Monday, December 23, 2019

FWOTW: no Christmas gifts

So today’s post is a bit different from my other frugal win of the week (FWOTW) posts.
About 5 or 6 years ago, my wife and I decided that we no longer needed to exchange gifts.  This applied to various occasions such as Christmas, birthdays, anniversaries, and Valentine’s Day.  I’ve written in the past about my thoughts on gift giving during Christmas here, and I still feel like those comments remain relevant today. 
To quote from my previous post:
One of the best decisions that my wife and I have made regarding gifts was to just agree not to shop for surprises for each other.  If we really need or want something, we just agree to go and buy it – no need to connect the purchase to a random “gift giving” holiday.  We already have almost everything we could possibly want.  We are trying to minimize the junk we own.  Anything else would just clutter our home.   

Sometimes it is hard for people to understand why I don’t buy an anniversary gift for my wife, or why she doesn’t get me anything for my birthday.  Our attitudes go against common consumerism culture.  Once you are in a committed relationship with your significant other, your finances are linked.  You are now saving for financial freedom together.  Spending money from our same bank account doesn’t benefit our financial future in any way.  Our best gift to each other is sharing the common goal of reaching financial freedom together. 

Last week I was in the office lounge eating my homemade food during lunch.  One of my coworkers also brought her lunch struck up a conversation by asking me how my Christmas shopping has been going.  I explained to her that my wife and I decided years ago just to not worry about getting each other gifts.  It was an unnecessary stress that we really didn’t need and our lives were better off without random gifts.  She was a bit surprised to hear that we don’t participate in giving gifts to each other.  My coworker then started telling me about how difficult it was trying to find the right gift for her husband while having a hard time balancing the budget at the same time.  She explained how last Christmas, she was dealing with unemployment and money problems, and the couple decided not to exchange gifts.  Christmas came and went without any issues.  Since she was working this year, she automatically thought that they were just going to resume the tradition of giving gifts.   
Well, this morning my coworker excitedly came to me to share that she had a talk with her husband and they both decided they did NOT need to get each other gifts for Christmas!  She told me that she was so relieved after talking this out with her husband.  There’s no need to break the budget to follow the trends of society.  Christmas is not about giving gifts.
This holiday season, take the time to appreciate everything that you already have.  Appreciate your health, your family, and your friendships.

Monday, December 9, 2019

Milestone reached: over 300K invested in my 401K

A 401K is a retirement savings plan sponsored by your employer that allows you to contribute part of your paycheck towards your retirement before taxes are taken out.  Contributions into your 401K lower your adjusted gross income, which may lower your tax liability.  

I just hit a new milestone in my 401K: my investments have surpassed 300K in value! 

I started contributing into my 401K a little over 8 years ago in October 2011 with a 3% contribution from my paycheck.  When I first started contributing to my 401K, I couldn’t imagine it ever being possible to max out my contributions to $17,500 (the limit back then).

I increased my contributions over time, just 1% every few months.  Slight increases in my contributions made it easier to adjust to slightly decreased paychecks.  Salary increases also helped make increased contributions and lifestyle adjustments easier.  By June 2014, I was finally able to max out my 401K. 

During the last 8 years, the market has gone up and it has gone down.  I continued to make contributions with each paycheck.  When the stock market declined, I picked up more shares of my index funds.  When the market reached new highs, I picked up less shares.

Time in the market is much more important than timing the market.  Investing in a 401K consistently puts money into your account with each paycheck, whether the market is up or down.  You’ll end up fine even if you only invest at market peaks, as long as you stay the course with your investments and not panic when the stock market has a crash or correction.
If your employer offers a 401K, I highly recommend contributing to it.  It’s the best way to consistently invest on autopilot.  And since your contributions are taken out of your paycheck directly, you won’t miss the money when you get paid.  If your company offers a match, definitely contribute up to it.  Saying no to a 401K match is turning away free money.  Match contributions from your company do NOT count towards your maximum individual contribution amount.  

My 401K is 90% invested in 3 funds designed to mimic VTSAX, the Vanguard Total Stock Market (71% S&P Fund, 6% Vanguard Mid Cap, 13% Vanguard Small Cap Growth) as well as 10% into a Vanguard Health Care index.  

Starting next year in 2020, the maximum contribution for 401K will be $19,500 (for those ages 50 and over, the additional "catch-up" contribution limit will rise to $6,500).  I’m looking forward to the increased limits.  If you are not currently maxing out your 401K, try to increase your contributions.  Even 1% increases can make a huge difference over time.   

