Losing $ Sux

I forgot what losing money in the market feels like. I just did my Q3 net worth. I had started it in mid-September. What a difference those few short weeks have made! I feel like I'm down between $15-$20K since then. Not feel like, I know. At least that much. I probably saved about $16K last quarter, at least. And it all got eaten up by the market drop. The good news is I feel less nervous about buying stocks now than I have in a long time. It will be interesting to see if October maintains its reputation for being a shitty month for the stock market. Oh well, long view and all that I know. It's just that every drop puts me that much further from retiring which is a big goal of mine that can't come soon enough.

Tired, Broke, Hungover

July has been insane. I don't know if Halloween is a particularly amorous occasion, but almost all of my close friends were born in July. Actually even people at the office were born in July. EVERYONE was born in July. So at least 1-2x a week this month I've had to attend a pricy birthday dinner. It was also my niece's first birthday. And I hosted my spendy friend for 3 days around the 4th of July. Translation = I am broke, hungover and  tired. I never want to eat at a restaurant again.  Seriously. I NEVER feel that way. I can't wait until August. I'm going to do the Austerity August challenge someone posted about on a Mr. Money Moustache forum.  I have 2-3 business trips in August, so while that involves a lot of eating out/drinking with clients, etc. it will not be on my dime, thank god.  Oh and I'm planning a trip for January so I also had to shell out $400 for airfare and will have to put a deposit down as  well. So in January I'll be psyched because my costs will be low and I'll have prepaid for the trip, but I definitely didn't need the extra expense this month.

Even more  than the $$$, I feel really burned out personally. I love my friends, but I need time for me. I'm taking a class and I didn't do that great on my quizz, probably because I'm running around socializing like a crazy person. I think money is a good sign to how I'm feeling. If I'm spending too much on other people, most likely I'm spending too much time and energy on other people as well and not saving enough for myself. I try to tell myself it's a temporary period, but it still feels stressful. I'm starting to burn out and skip the bday celebrations as the month comes to an end, so that's helping.

Here's to Austerity August!!!

Paying Too Much for What Ifs?

I'm a very conservative person by nature, meaning I like to "protect" myself from possible risks. What I'm realizing is that this means I pay a lot to cover myself in case of what ifs.  This hit home this month because I've spent $1K on these type of expenses:

-- Long term disability insurance: When I started at this job, we didn't get any coverage, so I purchased a private policy. I've lowered the coverage amount, but I still paid $784 this month for my annual coverage. Since I now have coverage through work, I wonder if I need this at all anymore.

-- Homeowner insurance: I increased the value of my house to keep up with the market, so my premium increased this year. I paid $680 for insurance this year. I think it's about $200 more than last year. In reality, I could cover most home emergencies myself, so maybe I should look at increasing my deductible and lowering my premium.

-- HVAC coverage: I have a service repair contract so if anything happens to my HVAC or hot water heater, someone will come repair it for free. I think I even can get a new hot water heater for free under this contract. This expense is $412.

So that's a total of $1196 in expenses I might not even need (disability and HVAC) and then I could probably save at least $200 on my homeowners insurance, so that's a savings of almost $1300 a year or $108. Since I just locked in these contracts for the year, I'll have 12 months to consider whether to cut, reduce or keep these expenses, but I think it's worth considering.

Spending Like Crazy

So this year has been a mixed bag with spending, a little bit of feast and a little bit of famine. Basically alternating months of each. In January (which is always my highest spend month) I spent more than I made by a few thousand because I spend a little of my December bonus money. This year I bought a mattress (from Ketsia which sells "green" mattresses and uses a no pressure sales strategy. Such a nice experience) and a couch.  I also bought a new side table and coffee table. I'm kind of regretting buying those because I actually like my old ones, it's just that I stained the top of the coffee table. I should have just sucked it up and kept it, but what's done is done.

Then in February and March I spent way below what I made even though I went on vacation.

