I was riding my bike today and that entails listening to podcasts and a LOT of thinking/calculating.

Often I’m thinking so hard (and scanning the roadway) that I don’t pay attention to the podcast playing.  Do you ever find you are thinking and not paying attention to the sound of the TV or device playing? 

It occurred to me mid-hill as my legs were burning and my lungs were trying their best to refill my legs with oxygenated super-blood (well, actually normal Kevin blood) that this ride—this effort— is a payment toward my future health, to my future movement ability, to my future happiness.

It’s no secret from my writings that I’m very happy and find so much positive and gratitude in my life each and every day.  On the bike ride podcast in my ears, the interviewee said “say thank you each night and every morning and you will live a better life.  It’s that simple.”  It’s those two words, twice a day that can make a massive difference for everyone.  Yeah, zen-talk, blah blah blah.

I deeply believe in enjoying each day.  No matter what is going on, we are lucky to have each day.

Back to my ride: so I was thinking about the effort on my pedals, the burn and the “this hurts” thoughts, and I realized how I was trying to better myself, not only for the now but for the future.

In the next moment, I realized how my future events may be better because of today’s effort.  I thought about delayed gratification and the ability to do something now—changing something now—in an effort to receive something (better) in the future.

I believe so much in the ability to delay gratification to achieve goals.  Placing targets—even higher targets—in the future are much harder than getting little items in the immediate.  [for some reason building a skyscraper just came to mind—all that foundation work underground that nobody in the future will ever see]  Today’s concept is much more than the simple “you will save money if you wait to buy something until you have the money saved up, and/or you are really sure you want to purchase the item.”  Planning, preparing, and working towards the future in many different ways will be rewarding should we reach the future.  Most of us do not have unlimited resources and will have to invoke some level of delayed gratification.

At the extreme, when we travel and are killing time at night in a hotel room (boring people) and there’s no DVR so we are forced to let the commercials play.  We’ve found after nearly 20 years of time-shifting our viewing (see our first device UltimateTV) we have no patience for TV marketing of products, foods, medication or politicians.

I just haven’t grasped the “I see it, I want it-NOW” mentality.  Oh, I definitely buy things.  I definitely buy things I do not need.  I also spend too much time making sure it’s the correct/best item for me and the best price (usually a huge waste of time) but over that research time period I often weed out the unnecessary. 

So delayed gratification is built into me.  …I can wait.

I just realized my last post was about saving the best for last.  Note to self, enjoy now AND be prepared for better in the future…assuming the future comes.  Nothing is guaranteed, so balance is critical.

*** Nothing in this article is to be construed as financial advice.  I am not a financial planner, nor do I pretend to be.  You should always consult your own professional when seeking advice.

Have you ever thought about your personality traits?

I’ve learned over time to understand how I think.  I’ve been placed in situations where I come across information that I’ve had to evaluate and make a decision from.

It makes me wonder how other people see situations, instances, information or crisis actions.

The general questions are:

• Good news or bad news first?
• Half full or Half Empty?
• The best: first or last?  

What kind of mindset do you possess? 

I’ll share how my brain/personality seems to work.  I’ll answer the question above (maybe just to learn more about myself).

Examples:

I always want the bad news first.  I want to know what is going wrong.  I find that I want to deal with the problem…now.  I want to see if I can resolve or start the process to eliminate the issue.  In a sense, I want to stop the bleeding.  Once resolved, or on track for (possible) resolution, I then feel free to look ahead and try to make things better.  Somewhere along this process, I want to “good news” to see how that fits into the current issue/process.

I generally find the glass half full, but only in the sense that I seem to have the drive to fill the glass back up.  I don’t believe I feel as though I’m missing the (top) half empty part of the glass.  Maybe I just feel there is half a glass to fill up.  Though, sometimes I also think, just because “a” glass is half full, that doesn’t necessarily mean the glass was ever, or ever will be full.  Not everything in life needs to be perfect/full.  I live by a life-calming statement of “everything has a ding.”  Nothing is perfect.  No need to try and make everything perfect.  I just try to enjoy the best of what I can do and accomplish.

No surprise to me, I tend to save the best for last.  I will get the bad stuff (work/tasks) out of the way so I can then enjoy the good stuff.  Thinking about the FI lifestyle, this is one form of delayed gratification.  I don’t believe waiting for the good stuff is required, but I do think the intentional decision in the selection process may be just as valuable.

