Tuesday, August 20, 2013

My Healthier Frame of Mind

Over the past few weeks I feel a lot of the self-inflicted stress and frustration that has grown within my current work place situation has not only calmed, but has been something that I have overcome. I am still in the midst of what at times feels like countless interviews, applications and informative meeting sessions, but I am definitely a lot more mellow and content with everything than I was a month ago.

I feel like much credit is due to being intentional and making a conscious effort, day in and day out, to be thankful and grateful for where I am right now in life. I am madly in love with the most incredible woman, all of our needs are met, retirement is secure and we are steadily progressing towards personal and shared goals in life.

Whether my next job transition equates to vocational fulfillment or not I am, for the first time genuinely in my life, truly happy right where I am. Granted this is a self-actualization that has been a long time coming with the help of couples and individual counseling. And lately I have been feeling great. When the day job goes through its usual bumps in the road I feel like I’ve been better able to handle the situation in the moment and not let the frustration stir up within me nor follow me home.

This has been a long time coming for me because I have always placed an unhealthy value of work in the equation that is my self worth.  I work hard, come in early, do work that no one else would volunteer to do and attack with fervor. And when things don’t go my way or progress is halted due to bureaucracy or procedures, I’d let the anger sharks come to surface. And that anger would consume and basically eat me alive.

So what’s changed? To be perfectly honest it’s been my outlook. Between the day in and day out of my current role, to interviews that go great to receiving referrals and declines, my attitude and head space has been the only difference maker lately. Before every interview I have been saying to myself, “win, lose or draw, you are exactly where you want to be in life: In a great marriage, in a strong relationship with God and financially secure. Now I’ve been come to be at peace and achieve each of these items over the last few years, but I think what kicked everything into overdrive was, thanks to the help of my individual therapist, I came to a place where I forgave myself.

I forgave myself for not being a good son, student, employee, Christian, and most dear to me – husband. My nearly 30 years on Earth has run the gamut from being straight and narrow to rocky to completely off the map. And today I write to you, confident in who I am and genuinely happy to be present day in and day out, enjoying the relationships that I have cultivated.

So while the pending vocational change is still blurry, I am in a clear frame of mind to press forward and see where my career will take lead to next.

Wednesday, August 14, 2013

My Boomerang Take

One of the most common knocks against my generation has been the boomerang effect that we have had on our families of origin. One study I came across noted that nearly 40% of adults between the ages of 18 and 31 live at home with their parents. Is it normal? Is this the bludgeoning effect of students taking on crushing student loans? What are appropriate terms for parents to set their boomerang kids free into the real world? These are all excellent and poignant questions that fortunately you and I get to define for ourselves as we set these terms and conditions within our own families. So here’s my two cents.

The College Approach

I’ve broached this particular subject in past posts so I will be brief. The approach that my kids will take towards their college education will be vastly different from the one that I took. My wife and I plan to save and invest through an ESA, with plans in place to contribute the maximum allowable amount each year for each child. And when that child comes of age, in order to receive those saved funds for college, they must either (1) attend a community college and transfer to an in-state public university or (2) receive a “considerable” scholarship to the college of their choice. Loans are not an option and I for one would love to see our kids work while they are in college while going to school part/full time and graduate with a degree, no debt and work experience. From there is where it gets a bit tricky.

Post College

Ideally I would want my kid to hit the ground running by the time they graduate with their four year degree. In my perfect world they would work part-time and upon graduation be able to slide into a full-time job seamlessly, all the while having a 3-6 month emergency fund saved up and ready to tackle the real world. But the truth of the matter that I need to face is that the ideal doesn’t always happen. My kid could end up choosing, which would be perfectly fine, to go on an accelerated pace and earn their 4 year degree in a shortened time span and not work while in college.

To me what is important is getting the degree and not being in debt. And from my vantage point as a prospective parent, is that I would want my children to have the strongest footing possible leading up to and stepping out into the real world after college is over. That might mean living with mom and dad until they land a part/full-time job, rent an apartment and have a 3-6 month emergency fund socked away in savings.
Where the rubber meets the road lies in boundaries. I can imagine that I would want to see progress and updates from my kid that they applied to X number of jobs a day, are working with and calling local temp agencies and have a checklist on companies/job postings that they hunt for day in and day out, rather than sleeping in until 2pm every day and playing video games. Is it harsh and legalistic? Probably, but at the end of the day I want to mold and shape my children into individuals that will work as hard for as long as they possibly can to make their values, dreams and vocation all come together for a brilliant and fulfilling life. And as a parent I feel that I and my wife are primarily responsible for bringing influence and insight to the children that make up our family.

