Tuesday, May 14

How I've Been Simplifying My Life

Getting rid of material things, unnecessary tasks, and unused financial accounts is important to me.  Living simply allows me to focus.  Recently, two of my bank accounts were compromised.  Both were at the same bank, with one being my primary checking account.  I have no inkling as to how someone obtained both account numbers and routing numbers, and what's even more troubling was the method used to withdraw funds from the accounts.  Without knowing how to prevent this from happening again, the only thing I can think of to do is to simplify my finances so that I can be laser-focused on each of my accounts.

Bank Account Closures

Closed a Savings Account

I never used the savings account and only kept the minimum balance I thought I needed to get free checking at my bank.  Once I realized I qualified for free checking based on having direct deposits, it was no longer necessary to keep the savings account.  Since this was one of the compromised accounts, it made sense just to close it out. 

Closed My HSA

I drew down the balance in my Health Savings Account.  I no longer qualify to make deposits into the account, which made it an easy decision to get rid of it. 

Canceled a Credit Card

Finally, I canceled a credit card I had with Bank of America.  Since I had no other relationship with that bank and the card had an annual fee, it was a no-brainer to get rid of it.  I have other credit cards with annual fees, and will consider closing them when the benefits don't justify the fee.  I have two cards, for example, that award a free night each year at the branded hotel chain.  Since the annual fee is less than the cost of that free night, there's no reason to cancel the account.

Resolved Nagging Issues

When I purchased our phones last year, I took advantage of a Google Fi promotion for buy one phone, get one free.  For some odd reason, Google never credited my account for the promotion.  I had to contact the company more than a dozen times, but eventually they properly credited my account.  I'm still waiting on the apology for all my time that was wasted!

Lastly, when I sold the townhouses in March, there was a lien on one of them from a mortgage I paid off 10 years ago.  Chase forgot to release the lien when I paid off the mortgage.  Getting this resolved took several hours of my time, but I finally received the necessary paperwork, and the closing attorney released the funds I was due.  This was a huge relief!

Eliminating Things

The battle against "stuff" rages on.  What is helping right now is an idea I have to house hack our next home purchase.  Right now it's just an idea, but if we go through with it, I want our next home to be one that we can Airbnb during high demand times or when we are out of town.  In order to do that, we need to minimize our personal belongings, which will need to be stowed away before guests arrive.  

I've been actively dejunking.  Right now we have almost a carload of stuff that needs to be taken to Goodwill.  This is just a drop in the bucket, though.  My focus is on excessive clothing at the moment.  It's hard to get rid of clothes that "almost fit" or those that are barely worn but just aren't my style, even though it should be easy to toss these things.

How are you simplifying your life?

Monday, May 6

My Frugal Miser - April Expenses: $11,129


Overall April had a lot of expenses.  I replaced the HVAC system at the Airbnb.  It froze up for the second time, and with summer around the corner, I wanted to be proactive.  The old system was 20 years old so it was time. 

I also paid 6 months of auto insurance ($533), made a quarterly tax payment, and paid for our Chinese visas and gratuities for the China trip we are taking later this year.



April Expenses:  $11,129

$1,067 Auto (service, gas, insurance, AAA, etc.)
$0 Bank Fees
$10 Clothing/ Personal Care
$564 Fun (vacations movies, gambling, alcohol, concert tickets) 
$527 Food
$506 Health & Dental
$1,519 Household/Mortgage Payment/Home Repair
$34 Interest Expense*
$168 Miscellaneous
$690 Taxes includes quarterly tax payments
$0 App Jobs Expenses (tolls, car washes, etc.)
$131 Unreimbursed Employee Expenses
$57 Reimbursed Employee Expenses
$312 Utilities
$725  Rental Property Expenses
$4,889 AirBNB Expenses

*Interest expense includes student loans.  As the rate is below 2%, I am completely comfortable paying the interest each month and investing the money that I would otherwise use to pay off this loan.  