In May I've been really restricting my daily spend, but had big expenses -- long term disability payment for the year, yearly homeowners insurance payment, an education expense for a program I'm starting. Basically about $2400 in extra expenses. The only saving grace is that I might be getting a small bonus payment at the end of the month. Also, I got my tax money back in March, so that actually should cover the overage from January.

Either way, it's strange to feel like I'm constantly watching my money and trying to save but yet spending on abstract expenses like insurance so at the end of the month even though I've been "good" I still don't have a big (if any) surplus.

C'est la vie I suppose.

Booze and $

So for Lent I've given up drinking. I feel fantastic (although I have cheated 2x), but it's also cutting back on my restaurant bills, which is great because that's one of my biggest expenses (outside of rent of course).  I think even when Lent ends, I'd like to cut back to drink only 1 day a week. I just feel a lot better, and booze at restaurants is so expensive. I rarely drink at home. In NYC everyone mostly meets their friends out, not at their apartments. So it's expensive. I wish I lived somewhere where people hung out at each others' houses. I would save so much $.

2013 Breakdown

Today I analyzed where my income went in 2014. It's pretty impressive, if I do say so myself. Even Mr. Money Mustache would be mostly cool with it I think. So taxes ate up 36% of my gross income, I saved 37% of it and I spent 27%. I saved 55% of my net income. Not too shabby. Of course some of that is because I get a bonus in December and I therefore end up saving it all because I have zero opportunity to spend it. In reality I don't spend that much of it. This is a pretty standard year in that 1/3 of my gross income usually goes to each of these categories.

F-You Capital One! Hello, Chase!

So this month (post bonus) has been a how shall I call it? hmm. Spending orgy is probably accurate, haha. Anyway, combined with my business travel expenses, I'm about $500 from the $10,000 limit on my Capital One platinum whatever card. I never applied for this card -- it switched over when HSBC sold their card portfolio to C1. So I applied for a credit limit increase. I got rejected!! I was so mad. I pay in full on time every month on that card and every other card. Always have. Never have had a late payment. AND they told me my credit score is 793. I called and got bumped up to talk to a credit supervisor but they're idiots over there and can't tell me why I got rejected.

I had been thinking about ponying up for the Platinum Amex (it has good travel benefits like they reimburse the fee for the Global Entry program which I've been meaning to enroll in for forever because I'm gold on American and they will add me to their TSA Pre list if I do). Anyway, the Platinum Amex is $400 a year. Even w/ the monetary benefits (I figure I could get about $300 worth out of it), I feel silly spending that on a credit card.  Plus, I love getting cash back. I just got a $500 credit added to the C1 card as a cash back reward.

So I went on CreditKarma and found another cash back card. The Chase Freedom (I know anyone reading this now is like duh of course). Credit Karma has some really useful tools. It showed me that barely any of the cardholders have even the limit I have on C1. I think the C1 cards are more for people who don't spend as much, have worse credit, etc. I'm probably ideal for the Amex, but because I want to keep earning that sweet cash, I got the Chase Freedom card. And I'm pretty sure that they gave me a credit limit of $28K, which sadly I actually might need at some point because of all my work expenses (i pay them and then get reimbursed). There's no annual fee on the card, so it's a win-win.

Starting off the New Year

To kick off the New Year, I met with my Learnvest financial planner. I really like her and value her advice. This year I'm tackling the same problem as last year which is getting my cash surplus invested. It sounds ridiculous, but I haven't even gotten last year's increase invested and now I have a big chunk to invest again this year. I can't keep up. I get so nervous about dumping a lot into the market. But once I set up auto investment, I can truly set it and forget it. It's just that to get the cash invested in a timely manner I would have to be making large buys each month. Right now I'm only going in about 10K at a time, which is not doing much to make a dent in my stash.

I have also convinced my planner that I don't need to replace my full income in retirement or even 85% of it. I know the exact number that I spend each year, and what part of that is for housing (almost 40%!), so in today's dollars I need about 60K a year with a mortgage and 36K a year without one. Of course that # doesn't include inflation.  If I used the Mr. Money Mustache formula I would need to save 25x the amount I need each year, so either  $1.5 million or $900K.  I think to be safe I would only be comfortable with the higher #. The planner's target number is going to be more like $2 million, but that's better than the like $4 million she is currently targeting which is most likely never going to happen.

