Goals for 2016

December 24, 2015 cb3 2 Comments

Bring on the New Year

Here we are. Already at the end of 2015. It’s hard to believe how fast this year has flown by. It’s also pretty cool that I’ve managed to track my expenses, stick to my plan and meet my goals for the year.

Now it’s time to formulate a new plan. I’m fairly confident that we could take the same goals from 2015 and re-apply them. After all, if I continue to do that then I’m only 9 years away from being debt free (In order to do that, I would need to reduce debt by 10% of the 2015 starting balance each year which is approximately $24k. If I use this years starting balance, I need 11.7% reduction to maintain the pace).

Accelerate the Finances

I’ve done a little back of the napkin analysis and based on a few factors, I think we can be more aggressive in 2016.

Financial goals:

Reduce overall outstanding debt (including mortgage) by 15%.
Make contributions to investments (taxable and retirement) of 15% of salary.
Eliminate outstanding credit card debt.
Eliminate remaining student loan debt.
Make a contribution to an IRA.
Generate revenue from a new income stream.

The first two are pretty simple and I believe easily accomplished based on what I learned last year. I’m trying not to spend extra income before it arrives, but I know what my ESPP and RSU schedule is and around how much I will receive. Most of that money is earmarked for debt reduction which is how I plan to accomplish the second pair of goals.

The next goal is more for the mental victory than anything else. I’m not maxing my 401k contribution yet, so this is technically not a priority. I think it would feel good to make the contribution even if it’s just $50.

Finally, I want to establish another income stream. Right now, most of my income is generated by my full-time job. I know that my investment portfolio is earning dividends, but I haven’t started tracking those. I’m not sure what form this new income stream will take at this time, but I do have a couple of ideas to explore.

Decelerate the Expenses

I’ve looked at a couple of areas on our variable monthly expenses and it looks like there are some easy wins to be had.

Expense Goals

Meet the $800 per month grocery budget
Reduce dining out to $400 per month (2015 – $600)
Reduce entertainment/alcohol to $250 per month (2015 – $435)

If we can accomplish these, we should be able to free up around $5500 in cash flow. We just need to make sure to stick to the meal planning schedule and have groceries ready for the week. I’ll be setting up a spreadsheet to track progress on that and help with accountability.

Let’s Talk Business

I’ve been reading a bit about business entities and the various benefits afforded to them. This year I plan to create my first business entity and being to explore what I can do with that.

While I don’t have any firm plans for what I want the business to accomplish quite yet, this exercise is more about learning the process at this point.

What about Chuck

When I started the blog, I talked about the canoe dock and what it means to me. That place is capable of centering me and I love the way I feel when I’m there.

This year I’m adding some personal goals as well in order to find that state of being more often. In 2015, I only took a total of six days away from work. That was back in March. With the crunch of project deadlines, the last half of the year was a bit stressful.

For 2016, I intend to take a little more time for myself.

Personal Goals:

Meditate at least three days a week
Take walks at least three days a week
Spend at least seven days camping
Go kayaking at least one time
Take one family vacation

The first two items might be challenging as I’m not very good at establishing new routines. I’ll need to set up another spreadsheet to track progress and keep me accountable. There may also be apps that I can use on my phone to help.

The last three items should be pretty easy to do. My wife and I already have plans to hike part of the AT while our daughter is at summer camp. We also have a family vacation already scheduled.

That’s at least two weeks away from work which is much better than last year.

State of the Blog

My goals for the blog really haven’t changed much. I still want to continue to document my progress and record stories about relevant events in my life.

I have gotten a couple of comments from real people (Thank You!), so I know that I’m starting to reach an audience. If I could grow to ten comments in the new year, I think that would be just fine.

Happy Holidays

Thanks for stopping to see what’s happening here and I wish you the best in 2016.

Cheers!

-cb3

Expenses, Movies

The Force was Strong

December 21, 2015 cb3 Leave a comment

Pricey Gratification

Last night, I took the family to see Star Wars: The Force Awakens. I’m not going to go into any details about the film, but I will say that it was everything that I had hoped it would be. We plan to see it again soon… for a couple of reasons.

This is the first time that the kids have had to stand in line prior to going in the theater. We arrived about an hour early but the line wasn’t too bad. We managed to get the seats we like. I did relay to them that I remembered standing in line for Empire Strikes Back when I was around my daughters age and what a special memory it was. She didn’t seem impressed, but I hope they’ll look back on it fondly.