Friday, May 3

My Frugal Miser - April Income: $12,597


I had a decent month in April, and I worked a lot.  We went to Nashville for a meeting, where we made $1,400 before taxes.  I worked another small meeting in Orlando after that and ended the month with a meeting in Chattanooga (earnings from that one will be paid in May).  I also did a lot of Amazon routes, and drove for Uber and Lyft for a few hours one morning when I couldn't sleep. 

Rental income includes the security deposits I was refunded on the townhouses I sold at the end of March, so it was higher than normal.  The Airbnb was booked almost the entire month, though I did block a few days when we were out of town.

I put some of the proceeds from the townhouses in short term savings.  I earned a $200 bonus from Discover Bank.  Interest income will be higher until I find a better investment for that cash.

April Income: $12,597

$264 Mystery Shopping
$1,980 Meeting Jobs
$64 Gig Apps (Uber, Lyft, Postmates, Doordash)
$1,891 Amazon Deliveries
$5,941 Rental Income
$2,216 Airbnb Income
$35 Interest Income
$207 Other Sources

Investment Accounts Change in Value:  $2,516


Friday, April 5

My Frugal Miser - March Expenses: $3,589


March was a mixed bag.  Now that the month is over, a couple things surprised me.  The amount we spent on food was the biggest surprise.  There weren't any extravagant restaurant meals.  We bought a lot of groceries and had takeout several times.  The "Fun" category also surprised me, until I remembered we wrapped up a short vacation at the beginning of the month.  I also lost some money in Tunica after I sold the townhouses.  The transaction was a cause for celebration!

The Good

I received a substantial refund on my 2018 taxes.  This was mostly due to losses on rental properties.  I had major turn costs at the beginning of 2018.  Since I sold the 5 townhouses, rental expenses over time will be much lower.

The Not-So-Good

Bank fees were really high.  I opened a new credit card, the Marriott Bonvoy Brilliance card.  After meeting the spending requirement I will get 100,000 bonus Marriott points.  I also paid the annual fee for my self-directed IRA. 

I spent $2,017 on "fun".  This is a new category in 2019 that consolidates spending on vacations, entertainment, gambling, etc. 

I also had to have more dental work done last month.  Hopefully my teeth are good for the rest of the year!

March Expenses:  $3,589

$800 Auto (service, gas, insurance, AAA, etc.)
$948 Bank Fees
$30 Clothing/ Personal Care
$2,017 Fun (vacations movies, gambling, alcohol, concert tickets) 
$717 Food
$0 Gifts Given
$1,024 Health & Dental
$1,382 Household/Mortgage Payment/Home Repair
$40 Interest Expense*
$133 Miscellaneous
($5914) Taxes (Quarterly Tax Payment) tax refund for 2018 overpayment
$0 App Jobs Expenses (tolls, car washes, etc.)
$0 Unreimbursed Employee Expenses
$312 Utilities
$1,973  Rental Property Expenses
$1,053 AirBNB Expenses

*Interest expense includes student loans.  As the rate is below 2%, I am completely comfortable paying the interest each month and investing the money that I would otherwise use to pay off this loan.  

Wednesday, April 3

My Frugal Miser - March Income: $13,201


March was another solid month.
  • I worked one meeting, so more income came from Amazon deliveries last month.
  • I sold the townhouses on Friday, the 29th.  Rental income will be significantly lower moving forward.  I am looking for ways to replace that income using the proceeds from the sale.
  • The Airbnb had a record month.  I probably left money on the table and could have charged even more.
  • My investment accounts had a decent increase.  Also, I shifted my idle cash into some short term CDs to earn a little more interest until I find more attractive stock values.

March Income: $13,201

$244 Mystery Shopping
$784 Meeting Jobs
$0 Gig Apps (Uber, Lyft, Postmates, Doordash)
$1,846 Amazon Deliveries
$6,333 Rental Income
$3,810 AirBnB Income
$27 Interest Income
$156 Other Sources

Investment Accounts Change in Value (Excludes IRAs):  $6,067


Monday, April 1

March in the Rear-view...Sold 5 Properties!

