Wednesday, January 06, 2021

Things I Thought I'd Write About

 I was going through a notebook that I've been keeping for the past couple of years that has a page in it where I jotted notes about things to write blog posts about. Obviously there is a lot I didn't get around to! But here's the list so you'll have at least some cryptic idea about things that struck me as being interesting from a money perspective:

Babbitt (the book)

The Manticore p 21-22 (a rather fascinating book, with some interesting observations about wealth)

p.154 Murder Must Advertise (another book! I don't remember what the money connection was, exactly)

Elizabeth White Faking Normal (I haven't read the book but saw something on TV about her, I think. A 55 year old woman talks about how she hid her financial problems.)

HDFC coops

"Hard Work"

Social Security projections

XX Finance advice (this related to a friend of mine who invested an inheritance with a financial advisor who had been recommended by some other friends. They put the money in a ton of different funds and did a lot of trading, and then the market went down. XX freaked out and ended up pulling out all her money and taking a loss. She then used the money to pay off her mortgage instead. The whole thing was just a series of mistakes in my view. XX couldn't handle the idea of risk and waiting for longer term results. The advisors were not investing her money efficiently, I don't think. I kept telling XX she could just put her money in Vanguard funds and do better but she was more comfortable playing it safe, even though her mortgage interest rate wasn't that high and she didn't have much of a savings cushion left after paying it off.)

Musicians, $600 (a friend of ours performed in a club, a big career step for him. But he had to pay backup musicians. The club was slow in paying his share of the ticket proceeds, the musicians wanted their cash, and he ended up borrowing $600 from Sweetie to close the gap. Sweetie never got the $600 back, though the friend more than made up for it in other ways later. But it just got me thinking about how many musicians seem to live on a thin edge financially. And that was way before the pandemic.)

Fred Bass $25 mil estate (this was the owner of the Strand bookstore in NYC, who amassed quite a bit of wealth. More recently his daughter caught some flak over her appeal for people to buy books from them during the pandemic, which some people took as a wealthy woman crying poverty.)

Wild (again, the book.)

Baby shower (someone I know spent an insane amount on a fancy baby shower party)

Near misses (__layoffs, __ layoffs, could have changed my luck) (I've worked a few places where other people got laid off and I somehow didn't, at a point where my finances weren't really solid enough to handle it. There but for the grace... etc.)

Investment results

Optimism vs pessimism/distrust

Healthcare, mom's $3k meds, medicare (yikes. now I can't even remember what those $3k meds were!)

Gala (a swanky fundraiser I went to, where the ratio of expense to benefit was probably questionable)

Mom's apartment move

Virus!


That's the whole list. At some point I'll elaborate more on some of those later items, perhaps! Or maybe I'll just keep accumulating notes and sketchy comments! 

Thursday, December 31, 2020

Another 2020 Update

 I have been so checked out on blogging and hadn't even seen the comments on my last post until just now. It is good to hear updates from longtime readers-- some sad news, unfortunately, but also some positive news. Deaths and births and life ongoing, as everyone adjusts to the pandemic.

I lost a dear friend this past week, to old age and unrelated to COVID, but it made me think about how much I value spending time with loved ones, which has been difficult these past months. I saw this friend a few times this year, always a bit worried about the risk to her of any outing, even a tiny, socially distant, mostly outdoor, or at least well-ventilated gathering. She had lived a very long life, and wanted to keep living it fully as best she could. We went to a museum together a few months ago, and she came to my house for Thanksgiving. She was hoping to visit Paris again when travel resumed. She was 94 years old.

On a more positive note, the pandemic has had a silver lining for me. I got a job! I used to sometimes hear from friends in my industry who thought I might be interested in certain openings, but when I said I didn't want to commute into NYC at all, things fell apart. But now that everyone is working remotely for the near future, that all changed! The perfect job kind of fell into my lap-- a more junior, less stressful position than I've had in a while, with a flexible schedule and decent benefits. I can work from home permanently. I wasn't sure I wanted a "real" job again, but I feel like this is something where I can be useful. It doesn't pay much in comparison to my past jobs, but it's more than enough to cover the costs of my current lifestyle and put me back into the mode of saving money instead of depleting my resources. And I figured with everything pretty much shut down because of the pandemic, I had nothing better to do anyway! Sweetie is a little bored while I'm working away upstairs, but when the time comes that we want to travel again and do other things, I'll see what I can work out in terms of reduced hours. So far I am happy enough that I think I'd like to continue part-time work for the longer term, but if that isn't possible, I can always just retire again, and be in a better financial position than the last time I tried to retire. One thing I've realized is that I am very good at working, but not very good at managing my own time in a productive and creative way. I need some kind of project to organize-- for a while it was moving, and home renovations, but once those things were past, I was getting bored again and COVID left me feeling even more aimless. So even if it's not quite the post-retirement plan I'd envisioned, I'm in a good place.