It’s a good thing that I tucked away a little of the money from the RSU sale for a special occasion. We bought tickets for a Regal RPX showing and, my goodness, there was a little sticker shock. For two adults and two children, the cost of seats plus the Fandango fee was ~$68. Whoa! That’s almost twice what we pay for a conventional showing. If it had been any other film, I’d say it wasn’t worth the up-charge.

Throw in snacks and beverages (oh, they server beer and wine here now too) and we hit over $100 for the evening. Next time, we’ll be a bit more restrained and I think it will just be the two of us for a date night.

Intensity

As far as the film goes (no spoilers here), it was a little more intense than the original three. My eight year old daughter is a bit sensitive and I think there were a couple of sequences that we kinda of rough for her. She handled it well, however, and we talked about it when we got home.

Out four year old boy, on the other hand, was a champ. He was a bit obsessed with the TIE fighters getting shot down as I don’t think he realized they were the bad guys (Admittedly, he has a strange affinity for Darth Vader, so maybe he’s on the Dark Side).

All in all, everyone had a good time and we thank J.J. Abrams for providing exactly what the Star Wars universe needed.

May the Force be with You

-cb3

Expenses, Goals, Investing, Strategy

2015 Year in Review

December 18, 2015 cb3 Leave a comment

As we wind down 2015, I wanted to take a look back at the Goals for the year and how we did. I’m also going to talk about what went well, what didn’t, and a few of the surprises along the way.

This may be the first year of my life that I’ve ever been able to view my financial health holistically. It’s also the first time that I’ve ever written down financial goals for myself. I’ve tracked every dollar each month as well as goal progress along the way. Sitting down and Drawing My Picture has been a powerful tool indeed.

Financial Goals 2015

I started the year with three pretty basic and achievable goals.

Reduce overall outstanding debt (including mortgage) by 10%.
Make contributions to investments (taxable and retirement) of 10% of salary.
Eliminate any monthly interest payments due to credit cards.

In 2014, I had only managed to reduce my overall debt by a little more than 2%. Not wanting to spend another 49 years working on the problem I set my sights on 10%

I also wanted to continue to contribute to investments at least a little. I had a general idea of how much I would be making over the course of the year and what my previous year’s total spending was so I also set a 10% goal (pre-tax included) here. I did reduce my 401k contribution and increase my ESPP contribution to help generate some extra income for debt reduction.

Coming into 2015, I had pre-existing credit card balances of approximately $20,800. Towards the end of 2014, I had done some balance transfers to 0% offers so $12,300 of that total was not generating interest and $8500 was. Tackling the $8500 was my top priority since it was costing me an extra $180 per month in interest.

I’m happy to report that at the time of writing, all goals have been met for the year. Debt reduction is at 10.65%, investment contributions are at 10.38%, and I only paid interest on a credit card four months out of the year. I thought I had eliminated interest after March, but the extra Vet bill led to a $38 charge on the November statement.

Year-End Balance Sheet

Let’s take a look at the balance sheet for the year. I’ve intentionally left out the cash accounts (Checking/Saving) since these have relatively low balances and will fluctuate a bit by year end.

The ‘Other Assets’ listed is the estimated value of our house according to Zillow. I hesitate to use it in the balance sheet since it is an estimate and not a very liquid asset at all. Asset value increased by 7.53% this year which is mostly due to contributions and an increase in estimated home value.

The remaining $7180 of credit card debt is sitting on a balance transfer card with a 0% introductory rate that will expire sometime in January. I need to review the terms of the transfer and make a plan to deal with that before the interest starts. I do have an ESPP coming up on Jan 31 that will eliminate the balance if everything goes according to plan.

Overall Net Worth increased by 44.32%. That’s a really incredible number to see, but it makes sense when you look at the fact that I’m both adding assets and decreasing liabilities.

Cash Flow

This is the first year that I’ve tracked Cash Flow. I can say that I was very surprised to see the numbers at the end of the year. It’s eye-opening (and slightly alarming) how much money is going out the door. Here’s a summary (Income and Investments include pre-tax contributions to retirement accounts)

I’m confident that we can lower expenses next year. Right away, I know that we’ll be spending around $6000 less on outstanding credit card debt (~$13000 this year with $7180 remaining). We also had two larger purchases of a replacement laptop ($3000) and a Vet bill ($4000).