March was a great month for many reasons.  It was less stressful because there aren't as many meetings to work during the month.  I did work one meeting early in the month for a long-time client.  It was super easy, but the pay was also on the lower-end.  I earned more delivering for Amazon because of this.  I like sleeping in my own bed every night.

It was also a great month because I accomplished several things.

Frugal Tip

Look for a discount!  Sometimes it pays to pick up the phone.

I'm guilty of relying on the web for just about everything.  In fact, I forget that I can do business over the phone still.  In February, there was an unexpected problem with my car that rendered it undriveable.  I was at the mechanic's shop, and I jumped online to rent a car.  There wasn't a single car available in Tampa Bay.  I mentioned this to my service advisor, and he picked up the phone to call Enterprise.  In under 60 seconds he had a car for me, at a really nice rate.  I had just checked online, and there was nothing.

A couple more examples.  My Internet bill at the AirBNB went up unexpectedly.  Most people would probably just pay the extra $10, assuming that prices naturally go up with inflation.  I looked online and couldn't find anything, so I called support.  All I had to do was agree to a 12 month contract, and I was able to keep the old rate.  I saved $120 and all it took was a 5 minute phone call.

One last example of looking for a discount.  My new health insurance doesn't include prescription drug coverage.  I had a sinus infection and went to Walgreens to fill a prescription for an antibiotic.  I was shocked at the price:  $72!  My friend was with me, and she asked if I had a Florida Discount Drug Card.  I had never heard of it, but getting one took 2 seconds and was free.  I literally just entered my name on a website and it generated an electronic card.  The pharmacist entered the card number, and the prescription price dropped by $39.

Taxes Are Done

I filed my taxes, which is always a big stress due to their complexity.  I received a substantial refund due to losses on my rental properties last year, and used the refund to finally catch up on all my credit card bills.  That's right - I'm back to a zero balance on everything.

No More Townhouses!

Second, I sold the townhouses.  I had been putting this off for years because it seemed easier to just hold onto them.  They were decent investments from a cash-flow perspective, but the area has gone way downhill.  A burglar was shot and killed in one of the neighbor's townhomes, random drive-by shootings had happened nearby, and drug activity was everywhere.  The last straw was when I went to Birmingham in January to work on a vacant townhouse.  Several of the other units were looking pretty shabby.  It was obvious that the owners (mostly landlords like me) weren't properly maintaining their properties.  Since I had not been able to raise rents for several years, while other costs were climbing, I thought it was time to look for a way out.  It also helps that the economy is firing on all cylinders, including real estate, so I feel like I got a fair price.  I sold all 5 townhouses to one investor in a package deal.  One and done.

Record AirBNB Income

March was an incredible month, as every single day was occupied at our AirBNB.  We grossed over $3,700 in March, a record.  What's even better, I could have made more.  Next year I know to charge more during the month of March.

Next Goals

My new normal is a month with about $3,500 less in rental income due to the sell of the 5 townhouses.  Much of that went towards property taxes, insurance and fire dues, as well as substantial turn costs whenever there was a vacancy.  Still, I would like to replace that income.  I'm leaning towards buying another AirBNB property, but prices are really high right now, so this may take time.  

