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Having my cake and eating it too with the new tax law

February 2nd, 2018 at 12:12 pm

My January 31 paycheck used the updated withholding tables, so I compared the Federal withholding on that check with the withholding on January 15 and found more than a $60 difference. I played around with the calculation in 1% (of gross salary) increments and figured that I could increase my retirement contributions by about $45 per pay period and still have an extra $15 per paycheck in my take-home pay, so I arranged for that change to occur starting this month. Over the course of the rest of the year, that's nearly an extra $2,000 in retirement savings, a $2,000 decrease in federally taxable income (which at the marginal 22% bracket means $435 less tax due next April, and an extra $330 in my pocket to spend. Win/win all around!

I also posted a blog post about this on our company's website at http://www.joycepaynepartners.com/client-insights/the-new-tax-law.

January in review

February 1st, 2018 at 03:33 pm

So I set myself up at the beginning of the year with half a dozen goals plus a few projects. I made progress in some categories, but on the daily exercise and CFP exam studying, I need a goal reset for February.

Here are the details by goal.

1. Job performance: Improve timeliness of advance preparation for client meetings. Complete the basic CFP coursework. I am tracking my meeting preps and got the last one done six days in advance. The year really started out with a bang, with a whole month's worth of meetings to prepare for in the first 18 days of the month. February looks more reasonably spaced. But I've made no progress yet on the CFP studying.

2. Take care of myself. Eat healthily (this includes an emphasis on whole foods and preparing my meals in advance), exercise consistently, sleep enough, and make time to de-stress with a daily meditation session (or two). I started a Whole30 but didn't adhere to it consistently, as I ended up eating out several times while feeling busy & stressed. Still, I did eat more "Whole30ish," limiting grains, dairy, etc. I lost weight while I was being strict about it but after I relapsed and particularly once I allowed myself to fall prey to the candy in the office, I ended the month weighing the same as I started. Also, I got very little exercise, but I did get fairly good sleep and I meditated 24 days out of 31.

3. Create a peaceful and inviting home environment. Teeny tiny progress so far. I'll do better when I'm less stressed and less cold.

4. Increase my Net Worth by 15%.
Assets up $7,245. Debts down $5,427. Total increase: $12,672, or 2.37% (28.46% annualized rate).

I have started tracking my spending--not daily, but a few times a week, using the Simpleplanning Budget planner, a nice straightforward Excel-based spreadsheet that I find much easier to work with than the current version of YNAB. I liked YNAB when it was Excel-based, but there are now too many bells and whistles and I find it confusing to get started with.

While I was successful at regular tracking, I was not successful at keeping my expenses under budget. I spent 10% more than planned. Food is my biggest area of concern, both groceries and eating out. I also spend too much on books. I already have social restaurant plans in place for the weekend, but starting Monday, I'm going to try to make the rest of February a "gas & groceries" month, in terms of spending on "variable" as opposed to fixed expenses--with the exception of (knock on wood) medical if needed for myself or the kitties, or any home or car repair emergencies that might arise.

For groceries, I'm going to limit myself to the cheaper chains this month: Aldi, PriceRite, and Giant, and avoid my favorite Wegmans, which isn't really that much more expensive on a per item basis for the basics, but it has better quality and more variety, so that the items that end up in my cart are that much more pricey. I only shopped at Wegmans once in January and I could really see the difference. Also, last month I bought some dehydrated vegetables plus some bulk teas I like on Amazon, so for those items, I still have a lot of food left over.

Even though I was over *budget*, my take-home pay for the month was $2,917 and my expenses were $2,613, so that is $304 to the good.

5. Maintain and expand my social life. January was a maintenance month--went out 3 times, once with one friend and twice with another, which is good for a month as busy as it was.

6. Take more and/or more frequent time off/vacations. Nothing concrete planned yet.

Projects: I'm not listing the ones I haven't started yet, but one project was to write at least 3 blog posts for work. I've now written 4, of which two have been published so far, a third will be published tomorrow, and one the week after that.

Market boom

January 24th, 2018 at 01:59 pm

Heady times on Wall Street these days. I updated my personal balance sheet and find that my net worth is up by $14,540 so far this year. My retirement accounts are up by about 10K *despite* the fact that I took almost 8K in required minimum distributions at the beginning of the year and set them aside to create "sinking funds" for other big expenses expected during the year (so I won't end up putting those expenses on credit cards as I have in the past). I also took the bonus money that I received for last year and used it to pay down some debt. All together my assets are up 8.3K, my debts are down 6.2K, for the total net worth change of 14.5K. That's an improvement I would usually be happy to see in a fiscal quarter already in three weeks.