I have lots more money stuff to talk about-- how much I invested in home office ergonomics, Sweetie's new car, my mom, my investments, and a recap of my 2020 budget and net worth. I'll try to get to it before summer! Happy New Year everyone! Wishing you all a joyous and healthy 2021.

Monday, September 21, 2020

2020 Update

It has been another good long time since I’ve posted… and what a strange time it’s been! I feel like the world has totally changed. COVID-19, baby!


First of all, I am very lucky to be able to say that my family and I have all been healthy. But I do have several friends who have had the virus, with varying degrees of seriousness. Thankfully all have recovered, but friends of friends have died, so I don’t feel too far detached from the real impact. My unlucky friend Mortimer, who I’ve written about here from time to time, had the virus in early April and barely avoided going to the hospital, which is a miracle as he has asthma and some other health issues. He still doesn’t feel totally recovered even all these months later. 
My life has been very hunkered down. Travel plans were canceled. ALL plans were canceled. I’ve mainly only left the house to go grocery shopping once a week. From mid-March until now, I have gotten maybe 3 take-out lunches and 4 take-out dinners. I ate in restaurants with outdoor seating for lunch a couple times over the summer, and exactly once for dinner, a couple of weeks ago. I went to visit my mom and sister once, and have entertained friends or family at home 6 times during the summer, always staying outdoors for most of the time. But groceries have definitely gotten more expensive, so I’m somehow still spending more on food. (This may be because Sweetie was the one tending to pick up restaurant bills while I paid in the supermarket.) My gym membership was on hold for a few months and I have yet to go back since they reopened. I spent about $45 on a new yoga mat and a resistance band for exercise (which, to be honest, I haven’t used much), and $60 on two sets of workout videos, which, again, to be honest, I haven’t used much. But I’m going to. I swear. Otherwise, I’m lucky to have outdoor options for walking and swimming so I haven’t been a total slug during the summer months. But once it gets colder again I’m going to have to try to go back to the gym. This will probably be my biggest risk factor for getting the virus. It’s also a big nuisance as attendance is very limited and you have to make an appointment, and you can’t take a shower. So I’ll have to weigh whether the motivational aspects of going to the gym outweigh the negatives, or whether I just have to find some other way of getting myself to exercise at home, instead of just fantasizing about it. 
I spent some money on plants for my garden, which has been getting a bit more ambitious. This summer’s tomatoes were phenomenal, actually, though my attempts at growing peppers and eggplant were a bust. I also spent some money on books— not a ton, but I wanted to support a local independent bookstore so I placed a couple of orders for things to read while the library was closed. Strangely, I haven’t had the concentration to get very far in reading these books. 
Since I haven’t been working, I at least haven’t had to worry about losing my job in the pandemic, as has happened to several people I know. If I’d stayed in my old job, it could well have happened to me, I suppose, though most of my former colleagues are still employed and adjusting fairly well to working remotely. I had been looking into possibilities for part-time work close to my new (not that new anymore) home, but these were all jobs at shops and cultural institutions that had to close down for a while. And now, with so many people out of work, I feel like I don’t want to take a job away from someone who might need it more. Because here’s the weird thing— or maybe not the “weird” thing, but the kind of disgusting thing: I have more money than I’ve ever had right now, over $1.65 million. When the stock market plunged on the initial coronavirus panic, my net worth dropped to a bit less than it was when I left my job. But since then, the market has recovered, and my net worth is currently more than 25% higher than it was when I stopped working. I’ve sold some mutual fund shares to replenish my cash savings, but my cost of living is so low, I can gain or lose more in market value in a week— or even a day— than I spend in a whole year. This may not be the case forever, of course. 

(And in fact, it's been a couple of weeks since I wrote everything above, and now my net worth is only about $1.63 million due to recent declines in the stock market!)