Major Life Events

I stand firm that my goal as a parent is to mold and shape a self-relying go-getter that can stand on their own two feet, but life still happens. My wife and I are currently at a point in our lives/family where the dollars are not a concern. Instead we are focusing and dreaming of life fulfillment through vocation and giving efforts. By the time we become empty nesters we will be in our paid for home and our investments will likely be earning more in a year than our incomes earn in a year. And if life smacks any one of our kids, we would be there with open arms to help.

Life events can include going on short/long term disability, divorce, loss of a child or spouse or chronic illness. If all things go well our kids will be debt free with emergency funds and have the right insurances in place, but I would contest that no insurance payout or emergency fund could replace a loved one or the struggle that comes with chronic illness. I for one would be honored and humbled if my grown adult child, after suffering an unspeakable family loss, health issues or emotional turmoil, turned to me for emotional support while they emerge from the rubble.

Yes boundaries would be in place to have a plan of action and get back on their feet, but to me financial peace in these scenarios is about being able to open my home to a loved one without the worry of needing extra money for rent or groceries creeping into the back of my head. In the heartbreaking scenarios I’ve just mentioned I would want to give my kid love and emotional support and I would want that to be my and their focus.

The fundamental problem that I’m seeing through case studies and examples with boomerangers is that neither the child nor the parent is prepared for the real world. Life happens and with it come emergencies and the need for savings. I’m strictly speaking generically, but essentially we have this problem: parents are up to their eyeballs in debt and borrow even more to put their kids through school. Those kids follow their parents’ example by not planning, and in most cases they studied in college what they wanted to learn rather than what they wanted to work in. And upon graduation the kid graduates without a plan and moves back in with their parents, also without a plan and round and round we go.

In closing I’ll add that the unexpected will happen in life both financially and emotionally and we have to be ready for it. And as a parent I want to carefully and precisely help my kids and not enable them to live without a plan, while at the same time be there for them in the most meaningful way possible when life happens.

Monday, August 12, 2013

My Techie Peers

A fascinating article that came from the fine folks at Reuters was recently brought to my attention and I am giddy with delight to address and unpack the details of this article here on this forum. In summary, the article profiled a specific sect of my fellow Generation Y’ers that have broken the chains of their student loans and kicked Sallie Mae to the curb. But there were a few details within the article that for better or for worse rubbed me in the wrong sort of ways.

Entrepreneurial Spirit

Statistically speaking I absolutely believe that entrepreneurs and small businesses are the back bone of the American economy. These innovative problem solvers bring ideas, concepts and talents to the market place and they can be generously rewarded for their contribution to the economy. But the shape and tone of this article implied that in order to be free of your student loans and to build a path towards financial wealth, that one must be an entrepreneur, specifically in the tech field.

I can confidently report to you that at this point in my life I have not started my own company, I know very little about tech (seriously, I don’t even own a cell phone) and I am not nor have I been a manager for a company like Google. Yet my household was able to pay off $80,000 of student loan debt in 3 years and build a portfolio that currently is in the low six figure range.  While it’s inherently true that if I had created and developed Instagram, then it would have not taken my wife and I 3 years to pay off our student loans, it would have been more like 3 seconds after the sale to Facebook. But you don’t have to be the latest and greatest tech geek to be able to pay off your student loans, I was able to do it by geeking out on by budget, working as much over time as I could,  living on less than I made and my wife selling so much stuff I thought I was next.

Avoiding the stock market like it’s the plague

And this point may not just be true with tech nerds as I anticipate this may be an attitude affliction that has infected many of my peers. The article hinted that many of the entrepreneurs in my age demographic opt instead to re-invest their funds to their own companies or invest in others through mediums such as angel investing. I can understand the artificial reluctance to instinctively avoid the stock market. We came out of college and were greeted with the Great Recession and witnessed our parents/older colleagues/wacky media outlets report that 401ks became 201ks overnight. But in my humble opinion the stark realization that we’ve come to over the last five years that sub-prime lending is stupid is no reason to avoid the stock market and its historically proven track record.

I am aware of my own capabilities and limits. I do not know who will be the next Wal-Mart or Google. But historically proven stock mutual funds give me excellent diversification across different industries and with companies of all sizes all over the world and within the US. My portfolio has been kicking inflation square in the junk and my average annualized returns that flirt with 20% barely bat an eye at being invested in actively managed higher cost funds against low cost passive index funds.