I'll enjoy it while it lasts since one always wonders just how long the current boom times can last.

Painless Savings Idea to Share

January 20th, 2018 at 03:15 pm

I had this brainstorm, which I am going to implement for myself and wanted to suggest this to others as well: If you are not already maxing out your pre-tax retirement contributions, ask your HR/employer to increase your 401k/403b contribution by an additional percentage point when they change over to the new withholding tables, which should be sometime in February. Without taking any action, the change in withholding should make your take-home pay go up by a bit--a small amount, maybe easing the pressure a tiny bit if you are living paycheck to paycheck, but not enough overall to really make you feel wealthier. If you are not living paycheck to paycheck and you have gotten used to living on your current take-home pay, take advantage of the change in withholding tables to divert that extra amount into long-term savings rather than spending it on extra consumables. Your take-home pay should remain similar to what it was and your savings will increase. You could wait until after the change takes place and compare your January and February paystubs, or you could try to figure out the change from IRS Notice 1036 with the new withholding tables vs Pub 15 2017 if you are an accounting geek, or if you have a bit of wiggle room in your budget you could just take it on faith that one change will offset the other by an amount that you won't really notice. I'm not a master of payroll but I did calculate for myself that the decreased withholding will be about 1% of my takehome pay and thus a good opportunity to increase my 401k contribution from 11% to 12% (I also have a set dollar amount taken each pay and put into my HSA account, some of which I spend during the year and some of which ideally gets saved; between the two set-asides I will be putting away over 16%, although last year I did end up spending about 2/3s of what I put into the HSA for out of pocket medical expenses. In a healthier year I'd be able to save more of that, and at least the healthcare expenses were paid for with pre-tax dollars.)

Budgeting: YNAB vs SimplePlanning.net; Debt paydown vs Sinking Funds

January 6th, 2018 at 03:39 pm

So one of my plans for the year is to get back to tracking my expenses--something I did assiduously when I first started on this site in 2006, but which I stopped doing during all the life craziness that started at the end of 2009 (leaving my job/career, Henry Hound's cancer diagnosis, my mom's terminal diagnosis). After a "wild & crazy ride," things at long last feel more stable, so it's time to get back to tracking and trying to rein in spending reasonably. I don't feel the need to go all austere--after all, who knows how long any of us has? Financial independence is an important goal, but I also want to enjoy the ride along the way. So I'll leave in some money for books, movies, dining out, and vacation, but I'll also try to cut the money spent in those categories compared to the last couple of years.

Back in my earlier days on this site, I learned about and used YNAB for at least a couple of years--back in the days when it was an Excel-based spreadsheet. I liked it back then. I've gone and enrolled in the free trial for the current web-based version, and I must say that I don't find it at all intuitive, so I found another Excel-based spreadsheet that I'd used before, at SimplePlanning.net, and I'm going back to that. I love the *idea* of YNAB, but not the current incarnation. Jesse Mecham just came out with a book and I'm reading that, but I think I will part ways with his software and stay with good old familiar Excel (where I spend about half my working life).

As I mentioned in an earlier post, I got a 20% bonus at the end of last year. I did use some of it to bring down my debt, but even though part of me felt a strong urge to put it ALL towards debt reduction and cut another 6K off the debt, I decided--at least for the moment--to keep 6K in sinking funds for larger expenses that will (long-term care insurance premiums, dental for one of my cats) or might (car repair, home repair, etc) occur. Most of the debt is pretty low cost--0% to 4%. When one of the 0% terms expires in May, I might consider paying that chunk off in full, but I figure I'm ok not deciding right now. At some point, maybe I'll give in and get that debt down to the 86K total that I'd listed as a goal, but for the moment, I'm enjoying enough money in my savings accounts to cover the big expenses that tend to accrue for me in the summer.

The idea of "slowing down to speed up" by "funding true expenses first" is something that Jesse Mecham talks about in his "You Need a Budget" book. So what I'm doing is consistent with that--trying to get off the treadmill.

As part of my cost-cutting attempts, today's big grocery shop of the week was at Aldi's, where I got out for $85. They didn't have celery or sweet potatoes at the store I was in, so I'm stopping at the Price Rite on my way home to pick those up. Then home to make beef stew. (Not all of the day was cost-cutting--I went to my favorite diner for breakfast and treated a friend to lunch, but the rest of the week it's back to home cooked meals--the beef stew, a chicken dish--maybe a paleo sesame chicken recipe I saw online if I feel ambitious tomorrow, the vegetable soup that I'm still eating from last weekend's cooking, and another batch of ground beef tomato sauce, which I am eating over shirataki noodles, along with a side of kale.

