I guess I've waited long enough to post again here.
My mother and father are doing as well as can be expected. My father had a simple heart procedure - pretty much an external one-time pacemaker-level shock - to quiet his atrial fibrillation. Everything is now hunky dory, there. He also had a stress test and pretty much passed with flying colors. He has the heart of a thirty year old. Not bad for a 78 year old, I'd say.
On the not-so-good side, my mom's dementia is progressing. She's also been diagnosed with mild osteoporosis. My younger brother (divorced and kids are grown) moved in with them to help them out. My dad is in great shape, but he is still 78 years old. Getting old really stinks. Baby brother is now job hunting in the Richmond, VA area. I don't know the job market there, but he's always managed to do well. I'm just glad there's someone younger around in case my folks need the help.
MIL is now in a convalescent home recovering from her surgery. She's not extremely healthy, but they're very optimistic that they got all the cancer. They're still putting her through a round of treatment (I think radiation), but I think that's more precautionary more than anything else. She is slated to be back in her house before Thanksgiving.
My knee MRI results are "bad, but not bad enough for surgery." They didn't add, "So deal with it," but it almost sounded like they said it, to my ear.
On the financial front, DW has finished installing the new french doors. I really like them, and they came in a few thousand dollars under budget, but still a few thousand more than I wanted to pay. I will admit that the installers did a better and much quicker job of it than I could have done. I know they're better than the old doors, because when DW and I were on Facetime, she opened the new door, I immediately heard the train whistle from about ten blocks away. With the old doors, I'd have heard the train before she opened the door. DW also says they seal better than the old doors. Maybe this will get our utility bills under $100 per month. That's a milestone I wouldn't mind hitting. The bills were originally in the $400 per month range when I first started energy upgrades.
The painters have also finished repainting inside and out. When they started, I felt this wasn't really necessary, but they found some water damage, which was repaired relatively early. If they had not found that damage, I'm sure I would have had a much larger bill to fix the additional damage whenever the damage would have been later found. So, although I didn't want the house repainted, it was a good thing DW had it done, after all.
Debt repayment is progressing apace. The doors are two payments away from complete. We put them on a 0% card just for the convenience factor. We could wait longer to pay them off, but I'm just as glad that they'll be paid off before January. I hate credit card balances. DW's car payoff is going OK. Still a ton owed, but with a 1.19% interest rate, I'd rather leave my money in the mutual funds than pull it out for the car. We'll just cash-flow the payments. It should be paid off in less than two years, and maybe sooner.
I sent the "contract" about the Bank of Mom & Pop loan to DD2 and SIL2. I told them that there was no need for a signature - it's not like we'll sue them if they don't repay it - but I wanted to make sure everyone was aware of the terms. I included a "late payment" penalty of 1% per month after 90 days, but I set back the "first payment" date to January of 2014. They were happy with the terms (0% interest and about a ten year term), which is not surprising.
About my bonus... I'm quite upset. They still haven't paid me for my April bonus. They have reasons, but those reasons are now sounding like excuses to me. Things go more slowly over here, but we are beyond a reasonable delay, in my mind. I plan to speak to our CFO tomorrow to sort this out once and for all.
I will be traveling back to the US over the Thanksgiving holidays. I hope to see my folks and all of my brothers. All four of us children are planning to be there, but I haven't got the details of their planned visits. Time is growing short, so I need to get on the stick about this. It has been over 25 years since all four of us got together at the same time. Two of us live in Texas, though I reside in Dubai. One lives in the DC area. My folks are just outside Richmond, VA. Baby brother just moved in with my folks from Kansas. Maybe his move means we'll all get together more often, but probably not. We keep in touch by phone and such, but to actually get all of us in the same city has just not happened much. It is mostly my fault, as I've lived in Europe and the Middle East for much of my life, and traveled frequently for my entire adult life, rarely visiting when I'm not on the road.
DW and I slowed our mutual fund purchases to cover the water damage repairs. It turns out we pretty much skipped October, but we'll make it up in December, or when I get my bonus. I could pay off DW's car with the bonus, but it's ear-marked for retirement instead. That's part of the "great car compromise" DW and I made. DW's early move back to the US is having more of a financial impact than I would have liked. She has held off on buying new furniture, at least, other than the beds and other assorted items. Only one room really needs new stuff, but of course it's the living room. That's better than another Tempurpedic mattress, anyway.
Viewing the 'Investing' Category
I guess I've waited long enough to post again here.
Anyone who has listened to Dave Ramsey (insert evil or triumphant music here, depending on your proclivities), knows he suggests "baby steps" for paying off your debt.
As a reminder, his steps are:
1. Save $1000 for an emergency fund.
2. Pay off all consumer debt sans mortgage.
3. Save up 6 months of expenses.
4. Put 15% toward retirement.
5. Save for kids' college.
6. Pay off your mortgage.
The last time we were paying off debt - and now we're doing it again, but that was last month's biotch - we didn't follow his plan for the debt snowball (lowest balance to highest balance). We also didn't follow the debt tsunami (highest interest rate to lowest interest rate). We followed the "loans then lines of credit." DW and I figured it's easier to not ask for another loan (paperwork) than to leave a credit card alone (swipe! cha-ching!).