Right now the stock market seems pretty disengaged from broader economic conditions. It is hard to see how COVID-19’s massive impact on the travel, hospitality, restaurant and arts industries won’t have a devastating effect on our economy for years, especially in the NY area. Eventually that will affect the stock market too. But in the meantime, it really is a glaring example of the rich getting richer while the middle class and working class and poor struggle to keep their heads above water. “The rich” is not usually a group in which I’d include myself, but the reality is that only a very small percentage of US households have a net worth of more than $1 million. I’m probably in the top 10-15% for net worth on my own, even adjusting for my age group, and taking Sweetie into account, probably top 5%. (I haven’t found good recent statistics but there are calculators where you can see where you stand based on 2016 figures. The continued recovery of the stock market since then would I guess mean that I’m a bit lower percentile-wise. Using my 2016 net worth would put me around the 90th percentile.) 

Anyway, I'm hanging in here. How are all of you, dear loyal remaining readers who still check in? I hope you are healthy and doing well. Thanks for sticking with me!

Monday, January 27, 2020

Spending Money on Clothes

Clothing is one of the areas where my spending has really decreased since I stopped working. I used to work in an environment that was relatively casual by corporate standards, but I still had to wear suits sometimes. Even when I was wearing jeans, I was conscious of wanting to look halfway decent, so I'd try to buy good quality jeans and not let them get too faded, and keep things interesting with sweaters and jackets. I also was always willing to pay for good quality shoes and boots that would last a while and not go out of style.
New York City brought lots of temptation at times-- there used to be some great shoe stores near my office, though they'd closed by the time I left. And when I moved in with Sweetie, my walk home from work often took me past a really nice little boutique. They had a well-curated selection of casual sweaters, jeans, work clothes and dressier things for evening wear, most of which I would just admire and walk past, since their stuff was quite expensive. But I eventually did buy a few things there.

One day, I passed the shop and noticed their signboard outside was offering a 15% discount if you spent $1,000. I just laughed and thought "oh my god, this neighborhood is getting so bougie for them even to post an offer like that." But a few days later, I went in and fell in love with a sweater. Then I tried on some pants. Then the salesperson, who was really nice, started suggesting things. I usually don't like being sold to, but this woman had a nice way of doing it. It was like having a personal stylist-- she suggested things, some that pushed my boundaries a little, some that made me say "no way," but others that made me think, "huh. This is something I can actually wear!" It wasn't long before I was at $900-something and then I threw in a t-shirt to get over $1,000 and get the 15% off. I couldn't believe I'd actually become the bougie customer taking advantage of the offer! I have never bought sweaters that expensive any time since (one was over $300) but I still wear all those clothes sometimes and love them dearly. I never felt like it wasn't worth it.
Other than that, most of my work clothes were purchased at chain stores like J. Crew or Banana Republic, and I'd order the occasional pair of boots or sneakers from Zappos. I'm not sure what my biggest ever year of clothing spending was, but it might have been 2016, when I spent a little over $5,000.

After I stopped working, all that changed. Without needing to dress up for an office, I find myself wearing a pretty basic uniform of jeans, t-shirts and a sweater or fleece top most days. In the summer, it's shorts and t-shirts or tank tops. I wear either sneakers or basic casual boots, and finally gave in and bought a pair of Birkenstock sandals. For a while, I bought no new clothing at all. Then I realized some of my jeans were getting a little worn out and decided to refresh them-- but to my horror, my favorite style from J. Crew was no longer available. I also had a favorite shirt from J. Crew, and was wearing it one day when my sharp elbow suddenly poked a hole through the threadbare sleeve.
I don't even live near a J. Crew store anymore, and their website didn't have any similar shirts anymore. So I turned to eBay, where I was able to find exact replacements for the jeans and shirt I already had for extremely low prices. And this is now my favorite way to shop! I'm in a phase, or perhaps the prevailing fashions are in a phase, where I just don't like or want most of the current merchandise that is out there. So since little of my wardrobe was ever particularly unique, and since most items still had tags where I could find style numbers to use in eBay searches, I've just duplicated some of the things I already own and love, for a fraction of the original cost. In 2018, I only spent $900 on clothes, and that even included a couple of things for Sweetie.
In 2019, I ended up spending a bit more, but that was mainly because I had some weddings to attend that required a bit more dress-up. I thought I'd be ok with stuff that was in my closet, but discovered that some of it dated back to when I was thinner, which was pretty depressing! But I still had outfits that worked, and I was able to jazz them up with some super cheap stuff from a local department store. Retailers seem so desperate these days, there are sales on all the time, and there seems to be so much cheap, low-quality "fast fashion." It kind of went against my natural impulse, but spending $20 or so on a colorful top to liven up an "oldie but goodie" black suit was just what I needed, even if the top ends up disintegrating in a year.
So this is my new clothing reality-- comfort and value, and a degree of minimalism in my daily attire. It's working for me, and for my budget!