Happy saving!

Spending It

I have some expenses coming up that are discretionary but I really should take care of them. Case in point - new mattress and couch because they are hurting my back. I can only sleep on one side of the mattress now. I'm off today, hopefully to finalize my choice for a new one. Think I have found the couch I want as well. But once I update the couch, I realize that the coffee table is quite scratched and while the matching side table is perfect, if I get a new coffee table it will no longer match. So that's two more pieces of furniture. Also, I don't have overhead lights in almost every room of my apt. So it's dark. The table lamps aren't cutting it. I plan to buy ceiling fans with lights and have them installed. So that all adds up. I'm not really excited about these purchases, but I feel like I kind of need to make them.

I am thinking of making a big "purchase" that I am excited about which is going in on a shared beach house. If I can pay a reasonable amount each month, I plan to do this, probably starting in March or so. That would be money well spent in my view.

I've been reading about the clothing fasts people are doing on the MMM forum. I'm thinking about joining, because that would help pay for the beach house. Yay for intentional purchasing!

Happy holidays to everyone!

Favorite Time of Year?

In theory, I should be super happy right now. I literally wait for this moment all year long. I found out my bonus and it is higher than last year by 16%. I know how fortunate I am to be well-compensated for doing my job. I know there are people who work just as hard, and sometimes in dangerous or uncomfortable jobs, that are paid much less. That said, I just feel tired and burned out. Work is still very busy and while we finally hired someone to support me so I'm not the only person on my teams, that person was on vacation all this week.  The crowds are bringing me down too. I guess I'm really starting to learn/believe that my career/job and saving/building a nest egg are the most important things.

Privilege & Poverty

If you read certain ladyblogs like I do, you will hear the word privilege a lot. I always knew that I'd probably qualify as privileged but I never realized what the opposite of economic privilege -- poverty -- is truly like. Although I make a hobby studying both ends of the economic spectrum, poverty and what it must be like was never so clear to me as when I read this recent blog post that is getting a lot of attention called "This is What It's Like to be Poor"

I thought about the contrast between being poor/unprivileged and my rather privileged existence through the lens of something that happened to me this week. I went running in my hood last weekend 2x (also a privilege to have a safe space to run outside) and I somehow ended up inflaming a joint in my lower back. By Monday morning, walking, sitting and standing were all painful. By Tuesday, my colleague told me "call my chiropractor right now!" at about 2:30 in the afternoon. Just having access to that knowledge -- who to call for help, is a privilege. And then the even bigger privilege -- my private health insurance for which I pay $200 a month in premiums and i'm sure my job pays at least 2x that, covers every visit I need with not even a co-pay. My fancy insurance also reimburses me 1/2 of my weekly $200 therapist bill, for a therapist who is out of network (in network therapy is $30 a visit). And I've been going to my therapist for about 4 years now. Weekly. And insurance has never said anything. But back to my back issue. Because I have a white collar office job, I was able to just shoot off an email saying I'm leaving at 4:00 to go get my back fixed. If needed, I could even have worked from home for several days that week (except when I had business meetings). That flexibility is a privilege. My boss' only response was feel better. Plus, if something crazy were wrong and I had to be out of work for months and months, I have private long term disability insurance that I purchased on my own and I have another LTD policy through my job. I could get paid for not working for years. Finally, if I were permanently disabled, I could live for free with my mom forever probably. And she would help me navigate and advocate for me to ensure I got all the benefits a disabled person is entitled to.

When you open your eyes, it is easy to see the privilege around you. For example, I woke up this morning thinking how wonderful to have a quiet, safe and serene place to sleep and live.  I don't have to have roommates. I get to live in the exact neighborhood that I want to. Crime is not an issue (knock wood). I have easy access to everything I need -- from fantastic food to health care, and I don't even need a car to access it. But if I did, I could afford to buy and maintain one.