Fast forward to now. DW just bought a new car, made some home improvements, is buying some furniture, and loaned some money to DD2 and her DH for their new house home improvements. So, we have consumer debt again as well as our mortgage.
So, we're on baby step 15:
We're paying off her new loans at a good clip (yes, already): Baby step 2
We're saving up the emergency fund again: Baby step 3 (total: 5)
We're putting more than 15% toward retirement (baby step 4: total 9)
And we're paying down the mortgage (Baby step 6: total 15)
This is possible because the "great car compromise" included NOT buying another house. We aren't building that fund until baby step 15 (or at least through "9") is done. I think we've already got step 3 back in place, more or less. I still have the "float" and there is still quite a bit of "furniture money" in the checking account, so I'm not worried on those lines. I would like a bit more cushion, though.
We should be back on an even keel - only car and house, with full EF - before the end of the year, with both the car and house still being attacked quickly.
I finally got around to transferring some funds from an E-Trade account set up by a previous employer. The money has been sitting dormant for about a year. I really should have done it sooner. I've lost out on about 20% gains by not doing so. Oh, well. It wasn't a whole lot of money, but it was still money lost through laziness.
On the Dubai homefront, I made stew yesterday. Then I added a lot of vegetables and a can of tomato sauce, so it is now a stew-goulash crossbreed, which I have coined as "stewlash." It was really good, but as always I used too much black pepper, so it has a bit of a bite.
I ate about a third of it, and put the other two thirds up in the freezer for lunches over the next month or so. I'll make chili sometime this week after I finish cleaning the crock pot. I always soak the ceramic liner for a day before I hand clean it, both of which precede me putting it into the dishwasher. I hate crusty remains from bad dishwashers, and there's no such thing as a good dishwasher in my experience.
DW is getting the house in order. Houston has been getting a lot of rain, so the lawn is coming in nicely where we had to mend the DD2's destructive "improvements." We have mushrooms now, which is not bad, but I asked DW to put down some Daconil (a fungicide) to help prevent future brown patch. I also told her I have Banner (another fungicide) in the shed, and for her to be ready to put it down in a couple of weeks if brown patch encroaches regardless of the Daconil treatment.
While I was doing the E-Trade move, I looked at my Vanguard holdings. They're up about 20% for the year. I know that will dip when QE stops, but it sure is nice to look at it now. I only wish I knew when the dip was coming. Yeah... I know: "Market timing." But you know the dip is coming, as it is unavoidable mathematically.
I know his name is a curse word to many, but I like to listen to DR for a variety of reasons. The least of which is that I like to hear the stories of people who have gone from staggering debt to financial security with great effort. What I have learned is that most of them changed their way of living to become debt free, and it is that "change of modus operandi" that I listen for to decide in my head if the person screaming "Debt Free!" is going to remain debt free.
As I've posted before, I put myself into considerable debt over a relatively short period of time due to a variety of reasons. Lost job, contracting business that barely paid the basic bills, retail therapy, and plain ol' stupidity being four of the major causes. Note that my divorce didn't even make the top four.
Well, I sold some stuff including a lake house and a third car, both of which I didn't need, and concentrated on paying off the other loans and such. Right now, I have no debt except my primary mortgage. I'm within a year of paying off the mortgage. I have plans to start purchasing houses to use as rental properties during my retirement for an income stream.
I was listening to Dave Ramsey, and someone with a remote house and payment called to ask about selling the house or keeping it for rental income. Dave asked the caller, "Would you borrow to buy that house?" Now, simplistic questions don't fit every situation, and my situation is different.
I can pay off my mortgage 100% within a year. At that point, I plan to save up $80K as a down payment on a second house, which I plan to purchase when I return to the US. I have no plans to live in my current house again, but it is in a neighborhood that is appreciating at about 6% to 10% per year, plus I can get rental income of about $1000 per month after taxes and insurance. I see no reason to sell such a cash cow. I can reasonably make $150K off of it if I do sell it, though.
My secondary goal, after I save the $80K, is to start saving for a second and third home in the same neighborhood, for eventual retirement rental income. As I'm the spreadsheet king, I have the financials worked out fairly well.
So, after hearing Dave's question, I am questioning myself as to whether I am doing the right thing. I have basically no bills, so everything I make goes into investments such as mutual funds and real estate. I plan to be real estate heavy, because God stopped making land, but lots of folks are still developing mutual funds. I just feel more comfortable with a house in hand versus a number on a piece of paper.
What would you do? Pay off the mortgage and buy property, or sell the house and invest in mutual funds?
Or something altogether different?
Editorial note: I know that many folks reading this are in debt and would love to be having this "problem," but believe me when I say I have not arrived here without a ton of effort and not just a few months where I was glad that the light still came on when I changed the calendar. You're reading about someone who has made it down the road after a very rocky start and quite a few missed turns and flat tires.