Abundance Project- $25,600

  The Abundance Project is a great idea I found over at http://millionairemommynextdoor.com and wanted to implement for myself over the next year.

Basically, it’s an exercise to expand your way of thinking.  Imagine what you would do with $100 the first week.  Double that each week you participate in the project (week 2=$200, week 3=$400, etc).  Consider how you could raise that sum of money to meet your goals and wishes.  Then, express gratitude for something in your life presently.

 Here’s a link to my first post if you want to start from the beginning (or click the abundance category link on the sidelines to see all the posts and go through them in order to review my money making- or radical spending- ideas!) https://diaryofadink.wordpress.com/2008/08/13/30-day-abundance-project30-day-abundance-project/

And here’s what I’d do with this week’s amount of $25,600.  My the money grows fast.  Only wish my bank account would double at this rate!  Geez, I wonder if we could resist the temptation to pull it out and spend it and be patient enough to just let it keep doubling at these rates???  Interesting concept.

What I’d buy:

That fully-loaded Honda CRV LX I bragged about not having last week…sigh.

I’d then have XM radio, space for a large dog (which we don’t have yet but would certainly buy!), and heated front seats to keep me warm this winter.  Aahhh… isn’t it a beauty??

 

The lovely Green Tea Exterior of my new crv

The lovely Green Tea Exterior of my new crv

 

 

 

 

Gorgeous interior fabric in Ivory

Gorgeous interior fabric in Ivory

 

 

How I’d raise the money:

I gave this a lot of thought this week.  There are a few homes in the area that are fixer uppers (not a lot of work needed but definitely some) and they are going for about the same price as a new one if you buy them in multiples.  Rent is extremely high in my area and with a little handiwork and a redirection of the money we have saved for a downpayment to a personal home, we could buy 2-3 rental properties and cashflow them.

 

The property insurance here is on the expensive side, especially for an investment property.  But, considering one deal I looked at this morning (3 properties downtown bundled for the price of 1 personal home in the area we’d be interested in buying) we would own the equivalent of 9 apartments.  After a year or so of treading water trying to get them in shape quickly and turn them into rentals to cover the mortgage and insurance, I think these could easily turn a profit for someone who is interested in owning.

 

One great idea I learned of long ago was to rent out individual rooms and hire a maid to clean the common areas.  That way you can make $2-400/room (depending on cost of living in your area) and possibly double or triple the amount of rent you would make otherwise all the while keeping an eye on the apartment by making the common areas shared spaces that you keep clean and tidy.  It’s almost a hotel deal at that point.  And, as we all know from Monopoly, hotels trump houses!

 

Three things I’m thankful for this week:

-Our vacation has finally arrived and DH and I are leaving the area and celebrating an anniversary alone with one another in the sun

-Three of the four new arrivals to our extended family this year have already been born this month and are thriving and healthy newborns

-The cost of fuel is coming down.  It’s down 25% from the end of summer in my area!  Hallelujah!!!

 

 

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Rightsizing Your Life

frommylibrary

With all the talk about the economy going bad and downsizing, I thought I might discuss one of the ways we are working to rightsize our lives and bring in more cash… and mention a book I just read.

Lately DH and I have been trying to get rid of some possessions we don’t use and generate extra cash in the process.  At first I thought it was going well (as everything went accordingly to plan) but in the last few weeks selling stuff has been such a chore.  We have so much stuff we cannot seem to get rid of despite many attempts.  We want so much stuff (like a big screen t.v. and some new clothes at the top of the list since DH’s dress pants aren’t fitting quite as well as they used to due to weight gain).  And still, we don’t need all the stuff we have right now…

So, our dilemma has become, “rightsizing” our home.  I first read about this word last week when I was reading a book called “Rightsizing your Life” by Ciji Ware.  It’s partly a retirement book to help decide where you should live and what you should do with yourself when making big life changes.  But, I think it’s also valuable as a tool to help you pare down your possessions and really just own the essentials needed to make you happy.

rightsize

As Suze Orman always says “People first, then money, then things.”