I think it's important to keep our eyes and ears open to be aware of our own privileges and ry hard to understand those who may not have them and figure out wayswe can help them overcome challenges that arise from their situation.

The Smothering Power of Stuff

Yesterday I went with my mother, aunt and cousin to my grandmother's house to clean out any food that was left.  My grandmother's house is packed with stuff. My grandfather was a "collector" and hobbyist who left behind tons and tons of stuff. Not hoarder level or anything. But just every space is packed, from the basement to the garage to the shed. Being there is overwhelming.

Besides feeling like I was drowning in stuff, the stuff brings out an ugly attitude in my mother. She accuses the caregivers that lived there of stealing what I think are pretty worthless valuables. She rants and raves about them. Meanwhile, she has inherited what most people would consider a sizeable sum, but yet is obsessed over the loss or theft of this $500 or less trinket. It blows my mind.

We also had a huge fight because my grandmother had always wanted me to take her china when she passed. There are 8 place settings. I declared that I only wanted 4 because I did not have room and would never use 8. My mother insisted that I take all or none.

Today with the benefit of a little space and time, I realize that I never want to go back to my grandmother's house again, at least not when my mother is there and probably not ever. The stuff is literally toxic in my mind now. There's no room to breathe and I personally feel there is nothing of value there and it should all be thrown out. My mother has declared that everyone in the family will come on one day in a few weeks and take what they want, but the few things that I would want are not worth going back for. I think my mother will be surprised because I think most of my cousins also won't even bother coming. What would they want out of a 95 year old woman's house?

It's a good lesson learned as I simplify my own living space. A good reminder for why it really is much healthier to live with less. I want to make room in my house for love, for light, for my soul to breathe. You can't do that when you are buried under mounds of stuff.

More Than Money

My grandmother died last night. I was very close with her, and I see so much of me and my mother in her. For both better and worse.  Especially when it comes to money.

My family has the opposite problem of what I think is the normal issue with money (overspending): we have issues spending money.  Especially on ourselves.  My grandmother lived through the Depression. She worked in factories and then she was a homemaker.  She worked hard all of her life. She and my grandfather saved and saved.  When she died, she received social security and a small pension. She still had more than 500K in the bank (from what I understand) and she was in her mid-nineties. Of course if she had lived for 5-6 more years in a nursing home, she would have spent all of that money. But she didn't.  The problem is (in my mind anyway) that she scrimped so much she didn't let herself enjoy life when she was alive.  She wore rags for underwear and wouldn't let us buy her new ones.  When I would buy her nice  things like new towels, she would simply fold them up and put them in the closet, saving them for god knows what and continue on using her rag towels.

I understand why my grandmother was the way she was and I admire her strong work ethic, thrift, determination and self-discipline that got her through the Depression and all the way to her mid-90s.  That said, I wish that she'd been able to appreciate herself and feel a little more secure and been able to enjoy her time here more.

I was happy today because I was actually wearing a bra that I bought last month (immediately after I posted that I hadn't bought any clothes on this blog, ha). I fretted over buying it for months. I didn't need it, but it was beautiful. Finally it went on sale for $45 (it was normally closer to $100) so I swooped in and got it. I hope that I can live like that -- still finding the joy in little treats and 'pampering' myself, but being practical and honoring my grandmother's memory and never wasting anything.

The Most Wonderful Time of the Year

Q4 baby, woohoo! The fun starts this month. In September of this year I fully satisfied my social security tax requirement. That means I get a nice chunk of change extra in all of my Q4 paychecks.
That alone makes Q4 awesome.  I also have been wrestling with my health insurance company to get refunded money that they owe me (dating back since May) and I'm hopeful that comes in this month, because then I can finally submit whatever is left from those claims to my FSA account where I will have almost $1,000 that I can pay out to myself. Plus, I'm going to make a big donation to Goodwill, locking in a nice tax deduction for the second most magical time of the year, tax refund time. October -- April is definitely the time of the year when I get paid the most, between social security tax max out, bonus (praise be to the Gods) and then tax refund. And this year I have no big expenses. No house down payment to save for, no student loan to pay off, no crazy transfer taxes around a new mortgage. All mine to save! Woohoo!!!

