Some examples are a recent euchre tournament I participated in at my Aunt’s.  Got to spend some good quality time with family, and some of their friends.  Although I was soundly defeated at rank eight of twelve participants, it is a bit easier to forgo my competitiveness and just enjoy the moments.  I have also made plans to visit my friend in Ohio in November and to watch the Trans Siberian Orchestra this December with my parents.  I have also spent some time just chillin’ playing video games so I am not without an excuse as to not doing an update on this blog.

But the more I think about it, the less I would choose to work.  Maybe I would feel differently at this point if I was actually outsourcing the other menial tasks such as cleaning or raking the leaves.  And I am basically near the end of the gauntlet of how much I would have to work before utilizing my available vacation time so I could maximize the life insurance payout for my wife.  I know many others have disagreed with me on this part, and I understand why.  If you are dying basically all of your time suddenly becomes more valuable.  Sure I gross less than $20 an hour now, but I still work.  Now compared to my original calculation of keeping the group life insurance by working for basically $400 an hour, the question remains, is it worth it?

I think that answer comes to a sense of sacrifice.  I sacrifice my time and my life for sooo much less now.  If I wasn’t willing to spend those hours now to help my wife after I am gone, then it also makes my current sacrifice almost meaningless.  And another aspect of consideration is what would I do with my time if I were waiting for her to come home from work?  In my final days, I want to spend the most time I can with my wife.  I don’t think I really want alot of spare time to just sit around and think about my impending demise.  I would probably start to feel more lonely or on edge.  Sure I am occupy myself during the day, but everyone else is still working.  The world does not revolve around me.

Anyways, after my little side rant there, I think the importance to keep in mind when looking at a proposed activity is to question, “Would I do this if I was dying?”.  That is really the best way to get yourself on track for prioritizing.

What about you, how do you decide what activities you want to do?

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Financially there are many things you can automate.  You can have automatic payments, automatic savings, and even automatic investing.  But you can use free tools such as mint to help track spending spending and growing their net worth when you are gone.

Right now, I do not use mint, but I have in the past.  I found a few things I didn’t like about it personally.  It would not separate the grocery purchases from the gas station run by the store.  Also, being my typical place to shop sells more than just food, it could not distinguish between the items from a single trip between food, household, or any other types of items I would pickup such as gifts.  So for myself, I found it to not serve my needs.  But for someone just needing to know how their spending is – in general – it is an excellent tool.  It can include accounts from most financial institutions, although it could not include all of mine which was another problem I had.

So using a tool such as mint and setting up automatic payments for things like credit cards, student loans, mortgage, water bill, basically everything possible, would ease the burden for when I am gone.  Most of that is already on automatic except the credit card payments as I usually just pay off the current balance at the end of month.  But also the investing strategy can be on automatic as well.  I would setup everything to go towards index funds and all automatic contributions and earnings to reinvest into those funds.  I doubt my wife has the interest, at least not currently, to learn about individual stock investing.  So this is another area in which I can help make things easier for when I am gone.

What about you, what sort of things would you consider automatizing?

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So if I am going to work, I need to get the most out of my remaining time.  That leads the topic to outsourcing.  I am thinking just about every mundane task.  Mowing the lawn, dishes, and cleaning in general.  For the last month I would hire lawn service to take care of mowing and raking while hiring some sort of housekeeping service.  I also considering eating out at a greater rate, but considering the time to travel to a restaurant, then wait to sit, then wait to eat after ordering, I don’t see this as a huge time saver.  Especially if I am paying someone to do my dishes daily while cleaning the house.  I think I would probably eat out more as a social occasion to meet up with family and friends, but I am not sure if a restaurant is even the place where you would want to have a deep conversation regarding your last days if you choose to tell that person.

There isn’t alot of other activities that I see would free up alot of time for me to spend with family.  But even at an unreasonable cost, it is worth it to outsource these tasks since I am choosing to work in this scenario.  I can basically deem any task less than $400 an hour worth it to outsource to make up that time at work.  Thus, freeing up as much time efficiently to enjoy those last moments and weekends.  So even more costly DIY repairs to cars or your house become affordable in comparison.

What kinds of things would you consider worthwhile to outsource if you were dying?  Is there something I am missing?

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I am not sure who I would tell that I am dying, if I actually was.  Of course immediate family would need to know.  But what about more distant family and friends?  Would you rather just stop by, have a good time like how you are used to, or be burdened with constantly explaining to everyone.  Most things that kill you are obvious, but I am kind of going under the assumption that I would just cease to exist at the end of October for the theme.  Not that I would disappear, but that I am perfectly capable of doing what I do now throughout this theoretical experience.  So therefore, I would not appear to be any different despite the fact that I am dying.  So since it is not obvious, back to the question, who do you tell?

