How We Got A Month Ahead in Our Budget… Again

In July of 2018, just after my family moved to North Carolina, we finally made it a priority to get a month ahead in our budget.

We took money we saved from not having a mortgage payment on the first month we bought our new house, together with some savings, and used that to create a bare-bones budget for the month of August. We lived on that money during the month of August and saved Mr. ThreeYear’s two paychecks to use for the next month, September.

We’ve kept this system up ever since, so that the money we budget is the money we earned from the previous month.

This has been a phenomenal system for a couple of reasons. One, we have a cushion in our bank account so we never have to worry about the timing of our credit card payment or other bills being taken out. Two, we know exactly how much we have to spend each month, before the month starts, so there’s no guessing with budgeting.

So why am I saying that we got a month ahead in our budgeting again?

I started a full time job last August, and began to get two paychecks per month. I am currently maxing out my 403b, and I’m a teacher, so to say that the paychecks aren’t huge would be an understatement. Still, they’re nice additions to our bottom line.

When I started to get regular paychecks, I decided not to add them to our budget, because I wanted to save them, or spend them on non-budget stuff.

Did I think that by not budgeting the money in our traditional money things we would somehow be more efficient or productive with the money? Apparently I did.

The months passed, and those paychecks got eaten up in some way or another, very rarely being spent on purpose like I had envisioned.

When we refinanced our mortgage to a 10-year, and our monthly payment went up by $450 per month, I realized that something needed to change.

I needed to add my paychecks to our budget, because we needed them to pay the bills. As much as I didn’t want that to be true, it was. We were going over budget every single month and if we wanted to make headway on savings goals, we were going to have to have a clear-eyed vision of exactly where our money was going.

At the same time, I finally admitted to myself that I wasn’t very good at budgeting.

Guys, I have been budgeting since 2008. That’s twelve years. That’s a long time to be bad at something.

But you know that saying, if you keep doing what you’ve been doing, you’ll keep getting what you’ve been getting?

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Musings on Covid-19

Oh, good. My site’s still here. As I logged on, I wondered for a second, since it’s been so long since I posted.

My family spent last week at the beach for Spring Break. I realize how incredibly fortunate we are to have that house to visit, to have a different view for a couple of days, and to be able to visit the beach. Still, we had planned to be in Spain, and I had a few moments of mourning that trip.

Your feelings are your feelings, as selfish or ungrateful as they feel, no? I read an article (I’ve read many over the past several weeks) explaining the unsettledness we feel as grief. Grief for a future that seemed more certain, grief for what we’d planned and didn’t come to pass.

Many years ago I read an explanation of Black Swans as events that would change the course of history but that come out of left field, completely changing the course of history in ways that are inherently unpredictable because of their randomness.

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How Humility About Personal Finance Can Be a Really Good Thing

I have been known to be a bit, shall we say, know-it-all about several topics. One of those is personal finance. I thought, once I got my debt paid off and was saving up a large chunk of our family’s income each month, that I knew all there was to know about this particular topic.

Of course, that’s an exaggeration. But, I am very quick to offer advice in this particular area, without necessarily being willing to listen sympathetically.

Sometimes, not having all the answers or feeling unsure about a certain area of personal finance, however, is important.

If you know you have all the answers, or that your way is the right way, how can you properly evaluate other ideas, or have an open mind to listen to new possibilities?

That’s where humility comes in, and humility often comes through failing at something.

So, if we have succeeded with money for a while, relatively speaking, how do we get money humility?

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Debit Cards for Kids

I’ve written a lot about how we teach our kids about money and tackle allowance in the ThreeYear household, but I have a confession to make: I’m really terrible at remembering to get cash from the bank to give my kids.

Isn’t that always the way? If there’s a tiny kink in your process, such as your bank being too far away to go get cash, then it can throw the whole process awry.

For the record, our allowance plan is supposed to look something like this:

  • Kids do weekly chores and help around the house.
  • Kids are given $6 each in cash.
  • Kids save $2, set aside $2 for Giving, and have $2 to spend.
  • Kids save up for toys they want, learning valuable money lessons like patience and perseverance in the process.