More on Minimalism

Even though I'm on a plane for almost six hours, I'm still minimizing. Or plotting what I'll do when I get home anyway. I made a list for each room of things I would like to eliminate.  As I mentioned in my last post, a lot of the things that I don't want/need I received as gifts, or handme downs. So they have sentimental value.  For example, I have a collection of mugs that I got from traveling, or at different points in my life, like grad school, even one from when I was a child.  I also have an entire tea setting (little saucer and plates) that came with my dish set. Although those are beautiful, I have not used them once in four years. Also, my mugs are smaller than I like, so although I drink tea at home frequently, I don't use the mugs. I use a ceramic travel mug. I seriously think I can eliminate both the tea set and most of the mugs. I found a beautiful black ceramic Mikasa mug on eBay and ordered two of them. I can replace the entire tea set and mismatched mug collection with 2 mugs. So although this cost me more money ($30) versus the old mugs and tea set which were free, the mugs are exactly what I want/need. I think in the long run it is worth it! 

I have become a minimalist

Ok, so not completely, but I'm so excited I feel like I've found religion or something.

I've always been really into organizing and de-cluttering. When I go visit my mom, I choose one space to de-clutter at a time. I've done most of her house at this point.

Yesterday I drank coffee which I literally never do (blame the pumpkin spice).  I went crazy organizing and de-cluttering my apt. Now, my apt. is generally very neat, if not a bit dusty with hairballs.  But since I moved in a year or so ago, I never really organized my closets. I have more space now than I ever have, so I didn't have to make the most of it like in my old place. It bums me out on the regular when I look at my closets and they are just kind of messy. I like neatness and organization.

So yesterday I became inspired and bought two e-books on minimalism and read them both. In between, I spent probably 10 hours sorting through my stuff. For the first time, I really looked at everything and evaluated whether it was worth keeping or not. I have always thought of myself as having a pretty lean wardrobe, but I still added another 2 bags to the 1.5 I have sitting around to go to Salvation Army. I couldn't believe it! Then I threw out the packing materials I had saved from my move. Because while I am overall neat and organized and don't have a ton of "stuff" I am a hoarder with packaging. I don't know why. But I have a lot of bags and boxes stored away. It was hard, but I felt really free getting rid of some of them.

I'm traveling today and left pretty early for the airport, but I couldn't help but go through my nightstand drawer before I left (I literally have not opened it since I moved in last spring). 

I feel like my eyes have been opened. Most of the stuff that I'm storing in my closets I barely ever use!

I also realized that a lot of the extra stuff I don't use was given to me as a gift, or I got as a hand-me-down from friends.  My mother is very sweet and always brings me back a souvenir from every trip, but it's built up over the years. I'm thinking of putting all but 1-2 things in a box and packing them away.

The books I read yesterday, both of which were useful, are:

How to embrace minimalist wardrobe
Simplify

Not much to report

Not the most exciting title for an update, but it's the truth! I could have sworn though that I posted in August. Anyway, the market is on fire, which is good and bad. I have a bunch of cash that I want to invest, but I don't want to invest now, for fear I will be investing at the high. I know October is usually a not very promising month for the market, so I'll be on the watch for any downturn, no matter how slight, to invest. I saw my Learnvest adviser (or talked to her) recently and we mostly talked about a strategy for investing the cash.  We'll see.  Overall, I"m about 40% in cash, which would be fine if I were 80, but since I am not, I need to put my money to work so it will grow.

The real estate market in my hood is also on fire. There's a place similar to mine on the market for $150K more than I bought mine for a little more than a year ago. So in theory if I could sell my place for that amount, I'd have to bring about 100K less to the closing to give to the bank to pay off the mortgage. Which is nice, but irrelevant because I have no plans to sell.

