Today's Focus

Current Goals:

1) $1,000/mo. to short-term savings and $400/mo to investments.
2) Weigh less than 180 pounds by 12/31/21.
3) Read more books.

Previous Goal: Eliminate Mortgage on Rental Property
Interest Rate is 5.125%!

January 1, 2019: $59,592
August 11, 2020: PAID!

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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.  


  1. Maybe your next vehicle could be a vehicle, like an suv that would be more comfortable for sleeping.

    1. I'm definitely considering an SUV. It might open up more Amazon delivery opportunities if I have a larger vehicle. Plus I'm considering getting a small RV so that we can rent our primary house on Airbnb, so having something to tow it would be important.

  2. On average if we prepare a similar meal at home the cost is about 1/4 the price of eating out if the tip is included. If you can't afford to tip then you can't afford to eat out. We eat out about once a week on average.
    At almost 72, I do not foresee buying another car in my lifetime, but never say never. My needs may change but we only drive 6,000 a year and my present auto only had 32,500 miles. Another 10 years as it will still be under 100,000 (even a my damn Chevrolet Malibu should do that).

    1. "If you can't afford to tip then you can't afford to eat out. We eat out about once a week on average"... we were cut from the same cloth! I use that exact phrase from time to time. Your comment is a good reminder though about how much less expensive (not to mention usually healthier) it is to prepare your meals at home.

      Never say never is true, but at your current mileage your car should last quite a while. I think my next car will last longer because I'm not driving for Uber nearly as much as I used to.

    2. Not only is eating at home less expensive - but generally a whole lot healthier

    3. Cheapchick,
      Was having this exact conversation this morning with my health coach. She agreed that it would be healthier and pointed out that the portion sizes at restaurants are part of the problem. I can better control my portion size if I prepare the food at home.


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