Author Archives: -N-

Week 75: 555 More Days, and Refi Update

Monday, 22 January 2018

The flu took a lot out of our lives.  I didn’t get it, but Mr. 182 did.  He was miserable, and I have never seen him so ill in the 25 years of our lives together.  He is still coughing badly, but other than that he is doing fine.  Because he was so sick, we didn’t address what we felt to be issues in this refinance of our house, but last Friday morning I was off work and he was well enough to discuss the details.  The final decision is to proceed with the refi, fixed for 30 years at 4.25%.  There is no prepayment penalty, so once things are done with other financial issues, we will decide where our priorities lie.

Yesterday, I really thought through my retirement date.  Based on what information I have about the school district, I decided I won’t retire until August 1, 2019.  There are 555 days left!   Setting a date was based on a number of reasons.  As a teacher, I like working in the summer as it is extra income.  There is also a potential golden handshake, if not this year, then in the next fiscal year.  I will begin to pull my social security in November 2018, with a 25% deduction (or more) for tax purposes.

With the refi of the house, our proposed house payment will be about $1100 less than what we currently pay.  That will put us ahead on debt reduction.  When I take social security, I will be older than 66.  This allows me to work without income limitations, and will add about $1200-$1400 to our monthly income after the tax deduction.  The extra money should, in theory, pay off all credit cards, increase savings, and put a better financial cushion behind us.  Once I retire, I will have my pension in addition to social security.  Our income will be lower, hopefully enough to drop our percentage even more.  Once the debts and income are squared away, Mr. 182 will increase his pre-tax deductions.

There are a lot of caveats!  As this is only the third week into the 2018 tax season, and the IRS and Congress are in upheaval with the government shutdown, who knows what the final amounts of taxes and such that will need to be paid.  Nobody really knows at this point.  Final mortgage figures are not definite, just approximate.  We hope to close by the end of February so our March house payment will be lower.  If a golden handshake comes this spring, and is worthwhile to take, I’ll do it.  I will probably take my pension, but hold off on my claiming my social security, just to make it past the 66 age marker.  Thus, while we have made our plans, life still happens, and we will have to meet the changes and adapt.

It’s a good thing to plan ahead, anticipate change, and be able to meet those changes.  Unexpected things happen.  Acknowledging their potential helps to plan for the unknown.

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Week 76: Flu Season

Monday, 15 January 2018

Nothing like the flu . . . fever, chills, cough, hot, cold . . .

Tuesday a flu shot was scheduled and the flu arrived the day before.  Thursday into the late hours at our MD’s office.  Swab test = Flu A.  Tamiflu and cough syrup with codeine.  Three days off work.  Still coughing a lot, but much better.

Get those flu shots!  Even if this year’s is only 30% effective, 30% is better than 0% effective.

Week 77: Re-Fi #2

Monday, 8 January 2018

Last year – well, December 2016 – we wanted to refinance our house.  We had a 15% equity in our home at the point.  Now we have about 22-23% equity.  We decided to try to refinance again a few days ago.  With interest rates going up, increased equity, increased valuation of our home, and a tight available housing market, it looks favorable.  While we have yet to recover fully the valuation of our own home from the market crash in 2008, our neighbors, who bought at the low of the market, have seen nearly a 50% increase in their own home valuation.

It always costs to have a house refinanced, whether in appraisal or closing costs or credit report.  The benefits of being diligent in our debt reduction has resulted in two things . . . first, we could pull money our of our cash funds to start the process, without pain, and second, our credit rating is up 15-20 points.

I personally will be surprised if we do get an approval, but for some reason Mr. 182 is expecting it to go through.

 

Week 78: Happy New Year! And a Resolution or Two or Three

And so it is!  A lot has happened in the past year, politically especially, but in our neck of the woods some major financial changes have happened since I started this blog 104 weeks ago on New Year’s Day (or close to it, anyway).

78 more Mondays to go, and I do think I will be retired.  And mostly if not totally out of debt except for a few items.  We are not quite where I had hoped, but that is the way it is.  We are still in much better shape than we were when I started this blog, and that is saying quite a lot.

Retirement Planning

I have Medicare Part A; I went to my appointment with the manager of my retirement fund, and have sent in a formal request for what I can expect if I terminate my employment on August 12, 2019.  That will be at the end of the summer term schedule, so that makes sense to me.  Also, there are rumors of a golden handshake in the works, so if so, I will take it if I qualify.  I should get the formal request’s information back by the end of January 2018.

Social Security

I think I will start it as soon as possible, but that may vary depending on how things move along over the next several months.  I’m not sure how it will affect our tax bracket, either, but it may be worth it for a year.  We will be consulting with our CPA very closely this next year.  I am sure the poor man is already going nuts.