No real progress on goals yet this week--I did one before-work exercise session. I'm recovering from an Achilles tendon injury anyway, so I'll push on the exercise once that is healed. It's too cold in my downstairs to spend time decluttering--when I'm at home, I make and eat dinner and then scurry up to bed. Upstairs is quite cozy and it's only when the weather is below 20 outside that I really feel cold downstairs. I didn't do any CFP exam studying yet, but I've drafted most of three blog posts for work that I am supposed to write this year, so getting that out of the way is good and cuts pressure from those expectations for the rest of the year. I promised at least 3 for the year and those are mostly done!

2018: Goals, Plans, Projects, and Juggling

January 1st, 2018 at 09:58 am

So here are my 2018 Goals, along with some plans for achieving them, as well as some one-off projects that I hope to complete in 2018.


1. Job performance
: Improve timeliness of advance preparation for client meetings. Complete the basic CFP coursework.

Plan: I'll start tracking the number of days in advance that I have the meeting prep drafted, something that I have not been doing. As management guru Peter Drucker said, "If you can't measure it, you can't improve it," so step one is measuring it, with a goal to improve it.

As for the CFP courses, which I gave short shrift to in 2017 (I completed just one of the basic courses), I plan to complete the remaining four basic courses this year--one per quarter). To do that, I'm going to get in to work 30-45 minutes early and use that time each day to study (habit).

2. Take care of myself. Eat healthily (this includes an emphasis on whole foods and preparing my meals in advance), exercise consistently, sleep enough, and make time to de-stress with a daily meditation session (or two).

Plans: Food: I'm doing a "Whole 30" in January to do a "re-set" on the less-healthy holiday eating.

As for Movement and Exercise (which I learned in 2017 are two *different* things), I had an injury last week and tore some of the fibers in my left Achilles tendon, so at the moment, I'm focused on doing my PT exercises and some routines focused on increasing my joint flexibility and decreasing myofascial stiffness. I had already been working with a DPT (doctor of physical therapy) before the injury to try to avoid injury since I have a history of getting over-enthusiastic and hurting myself when I get active in a program. The current injury just slows the plan down a bit. Last year I was quite sedentary because of the bout of adrenal fatigue I spent the year dealing with. This is the first time in 12 years where I currently do not have a gym membership (!!!)

My goal for Q1 is to get back to regular movement, starting with the flexibility and strengthening exercises. Once the injury is healed, I will focus on increasing my daily movement count to 30 minutes and 10,000 steps a day (per my Fitbit). My daily step average for 2017 was a measly 5874 steps per day (in actuality probably closer to 6000 since there were several days where I forgot to put my FitBit on), with only 38 days all year with at least 10,000 steps. I'll count this goal a success for 2018 if I get at least 292 days with 10K steps (that's 80%). That's approximately a two-mile daily increase in step count. Once the Achilles tendon is healed, I'll get back to using my Leslie Sansone "Walk Away the Pounds" tapes in the morning to build up the step count. Then in Q2, my plan is to hire and work with a personal trainer twice a week for the quarter to build up my strength and develop a routine that I can eventually do at home. In Q3, I'll cap off the experience with either some kind of an event, like walk/jogging a 5K, or experience, like going on an Appalachian Trail hike -the kind of activity I did frequently in my 30s and into my 40s, but which has not been part of my life since I made the big career change in 2009. Then in Q4 (the busiest time of year at work), I won't abandon exercise altogether but I'll focus on maintaining a daily movement practice and those 10K steps a day.

3. Create a peaceful and inviting home environment. This is the goal I abandoned in 2017...and 2016, 2015, etc, going back to 2010 when my mom was dying and I was flying back and forth across the country to help her. My plan in the past has always been waiting until I had a big chunk of time and then clearing out as much as I could. A friend comes down to visit each summer, so this has typically meant taking one day off of work and doing a big clean-up in July. This tackles the surface clutter but doesn't solve the underlying accumulation problem, since the excess goes into the "storage room," whose door remains shut during the visit, and I don't tackle the stuff hidden in closets and on shelves.

Plans This year, instead, I'm going to try for a 10 minute daily HABIT of clearing a small space--one shelf, or in some cases, maybe even a quarter of a shelf, a day, then taking the donate-able excess to Goodwill once a month and recycling or trashing the rest. Then in Q2, I will hire a personal organizer to help me deal with the storage room and make that useable again. My plan is to make it a dedicated exercise space so that after I have worked with a personal trainer at the gym in Q2, I'll be able to have a place to work out at home in Q3 and beyond.