Thursday, January 16, 2020

Still Alive, Still Spending, Still Saving!

It's been almost a year... yikes. Where to begin?

I actually don't have any major news. I'm still kind of adjusting to my "new" life. That has involved some higher than usual expenses as we decided we wanted to do some work on our house after being there for a while. And we've continued to take a couple of trips per year, though nothing super-exotic. But we are basically settled into a new pattern of life where we don't eat out very often and are generally enjoying a much lower cost of living than we had in the city. I've been mostly getting books from the library, so haven't been spending much in that area. I've gotten a couple of tickets for local performances and even a couple of things back in the city-- this kind of reminds me how much I miss being able to go to BAM in Brooklyn and be home within half an hour. Now staying in the city means having to time things right with trains and we always end up getting home really late. Sometimes I tell myself we can afford to just splurge on a hotel room but we've yet to actually do that. Our semi-retirement budget left room for a lot of splurges that we haven't yet allowed ourselves, but we've ended up spending more than we thought on household stuff, so I guess it balances out.

So how about some actual numbers?

My net worth as of Jan. 1, 2020 was $1,563,067. The stock market has been so strong, I think I've gained about $200,000 since I stopped working, even though I've had very little income since then. My goal has been to basically break even, but even if the market wasn't as strong, I think I'd be able to manage to spend less than my likely gains most years.
In 2019, my total income was about $70,000-- this includes all dividends, interest, blog earnings, gifts, EBay selling, etc. (I would be more precise, but Quicken does this weird thing where it shows realized gains from selling an investment as the total proceeds of that sale, rather than subtracting the cost basis to truly show the investment gain, so I've estimated what the real gains were without going back to accurately check.) Lots of that income is from my 401k, so it doesn't show up as taxable income. When I break it down to the actual taxable income, it was just under $20,000.
My total expenses in 2019 were about $27,000, not counting some additional one-time stuff that went towards our home renovation projects, most of which was actually paid for by Sweetie. My largest expenses were about $11,000 for food/groceries/liquor/eating out, as I usually pay for most of that for both of us. This still seems high to me but we did eat out more than usual for about a month while our kitchen was under construction. My next biggest category was "Misc" at about $2,300, which included a new Apple Watch and a new hard drive and battery to keep my old laptop going for a few more years. Also some art supplies, tax prep fees, postage and other random stuff. I spent just under $2,000 on clothes, which included a few things for Sweetie, and about $1,900 on education for a couple of classes. I am very lucky to have only had to spend about $1,100 on medical stuff-- this included my very low premiums for New York State's "Essentials" health insurance-- $45 a month including vision benefits, since I knew I'd need new glasses. The glasses themselves ended up costing a total of $370 for two pairs-- a thick single vision pair that was basically free, and a 2nd, half-off thinner pair with -- gasp -- progressive lenses, since I'm getting to that age where I'm not only terribly near-sighted but also need reading glasses. I will write more about the health insurance stuff, but the thing that really sucks about not being in the city is that my insurance plan, which is through United Healthcare, barely has any providers in my area. Having to drive 18 miles to an urgent care center that takes my plan is a bummer. I'm currently procrastinating about making that drive even though I probably need a little something to get over a case of bronchitis. I'm assigned to a primary care doctor who's only about 12 miles away, but I keep assuming it will be a nightmare to get an appointment. We'll see!
A few other expense lines: Travel $1,300, State Taxes $1,021, Gifts $1,476, Entertainment $958. Someday I'll have to do a post with my combined budget with Sweetie to reflect things I don't directly pay for myself, like our combined gym membership, auto maintenance, and utilities. etc. Sweetie's share is a bit larger, in proportion to the difference in our incomes.

Anyway, thanks for still reading and sorry I am so delinquent about writing. I make lots of notes about things I want to write about, and then for some reason I never get around to it! Terminal procrastination... happy new year to all of you, and hope you are enjoying the roaring '20s so far!