I honestly think the less people who would know the better.  The people who need to know can, but I would rather enjoy my time with everyone as if it were just another day.  I wouldn’t want to spend my time rehashing the diagnosis that I received.  I just want me to be me and my friends and family to be the friends and family I know.  But this opens up a different set of a can of worms.  If you know you are dying and somehow you end up if an argument with someone, would you then tell them?  I wouldn’t want anyone to feel a sense of regret that the last words between us were bitter.  But how does one go about not telling if there is an argument?  It is not like I have anyone I think I would argue with on a regular basis, but it is a fact that it can happen and would it just be safer to tell everyone so everyone can choose their last words carefully?

What would you do?  Who would you tell if you were theoretically dying at the end of this month?

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But this past weekend off got me thinking, that weekends are designed for a purpose.  You need that break, mentally or perhaps physically depending on the work you do, to recharge.  And if I was actually dying I wouldn’t be spending much time on here anyways.  Although I think it would be nice to leave something in writing for loved ones showing your thoughts during your last days.  But it is of utmost importance to live now, more than ever.

And living now doesn’t necessarily mean spending huge sums of money.  Some of the best things are free like this past weekend.  And many other great activities just cost your transportation such as Art Prize which goes on in nearby Grand Rapids.  Spending time with family and friends.

What about you, would you take some time to just recharge with your significant other if you were dying?

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If it wasn’t going to be so cold this weekend, I could just sit outside on our newly stained deck.  Or have a small fire and just enjoy the outdoors.  But we can always go for a bike ride and enjoy the outdoors and the wonderful colors that fall brings.  Or watching a sunset go down much like your life is arriving at its very own sunset, so to speak.  What about you, would you seek a moment of peace if you had 29 days left to live?  Or would you try to be as active as possible?

After taking the two weeks vacation, I am left with just 96 working hours.  So my hourly rate, just for the life insurance, would be $416.67 an hour plus my normal pay.  Argue what you want, but I trade my time for MUCH less than that now.  The question is, would you leave your work and give up on a rate of over $400 an hour or would you sacrifice your time to better your family financially?  If you say you would leave, that you value your time over $400 an hour, why are you working now?

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Kirsten at Indebted Mom posed an interesting challenge.  It is for 31 days and it is to live like you are dying.  Now you can’t actually do everything you would do if you were actually dying, because I have to plan as if I am not.  But I am interested in seeing if this challenge will change my perspective on life.

So for the majority of this month, I will be doing short small posts such as this, kind of journaling what I think I would do if this month was my last month.  So firstly, how would you expect to receive news that you are dying?  Well I would imagine that getting a specific time line or something would come from a doctor.  Now it would be sad at only age 27 to have a sentence of just 31 days… 744 hours… 44,640 minutes… and 2,678,400 seconds.  Being it would be an appointment of some sort, I would expect that it would be later in the day, and I would already lost precious time in my remaining days.  So how would I take the news?  I am not sure… I can’t say for certain unless if it really happens.  But I know I would be sad.  I want more time to spend with my wife here, now.  I suppose I am not scared of what will happen to me personally after death.  Death itself doesn’t bring out fear in me, perhaps because I believe our souls are eternal – and that I have a choice as to where I spend eternity.  Do you believe in eternity or do you believe these last days (in theory I hope, I don’t plan on getting hit by a bus or anything), would be my last days?

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Where I spend my time now

Sleep

All the sleep in the week comes in at the top, with about 52.5 hours.  Usually I get about 7 and 1/2 hours in this realm on week day nights and probably about the same on weekends – sometimes less, usually not more (unless if I get consecutive days in a row with less sleep).  Could I get a better value for my time in this area by cutting out a half hour a day on average or is it better for my long term health for trying to consistently get over 7 hours?

Work

Without regards to sleeping, working full time takes up the most time BY FAR.  In the mornings I get up usually around 6:20 AM and head off around 7:00 AM to not return until usually around 4:30 PM depending on when exactly I get out.  So with a typical 5 day week this whole process takes up usually at least 50 hours.  The wife and I get our meals together the night before, but really we would be getting something together to eat whether or not we will be working so I won’t count that time specifically as work.  I guess I can improve in this area by being more mindful of the time to try to get out right at 4:00 rather than my typical 5 to 15 minute delay, every little bit counts right?

Blogging

I’m not sure exactly how much time is spent in this realm and it probably be good for me to track my time for a week to verify what I believe is true in all of these areas.  But currently I spend at least 6 hours a week just on articles that I complete, probably another hour or two checking on the blog (comments, traffic, all of that stuff), then a good amount of time reading other articles… like I could be in the middle of writing an article while glancing at other blogs and just drift off reading… so I could easily say I spend another ten hours (or more) in this realm weekly reading and commenting, if not more.  Also time on twitter and time spent starting drafts and putting ideas down for future articles, so probably another two or so in that realm.  So all together my guess is that I spent about 20 hours a week blogging.