Sunday, December 1, 2019

Side hustles November 2019

­The great thing about doing side hustles to generate extra income is that you can hustle on your own terms.  The more hard work, time, and creative effort you put in, the more extra money you can make.  You can hustle as little or as much as you want, whenever you want.  It’s your extra money, and you can choose how you want to spend it.  Instead of focusing on what ideas don’t apply to you, try focusing on different side hustle ideas that you can implement to work for your situation.

Once a month (usually on the 1st), I like to post a short summary of our personal and financial situation for the previous month.  While I don’t often post articles, I am committed to documenting all of my side hustle income.  Here I’ll share some of what’s been going on with our lives and our side hustles. 

Welcome to December!  Did you have a good November?  It’s been another adventure packed month for our family. 
We visited the La Habra Children’s Museum 3 times this month.  It’s a great place to spend a few hours exploring all of the children’s exhibits.  This place is like a second home for our family.
We visited the Aquarium of the Pacific in Long Beach 2 times this month.
Our daughter loves sea turtles.
The big highlight of our month was a 5-day, 4 night stay at the Legoland Castle Hotel.  It was quite a busy vacation, with 3 visits to Legoland and 1 visit to Sea World in San Diego.  It was great staying at the Legoland hotel because daily free breakfast buffet was included.  We also had early entrance to the Legoland theme park every morning.  Our son rode his first rollercoaster: the Coastersaurus!  He loved it!  The best part about our trip was that there were no crowds this time of the year and no lines for the rides we went on.  On many of the rides, the attendants allowed us to stay on for another ride.
In other news, this month I turned 39.  It’s hard to imagine that I am almost 40 years old!  I continue to try to pursue a life of happiness and meaning while enjoying the here and now with my family.  Time passes so quickly. 
Thanksgiving this year involved spending quality time with family, having office potlucks, and holiday dinner parties with our friends.  We have much to be thankful for.  We are thankful for our health, our families, our friends, and our financial stability.   
In sad news, our dog has been suffering from many health issues this month.  She was diagnosed with a urinary tract infection after she had blood in her urine.  Later on, she had uncontrollable vomiting and was diagnosed with chronic pancreatitis.  She has been on multiple medications and now needs to permanently be on a prescription low fat diet.  Her veterinary bills have totaled $1,059.83 this month!  I am thankful that these big expenses are not major setbacks for our family. 
Here’s our monthly summary of side income that we have generated in the previous month of November.
Award Travel
On 11.19, I redeemed 34,492 Southwest Rapid Rewards points towards 2 free flights for my wife and our son to fly home from visiting the in-laws during Christmas.  Paying cash for these flights would have cost a total of $503.96.  When redeeming points, I only had to pay taxes and fees totaling $11.20 for both flights, saving us a net $492.76 on ticket prices!
Cash Back
On 11.21, my wife received a $43.92 statement credit on her AMEX Gold card from the Airline Travel Credit benefit of her card.  This was cash back on a Southwest Airlines ticket flight for my wife and son to visit the in-laws.  We paid the majority of the flight costs with previously saved up Southwest $100 gift cards that AMEX reimbursed.  Unfortunately, the AMEX Travel Credit benefit no longer reimburses airline gift card purchases.
On 11.25, my wife received a $11.20 statement credit on her AMEX Gold card from the Airline Travel Credit benefit of her card.  This was a reimbursement for taxes and fees paid on award travel flights.
On 11.29, my wife received a $10 statement credit on her AMEX Gold card from AMEX Offers.  This offer was for 10% back on any insurance purchase, up to $10 cash back.  We used her card to pay our homeowners insurance.

Rental Income
On 11.5, we received a net profit of $450 from our rental property. 

Survey Income
On 11.2, I received a $10 check from M3 Global Research for completing a medical survey.
On 11.6, I received a $10 check from E-Rewards Medical for completing a medical survey.

Miscellaneous Income
On 11.4, I noticed that the two Legoland annual passes (with 2 bonus day passes included) I purchased at Costco had dropped in price by $20.  A quick phone call to Costco helped us get $40 refunded as a price match. 

Monthly Totals:
We saved $492.76 on award travel
We earned $65.12 from cash back
We earned $450 from rental income
I earned $20 for completing online surveys
We saved $40 by price matching a price drop from a Costco purchase.

All of this totals $1,067.88 from our side hustles for the month of November!  One more month to go before we start another year.  Keep hustling.
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