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1189/1200
There is no joy in writing the following sentence... We spent WAY too much money last weekend. We are eleven days into this Financial Independence project and we take an eighteen hour detour from our goal. Expense #1. We purchased a 1/4 of a beef. We didn't need a 1/4 of a beef, but we sure wanted a 1/4 of beef. We have two meat freezers filled with chicken, duck, sheep, lamb, deer, and pork. Of the meat in our freezer, zero has come from a store...additionally, we do almost 100% of the processing of our protein on our own. We are proud to say that we know where our food comes from. We also know that our price point for raising, feeding, harvesting, processing, and packaging our own protein is generally around $1.00/lb. The beef and processing cost $3.50/lb. We bought 190lbs of some of the most amazing beef that money can buy. This beef was locally processed and raised by very close friends. Grass fed and finished, this is GOOD BEEF. We are happy to have it. Additionally, We are pleased to purchase this beef from our close friends...Unfortunately, the beef was not in the budget. We did not anticipate this purchase as a true expense in our budget and we needed to raid the Miscellaneous/Gifts fund to pay for the beef. Total Cost $665.00. Whoopsies. Expense #2. We took a trip to the big city to purchase tools and supplies to install a small patio at our home. This construction project was a budgeted and planned expense. The monies have been accounted and encumbered for several months. Regardless, we have now spent the funds. Total Expense $299.29. We still have $150.71 in this fund. We will roll these monies into our next project! The patio project was planned, expected and worthwhile. We saved our money to purchase the tools and supplies, we worked hard to create a finished product that we will enjoy as long as we are in this home. The Patio Project is an example of how budgeting is intended to work. Expense #3. Unfortunately, a trip to the big city also led to a weakness in resolve. Kids get hungry, grandparents get hungry...I get to pay for it. I need to start with the caveat: We budget $25.00/month for eating out...This amount covers two Little Caesar's Stuffed Crust Pizzas. We simply don't go to restaurants. Ever. Except for Saturday...$84.96 at Buffalo Wild Wings. Again, a budget amendment. In short, we spent more than $1000.00 in 18 hours. We are back on track and focused on our goal of financial independence in 1189 days. I guess this is why we have a budget. 1193/1200
When researching retirement investing, it does not take long before one encounters the term of Diversification. Diversification is imperative. The aphorism "don't put all of your eggs in one basket" applies directly. What is Diversification? Theoretically, diversification occurs when a portfolio contains a menagerie of positions across many asset classes. A traditionally diversified portfolio will often contain fixed income assets, equities, bonds, and even hard assets. Ideally, when one of the asset classes experiences a downturn, other classes will experience an increase. In short, Diversification works because the asset classes generally react differently to the same economic trend or event. Diversification in practice: I am not your financial advisor. I am not your fiduciary. I am just some guy typing words on the internet. Please do your own research. In the bridge accounts to which we reference, we have 100% exposure to equities. More than 70% of the capital is invested in indexed funds. The rest we have allocated to individual stocks. The diversification of our portfolio comes in the sectors and industries in which our individual corporations operate. A quick run down of the individual companies in which we invest: Apple - AAPL - 2.5% of our total portfolio. "own it, don't trade it" says Jim Cramer. We are waiting for a pull back where we will add to this holding. Berkshire Hathaway (B) - BRK.B - 4.8% of our total portfolio. This is a long term value play. We continue to add to this holding with a Dollar Cost Averaging Strategy. Citibank - C - 5.4% of our total portfolio. We are about to liquidate this holding. Astro Zeneca - AZN - 4.4% of our total portfolio. This was a COVID play. We keep a close eye on this stock. Analysts are confident in the up-side potential. I am concerned with the recent news of concerns regarding vaccine trial data. Johnson & Johnson - JNJ - 4.2% of our total portfolio. This is a dividend stock we have held for quite a while. We have been happy with the steady growth and dividend reinvestments. Recently, there has been a very positive upside with the growth of the single dose COVID-19 Vaccine. WalMart - WMT - 3.6% of our total portfolio. In an effort to remain diversified we researched WalMart vs. Costco. We chose Walmart as a long term holding. Any recommendations on how we can reallocate or maintain diversity would be greatly appreciated. 1196/1200