I've been pretty good on my expenses lately. I haven't bought a stitch of clothing, any electronics, any furnishings or any sporting goods this month, and there's only 10 days left. Would kind of like to keep it that way. My food budget is somewhat under control. Took lunch all but one day this week.

Yawn, sorry for the boring update! But I guess slow and steady wins the race.

What do you spend money on?

There is an article in the New York Times Today about how spending money on experiences makes you happier than spending money on stuff (including real estate).  I feel like I've known this instinctively all along. In my 20s, when I didn't save outside of my 401K, I spent all of my money on traveling and going out to dinner with my friends. I had no fancy clothes, purses, furniture or shoes.  Just a lot of fun. This used to depress me. In my early 30s I thought, "I spent all this money and I literally have nothing to show for it." But now I look back fondly on that time and I know I always will savor those memories of early adulthood freedom in NYC.

I've continued the trend (well, not spending all my money luckily) but spending on experiences.  I just took a look at my spending for the year so far. The top categories (outside of the mortgage) are Travel and Food and Dining, with Health Care in 3rd.  Health Care expenses for me are seeing a therapist I really love and learn from and my acupuncturist which makes me feel amazing and helps me keep a chronic illness under control. When I do buy stuff, it's mostly sporting goods I need to practice my favorite sports/hobbies with my friends.

So yay to not spending on stuff, but yay to spending on fun experiences with friends and family and really enjoying life.

Spending Reduction Success

I'm so happy I've finally gotten my restaurant/out of home dining budget down! For the last two months I've spent about half of what I normally spend.

March = $642
April = $787
May = $478
June = $380

I did it by making my lunch and making a big pot of something that I can eat all week for dinner. I also cut back on going out to dinner as much. In June, I was traveling so much for work that a lot of my food expense was covered, so I was able to have a nice sushi night out ($100). If I hadn't done that, I would have spent barely anything at all on eating out.

It feels so good to get my spending in this category under control.

I also did my net worth update for the quarter. Even with the recent market dip I'm pretty much on track for where I want to be. I like to increase my net worth by $25K a quarter. Of course that's not always possible, but that's the goal.

One thing I do not do is include any price appreciation from my apt. in my net worth. Although I paid $450,000 for my apartment one year ago, the same unit in a different building just sold for $600,000!!!! Which I think is the sign that we're in a bubble, but the good news is I don't care I'm just going to keep my head down and keep paying off my mortgage.

How much do you save?

I've been reading Mr. Money Moustache a lot lately. I love his blog and feel like it's really the only PF blog where I am actually learning new things. Anyway, as his readers know, he advocates saving like 50% of your pay. Um, wow. And  I thought I was an aggressive saver!

I've never actually added up about how much I save each month, so I wanted to see what % I save. In various ways (pre-pay mortgage principal, cash direct deposited to my trading account, and cash deposited to my checking account) I save about 15-20% of my monthly income. It's not bad, but it's not great. The only thing that makes me a super saver is my bonus.  I usually get a bonus in December (praise be to the Gods) and it's a good chuck of my income. Last year 50% of my gross was paid out in that one check. And I save the whole thing (except when I spent it on my downpayment for the apartment last year). So in reality I save a lot more than 20%, but I want to try to get better at saving on the day-to-day level. I guess it's just more challenging because so much of my compensation is paid out at the end of the year. It's good practice though for if I ever had to take a lower-paying job. I know I can successfully live on half of my salary and still save 20%.

This month I've been traveling a ton for work which means I save a lot on food expenses. My monthly spending for June had been very low, until I booked an international vacation for December. But the saving wasn't for naught, because I was able to pay for it all out of my salary and not have to touch savings.

I'm curious about doing my networth update for Q2. The stock market was humming until about June. Unfortunately I think I'm going to end up down or flat on my investments for the quarter, and I haven't saved a ton of cash, so I think I'll be below average on my quarterly networth increase, but we'll see.