Sleepy Summer Sunday

It's summer here in Tampa Bay and the heat is on.  Lately the middle part of the day has been too hot and humid - temperatures in the mid-90s - to be outside.  There's so much uncertainty these days that I've been spending the indoors time thinking about our future.

Financially

I want to keep reducing debt.  The focus this year has been on the last rental property mortgage.  Earlier this month I withdrew $10,000 from a savings account to make a large payment on the mortgage.  The balance is now under $40,000.  When I took out the mortgage in 2009, a 5% rate wasn't so bad.  Rates are around 3% today.  What makes it even worse is that savings rates are almost zero.

I've kept higher cash balances because of all the uncertainty, but I'm seriously thinking about paying off the mortgage soon.  It's a little scary since the meeting industry remains shut down, but then again, our income has remained high.  The Airbnb is doing as well if not better than this time last year.   I needed the security blanket that was a hefty cash balance, but am feeling better about things.  Paying off the mortgage would feel amazing!

Fun

Earlier this month we went on a quick 4 night getaway to Las Vegas.  It was so much fun.  Having been stuck at home for so long, we needed to go somewhere.  We visited Mt. Charleston for the first time and went on a 3 hour hike.  It was a great escape from the heat.  

My Second-Ever Royal Flush

Of course we did a fair amount of gambling.  I hit my second-ever Royal Flush!  The $1.25 bet turned into $1,000, which virtually paid for the trip.  

Las Vegas post-COVID-19 is a different place.  With little to do besides gamble, I think the casinos are returning to a more value-focused proposition:  parking is free once again basically everywhere.  Hotel rates were low (our 4 nights were free thanks to my Boyd B-Connected membership).  When I was booking I almost booked a room at the Bellagio.  Rates were $54/night, but with a $45 resort fee I was turned off and stuck to totally free.

New Car

Last week I bought a gently used Hyundai Elantra from Hertz.  If you haven't heard, Hertz went bankrupt recently.  Now is a great time to buy a used car!  The timing couldn't have been better:  I had planned to sell the Sonata at Carmax (Hertz only offered $1,000 for the trade).  The next day, the check engine light came on and it started driving poorly.  I thought I had it fixed, but yesterday it stopped running and I had to be towed.  In retrospect it would have been better to just sell it to Hertz!

My Frugal Miser - May Income: $10,426

Even though the meeting industry is shut down, I managed to keep our income up.  Unfortunately my income was slightly less than my expenses in May.

The Airbnb turned in a decent report considering the shutdown.  It sat empty 9 days, and rates were lower on the days I did rent it.  There is some good news:  towards the end of the month, as the quarantine ended, I saw new bookings at close to normal nightly rates.  We even received a 12 night booking in June at rates higher than last year.

Meeting work was zero.  It will probably be this way for the foreseeable future.  Summer is the slow season for corporate meetings, but that doesn't matter right now because gatherings of large groups are still forbidden.

Once again I did deliveries, mostly for Doordash and Uber Eats.  This is a real grind.  It doesn't sound so bad, but it's very long hours for relatively low pay.  Strip out the mileage deduction and very little is left.  Unfortunately Amazon has been reducing the number of routes available to Flex drivers as they shift more volume to the branded blue vans.  It looks like most of my Amazon income is slipping away.

Rental income includes the two houses in Birmingham and the March rent from the condo.  One of the two houses was only rented half the month and is now empty.

I received a $300 bonus for opening a bank account.

May Income: $10,426

$0 Mystery Shopping/ Merchandising
$0 Meeting Jobs
$3,876 Gig Apps (Rideshare, Scooter Charging, Food Deliveries, etc.)
$960 Amazon Deliveries
$2,315 Rental Income
$2,130 Airbnb Income
$33 Interest Income

$1.112 Other Sources

Investment Accounts Change in Value:  $1,740

My investment accounts increased slightly but are still down YTD.

My Frugal Miser - May Expenses: $11,427

May was another expensive month.  Fortunately the biggest expense by far - paying my 2019 federal taxes - is a one-time cost that shouldn't recur next year.

Large Expenses

• I paid $309 for the yearly insurance on the Birmingham condo.
• It cost $133 to take the cat back to the vet when she wasn't feeling good.
• I booked an October cruise for $473.  Cruise lines are desperate, and this cruise includes free drinks and a $500 onboard credit.  This will be our first Baja Mexico cruise.
• One of the Birmingham rental properties needed an emergency repair.  It also became vacant (not related to the repair) which means there will be more spending in June to prepare for the next tenant.
• $820 was spent on the Sonata.  This includes an oil change, new filters, 6 months liability insurance, and gas.  
• The largest expense was for a payment towards 2019 federal taxes.  I sold 5 properties in early 2019, and had to pay taxes on the capital gains.

Everything Else

Our food costs continue to be high and is perplexing.  Almost all our food comes from Walmart or Aldi.  The most expensive restaurant meal was only $25.  I could definitely cut back on fast food, but it's not a daily occurrence.  I need to work harder at reducing this.