Debt Reduction

Like I said, we aren’t quite where we would like to be.  Taking Social Security will help clear out the debt issues sooner, and then we will be in a better place financially when I do retire.   I have re-evaluated what we have been doing, and have changed the parameters a bit.

Taxes

The Republicans claim we will benefit from their new plan.  I don’t think we will.   We live in a high tax, high housing cost state and area, so we will not be able to claim the same amounts of state and local taxes we have in the past – we claim far more than the $10,000 they are capping things at.  I’m actually worried about our 2018 taxes – I think we will owe a lot of money.  We already pay about 35% of our income in taxes, so the 2.4% we can expect in our favor in payroll is likely to go to support the corporations who won’t reinvest in their workers, only their stockholders and management, and who don’t support our government nor our citizens.  (Don’t get me started on health care, either.)  We did pay all of our 2017-2018 property taxes since we had the bills for them – this should help us a bit for 2018 filing.

Downsizing, Discarding, recycling

I think this says it all.  We have sold books, and cleaned out the garage.  Last week we created his and her sides of the garage.  While we still cannot park cars in the garage, we can access our personal stuff more easily.  We have more bookshelf space in all rooms!

Resolutions

  1. Pay off as much as possible this next 18 months
  2. Remove the 20 trees from the property so we can begin to re-do the back yard into a usable space
  3. Do the household repairs, little and big, if we can
  4. Continue to get rid of things we don’t need or use

Conclusion

This upcoming year is going to be a bit of a roller coaster ride – taxes, politics, life changes getting closer and closer.  It’s really scary, and we both need to face it and embrace it, despite our fears.  This will perhaps be one of the biggest life situations we will ever face.

Week 79: Merry Christmas!

Monday, 25 December 2017

Light looked down and beheld Darkness.
“Thither will I go,” said Light.
Peace looked down and beheld War.
“Thither will I go,” said Peace.
Love looked down and beheld Hatred.
“Thither will I go,” said Love.
So came Light and shone.
So came Peace and gave rest.
So came Love and brought Life.
                                            –Laurence Housman

Week 80: Time Off for the Holidays!

Monday, 18 December 2017

With just a week before Christmas, I am signing off for the next two, possibly three, weeks.  The holidays are upon us and there is so much going on.  We are preparing for our annual Christmas season, but this year we are being more frugal than in the past, and it feels good.  At the end of the year, we will look both forward and back, to see where we have been and where we hope to go.

Happy Holidays to Everyone!

Week 81: Prepare for Catastrophe

Monday, 11 December 2017

This country has been through several hurricanes this year.  Now, the west coast is burning a second time.  In October, fires raced through northern California, destroying homes (8900) and wineries and wildlife and businesses.  Now, in southern California, fires are racing throughout, from the middle of the state to the Mexican border.  At times, the east coast faces horrible weather in winter, as does the south and midwest.  In face of this, what are some of the things people do to prepare for such potential catastrophes?

A quick web search reveals multiple sites which are helpful.  Depending on the needs of the area, suggestions vary.  These include:

  • Stock up on emergency supplies, such as water, non-perishable food, medications, first aid, cleaning supplies for yourself and your things, tools, pet supplies, and a generator.
  • A family emergency plan to include discussions about contacting each other and what to do for injuries.  In other words, talk about it and make decisions.
  • Secure your property by making sure locks work on doors and windows, bring in furniture and plants.  Think about what you have outdoors – can something you don’t bring in be used to break in to your property?
  • Know what you are likely to expect.  Hurricane?  Tornado?  Blizzard?  Fire?  Flood?  Earthquake?  Prepare accordingly.
  • Have emergency names and numbers on hand and be sure everyone knows who to get in touch with in case of separation.  Know who you can contact in your neighborhood – who you can trust.
  • Check your insurance policies.  Are they up to date?  Can you increase coverage in case of a natural disaster?  Will a natural disaster become an “act of God” and be denied by your carrier?

To tell the truth, most of us don’t want to talk about emergencies and their potential consequences.  It’s scary.  Preparing for disasters costs money.  That is a fact, and for those who are cash-strapped, it is an additional burden.

Financial planning and responsibility requires an eye to catastrophe.  This is why it is recommended as a primary goal in debt reduction to have an emergency fund.  Ramsey suggests $1000.00.  Others suggest enough cash to survive 6 months.  Everyone needs one, and it will vary with your needs.  I also suggest a monthly investment in emergency supplies or changes to your environment.  This may mean including money to buy bottled water or dehydrated food.  It also means finding a place to store these items so you can get to them.  How they are stored is also important.   It seems that no one discusses where to store these things . . .

Catastrophes and emergencies happen.  We forget about them because we are generally not living in survivalist mode, meaning worrying daily about food, shelter, clothing, and water.  Think about them – your survival may ultimately depend on preparations you make today.