4. Increase my Net Worth by 15%. Obviously, attaining this goal to some extent depends on how the markets do in 2018, but I'll control it to the extent I can with increased savings (I increased my retirement contribution so it is now a total of 14% going into my 401(k). I have another 7% going into my HSA account. Although I do spend from the HSA for my larger medical expenses, I did save a net 3% in 2017.

A big change for 2018 will be getting back to tracking expenses, which I did religiously at the time I started on SA, but gave up during my mom's illness. I'm currently trying to figure out if I'm going back to YNAB or just tracking on Mint or Personal Capital.

5. Maintain and expand my social life. This is a secondary goal, but still important.

Last year at this time, I quoted James Clear about the "four burners" theory and how you could really only focus on a couple of "burners" (domains of life goals) at a time, while the others stayed on simmer.

This year, I'm instead going to cite former Coca-Cola CEO Bryan Dyson's "juggling" speech:

"[…] Imagine life as a game in which you are juggling some five balls in the air. You name them work, family, health, friends, and spirit. And you’re keeping all of these in the air.

You will soon understand that work is a rubber ball. If you drop it, it will bounce back. But the other four balls – family, health, friends, and spirit – are made of glass. If you drop one of these, they will be irrevocably scuffed, marked, nicked, damaged or even shattered. They will never be the same. You must understand that and strive for balance in your life."

The social domain is obviously one of the "glass balls" that I can't let drop even while my focus is for the most part on work, fitness, and improving my home environment.

I'll continue to (as I have been doing) go out with at least one friend locally per month as well as making sure I have at least one phone call or email exchange with some of my good friends who live at a distance.

This year, in addition, I think I'm going to add an activity, namely, starting to play with a local community orchestra. Playing in an orchestra was a big part of my life in my youth and something that I would like to get back to, which will also introduce me to a new group of people.

6. Take more and/or more frequent time off/vacations. I wasn't very good at this in 2017, especially the first six months, and I paid the price in adrenal fatigue. So I'm going to take more long weekends and try not to let more than five weeks pass without having at least a 3 day weekend.

Plans As far as vacations, I'm not sure. if my high school has a 40th reunion for my class, I may go out to that. If I don't make it out there, then maybe I'll visit the two cousins I have in Phoenix, or else visit Seattle and Vancouver. Plus I'd like to take one long weekend down south (I have friends in Atlanta and near Charleston SC and in Chapel Hill NC whom I'd like to visit sometime in the next few years--each of these would be a separate short trip, one a year). If I don't go out west, I'd like to take a week and visit my friends in New England--I lived in Vermont for 3 years and have friends there and in Boston and cousins in Western MA (plus I could stop and see Patient Saver in CT on the drive up or back). Plus I'd like to do a long weekend in Lancaster PA Amish country since I've been reading so many Amish romances (my latest guilty pleasure), and another B&B weekend locally along the DE for a low-stress getaway.

That's 3 short trips (Lancaster, local B&B, long weekend in the south) and one longer trip (either west or north) for the year.

I didn't travel much in the hard job-transition years after my mom died and 2017 was my first year getting back to it, and I'd like to continue the more frequent travel each year as long as the kitties' health holds. I need to get the travel bug out of my system before I get another Basset Hound, since I know myself and I know that once I have a hound, I will be hard-pressed to leave him for more than a day or two--one reason I am taking a 10-15 year break from hound ownership.

Projects Finally, here are some one-off projects that I would like to accomplish in 2018. All of these were on the 2017 list and none got done: Find a new Primary Care Physician. Get a passport (deadline 10/10/2018, as after that date my PA driver's license will no longer get me on an airplane). Find a lawyer and draft estate documents. Hire a house-call vet to check out Bridget since she is too skittish to take out to the vet, and have Buffy's dental work done. Write at least 3 blog posts for work, and master the last three (most difficult) spreadsheets at work where I still need to have my work reviewed since I haven't entirely grasped them.

2017 Year in Review

December 31st, 2017 at 04:26 pm

I started the year two months into a new job, as a financial planner at a wealth management firm. The first two months (Nov & Dec 2016) had been doing tax-related calculations (my strength as a CPA) and learning some of the systems and procedures in the office.

I started really diving into the spreadsheets we use for financial planning at the firm in January, and I was assigned my own list of about fifty dedicated clients (as well as providing tax support for the other clients serviced by our office).