But, to get back to the book, it has seven steps which make it easy to approach rightsizing your own life (or at least your home and closets!).  Taking “baby steps” to improve our lives is so important.  Dave Ramsey, sit down, this is not your book and it’s not your turn.  Sorry, my financial side overwhelms me sometimes.  Since DH and I have been trying to find more things to try to sell and get rid of I think this has been a very helpful book!

Our goals for November:

-unload the recreational equipment which generated a lot of calls but no actual people came to visit it

-bring our newly acquired collection to the pawn shop

-dump our clothes on consignment from the annual paring down of the wardrobes

-go through our books and see what we can sell online (including textbooks and coffee table books that we don’t truly love and use)

-bring whatever does not sell to our friend for her spring yard sale to get it out of the house for the holidays and hopefully generate $50 or so down the road

Just another reason…

Princess Cruise Deal
21-Night Trans-Atlantic Thanksgiving Cruise from $869

for early retirement.

If we were retired we could wait for just the right deal… and strike when the iron was hot.  Like right now!!  We paid $2500 for our November cruise in January and $600 for our flights earlier this summer.  An even cooler cruise, for twice as many days, hitting 3 continents, is being offered for 60% of the price we paid.  Flight costs would still come in quite a bit under what we’ve paid too, all things considered.  Now, I’m not complaining, we’re happy to be leaving in a month… but boy do I wish we could have waited on days like this.  On days when $25/night cruises to the Bahamas are setting sail (see Norwegian Cruise Lines for details) in November I think, man, if we were retired and called the shots on when we work, and where… we could totally take advantage of these deals!!!

Just keep breathing and reminding myself… one more month… one more month…

Eventually, I’d like to be retired early and be choosing my work dates a few times/year instead of my vacation dates!  OR choosing to get away from the hot weather to go to a cooler climate.  Oh, imagine how wonderful that would be…

October’s Money Magazine– Retirement Issue

October’s issue of Money magazine is all about retirement.  None of it applied to me.  It was very frustrating to read.  I don’t think we’ll be renewing our subscription next year.  While I appreciate  that the subscription was $2 for a year of issues, there haven’t been too many really insightful articles in 12 months.  This edition was no exception.  Plus, it’s always available at two local libraries and our local bookstore! 

I think the most frustrating part of retirement is trying to plan for something that is so many years away for DH and I.  Then, trying to plan for how long it will last…30 years, 50 years… trying to plan for some appropriate amount of money for retirement when you don’t know how much things will cost, whether we’ll move to universal insurance, whether we’ll be sick and need additional medical care.  I’ve always believed in planning for the downside.  But, this downside, is almost too disheartening to plan for.

Then I think how much more frustrating planning for a near retirement in this economy will be.  I become grateful that we’re not anywhere near retirement age when I consider that.  It’s ridiculous to imagine that so many things that seemed sure and certain are now so uncertain.  How do you plan for retirement when everything can go according to plan for 40 years and then, in a matter of months, everything can change?  How can you accumulate enough to cover that downside?  Will this happen to us 40 years from now?

In unrelated retirement news, DH and I have discussed whether or not to stay here and buy a home recently.  The house we were most interested in last week (the only house we have found that we were interested in after looking for almost 5 full months) was pulled off the market because the newly retired owner had a change of heart, overnight.  That’s all the details I’ll give, but both realtors (his and ours) said they’ve never seen this excuse in over 20 years of combined realty experience.  I’d prayed for wisdom to make the right choice. 

This was the best possible deal around.  I won’t buy just to buy.  It would have to be a really good deal to get as centrally located as we already are.  We have 3 solid reasons for staying here and within 5 years, those 3 goals will have been achieved if we don’t lose focus.  Originally, we felt that within 10 years we could max out our retirement goals and that we would move then.  But WE DON’T LIKE THIS CITY.  We’d like a new area.  This doesn’t mean we’re up and out of here in a year.  The soonest we could achieve the goals we have set for ourselves is 3 years.  We would be under a lot of pressure to find a place to move and achieve these goals in that timeframe.  So, we’ve redefined our goals and we are going to aim for 4 more years!

Social Milestones

DH and I have been investigating a house that’s been on the market for the better part of this year in our neighborhood.  It was listed at an outrageous price and needs a lot of cosmetic work inside.  It’s definitely not our dream home but it is now a very good buy.  We’re having a lot of difficulty justifying the purchase and the move though.