My grandma would ALWAYS grab dessert first at any buffet.  She decided to start with what she enjoyed the most.  I always thought that was awesome.  She did something that was so far outside the norm (salad, entrée, dessert) without any regard for what others thought.  Also, she always a full selection of dessert choices.

Balance:

So I wonder, get the bad out of the way and save the best for last?  Take advantage of the best now since we never know what the future will bring, or if it will even arrive for us.

How do I balance my inherent nature for delay (wise) gratification with a life optimization mentality?

As a fairly risk-averse person, I guess I will try and continue to take care of the issues/planning and aim for the good stuff while keeping a very close eye on the future and making sure I’m not sacrificing future stability for immediate gratification.

See, nothing is easy when you try and break things down and really think about them.  Enjoy your life, enjoy your days.

*** Nothing in this article is to be construed as financial advice.  I am not a financial planner, nor do I pretend to be.  You should always consult your own professional when seeking advice.

Over Memorial Day weekend I was lucky to attend a “Financial Conference” as I explained it to people.  In truth, it was a hangout session for money nerds, which was quite accurately disguised as a “camp.”

I’ve been to a CampFI before, the “Southwest” version at Joshua Tree, and was just as thrilled this time after spending three more days with my people again this year—albeit different my peoples as CampFI Mid-Atlantic.

He’s the really cool thing, the group of seventy plus people ranged in ages from 23 to maybe 63ish.  To be even more clear, there almost were three generations in attendance but there weren’t different levels of discussions.  ALL ages of people were engaged in discussions, on all topics, no matter their age.  EVERYONE in the discussions added ideas, perspective, and additional inquiries.

I’m quite an introvert at heart—just like many others I’ve come into contact with in the FI world—yet at the CampFI’s it is so easy to talk to everyone.  To me, it’s the strangest thing to just walk up to someone and start chatting, then go more in-depth on a topic, or multiple topics, a process that just seems so natural.

Discussion timelines were quite amazing as people talked very late into the evening and were often up early getting their bodies in gear with some form of activity.  The campers sure seem to really live life to the max and get the most out of their day(s).

For those who don’t know, CampFI is three days of hanging out with people so similar to yourself.  We arrive on Friday afternoon and leave mid-day on Monday.  The camps are located outside of a populated area in a (youth?) camp-like setting.  It’s a little basic on the lodging and dining side, but that seems to fit us FI people just fine, especially since we often cherish experiences more than material items.  We do not seem to need luxurious accommodations.

The days are really very loose and open with lots of free time to gather, play games, snack, hang out, meet, then meet more, and truly get to know so many people living a similar intentional lifestyle.  One very cool aspect is that everyone comes from different professions and often different parts of the country (or even worldwide). 

There are a couple of hour-long presentations each day on life topics.  The presentations are not really geared toward money talk.  They seem to be more about a higher level of thinking, of living the best life on your own terms.  I’m sure that is on purpose as we all consume money -talk media non-stop in our real lives. 

The group size at both of my camps has been great.  There are lots (70ish) of people to hang out with and make friendships, but not too many to be overwhelmed. 

In closing, I think my main thought is that I find I really care about the people I’ve met.  I’m excited to stay in contact and watch their lives progress towards more-awesomeness.  At (and after) camp, it’s not at all like the instagram-highlight reel lifestyle, but a much truer, more real, we’re-kicking-ass at the lifestyle we choose.

If you’re really into living an intentional FI related life, CampFI is a great way to rise up another notch.

*** Nothing in this article is to be construed as financial advice.  I am not a financial planner, nor do I pretend to be.  You should always consult your own professional when seeking advice.

Do you live each day with enjoyment?  Do the events that unfold throughout the day add to your satisfaction?     [please say yes]

We have a family member who is getting older and lives each day with enjoyment, excitement, and passion.  That is so much of what we all want in our own lives.  The hard part of this story is that most of their thoughts are in those daily moments.  The past activities are not as bright and visible.

Senior Moments:

As we age, we all have some brain connections that slip or miss.  These often have been referred to as “senior moments.”  That makes sense as they happen more frequently as we get older.  They can be simple things like you can’t quite remember the name of a business or exact location.  At first, it seems the reason you can’t recall the information is that you didn’t pay full attention at the time of the action or other things have come up since that activity.  Yes, that is true, but it’s also because our brain synapses’ just aren’t firing and connecting quite as well as they used to in processing information.