In reality, it goes something like this:

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Should We Get a 10 Year Mortgage?

Mortgage rates are lower than ever, and when I recently saw that 10- and 15-year mortgages have hit 3% rates, I was intrigued.

Long-term readers of the blog know that we have (and love!) our 15-year mortgage, because it’s allowed us to pay off our house faster and build up more equity than a 30-year mortgage.

I’m also completely aware that those who have a 30-year mortgage tout the benefits of those, including the ability to essentially maintain a super-low interest rate while investing their money in higher-return vehicles like the stock market.

Mr. ThreeYear (especially) and I (less so) tend to be of the more conservative variety, preferring the feeling of having no debt to the feeling of optimizing our investments. One option isn’t better or worse than the other, just different.

When I mentioned to Mr. ThreeYear that we could consider refinancing to a 10-year mortgage at a lower rate, at a monthly payment that we could afford, he was very excited.

So we began to investigate the option of refinancing to a 10-year rate.

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Why We’re Eating More Vegetables in 2020

As I mentioned in my last post, this year I’m not setting goals like I have in the past. One of the reasons for this is because I’ve achieved a lot of my short-term and mid-term goals, especially the big ones (become location independent, fully fund our 401ks, get a job, get a dog).

This year, I’m more focused on tweaking the little, day-in and day-out habits that ultimately make life better or worse.

One of those habits that I’m tracking is how many vegetarian meals I eat per day.

Why am I tracking vegetarian meals? I’ve been an avid meat consumer since birth, and I’ve never, absolutely ever, been tempted to become a vegetarian or go vegan.

However, I’ve realized for some time that eating less meat is good for the planet, and recently, I read the book Blue Zones Kitchen, which convinced me that eating more veggies is good for my body, too.

I’ve talked about the book before. It’s a cookbook written by Dan Buettner, the National Geographic researcher who coined the term “blue zones,” areas of the planet where the local populations live, on average, ten years longer than the people around them. No one knows exactly why that is–it could be close knit relationships, their propensity to move more throughout the day, diet, or a combination of many things (which is probably the case).

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December Net Worth Update

Guess what?

Like all good things, the three year experiment has come to an end.

Don’t panic: The Three Year Experiment hasn’t come to an end, though my posts are certainly less frequent than they have been!

But, the three year experiment, whereby my family worked towards location and financial independence within three years, has come to an end.

Technically, I suppose it should have ended in July, on my 40th birthday, but the blog only really got started in January of 2017, so I gave us until December, 2019, to reach our goal.

Did we do it? Are we location independent?

Well, now that I have a location-dependent job, I suppose we’re not, although we don’t need the job, so I could hypothetically quit any time. Mr. ThreeYear is a remote worker, so we could move, at least within the US. We’ll also likely spend some time this summer outside of the US, with him working remotely. So, I will say that, YES, we are location independent, and more importantly, we have engineered our lives to be more reflective of our values and desires.

  1. We live closer to both sides of our family.
  2. We can travel more, in the summers especially.

Are we financially independent?

Technically our goal was to double our net worth by the end of 2019. Spoiler alert: we didn’t make it.

We DID, however, get 82% of the way there, even with our move. Next year, we should finally double our 2016 net worth, so even though it took us 4 years, I’m pretty stoked (according to my projections, it should take about 5 more for us to double it again).

I thought that we would have spent a gazillion dollars this year, but it turns out, our spending was lower than last year’s, even with an obscene amount of spending for home upgrades. We’ve been so content with our new digs that we haven’t felt the need to take as many vacations, so lower spending in that category probably offset some of the spending in the Home Improvement category.

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The Long Game

I pulled a shirt out of the wash the other day. It was one I’d bought for Junior ThreeYear, many years ago, from our elementary school in New Hampshire. You could have the shirt personalized, so on the back I’d had our last name printed.