Yes it’s important (and vital) for entrepreneurs to reinvest in your own business, but this angel investing stuff has really gone awry in the last few years and I have a reason to believe Facebook is to blame. Unless you do a thorough bottom to top, top to bottom fundamental analysis of a company, meet its leaders and innovators, have been in the company evaluation business and have successfully done it for several years if not decades and make a well thought through decision after months of meticulous examination, angel investing can be just as bad, if not worse, than trying to invest in penny stocks in the hopes for “brilliant” returns. And yes I groaned out loud when reading about a tech dork that refused and fought his wife on opening a college savings account for his child. ARRGH!


Now this was something I could get behind.

With the exception of intergalactic travel, the message of spending budgeted entertainment cash on experiences such as travel, food and wine definitely resonated with me. Just this past weekend my wife and I spent our weekend taking in the nostalgic 90s rhythms of Wilson Phillips at Market Days (my favorite summer fest in the city), laying on the beach in Edgewater, catching up with friends at church, eating some great Mediterranean food and splurging (dietetically speaking) at George's the best damn ice cream shop on the North Side. And we did all of it while coming under our allotted weekend budget by $60. Experiences, especially in my post debt life, have been the driving force behind a lot of the decisions I make day in and day out as well as for weekends, holidays and vacations. The best part about debt free is being able to set goals like travel in the horizon, save up for a month or two and be able to take that trip/make that experience without batting an eye at the cost.   

So in conclusion I’ll assert this. It takes a ton of work and is really tough to focus in and get gazelle intense to pay off your student loans. Whether you are squeezing your budget, working extra hours or selling everything you can like we did, or if you truly are developing the next Facebook, it takes a ton of work, blood, sweat and tears. But you don’t need to have invented Java or have dropped out of an Ivy league college –started a company and moved to the Silicon Valley – to pay off your student loans and find financial peace. If that was the defining criteria, I for one would never have had the hope I held while climbing out of my self-made mountain of debt.

Saturday, August 10, 2013

My Short Fuse...The Exciting Conclusion?

Apparently I struck a nerve. As a follow up to my recent post in my hunt for a new apartment, well, to put it quite frankly it got a little complicated. My recent conversation/argument with the leasing agent lead to the property management company decision makers to huddle together and approve our application under the condition that we give them electronic access to our banking account for our monthly rent payments.

My knee jerk reaction was a mighty, “NO WAY IN HELL,” as my wife and I gathered together for a meeting of our own in our current apartment. We wrestled back and forth, with each other and even thought out loud to gather wisdom from the other and process our own thoughts. For me it boiled down to this central idea: If we have to fight this damn hard to give them our business and pay them monthly rent checks, how hard is it going to be to get them to action on a maintenance request.

But at the same time, on the surface, the rent was cheaper, the neighborhood a bit more diverse than our current one and easy to get to and from work with many express buses to choose from. So we were stuck at an impasse, to sign the lease and agree to the terms or tell them to piss up an electric flag pole?

Now I don’t give a lot of credence to modern technology, but I honestly in this case have to say thank God for Yelp!! I typically head to yelp to get a heads up on restaurants and to order the right kind of dishes and to confirm if the location is BYOB. For this occasion we used the consumer empowerment website to check out reviews of our prospective landlord, and man was I glad that we did.

Review after review after review talked about poor and shoddy maintenance work, a companywide policy of having their employees shrug their shoulders when tenants brought living issues up and many reviewers upon move in were faced with uncompleted maintenance work as the movers brought the couch and bed in. Usually when I see negative reviews on yelp I like to get a whole picture. Is everyone saying this? Are they hipsters being pretentious? Are they suburb people who wouldn’t know culture if it hit them in the face with a 2X4? But page after page ranted and raved warning anyone who read to never give your business to this property management company. From middle aged married couples to young single guys and gals to gay couples, hardly anyone through 15 pages of comments had ANYTHING good to say about our prospective landlord. So we decided to pass on their offer and condition of having access to my checking account. In my opinion bad customer service + having to fight with you to give you money = no way in hell I’m going to give you access to one of my banking accounts.

Thankfully we are month to month with our current landlord so we can go back to the drawing board and continue to look for available and new to the market apartments. I’m anticipating that fall availability should be in our favor. Usually summer is high moving season on the North side as college students flood the market and once the semester starts the rental market should transition back to being a renter’s market. So, as my wife and Dave Ramsey said, we will be turtles, taking our time and making solid and well thought out decisions along the way.