It’s possible that I can be a little more aggressive with my goals for 2016, but I don’t want to set myself up for failure so I’m still working on finding a balance. We may also be able to fund a family vacation next year which will help with the mental health aspect for the rest of the family (I think I’ve only taken 5 or 6 days off this year).

The slightly alarming bit is the fact that our total income included bonuses and RSU sales. If it hadn’t been for that, we may have ended up adding to debt instead of removing it. I need to get us to a point where we’re not dependent on extra income and everything can be handled by regular salary.

Expenses We Can Control

There are a few areas of expense where I know we can make a difference. I tallied up the monthly average for variable expenses and found the following items are over budget on average:

Pets and Electronics both have outliers that are skewing the average. Both should be much lower next year. The top item is basically anything we buy at the grocery store. We’re only slightly over budget on that but if we can cut it by 10% that’s around $1000 in savings.

Dining out should be half of what it is. One of the key challenges for us is having a weekly menu and getting the grocery run done. If we can make a better effort to be consistent there then we can easily cut this in half and save $3500 or so.

Entertainment and Alcohol includes things like movies and hockey tickets as well as trips to the package store. I’m cutting back on the craft beer and will be re-focusing some hobby time to brewing again in 2016. Honestly, I’d like to see this number cut in half too but a 10-20% reduction will be great.

Combine those reductions with the unexpected expenses and credit card payoff and we could reduce expense by up $18000. Stretch goal would be to make it under $100000 total expenses for the year, but we are still in debt reduction mode so I’m not as focused on that.

2015 – Year of Success

Well there you have it. As of right now, it looks like I was able to meet my financial goals for the year. Woohoo!

I’m looking forward to 2016 and will be updating my goals for the new year in a few days.

Cheers!

-cb3

Bonsai, Expenses, Lifestyle

Bonsai Class – Pine Workshop

December 14, 2015 cb3 Leave a comment

A Little Background

I’m pretty sure that I’ve already mentioned my major hobbies on the site. Growing things, in particular bonsai, is one of my core activities. There are a couple of reasons why I’m drawn to this.

First, it is the antithesis of what I do for a living. The organic natural processes help me balance out a life that revolves around technology. Second, it gets me outside for little bits of time each day. This is especially important since I started working from home a few years ago. Finally, it requires discipline and patience. This is counter to how my brain typically works, so in a way it’s a type of mental exercise to help me perform better in other areas.

Why I Needed This

The workshop had a very reasonable price of $55 which I had available in my discretionary fund (my wife and I each have personal checking accounts separate from the main account where we funnel a set amount of money each month for fun). It also involved about six hours away from the house which was harder to do without feeling guilty due to the amount of time that work has been requiring the past couple of months.

Eventually, my mental health needs won and I reserved my spot. Being able to unplug for a good portion of the day and focus on learning something that didn’t involve computers was a huge relief. I was long past due for a little time for myself to re-establish balance.

The Class Itself

This class was centered around Fall maintenance work on Japanese Black Pine bonsai. The discussion did reach other topics such seasonal work for Spring and Summer as well as fertilization, but mostly we focused on the Fall work.

The first thing we did was to take a look at our trees and work on removing any old needles from the previous year’s growth. These are fairly easy to identify by the position on the branch and the fact that the color is starting to fade and may be yellowing.

After the old needles are clear, we can take a look at the new growth that developed during the summer and prune any excess shoots down to a pair. Ideally, we want a pair of shoots of equal strength that are sitting side by side instead of top to bottom.

Finally, we can get in and perform any wiring necessary to develop that shape of the tree. There was an afternoon session on wiring, but I had other obligations for the evening and needed to get home. I had already participated in the wiring class a couple of years ago and feel like I have that under control.

What I Took Home

Well, I didn’t take home another tree! It was tempting, but it’s really not a good time for me to make the kind of investment that it would take to get the kind of tree that I want next. Most of my trees are what I consider project trees. It will be several years before any of them are show worthy. Eventually, I’d like to add a bigger specimen that is mostly refined and just need minor adjustment and maintenance. That can be a costly endeavor, so for now it’s on the ‘one of these days’ list.

I also came home with a greatly reduced stress level. I wasn’t worried about email or work the entire time I was out. It also prepared me for a laid back night out with the family to the local minor league hockey game! Fun times.