Monday, February 25, 2019

Cash is a Stranger to Me

I was recently in the city to have lunch with some friends, and I think it may have been the first time I ever went to a credit-card-only restaurant. There was some confusion as we tried to figure out how to split the bill with one person wanting to chip in cash and two people being willing to use cards, but then not having enough small change to appropriately share the cash. I suppose we could have asked the server to just put different amounts on each card but that seemed even more complicated!
Later that afternoon, I stopped in a cafe to grab an iced coffee. (It was one of those weird hot days and I was getting rather parched walking back to the train station.) Again, no cash was accepted. (I was also a bit shocked that a small iced coffee cost $4.75. I think I am already becoming unaccustomed to the ways of NYC. But it was very good coffee.)

Whether or not I'm going to places that don't accept cash, I find that I almost never spend it anymore. Every couple of months, I get my hair cut, and pay for that in cash. Once in a while, Sweetie and I will go to the local pizza place for lunch and we'll pay cash for a couple of slices. And occasionally there will be some other little thing. It used to be that I might buy a copy of a newspaper. But I get home delivery of the New York Times 4 days a week, and now I read the Wall Street Journal at the library. Even parking meters always seem to take credit cards now.

The Times just published an article about the backlash against this phenomenon: This Legislation Could Force Stores to Take Your Cash. I can see both sides of the issue. People argue that going cashless shuts out poorer people, who are unlikely to have access to credit and bank accounts. But businesses like the safety and administrative ease, and governments like having a data trail to prevent tax evasion and corruption.

I hope paper money doesn't disappear completely-- like postage stamps, paper bills are almost works of art, and I've always like collecting unusual ones from my travels. But I can't say I'll be using it very actively myself.


Monday, February 18, 2019

My Quarterly Blog Update: What's Up with Mom

That seems to be about the frequency I'm posting with lately! I really appreciate the comments from longtime readers and am glad to know you are still checking in! And it is good to hear from you about how you are doing in your own pursuits of financial stability and independence.

T'Pol, thanks for asking after my Mom. She is actually doing quite well. I invested the money in her two trusts (one revocable trust that is all hers, and one irrevocable trust, where she only gets the income but can't touch the principal) in Vanguard funds and they have been doing well enough to generate over $13,000 of income for my mom in 2018. She has been living on what she still gets from my father's pension, and her social security payments. In 2016 and 2017, she asked me for $5000 from the trust income to pay for other expenses. One year, that included my grandmother's funeral. The other year, she was moving to a new apartment. In 2018, she ended up asking me for two $5000 checks, as she had some expensive dental work. I was a little worried at first that she needed that much more-- it came at a point where she was fantasizing about moving to a larger and much more expensive apartment, and I sent her a slightly stern email querying the amount to make sure she wasn't somehow going behind my back to rent the new apartment. This was in December, and I explained to her that things were generally going well with the trusts but that the markets had just plunged and that we should be careful. I had another conversation with her where I reminded her how stressed out she had been when she was drowning in credit card debt, and that we had things under control now.
I worry that my mom doesn't understand the concept of building up a cushion for emergencies. I'm legally required to report to her on the trusts every year, and I've come up with a nice little template where I paste in a lot of charts and numbers from Vanguard showing what the assets are, how they did, and how much is being paid to her. (I do this by transferring the income from the irrevocable trust into the checking account for the revocable trust, which I also control. When my mom needs money, I write a check from the revocable trust made out to her personally.) My mom always just seems to glaze over on the overall details of the investments and just wants to know "How much did we make? How much more do we have than when we started?" Right now, the value of the trust accounts is over $130,000 more than when we started in 2015 (with about $450,000), and I worry that a number like $130,000 just makes my mom think "woo-hoo, we won the lottery!" So I keep reminding her that the funds go up and down, and that the money has to stretch itself out over quite a few more years, and that the more money we have invested, the more income we make, etc etc.
Some of that sinks in, some doesn't. Even though she is basically spending all her income except for a few thousand dollars of the trust income some years, she was on the verge of signing herself up for an apartment that would have cost her about $900 more a month! She said "oh, I'll just cut back on my budget somewhere," but she doesn't have any big areas she can realistically cut.

So overall, I would say things are pretty good, and we haven't had any fights about money, which is the best thing of all. But I'm always wary of what could go wrong! We are lucky to have the resources we do have, and as long as we are careful with them, everything will be fine.

And I do have more stories to tell, and hope to get around to posting again soon!