Headlight Range:

The analogy I envision is to think about driving at night on a quiet country road.  What you’re concentrating on is the activity right in front of you.  Sure, you can also see a little way up the road with some headlight glare.  But just outside those bright lights, the view somewhat darker.  The activities are right there, just outside the brightness, but they are hard to make out clearly.

Think about looking in your rearview mirror.  Immediately behind your car may be visible, or somewhat visible because your taillights give some light, but farther back, it can be very dark and hard to recognize.

If there are streetlights, business lights/signs, highway signs, other car headlights, those will help you see outside your own headlight area.  I feel like those helping lights are people around you who are with you and possibly assisting you.

My question, is living within the headlight visibility area OK?  Sure, if you see the brightness is the day, in the activities.  If you concentrate on those areas that are dark, then you may not feel as positive about your life journey.

Enjoy Each Day:

Whatever we do in life, I really believe finding the positive and enjoying your day—whatever’s in your visual/visible range—may be the most important thing we can do for ourselves and others.

If possible, strengthen your own shining light with exercise, diet, social interactions, whatever it may take.  One morning we will all not see the morning light, so enjoy each day!

*** Nothing in this article is to be construed as financial advice.  I am not a financial planner, nor do I pretend to be.  You should always consult your own professional when seeking advice.

DONE!  25xExpenses saved.  You’re ready!  Time to truly evaluate the FIRE lifestyle, or Fully Funded Lifestyle change many of us are talking about right?

[insert screeching sound]  BEFORE jumping headfirst into your new awesome lifestyle, please (re)consider two things:

1. Are you calculating your 401k/IRA’s balance(s) in your 4% withdrawal rate?
2. Are your expenses all-inclusive of all the money you will need each year?

Qualified Tax Deferred balances:

I keep reading articles with the amazing accomplishments of “maxing/maxed out our retirement accounts.”  That is an amazing accomplishment in today’s economic/consumption lifestyle.  My concern is $500k in a 401k does not necessarily equal $500k spendable/$20k per year in spending.

Instead of spending $20k, you are actually using the 4% rule to withdrawal $20k for the spending amount plus taxes.

Now, of course, $20k counted as ordinary income—if your only income—is not going to hit you hard on the tax side.  However, if you were a big-time tax-deferred saver and your qualified accounts have skyrocketed, you may plan to take a much larger withdrawal THANK $20k, thereby pushing you into high teens/low 20’s total tax brackets (Fed, State, Local, sales, etc) or even higher (good problem actually).

I believe it’s safer to be more cautious and I adjust my personal retirement account balance to a projected 70-75% spendable amount.  At least for the big picture planning.

Expense Inclusions:

So you say, “I/we spend $3000/mo (or $4000, or $5000, or more) for our lifestyle.”  I’m assuming that is your after income-tax spending.  I mean, who calculates how much they are required to allocate for funding the government each year, right?  I can tell you exactly who knows, people who send in quarterly tax payments because they are not receiving a paycheck/annuity-type payment that has automatic withholding.” 

I know without a sliver of doubt, when you decide to take money out of your qualified accounts (I love the word ‘qualified’ as in accts, dividends, etc) you will know quite clearly how much net withdrawal you get to keep/spend and how much is going to your non-related uncle.  Or for the wise planners here, how much the Roth IRA conversion amount will cost you in taxes.  How’s that for using a Roth to find a positive slant on paying taxes?

Quick example:

You’re older, and you are all set up with retirement accounts and social security.  Life’s good.  But you decide it’s time for a new car because at your age you don’t want to hassle with AAA and/or getting your car repaired across town.  If you don’t want to make payments on a basic $20k (or cheap $8k) car and decide to use your “savings” you have to pull say $25k (or $10k) from your nest egg. 

Your large purchase will require a withdrawal of the vehicle’s price + sales taxes +other registration taxes PLUS the income taxes at your highest marginal rate.  This withdrawal is at the top of your income…top end of your ordinary income.

If you wanted to purchase a vacation home for cash…can you feel your uncle wringing his hands at your upcoming payment to the IRS?  Not exactly a house warming celebration party.

Not all account balances are true balances.  Sometimes (often) there are implied obligations within those balances.

*** Nothing in this article is to be construed as financial advice.  I am not a financial planner, nor do I pretend to be.  You should always consult your own professional when seeking advice.