Cheers,

-cb3

Expenses, Goals, Investing

Quick RSU Update

December 9, 2015 cb3 Leave a comment

A little more at Vesting

The RSU vested on December 1st and came in a little higher than the $3300 that I calculated. I had based the number of shares to be held for taxes on the previous cycle. However, this time around the stock price was lower so they didn’t hold as many shares.

Total gain after the sale was around $3700.

Divvy it Up

I kept the allocation that I had build based on the previous estimate and used the extra for debt payoff:

$3000 went towards outstanding debt including the remaining $1550 balance from the Vet bill.
$500 went into my individual brokerage account at Personal Capital.
$200 will go towards a family outing for the holidays

Back on Track

This puts the current debt reduction projection for the year back up to 10.65%. Barring anything unexpected happening, I believe we will meet the 10% goal for the year.

Over the next couple of weeks, I will be setting up my spreadsheets for next years cash flow and debt reduction projections. I’ve already started jotting down a few new goals that I want to add for 2016.

Cheers!

-cb3

Lifestyle, Travel

Ireland

December 7, 2015 cb3 2 Comments

A Long Planned Trip (ish)

I’ve had a longing to visit Ireland since… I don’t know, forever. My brother and I had started planning a trip to celebrate my long overdue graduation from college in 2004. Well, life happened instead.

We were supposed to go in the summer of 2005 and in Feb of that year, I found out that the grant funding my position at the University was running out. I wasn’t fired or laid off per se. They just couldn’t pay me anymore. So, scratch that idea as I had to take a job in another city and front the cost of moving.

Fast-Forward to Present

Ten years later and I work for a global company and have architected a change to their wireless infrastructure. Lucky for me, the first site to deploy is in Cork, Ireland and I’ve been requested to be onsite for the roll-out.

It’s not quite the vacation I had imagined back in college, but it’ll have to do. I’m both giddy and full of dread at the thought of the trip. On the one hand, I’m going somewhere I’ve always wanted to go. On the other, I’m going to spend about 70-80 hours in a conference room that looks no different from those in the US.

The Day Arrives

I had an evening flight out of Atlanta with a four hour layover in Amsterdam. In my mind, I would sleep on the flight over and be ready for a light day mostly spent at the hotel. My boss had other plans and wanted me to get to the office as soon as I landed. I got maybe two hours of sleep on the first leg of the flight, had a pint of Murphy’s at Schipol before the second leg and slept the hour and a half over to Ireland.

Hitting the ground running when I got to the office was an interesting experience to say the least. My body had no idea what time it was and I was regretting eating the in-flight meal the evening before. It felt like I had a ton of bricks in my guts. Somehow I managed to work from 11am local to around 10:30pm that night.

The Local Cuisine

Being somewhat of a food nerd, I asked one of my co-workers where we could get some traditional Irish fare. His response… ‘What, you mean like cabbage?’. Luckily, I was talking to the wrong person and meals weren’t nearly so tragic.

Highlights from the trip were Sunday brunch at Sage in Middleton, dinner that night at Blair’s Inn near Blarney, and our last night’s dinner at Electric in Cork.

Sage has an excellent locally sourced menu and a surprising craft beer selection from Irish breweries (I think the craft beer scene is lagging behind the US since most bar served macro beer). All of the ingredients come from within 12 miles of the restaurant. I had house made black pudding to start and a main course of Hereford filet medallions.

Blair’s Inn was a wonderful experience in itself. It had the country pub atmosphere that I had hoped to find. We sat at a corner table by a coal fireplace which was quite toasty and welcoming. The beer selection here was also top notch and I had a really nice cask stout. Dinner was a braised lamb shank (literally melt in your mouth) and rosemary mash. I also splurged and got sticky toffee pudding for dessert. Movement back to the cab was difficult after a meal like that.

Finally, on my last night there we had dinner at Electric. This is a neat place right on the River Lee. We started by having a pint downstairs at the bar while we waited for our table. Our table was in the main dining room, but they also have a fish bar overlooking the river. I started with seafood chowder which was absolutely amazing. For main, I had fish and chips which I felt was more of a cultural obligation. It was good, but disappointing after the excellent chowder. For dessert, I had an Irish coffee (another cultural obligation).

Being Touristy

On Sunday, one of the local directors had arranged for a little excursion to Middleton. He picked us up and we had brunch at Sage before walking over to the Jameson distillery. I honestly had not had any Irish whiskey since college (and really, not served in the best way back then). However, good whiskey is a passion of mine and I was happy to explore.