Holy Cow! CoastFI. This is the term that accurately reflects our plan. My understanding is that Coast Fi or Coast FIRE is achieved when an individual has enough money saved in retirement (or other) accounts that the annual rate of growth will support retirement at a typical retirement age without additional contributions to the principal of the account. We are close...very close. Freedom is attained with CoastFI through the flexibility of only needing to earn enough money to cover living expenses. CoastFI will provide us the flexibility to pursue different jobs that may pay less, but allow us to enjoy our lives and one another more. The stresses of our current careers are, quite literally, killing us. With CoastFI, a change is within reach without jeopardizing a comfortable retirement. Our plan is to purchase a homestead in the midwest, spend time with our daughters, become members of a community and be more available to our family. What we will do to earn money is, as of yet, a mystery. We will have jobs that don't follow us home, if we want to take a vacation or take time off, we will have the flexibility to do so. Our careers will no longer be our lives and we will have the wherewithal and the means to make our life whatever we want it to be. We look with longing to these days and feel blessed to be in a position where CoastFI is on the horizon. 1199/1200
Dave Ramsey tells us, among other things, that no one gets hurt on a roller coaster unless they jump off. I am not sure if I have accurately quoted this aphorism, but I believe I have captured the spirit. Yesterday was one of those days. DON'T JUMP OFF. Total unrealized loss = ($5,234)...Ouch. This reflects - 2.22% of this bridge account. The total daily rate of change IS +$435.77 We are still well above the required daily rate of change to meet our goal. The markets make me think of "Ludicrous Speed" from the movie SpaceBalls. Faster than Lightspeed...but much more dangerous. Ups and downs and wild swings based on very little traditional analysis. We will ride it out, we will continue to invest as aggressively as possible. We know we will experience losses. There will be ups and downs in the market, but over the long haul, the aggregate will be on a positive trend. The Market is down again today... DON'T JUMP OFF. 1200/1200.
Today is launch day! We meant to launch a few days earlier... It took me some fumbling to get the domain registered. I cannot overemphasize how valuable it is for us to have a day/date tagged to this goal. We make no bones about it, There will be ups and downs in the next 1200 days. We will take the good with the bad and we will share it all with any community that forms around these words. Hopefully, someone will find these words and find value in our project. Account update Yesterday was a quite day in our accounts. We were +348.00 on the day. We have met our daily goal! The markets were down today...I do not anticipate we will meet our goal tomorrow. I will let you know. As of today, our average daily rate of change is +$559.02 on the year. You will note this is a big jump from the data presented in the previous post. We moved about six thousand dollars into the account earlier in the week. We will keep a running total of this daily average change for the duration of the project. Periodically, as we run ahead or behind projections, we will re-evaluate the daily need and make calculations based as such. Today is pay day. Pay day is always an entertaining day as we are able to work on our www.ynab.com budget. More on YNAB later, BUT. I haven not found a piece of budgeting software that meets our needs better than YNAB. If you are not in love with a budgeting spreadsheet or software, I would strongly recommend you give YNAB a try. Although the premise of this blog is simple, the application will prove to be exceedingly difficult. We have a goal. 1200 days from today (actually, 1203) we plan to achieve financial independence.
We have, in the words of Jim Collins, a Big Hairy Audacious Goal. We do not want to quit working...but we want to get our family in a position where we can work where and when we want. A position where we have the flexibility to enjoy each other, our kids, and our lives. We have been in public service for nearly 25 years... Our goal is to spend the rest of our time serving others. This blog will help us record the journey and maintain accountability to our chosen path. Wish us luck! |
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