We should start seeing positive cash flow again even without replacing the townhouses.  The next big cash outflow won't be until property taxes are due at the end of the year.  I just renewed the insurance policies, and don't expect any vacancies the rest of the year.  I will use the cash flow for a few things:  
  • I need to build up a cash reserve for turn costs and property tax bills.  $10,000 is probably what I need.
  • I want to invest more in our existing AirBNB.  Because it's an old house, there is a long list of repairs and improvements I would like to do.  Now that I know it's cash-generating potential, I want to spend a little money making it nicer and being proactive.  By proactive, I mean replacing the water heater and air conditioner sooner rather than later, before they break.
  • I'd like to spend some money in the backyard at our new house.  We only have a small concrete porch.  I'd like a sunroom, or at least a covered sitting area.  My partner wants a fence, which probably isn't a bad idea, either.
To sum things up, March was a wonderful month!  Life just became a little bit easier.  April will be a busy month, so bring it on!  We have a week-long meeting in Nashville followed by a meeting in Orlando.  The AirBNB is nearly sold-out for the month, so that too will keep us occupied.  In my spare time, Amazon.  I feel as if everything is firing on all cylinders.

Saturday, March 9

Catching Up and Getting Simple

Today is a beautiful day, and not just because it's sunny with a high in the low 80s here in Florida.  It's a beautiful day because I just wrapped up my federal tax return and business returns.  Even better, due to higher spending on the rental properties last year I will be getting a sizable refund this year.  Last year I had a big tax bill.

Filing taxes was easier this year.  Most of the meeting jobs I do have converted from 1099 to W-2, significantly cutting down on record keeping and forms to fill out.  My goal though is to keep simplifying my finances.  Here's what I'm working on in 2019:

Simplifying Finances, 2019...

  • A few years ago I opened a Health Savings Account.  Since I no longer have a high-deductible health plan, I can't add funds to the HSA.  I plan to withdraw the balance in this account this year as I have medical expenses.  Goal is to close it out by yearend.
  • I was one of the original adopters of Prosper, even attending Prosper Days back when it first started (the memories!).  The returns on this platform aren't meaningful enough to continue using it, so I've been withdrawing funds from it every time I had $100 available.  Some of the loans I made on Prosper mature at the end of 2022, so this is going to be a slow process.
  • I'm "shopping" the Birmingham townhomes to potential investors.  There's a good chance the sale won't go through, but I do have an interested buyer under contract.  These townhouses have been cash cows over the years, but the neighborhood has steadily declined and turnover costs are too high.  We've been thinking about adding another AirBNB property eventually, so if I do sell the townhouses, I'd potentially use the proceeds to fund another BNB here in Florida.

Having Fun, More Frugally...

We love to travel, but I don't like paying for it.  This year I'll spend every time finding ways to cut costs in the "fun" category, while not cutting back on fun.

  • Last month I opened a new credit card, the Marriott Bonvoy AMEX.  I did this for the bonus:  100,000 Marriott Rewards after spending $5,000 in three months.  This will get us several free nights in Marriott-branded properties.
  • We booked a trip to China through UTO Vacations.  It's 8 nights, and includes flights from New York, flights within China, hotels and tours.  It was only $299 per person, plus the cost of a Chinese Visa and gratuities.  Since it seemed too good to be true, I did a lot of research beforehand.  The "catch" to this incredible price is that our trip is subsidized by requiring us to visit specific stores in China on each tour.  Apparently the merchants pay a fee to the company to entice the tour to visit the store.  Overall it was a reasonable compromise, as each store visit only lasts an hour and there are only a handful of these along the way.  I liken it to doing a timeshare presentation:  the trip is substantially discounted as long as you listen to the sales pitch.

Last, but not least, is simplifying our "stuff".  This is an ongoing process that will never end.  I should probably wait until I've gathered some things to get rid of and then write another post on that.  Until then... have a great weekend!

Thursday, March 7

My Frugal Miser - February Expenses: $8,717


It's important to remind everybody that I am including business and personal expenses in these reports.  Business expenses are a necessary part of growing my income.  But there's a difference between buying sheets for my AirBnB and paying for a restaurant meal.  Nonetheless, it is all listed below.

I have switched from Quicken to a customized spreadsheet to manage my finances.  As part of that transition I have consolidated some categories.  I am also now reporting business expenses.  Previously I did not include rental property expenses. It's all designed to simplify managing my money.