Church

Church itself doesn’t eat up alot of time usually, between travel and service time usually about 2 hours a week.  But then you add in Wednesday night we spend another 2 to 2 1/2 hours a week with that.  Plus we have some daily reading now for Wednesday night, not alot, but by the time you get started, read, discuss whatever there was to discuss it is easily another half hour per day if not longer.  So in total this area adds up to about 8 hours a week… and it is actually an area I feel I need to increase because I don’t really read enough.

Personal Finance

Ok, if you haven’t noticed, I am a spreadsheet guy.  I also like to run personal calculations on tax forms to see how things would turn out if I changed how I contributed to accounts tax wise.  Yea, go ahead and call me weird, but I like doing that.  So doing that and tracking, plus trying to look into stocks for investing… that takes time.  I am thinking the biggest way I can improve here is to just record transactions once a week plus the end of the month.  Another good thing is what I do in this category and often be used in some way for producing blog content, such as my Savings Rates.  But things like Net Worth I wouldn’t have calculated on anything other than an annual basis previously so that doesn’t necessarily save me time in that area.  Another thing… once I get a system in place to evaluate stocks that will save time, I have some stuff in the works and alot of key things I am looking for, but still tweaking it before I post about that.  One thing that cross my mind is that… it is definitely more time efficient to invest in index funds.  And it is tempting… but I do like the income aspect of dividend stocks.  You could argue that an index fund provides dividends, but it only does because SOME of the individual stocks do.  Anyways time spent in this realm… is probably too much… if I would take a guess I would say at least 6 hours a week, but I think I may spend more time in this area.  Hard to say with how the time blends with blogging, I could also be double counting.

Exercise

This is another area in which I need to do more of.  Last week I think we only went on one bike ride, a bit of a longer one about 8-9 miles, but still I need to exercise more consistently and do some weights.  I should be spending at least 2 and 1/2 to 5 hours a week in this area for a good healthy balance.  Doesn’t sound like much, but when you add in time getting changed and getting water and showering after you can add a good 15 to 20 minutes after exercising as well.

Cooking-Eating-Dishes

This eats up (see what I did there!?) alot of time.  Just yesterday for example when I started working on this post after work I had to stop to get dinner going.  Stir fry so after I got the meat going, I had to start cutting up veggies and getting those all ready to go in after the meat was cooked.  So I spent a good 40 minutes actively working on getting dinner ready and I had to stop in the middle of writing this post causing it to take more time.  Plus then dishes, I don’t do them every night, but twice during the week and both weekend days is the norm.  Add in a good hour for that whole process and putting stuff away you are talking a good 8 and a 1/2 hours a week in this area between cooking and dishes.  Eating isn’t too bad, usually that is time spent with the wife while we either watch something or play a card game during dinner.  You might think 30 minutes a meal for cooking sounds like alot… but not really.  Sure sometimes after I get everything in the oven I can walk away, but alot of stuff you can’t.  This weeks meals included a Roast, in which you think there wouldn’t be much prep but I sear the roast before putting it in the crockpot.  Helps keep in the moisture for a tender roast.  So that plus getting the carrots peeled and everything in there is still like a 1/2 hour.  Yesterday’s dinner I mentioned already.  Tonight’s is Alfredo which is fairly quick, but I can’t leave the room with a boiling pot of water.  Wednesday is Turkey burgers with some potato slices.  Total time for that is about a 1/2 hour, kind of inactive once the potatoes are in the oven, just a couple of flips on the burger and cheesing it – so not too bad and I can do something during cooking.  But I also make my own pretzel buns, which take time as well.  But really it is hard to get a dinner or any other meal together with less time invested than a 1/2 hour.  There are a few things, but we like variety so we don’t feel like eating out.  So I think this category… including eating meals at home is probably around 12 hours.  Some areas to improve?  Well batch cooking can save time here, which we do with some stuff like taco meat.  Another batch type item this weekend I plan on making is pulled chicken, that will provide a good number of lunches with the meat.

Time with Family

Usually time spent with wifey at home, but we like to visit with family on weekends.  Lately we haven’t, we have had other crap going on, but look forward to doing so in the future.  We don’t always get time every night to spend together, but I would say we do usually 10 hours a week easily either spending together or with other family members.

