly yesterday. I grew up in a middle class family, without quite knowing what it was. My father made sure I had everything I needed – but that was probably because I didn’t ask for much. I remember asking my Economics teacher back in high school what it meant to be middle class. What I actually wanted was a number – that threshold where you left middle class and entered upper class or upper middle class at least.

Being of any particular class, of course, has nothing to do with being happy. My parents are certainly happier today, in their restricted budget, than they were when they were working and had disposable money. The happiest being in the world is a monk. But to the rest of us, the average beings, the true utility of belonging to any class is completely comparative (and irrelevant).

This Washington Post calculator and the Pew Research Center posits my wife and I in the upper income tier.

<Caption: I like them a lot – how quickly flippant, you say>

In reality, we are town home dwellers living among single family ones that cost a half million and more. I don’t feel particularly middle class when my long serving Honda Fit parks next to any of the other cars in the neighborhood. My neighbors include a retired teacher and a registered nurse who is also a single mother of two excitable boys.

I think we’re mixing middle class with middle income. And perhaps why the Pew Research cites “upper income tier” (not middle class) on the article about determining if you’re middle class.

One of my heroes is Ronald Read. For as much as is known about him, I find him refreshing and philosophic in infinite melancholic ways – more on that on later posts.

The middle class, the Pew Research Center posits, is the spectrum between 2/3 of the median HH income and twice the HH median. Using the median annual household income in the U.S. which was $56,516 in 2015, the middle class spectrum for the year was $37,677 to $113,032.

Anything higher, which I suspect is the bracket most FI seekers fall under, would place you in the “upper income tier”.

Your working salary, though, is short lived and temperamental to the market, the self, and a whole host of external forces. Just about the only way FI works is if our salaries are reinforced with the way we live, our outlook and an honest goal. How long we sustain these determine whether or not we succeed.

There are a few practical things we’ve done (but previously shared by a hundred others). Before I list, please note: We are not hippies. We lean both left and right, to choose the best of all worlds, usually for the best of more than just us.

First off, marry well. Choose wisely – a frugal, employable spouse. My wife and I live on one income. We married in court for $12. I took a half day off. While we’re still not maximizing our 401k, we are saving over 50% of our gross pay – significantly higher than the national savings rate that, depending on the source, hovers anywhere from 5% to 15%.

We don’t do Whole foods, and Trader Joes is awesome.

Choose a degree that pays. If that’s done and not done well, choose a job that pays. I’ve worked with people from all educational background and attainment. If you don’t have the degree, get the experience.

I’d like to say Never Settle. But I’ve sort of settled into a semi-stress free job, where I dream of someday working for Google without the fear of loosing the job.

Save and invest, wisely. For us, the less sophisticated majority and somewhat young, the most potent vehicle are time (start early, start young), maximizing all available tax-advantaged retirement plans, than some more. Our portolio is here, if you’re keen.

Where you live will greatly impact your savings. Our housing expense quadrupled after we moved to CO (from KY). Magnify Money lists ten top places to live for six figure households. Cities in Tennessee loom large (I once interviewed for a small company in Chattanooga – but didn’t get the job). Avoid the usual suspects (SF, DC, Honolulu, and  Boston that make the converse list) – especially if you’re flipping burgers – I’ve never understand why as is evidenced by this and this).

Find alternate sources of income, best if completely passive. I’m trying my luck with this site, but there’s a lot to learn.

In gist: Status is irrelevant, avoid the coasts, save and invest, find passive means, never settle, get that degree (and job), marry well and be humble (in reverse order) – those, my friend, should make you FI.

And finally, just for kicks: a million is more or less what most people aim for (after which they get insecure and postpone). But if you were good with a million, the 4% today places you at:  

 

*The title is adopted from this Pew Research article that is a more thorough write up on the middle class.

Minimalism, in a few things 

Our lifestyle shapes our financials. We like our space light and airy. Our room is all space and a mattress. Welcome to our Crib!

Our clothes dry in the sun. We’ll slip those in the dryer now that winter’s near.

For vacuuming, we use this. Fellow readers, if you can show me how I can become an affiliate on this or anything else, please. It is great on the carpet, and not so much on the hardwood floor. But our homes 65% carpet, and our primordial broom can sweep away anything on the wood.

We run the dishwasher and the AC occasionally (to ensure that they are working). We hand wash everything. The fans become redundant when the windows are half open in the summers.

Frugality?

We have “normal” expenses.

We bought a town home this year. We upgraded from a one bedroom in Kentucky to a two bedroom now. We pay four times more now than we did in Kentucky.

We travel – weekend getaways and week-long ones. We’ve traversed the country, length and breadth. Our beloved Honda Fit now runs only on weekends and when public transportation is absent.  She’s logged 70k miles since 2011, and is good for more than a decade. She is (with my old guitar and my recently retired I-Phone 4) my dearest attachment – companions of my dark days.

We eat out once or twice a week. We always share the drink. On proposing that she and her husband do the same, an older colleague working overtime retaliated with absolute amazement: “But I want my own drink”.

When seriously starved, the China Gardens and the India Palaces make for better deals. If at MacDonalds, a dollar is all you need.

But we cook. We cook every day. My wife takes the leftovers to work. I did carrots for a year (so much so that one colleague “replied all” to team lunch email that said “gofi, you are not a rabbit”). I’ve since progressed to Oat Meals (for ~$3 for a box of 8 packets, and with 2 packets/lunch => $0.75/lunch). My wife prefers home meals and I just want a light lunch (so I can dinner like a pig).

Because we cook, we’re now able to dish out a few high quality meals, that when plated properly look all the more desirable (should there a need to impress).

note to self <insert better pic – that steak>

I fight my greatest battles in the mornings – three Starbucks scattered strategically on my way to office. I’m not a sucker I tell myself. I count my days and walk on. The mediocre coffee in my office is good enough.

We buy what we need. We have everything we need.

The public transportation is great for getting to work. I enjoy people gazing, imagining what they do and how they live. It is a wonderful diversion and is the fastest hour of my day. I remind myself to be grateful for all the wonderful things I have, that I smile, and remain humble.

The light rail to work stops at the Union Station. I refuse the free mall rides to office and walk instead. A mile to and a mile back make my 2 miles a day exercise.  On most evenings, my wife and I walk the extensive network of walking paths that run through our neighborhood, and the sight of good looking people (in Thule and Patagonia) is always mentally  rewarding. Please keep consuming. We’ve added a Rowing Machine for the winter, and for my lungs and stiff bones.

I should end now. It’s 10:20 PM. Please comment. If nothing else, let me know how your dog is doing.