In January, I was still going to the gym and working with a personal trainer, but I started experiencing bouts of severe fatigue. By February (with an overload at work due to tax letters—we don’t do taxes, but as a wealth management firm, we provide our clients with an annual summary of what forms to expect), I had given up going to the gym. By March, I had decided to consult a chiropractor specializing in metabolic disorders (I had some adrenal fatigue as well as an increase in my Hashimoto’s thyroiditis symptoms). I checked out three and started working with one weekly in April, continuing through September, by which time the excessive fatigue had been mostly resolved. I’m still not as energetic as I would *like* to be, but neither am I feeling compromised the way I was back in the spring.

I kept my nose to the grindstone at work for most of the year—I hardly took any days off for the first six months. I got to attend the American Institute of CPAs conference in June in Las Vegas, which was a great experience hearing talks by people whose work I have been following for years now (although I really didn’t see anything of Las Vegas outside of the MGM Grand conference center). A highlight of this was being “life-planned” in a demonstration by the “father of financial life planning” as part of a two-day pre-conference workshop I attended. As a result of attending the relatively small pre-conference workshop, I had people to hang out with for meals, some of whom I am still in touch with. We also had a company retreat in Richmond VA in September.

On the “fun” side, I spent most of a week in Los Angeles visiting my sister, and I went on one overnight B&B trip locally over the summer, and I was invited to spend another overnight visiting a friend from grad school who was staying at a cabin in the woods along a creek. I hadn’t seen that friend in person in 25 years, so that was a great visit. I also hosted an annual visit from a friend who comes down yearly to see a play at the PA Shakespeare Festival with me.

Other than the travel (which was a lot for me compared to recent years, but not compared to what I used to do in my 20s and 30s), I saw a lot of movies (over a dozen for entertainment, and another six as part of a lecture series I attended on Religion and Art—six weeks of one lecture and one film per week taught by a retired professor of religion), two plays, one ballet, three "circus" acts (including one by Cirque de Soleil), and four choral concerts (my best friend sings in two choirs).

I went to nine or ten business networking events, four events for the new Food Co-Op I joined and four meetings for our local neighborhood association, two political events (the Women's Day March and a tax day rally), and I took a one day art workshop. I went to events at friends’ houses about once a month, meals with friends at restaurants at least once monthly, and to religious services about that often as well.

I originally had three big goals for 2017, which I eventually reduced it to two. The original three were 1. Job performance (technical mastery of systems and procedures at new job, CFP exam study); 2. Taking care of myself (eating healthy, exercising consistently, sleeping enough, and meditating daily); and 3. decluttering at home. The decluttering goal was the one I abandoned.

Overall, I made good progress at mastering the new job, but I was overly optimistic in thinking that I would be able to complete the CFP exam coursework and take the exam while learning everything at the new job. I did complete another one of the basic courses, however, and I did well enough at the job to get an overall positive evaluation and a raise.

I also spent effort taking care of myself, but instead of getting into shape, I managed to get out of shape because of the adrenal fatigue and stopping going to the gym. (I know I made it sound like I did a lot but I think I wrote out just about everything I did since I was in bed between 6 to 7:30 pm about 4 nights out of the week for at least half the year, and I still find myself in bed really early 1 or 2 nights a week.)

I did an ok job of getting to bed earlier and of meditating regularly, practicing on 277 days for about 10 minutes per day.

This month, I took myself to a physical therapist after experiencing unusual pain in my Achilles tendon after a two-mile walk, something that I have always been easily able to do, and I have developed a plan to get back to exercise in the new year. I also allowed my generally good diet to deteriorate over the holiday season, so it’s back to clean eating habits tomorrow, starting a month on the Whole 30.

In terms of finances, I had a very good year despite some bad spending habits (buying too many books on the Kindle, in particular). My net worth increased by $63,666—a 13.5% increase, and my overall assets are now very solidly over half a million.

Overall, it was a good year, and I am very happy that, other than Buffy’s brief bout of pancreatitis back in the fall, there was nothing significant to report with the furkids this year. Bridget turned 13 in October and Buffy hits that age in March, so they really are getting to be seniors. My previous kitties (Phoebe and Teddy) died at 13 and 14 respectively, so I am praying that my current “kitty matrons” remain in good health throughout 2018.

20% bonus, 3% raise

December 28th, 2017 at 08:40 am

Today I got the email I've been waiting for all month: info about my annual bonus (first time in my 30-year working career that I've worked for a place that gave bonuses) and raise.

The bonus is given on a company-wide, not individual basis. Each year there is a revenue target, and if the company meets it, we all get the 20% bonus.

The raise is determined individually, and I believe that 3% is the standard raise unless one achieves a new certification or changes roles within the company or has some other special achievement.

With the bonus, I'll be able to pay off a chunk of credit card and loan balances and will meet my debt reduction goal for the year, hooray!