The Good

Because the meeting jobs often provide us meals, our spending on food was really low:  $90.  I can't remember the last time it was so low.  Meeting work also meant less spending on gas for the car.  However, that was offset by a repair in February to fix an oil leak.

The Not-So-Good

I spent $1,500 on "fun".  This is a new category in 2019 that consolidates spending on vacations, entertainment, gambling, etc.  In February, I made a payment towards our next exotic vacation:  China.  We are going there in October.  We also took a trip to Vegas and Seattle at the end of the month, so some of the spending was on this trip.

I also had to have more minor dental work done last month.  Lastly, bank fees and interest.  I paid the annual fee on the Chase Sapphire Reserve card, which is $450.  I will get $300 in travel credits which will offset the cost of having this card.  I also paid some interest on two credit cards.  Rather than covering my balance with money from my investment accounts, I decided to keep an oustanding balance and just pay interest on it.  This isn't the cheapest way to do things, but I have my reasons.

February Expenses:  $8,717

$500 Auto (service, gas, insurance, AAA, etc.)
$460 Bank Fees
$96 Clothing/ Personal Care
$1,525 Fun (vacations movies, gambling, alcohol, concert tickets) 
$90 Food
$0 Gifts Given
$982 Health & Dental
$1,310 Household/Mortgage Payment/Home Repair
$0 Investment Expense
$105 Interest Expense*
$118 Miscellaneous
$0 Taxes (Quarterly Tax Payment)
$0 App Jobs Expenses (tolls, car washes, etc.)
$0 Unreimbursed Employee Expenses
$280 Utilities
$2,777  Rental Property Expenses
$474 AirBNB Expenses

*Interest expense includes student loans.  As the rate is below 2%, I am completely comfortable paying the interest each month and investing the money that I would otherwise use to pay off this loan.  

Tuesday, March 5

My Frugal Miser - February Income: $12,519


My income in February was good.
  • Meeting jobs took up the majority of my time.
  • One rental property is vacant; everything else is occupied with rent paid.  I m now including homes owned through my retirement accounts.
  • We had one 28 day rental at the AirBNB.  When I first went live with our rental, I had extremely low rates and a 20% off promotion.  This was the last vestige of that promotional activity.  I estimate our February income could have been $1,500 higher if I had been charging market rates in February.
  • My investment account barely changed.

February Income: $12,519

$336 Mystery Shopping
$3,239 Meeting Jobs
$0 Gig Apps (Uber, Lyft, Postmates, Doordash)
$646 Amazon Deliveries
$6,840 Rental Income
$1,431 AirBnB Income
$26 Interest Income
$0 Other Sources

Investment Accounts Change in Value (Excludes IRAs):  $423


Monday, February 11

My Frugal Miser - January Expenses: $12,996


January was another fairly expensive month.

I have switched from Quicken to a customized spreadsheet to manage my finances.  As part of that transition I have consolidated some categories.  I am also now reporting business expenses.  Previously I did not include rental property expenses. It's all designed to simplify managing my money.

  • We spent a week in Birmingham working on the empty townhouse.  I had to replace the cabinets and countertops, which was a $6,000 expense.
  • Food spending was high. We ate out every day while we were in Birmingham.  We eat restaurant food way too much.
  • I switched from an ACA health plan to one called Liberty Healthshare.  The monthly premiums are higher but overall it should lower my health expense.

January Expenses:  $12,996

$209 Auto (service, gas, insurance, AAA, etc.)
$0 Bank Fees
$47 Clothing/ Personal Care
$15 Fun (vacations movies, gambling, alcohol, concert tickets) 
$583 Food
$0 Gifts Given
$1,331 Household/Mortgage Payment/Home Repair
$0 Investment Expense
$77 Interest Expense*
$0 Miscellaneous
$0 Taxes (Quarterly Tax Payment)
$0 App Jobs Expenses (tolls, car washes, etc.)
$101 Unreimbursed Employee Expenses
$110 Utilities
$8,343 Rental Property Expenses

*Interest expense includes student loans.  As the rate is below 2%, I am completely comfortable paying the interest each month and investing the money that I would otherwise use to pay off this loan.  

