Today's Focus

Current Goal: Eliminate Mortgage on Rental Property

January 1, 2019: $59,592
March 20, 2020: $52,982
2/14/20 paid an extra $750 towards principal
3/20/20 paid an extra $1000 towards principal

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Saturday, December 7

Preparing for a Cash Avalanche in 2020

I've started to think about my 2020 finances.  2019 seemed like a tight year, so I looked back to see where all the money went.  Besides maxing out my Roth IRA contribution, I've contributed nothing towards savings.  In fact, I've borrowed from my brokerage account to pay for improvements to the Airbnb.

So, what happened?

By year end I will have spent over $50,000 on the Airbnb.  This year I replaced all the windows with hurricane impact windows, installed new siding, and replaced the HVAC system.  The siding replacement included replacing a lot of rotten wood around the house.  Overall, the house is in really good shape now.  While there are a few other projects that I need to do, they won't cost nearly as much as what I did this year.  I'm fairly confident I'll spend under $10,000 in 2020 on the Airbnb.  That's a $40,000 difference year over year.

Rental property expenses were the second highest expense this year.  At the beginning of the year I remodeled the kitchen in one of the townhouses.  Then I decided to sell all the townhouses.  Because I sold those 5 properties, rental expenses will be lower (income will obviously be lower, too).  I'll end up spending close to $30,000 this year.  Next year the total will be much lower.

The third highest expense was for our primary residence.  I'm not ready to announce anything yet, but I am thinking hard about moving closer to our Airbnb and reducing our monthly housing costs.

Finally, all the other spending categories can fairly easily be reduced:

  • We are going to prepare meals at home more often - that's going to be tough to stick to, but it's my top commitment on a day-to-day basis.  This should lower our food cost.   
  • I had a lot of dental work this year which shouldn't repeat in 2020.  
  • I will probably buy a new car soon, which will cut down on repair costs.  
  • Last, I plan to be smarter when planning vacations.  I will continue signing up for new credit cards to earn bonus rewards.  Right now I am working on earning 70,000 Southwest Airlines Rapid Rewards through a new credit card I just opened.  We will still travel next year, but hopefully the flights and hotels will be as close to free as we can get.


Taking all these actions into consideration, cash flow in 2020 should be substantial.  I'm planning to use the cash to build up my brokerage account (basically "repay" the withdrawals I've made this year), pay down the mortgage on one of my rental properties, and build cash reserves for the next recession.  

Thursday, December 5

My Frugal Miser - November Income: $6,714

My November income was less than usual.  I worked one meeting plus a one-day event at the airport.  Airbnb income was impacted by the 11 days it was offline for the window and siding installation, plus another 3 days I blocked because we were out of town.  I also have one vacant rental property. 

The good news is December will be better.  I've already booked most of the month at the Airbnb.  Amazon will be busy because of the holidays, and we have a three day meeting in New York.

November Income: $6,714

$258 Mystery Shopping
$934 Meeting Jobs
$0 Gig Apps (Rideshare, Scooter Charging, etc.)
$412 Amazon Deliveries
$3,594 Rental Income
$1,478 Airbnb Income
$36 Interest Income
$1 Other Sources

Investment Accounts Change in Value:  $4,817

Even though I've been converting more investments to cash, my stock market investments continued to climb.

Tuesday, December 3

My Frugal Miser - November Expenses: $7,589


November continues the trend this year:  overspending.  I've managed to spend more in 2019 that I've taken in as income.  Of course, a big part of that has been investing in our business.

I would really like to lower our spending on food next year (it's been averaging $500/month).  Last month $200 was spent on restaurant meals.  We stayed two nights in New York as part of the China trip and worked one meeting where our meals were not covered.  Our most expensive restaurant meal was only $25, so we weren't exactly gluttons.  One of my goals next year is to cut back on restaurant meals.

There were some larger expenses.  While there weren't any car repairs last month, I did pay $383 to renew my auto insurance for six months and spent roughly $250 on gas.  Last month I drove to Birmingham which accounted for a big part of the gas I used.  We went to China, which accounts for the $1,000+ we spent on fun.  The only other larger than normal expense was the $216 I spent on Christmas gifts.

Business expenses were just under $3,000.  I paid annual HOA dues on a property and fire dues on the condo.  I also have a maintenance agreement for the HVAC system at one of my properties and made the semi-annual payment for that.  The Airbnb expenses include utilities and supplies.  There is still one payment left on the windows and siding, which I thought I would have to pay in November, but the company still has a little work left to complete.

November Business Spending:  $2,756
November Personal Spending:  $4,832

November Expenses:  $7,589

$637 Auto (service, gas, insurance, AAA, etc.)
$50 Bank Fees
$22 Clothing/ Personal Care
$1,054 Fun (vacations movies, gambling, alcohol, concert tickets)
$593 Food
$406 Health and Dental
$1,543 Household/Mortgage Payment/Home Repair
$12 Interest Expense
$218 Miscellaneous
$161 Taxes includes quarterly tax payments
$0 App Jobs Expenses (tolls, car washes, etc.)
$35 Unreimbursed Job Expenses
$22 Reimbursed Job Expenses
$136 Utilities
$1,899 Rental Property Expenses
$801 AirBNB Expenses