I already know June will be a tough month.  Our largest rental property has to be prepared for tenants and that is always a costly turnover.  The Sonata has 224,000 miles and will need to be replaced soon.  And I need to do some repairs and improvements to our house also.  I would like to move back to Pinellas County which will reduce monthly housing costs, but the current house will need to be in pristine condition in order to sell it.

May Business Spending:  $2,441
May Personal Spending:  $8,986

May Expenses:  $11,427

$820 Auto (service, gas, insurance, AAA, etc.)

$0 Bank Fees
$0 Clothing/ Personal Care
$836 Fun (vacations movies, gambling, alcohol, concert tickets)

$707 Food

$406 Health and Dental

$1,624 Household/Mortgage Payment/Home Repair

$0 Interest Expense

$174 Miscellaneous

$4,305 Taxes includes quarterly tax payments
$25 App Jobs Expenses (tolls, car washes, etc.)
$0 Unreimbursed Job Expenses
$0 Reimbursed Job Expenses

$114 Utilities
$1,560 Rental Property Expenses
$856 AirBNB Expenses

Normalcy is Returning. I See Opportunities...

Every few years the world experiences an unusual event causing society to believe things have permanently changed.  Each of us forms our own unique perspective about these things that shapes our lives.

During my adult life these are the events I remember:

The Internet

My freshman year of college I took a creative writing class.  It was in this class that I first experienced the Internet.  There wasn't much to do online just yet, but I didn't know that then.  Dial-up Internet was all we had, and we didn't know how slow it really was.  AOL chat rooms.  The familiar "You've Got Mail" after connecting to the service.  Being able to read the news online.  Who can argue that this technology that has only been commercially viable for 25 years would change our lives in so many ways?  Today, we watch TV over the Internet, manage our finances online, and shop for groceries, all from the comfort of home.

The Dot-com Bubble

This was the first time I lost money in the stock market.  Like many other investors, I got caught up in rising prices.  I remember a story on the news about Cisco Systems becoming the most valuable company in the world.  $500 Billion market value.  I wanted in and pretty much bought at the very top.  I also bought stock in a defunct operating system and who knows what else.  From the crash I learned invaluable lessons.  I learned that you should never overpay for something.  Patient investors, and even consumers for that matter, will be rewarded... eventually.  I discovered Warren Buffett during this time.  In the grand scheme of things, the money I lost in 2000 was a cheap education that has served me well.  

9/11

A terrorist attack on our soil, killing thousands while exposing weak links in our security.  Air travel was grounded.  Stock markets closed.  We were at war.  How did this affect me?  In truth, it barely did.  You see, everyone has a unique perspective in life, and the things going on in mine ensured that 9/11 was barely more than an interesting story on the nightly news.  Not meaning to be insensitive, just pointing out how different people perceive events in their own way.  Within a few weeks of 9/11, and totally unrelated to this tragedy, my life was basically starting over.  I had gone through a traumatic experience and had a renewed hope for what was possible.  Within a year of 9/11 my home situation changed, I had a new job, I was back in school with a new major, I lost my father.  

The Housing Foreclosure Crisis and Recession 

I lost my job during this period.  That's the first thing that comes to mind.  It was somewhat related to and caused by the crisis.  This was also the peak of when I was purchasing foreclosed homes and turning them into rental properties.  I started blogging about my frugal life.  We opened a restaurant.

COVID-19

Relatively speaking, this one has affected basically everyone.  It's the first time in modern history a health scare has shut down the economy, quarantined nearly the entire world, and brought about Depression-era unemployment in a matter of weeks.

How I'm Taking Advantage of the Pandemic

We as a society are resilient.  We bounce back, even if things aren't exactly the same.  After 9/11, the way we fly changed.  But with TSA Precheck and a good knowledge of the rules, it's barely an inconvenience.  After the 2008 crisis, housing recovered. 

There are opportunities for those of us who can see beyond today. 

• In the stock market, certain sectors have been negatively affected.  I invested a significant sum of money into Vereit.  It's a stock I've owned for years, and it has been cut in half in the last few months.  The company owns single tenant properties, mostly retail.  Think Walgreens, Dollar General, and casual dining restaurants.  They don't own malls or shopping centers, which I think are going to struggle.  Sure, things are going to be rough this year.  But my money is on a recovery.  
• I am reevaluating my career.  I've been working in the meeting industry since 2012.  There are some things I like about it, but I've never been passionate about the work.  Since this industry will struggle for the foreseeable future, now's the chance to consider something else.
• I'm looking for opportunities to save money.  The rental car industry is struggling - Hertz just filed for bankruptcy.  I think used cars will be cheaper and plan to buy one soon.  If the housing market also goes down (I don't know that it will), I'd like us to move back closer to the Airbnb.  I just booked a short getaway to Las Vegas.  I'll blog later about how we're saving money.  I'm also looking at cruises.  Now's the time to book a cheap cruise!

I'm choosing to see the opportunities in our current environment, not just the problems.  How can you take advantage of the situation?