Browsing through the old stone buildings was a remarkable experience. There’s a lot of history there that we just don’t see in the US (not that we don’t have a lot of great history!). I was also very impressed by the sheer size of the operation compared to the time it was built. The fact that people were able to build to this scale before the industrial revolution is awesome.

The actual production of the whiskey was mostly what I expected. The process doesn’t vary that much among distilleries or breweries. They do distinguish that they triple distill the spirit before barrel aging. For whiskies, the barrel selection and aging times are what give the final product it’s characteristics. Jameson is very smooth and has a lot of honey and vanilla aromas and flavors. I actually quite enjoyed it.

At the end of the day I added about $200 worth of whiskey to my luggage and had to stop at a Tesco to pick up an additional bag for dirty clothes. Mental note: In the future, pack an extra bag so that there’s room for souvenirs in the luggage.

The Return of the Geek

The last night in Cork was a little rough. We had a team dinner which lasted well into the evening and then a meeting with the home office in PST at around 10pm local. My flight was at 6am the next morning with a layover in Amsterdam again and then a direct to Atlanta.

By the time I made it to bed, I had about two hours to sleep before I had to get up and catch the taxi. Being from Atlanta, I’m super paranoid about getting to the airport early so I scheduled my cab for 3:45. Perhaps that was a bit aggressive as the TSA line didn’t even open until 4:30. No worries, I had time for coffee and a little more shopping in the duty free store.

All-in-all, the flight home was uneventful and I was able to get a little more sleep this time. Hartsfield-Jackson International terminal on the day before Thanksgiving wasn’t nearly as bad as I expected. The bad part was getting around to the domestic side to pick up my brother. Ouch. Traffic into the cell phone lot was backed up bumper to bumper, so I dipped into the hourly lot and forked over my $3.

Still on the List

Even though I finally made it, I still have Ireland on my priority list of destinations. Next time I want to do it on my own terms. Occasionally, we talk about going for a summer trip and renting a cottage for a couple of months. My job basically allows me to work from wherever I can get an internet connection. It would be even better is we could clean our place up and lease it out while we’re gone.

Anyway, thanks much Ireland! I had a great time despite the work requirements.

Cheers,

-cb3

Expenses, Goals

November 2015 Progress

December 1, 2015 cb3 2 Comments

Happy Holidays!

November was, to be honest, an ass kicker on the full-time job front. I had even started a slight rant post that I’m not sure I’ll finish. Regardless, it makes the sound of financial freedom even more appealing and I was exceptionally thankful for a few days of downtime over the Thanksgiving break.

The week leading up to the holiday I was traveling for work to Ireland. It was my first trip out of the country and while I didn’t have a whole lot of time for tourism, I did get to see the Jameson distillery in Middleton. Of course, that lead to a little extra personal expense as I purchased a few gifts for family. I’ll use some of these as Christmas gifts, so it won’t be a huge overage as I’d be spending the money anyway.

Other than the travel expense on gifts, there wasn’t anything unexpected this month. Groceries, restaurants, and entertainment/alcohol were back up this month due to holiday events. We still managed to keep it under control and none of the categories were the highest of the year.

Current Goal Status:

Reduce overall outstanding debt (including mortgage) by 10%.
1. At the end of November, overall debt reduction is 9.15%. We put extra towards the Vet bill to help recover. Year-end projection is currently 10.03% so it look like we’re back on track.
Make contributions to investments (taxable and retirement) of 10% of salary.
1. Combined saving in investment accounts is now at 10.19% which is still below the 10.71% high in September. I’m still on track but may be able to bump this a little at year end.
Eliminate any monthly interest payments due to credit cards.
1. November broke the streak and I paid $38.03 in interest on the card holding the Vet balance. This brings total credit card interest to $386 for the year. I don’t anticipate any interest in December.
2. Of the $3200 balance increase from veterinary surgery, ~$2200 remains on the card. I have an RSU vesting today that will eliminate this balance.

Total expenses for November rose to $8031 which was still the second lowest of the year. Net cash flow was slightly positive at $423.

Looking forward to the gift-giving season, we’re working on setting a budget for gifts and making sure we have a checklist of each person before we start buying. We’re also looking at using the points on our Chase Sapphire card on Amazon to offset purchase costs. I don’t believe we’ll use them all and we don’t have any travel planned for first half of next year where we could use the points.

-cb3