 

 

 

The pros include being able to own a dog, securing a place in a neighborhood we love for as long as we want, and the possibility of a tax-free capital gains investment.  The cons include, but are not limited to, increased monthly expenses of $4-800/month depending on the mortgage (15 or 30 year), increased cost of utilities, and decreased freedom (to move, to take great international vacations, and to spend freely!). 

 

One of our issues is that of “social milestones.”  While it would be a huge achievement by our peers and family’s standards to own a home, we’re realizing that it may not be part of our long term plan.  Everybody we know is getting married and/or buying condos/houses.  The drives right now in our age group are to get married, have kids, and enjoy a deep sense of community in a nice area.  They aren’t maxing out retirement accounts with the plan of stopping all contributions in 10 years.  They aren’t considering living internationally at that time or planning to visit all of the continents and most of the states at least once in the decade before that. 

 

My concerns are: What if we end up staying here 15 years?  We could own a house outright by then in a great neighborhood at a decent monthly mortgage until then.  We could live in an established neighborhood with the best school district in the county at our disposal.  We could have an investment that may have doubled in value completely paid off and available to cash it in to fund our “early retirement” for 20 years until the traditional retirements (403b) kick in at 65.  We could end up enjoying our time here a lot more by becoming a part of the community and owning a dog instead of biding our time until the next adventure.

 

It’s a difficult decision and the social pressures are pretty high to buy.  I know not all decisions should be about money and that is something I struggle with on an ongoing basis.  I’ve always tried to make decisions that allowed me the most options and I hesitate to make a decision that violates that. 

Options

It’s all about options.
 
We make choices now so that we can have more and more choices later.  While we think we may know what we want tomorrow, experience and wisdom (limited as those may be in one’s late 20s) tell me that we probably have no idea what’s in store for us and that we will be best served by keeping our options open.  For example, we could go live internationally now and forego this “retirement savings frenzy” we’re currently experiencing.  Or, we could buy a house and get a dog and enjoy living here a bit more than we do now as we suffer through some of the trials of apartment living.  Or, we could accept the fact that early retirement (in our 30s/40s) is very unlikely (in the traditional sense that we could STOP working altogether) and just let up and enjoy our lives more by spending more money on wants and caring less about needs like retirement since we clearly have a lot more time to save for them. 
 
However, it’s all about options.  We choose to save now so that we have the option of working when we’re 70.  We choose to save now so that we have the option of raising kids later.  We choose to save now so that we have the option of buying a house or moving or renting forever if we find the perfect apartment community someday a la millionaire mommy next door.  WHERE IS THAT APARTMENT????
 
Sometimes we get down and “I wish” enters our vocabulary…but we remind each other (yes, it helps to have a supportive partner) that living frugally now ensures us options later.  We may want them.  We may need them.  Nevertheless, we will have them!

Retirement- Is 35 too young?

                                                                        

This has crossed my mind a number of times.  Now, I’m not saying I’m going to make retirement by age 35.  But at this rate, I’m pretty sure DH will as he is a few years younger than me.  He hasn’t even finished his first degree yet.  If we were to retire at his 35th birthday would he have time to really pick and start a career before his early retirement party??

And honestly, what would retirement mean?  Would we stop working completely?  Would we start volunteering our time or travel internationally and help worthy causes for stipends?  Would we cut back to part-time work and refocus our efforts at home on volunteer work and social projects?

Could we celebrate at age 35?  Would ANYONE in real life support us or be happy for us?  Or would we quietly have to do a dinner followed by a lengthy world cruise uncomfortably laughing at work when coworkers suggest we’ll be “paying that trip off for a few years, huh?”?  Could we even admit to our families, who, if still alive despite many years of smoking and alcohol abuse, will likely still be working and not contributing a dime to their own retirements at that age?

These are the questions we regularly ask ourselves.  These are the concerns we frequently wonder about and sometimes I wonder if it somehow keeps us “trapped” and will make us unable to ever cutback or retire should we continue to carry these concerns forward.  If a couple retires young enough to really enjoy their lives, but they aren’t shouting it from the rooftops and quietly continue upon their path, did it really happen?