Friday, February 8

My Frugal Miser - January Income: $14,389


My income in January was good.
  • Meeting season has begun.  More of my work was working meetings, but I still managed to deliver some for Amazon.  
  • One rental property is vacant; everything else is occupied with rent paid.  I m now including homes owned through my retirement accounts.
  • AirBnB was solid once again.
  • My investment account was way down.  My Sears put options lost a significant amount.  I had to close them out but still made a tiny profit.

January Income: $14,389

($21) Mystery Shopping
$1,425 Meeting Jobs
$27 Gig Apps (Uber, Lyft, Postmates, Doordash)
$868 Amazon Deliveries
$9,716 Rental Income
$2,150 AirBnB Income
$28 Interest Income
$197 Other Sources

Investment Accounts Change in Value (Excludes IRAs):  -$10,025



Sunday, January 13

AirBnB December Performance

AirBnB - December 2018


In our fourth month operating an AirBnB home we were cash-flow positive (that's two months in a row!)  Nightly rates are improving.  I was successful at filling a few vacant days by tinkering with rates.  Often if we are in-town and have a vacancy, I will lower rates as the vacant day approaches to try to get the house booked.  For example, I had a 3 day gap in mid-December.  Rates started at $79, which I gradually lowered until I picked up a booking at $49/night for two of those nights.  With the cleaning fee, that booking earned us $165 that we otherwise would have missed out on.

Financial Performance

Occupancy Rate:  90% (3 days unbooked)
Payments Received:  $2,886
Expenses:  $399

Net Income:  $2,487

Friday, January 11

My Frugal Miser - December Expenses: $7,294


December was another fairly expensive month.  Fortunately, I'm mostly finished furnishing our new house.  That was a major expense for 2018.
  • I had new brakes installed on my car; I also spent a lot on gas with all the Amazon deliveries I made.  Good thing gas prices are super low.
  • Food spending was high.  We had family visit for Christmas so this category includes spending for several additional people.
  • I had to replace a broken crown - over $800 after insurance.  Dental care can be expensive!

December Expenses:  $7,294

$434 Auto (service, gas, insurance, AAA, etc.)
$86 Bank Fees
$0 Charity
$0 Clothing
$0 Computer
$530 Entertainment (movies, gambling, alcohol, concert tickets) 
$769 Food
$319 Gifts Given
$1,843 Household/Mortgage Payment/Home Repair
$153 Health and Dental Insurance
$0 Investment Expense
$11 Interest Expense*
$808 Medical/Dental
$0 Miscellaneous
$9 Personal Care
$0 Subscriptions
$1,819 Taxes (Quarterly Tax Payment)
$31 App Jobs Expenses (tolls, car washes, etc.)
$0 Unreimbursed Employee Expenses
$390 Utilities
$94 Vacation

*Interest expense includes student loans.  As the rate is below 2%, I am completely comfortable paying the interest each month and investing the money that I would otherwise use to pay off this loan.  

Thursday, January 10

My Frugal Miser - December Income: $12,151


My income in December was strong.
  • Most of my work was delivering for Amazon.  Several days Amazon offered higher than normal rates because of higher volume.
  • One rental property is vacant; everything else is occupied with rent paid.
  • I had the best AirBnB month yet.  
  • My investment account was up.  

December Income: $12,151

($22) Mystery Shopping
$0 Meeting Jobs
$0 Reimbursed Job Expenses
$0 Gig Apps (Uber, Lyft, Postmates, Doordash)
$3,062 Amazon Deliveries
$6,205 Rental Income
$2,888 AirBnB Income
$18 Interest Income
$0 Other Sources

Investment Accounts Change in Value:  $3,356



Notes:  
  • I don't include transactions in my retirement accounts.  This includes rental income, dividends and capital gains and losses.