Wednesday, August 7, 2013

My Short Fuse

You may be shocked to learn this about me, but there are a few things in this world that send my temper straight into orbit. This past week I experienced one of these things. My wife and I are in the process of seeking out, finding and applying to move to a new apartment. Currently we are month to month with our landlord and we have taken this opportunity to seek moving out of Lakeview East and trying out a new neighborhood.

So after months, and what has felt like a lifetime, we feel like we’ve found a great place. There’s a bit more elbow room in comparison to our current apartment, hardwood floors versus our current carpet, a dishwasher, gym in building and, oh yea, the rent is cheaper than our current place :) !

The move would require us to leave the familiarity of Lakeview/Lincoln Park for a neighborhood just a tad North, but we feel that the trade-offs would be well worth it, especially since we would get to still be by the lakefront. So to prepare for what could be a quick move we transferred roughly $2,000 from our travel account to one of our checking accounts to cover all anticipated moving expenses in cash, these have included: application fee, 1st months rent, fee for movers and what will be a first for us, having a wireless in apartment security system.

So the application was sent out and the response we received was not so hot and just about erupted my coronary arteries. The prospective property management company gave my application an “Incomplete” status. Even with proof of recent pay stubs, employment verification that we have been steadily and continually employed for the last five years and fronted the aforementioned fees/deposits, my lack of a credit history flagged the property management company to put a halt on our application.

I was informed that I would need a cosigner for my portion of the application, and lovingly also have to pay an additional application fee. I…WENT…INTO…ORBIT.

I informed the relayer of this untimely news that I do not need a cosigner for this apartment. I also lovingly shared the reason I do not have a credit history, which is because I am debt free and have been for the last four years. To sweeten the deal I offered to provide recent bank statements that show our monetary assets in the low six figures.

I was livid, I was angry, quite frankly, I was pissed off. I mean really, would this property management company (and probably others out there) prefer to have applicants flushed with student loans, car notes and credit card debt? To me that says there’s a lot of monthly payments due competing with a rent check for first place every month.

But then I started thinking, what if I was in a dire financial situation or fresh out of college. What if I was upside-down on my house, short-sold my home and was trying to climb out from the bottom. What if I was a hard working college student, putting myself through school and never used debt? Then the knee jerk reaction to these young and/or hurting people is to penalize them with more fees (through the extra application fee) and drag someone else into the individual’s financial situation.

To me that just seems wrong. Thankfully in my situation the management company accepted to receive my financial statements displaying the fact that I am my own line of credit. And, fingers crossed, we should be finding out by the end of the week whether we get the apartment. But this situation has done two things for me. For starters it reinforced that when living debt free and either trying to rent an apartment or get a manually underwritten mortgage, that it ends up taking a lot of time and paperwork, and you kind of have to shake the other party around to get them on the same page and educated about those of us in the debt free Ramsey nation. But it also made me feel empathy as well as sympathy for those new to adulthood whom have been “living right” as well as those that are hurting and crawling off the financial floor.

So if I’ve described you or if you are like me, a debt fighting frugal fury fighter that is debt free and facing this same kind of scrutiny, know that I am right here fighting along with you. Together we’ll show the world that debt is not a way of life and that the borrower truly is slave to the lender. 

Sunday, August 4, 2013

My Super Summer Grocery Savings

Summer is without question a magical time of year in the Midwest. The sun is shining, the weather is warm, Lake Michigan is filled with beach goers, and in my tiny little corner of the world the best thing in the world is happening at my local grocery store. Yes friends, I am going hog wild at all of the affordable fresh fruit and vegetable options currently available to me.

Although in my debt busting days I held myself a lot more accountable to this rule, but I generally try to buy fruits and vegetables that are under $1 a pound, or within reason of that range. Well the magically thing about summer is that there is a plethora of yummy and delicious fruit offerings at my local market. I was so geeked at these offerings that I just had to snap a few shots and share with you the fine assortment of fresh fruits that are currently under $1 a pound at my local grocery store.

By and large I would say that our monthly grocery budget during the summer months has been firing on all cylinders. We are in a great groove of eating all of our fresh fruit and vegetables week to week without throwing out a single thing due to the food turning bad. In turn we did not increase our monthly entertainment budget for the summer months, so we’ve been on par with the rest of year regarding how often we go out to eat (which boils down to roughly once or twice a week).

So the majority of our meals of breakfast, lunch and dinner are home made throughout the week and weekends. And on a monthly budget of $400 for two people we have been routinely been coming under budget by about $30 every month. So that extra money has been a sweet cherry on top of our monthly savings to buy our first house. And with weekly food discounts like this you can bet we are going to finish the summer strong!