Now Little ThreeYear is wearing the shirt, and because I’d put our last name on the back, it doesn’t feel as much like a hand-me-down from his brother.

I realized, while looking at the shirt, that I’ve gotten in the habit of thinking very long term in my life. For example, I put our last name on the back of the shirt because I knew it would be used by both boys. When I buy clothes I think about if they’ll last for both my kids, because I’ve always played the long game with the kids’ clothing.

The long game.

According to my highly-unscientific Google search, the term is British, and comes from whist , a card game popular in the 1800s that, because of its length, was shortened. Therefore, you had the original long game and the shortened, or short game. Americans will claim the term comes from American football and the idea of advancing by throwing the ball down the field.

The term has now changed, of course, to mean a strategy of considering the longer-term consequences of your actions. For example, had I played the short game with the boys’ tee-shirt, it would inevitably be relegated to the back of the drawer since my younger son would not wear a shirt with his brother’s name on the back. His last name is much cooler.

Playing the short game isn’t all bad, of course. Sometimes, we need to make decisions for our short-term health or wealth. There are times when driving through the McDonald’s line stopped a melt-down with my kids. Not thinking about long-term health consequences in that moment, let me tell you. I could argue that Mr. ThreeYear and I made a short-term decision when we bought our house. We needed a place to live and work and didn’t take the time to think through the long-term ramifications of our home purchase.

Still, in our fast-paced world, financial bloggers are known for being long-term thinkers. Especially in our money lives, we plan for years in advance.

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The Real Cost of Hustling

Yesterday I was reading a millionaire interview on ESI, and the author of the interview, who is 35 and has two kids, wrote:

I didn’t start hustling until 2015 when my first child was born. I started driving for Uber after the child went to bed. I saved everything from that to build their 529. I continued until the 2nd came along and did the same but just ran out of energy to continue.

As for work/life balance, he wrote:

It’s ok right now as I don’t mind working until 6 pm. But since children entered the picture it has been difficult to complete the work needed and take care of the kids every night. Honestly I should probably be working on the weekends to keep up with my work.

Couple that comment with the fact that this weekend, Mr. ThreeYear and I watched Playing with FIRE, the documentary about Scott and Taylor Riekens. This couple embraced the FIRE movement and created a documentary about the experience (I got a link from Ally Bank to watch it for free so I was pretty stoked). There were several FIRE adherents featured, and one was a couple of teachers who talked about how much they hustled to earn extra money to retire early. They worked evenings, weekends, and summers–basically anytime they had free time– to supplement their incomes.

I didn’t think about these two comments again until yesterday when I was in my car, going to pick up my older son from school. His bus was late and it was raining, so he contacted me and asked me to please come get him.

For some reason, as I drove to pick him up, I started thinking about these two comments, and I got extraordinarily annoyed by the pervasive idea that hustling is such a great thing.

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What I Wish I Knew Then About FIRE: Guest Post on Costa Rica FIRE

Ahh, hindsight. Most always 20/20, it is the perspective gleaned from missteps and mistakes made.

We can’t change the past, no matter how much we’d like to, so our ancient mistakes can only serve as a guide in our present lives.

That’s the idea behind Scott and Caroline’s post. The couple, now empty nesters who I first profiled on the blog here in my Your Three Year Experience series, write about crafting a life you love, living in multiple places, and traveling. They reached out to lots of financial bloggers, me included, with the question, “What do you know now about FIRE that you wished you knew when you started?” In other words, what would you have done differently in your pursuit of financial independence/retiring early?

For our family, where retiring early has never been a primary goal, I had to think about the question under the framework of decisions we made that would have impacted our lives differently.

Certainly moving to New Hampshire in 2010 was a decision that we debated. Just before Mr. ThreeYear accepted the job with his company there, his company in Atlanta offered him a really great deal to stay. If we had stayed in Atlanta, our lives would have looked so different. What choices would we have made? Would we be as financially solid as we are now? Would our health and well-being have suffered as a result of Mr. ThreeYear staying in a stressful work environment?

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