Wasting Time / Video Games

Somehow I still find ways to waste time in this realm, but usually if I do it starts later in the evening then cuts into my sleep.  For instance on Sunday I had some down time while we were waiting to go some where, so I was playing temple runner 2 on my deactivated smart phone.  Well I was doing pretty awesome if I would say so myself, so I paused it when we left and continued later that evening.  Well… that run took for freaking ever because I was still doing good.  I spent probably 2 hours that day playing on my phone, but at least I set a new personal record, right?  Come on temple runner fans, is an 80 mil score legit or what?  Anyways I honestly don’t find too much time to waste in this area since I started blogging, but I still probably get about 2 hours a week somehow.

Personal Care & Shopping

I plan before shopping… which I guess is more related to personal finance and I probably consider that part of that realm.  So the shopping trip is usually quick because we know what we want, spend maybe an hour-ish total time.  That and a good 15 minutes to a half hour on week nights depending if I shower or not… you could say I spend a good 3.5 hours in this area weekly.

Misc House Chores

Ya know, weekly trash and mowing… it really is about an 1.5 hours (which is the amount of time left in a week!).  So that wraps up my total to 168.

The Problem

If everything went exactly how I stated above I would be OK.  The problem is for one, I don’t often exercise as much as I should so that time is being spent elsewhere.  I know I usually spend more time hanging out with wifey and family than 10 hours… so maybe some time there.  Computer time is kind of hard to distinguish between blogging and working on my own finance stuff, I may be overstating between the two slightly as to how much time I put in this area.  The biggest problem is that time is usually all “filler” time.  So I am constantly starting and stopping working on stuff, such as having to stop in the middle of this post.  It makes it ineffective and things feel like they aren’t getting enough time.  The amount of time isn’t a problem, the quality of time is.

Other problems include when other crap comes up and disrupts everything.  Like Saturday having a conference with church to go to.  We got up early for a Saturday, went to the conference, then did our shopping, and we weren’t back until like 4 PM.  Then I found some way to waste time for an hour or two because I wanted to get on the computer for a bit and answer posts, etc, then we got dinner going and dishes.  The day just… disappeared basically.  And when stuff gets added in… there is no time for it.  Something else has to suffer and right now that seems to be our time spending with each other or other family and exercise.  Also if I have a book I am reading that eats into time as well, but I usually let it dig into my computer time (blogging and personal finance).

The Solution

I am not entirely sure on the solution, I know a few things that I can do in a couple of areas to improve as I mentioned under the areas I spend time.  If I were to switch to index funds rather than dividends it isn’t like I will see a free fall in free time, maybe just 1 to 2 hours a week… which really to invest properly I need to be spending more time.  But as you can see I don’t have the time with the way I am currently doing things.  I can do stuff on the computer in batches, but really when I am on here I might as well get stuff done so I can throw away receipts and such.

My biggest concern is how will I fit everything in time-wise when we have kids.  Commutes will take longer with having to contend with daycare, plus caring for the child, etc.

Do you have any suggestions for time efficiency?  Are there any glaring problems you see with how I spend my time?

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I have had a vague idea of when I would become financially independent.  Somewhere between age 46-50 was the general idea.  I can’t say when it will happen for certain, circumstances change, inflation happens, or life events.  But I can say if everything cost wise and lifestyle wise were to move in the same direction as where I am today, that I know when I can retire.  The good news is I am a bit of an optimist and I hope I can create a larger spread in savings, paying off debt, and make a little more income than inflation.  Who knows, if this blog starts to make a little money a couple years into the journey that is all money that will speed up this process.

After reading a detailed post from Big Guy Money on his journey to financial independence I thought maybe I should share my thoughts on the time frame for my journey here. So this post will kind of give you an idea of where I am going now and how I plan to get there.  Kind of like a travel guide subject to changes due to unforeseen circumstances.

How do I know I am on the Right Track?

This is the main reason why I share my net worth.  It is the way in which I can measure my success over long periods of time.  While I am not overly worried about little (or big) fluctuations through the market dropping or increasing, I am concerned that each month I am making a conscious effort in my savings.  Between these two systems I should know that I am headed in the right direction to one day be financially independent.  Once I have 25 times my ordinary expenses I am free to leave my full time day job if I so choose.  That doesn’t mean I cannot work in any fashion, I can just choose whatever I want for how every many, or few, hours I choose.  Or I can even volunteer on a greater scale as I should have more free time to do so.  The fact is when 9+ hours of my day is spent working and going to work, it is hard to get value out of my time.

Where my Money is Going

Loans

I hate debt, which is one reason why I am paying it off a bit quicker.  But I also need to get rid of all my debt before I retire.  Currently I plan on paying off all my debt at age 40.  And being in debt is a pain as I must ensure that I protect my family until we have significant financial assets.  This is why I call life insurance a penalty of debt.  If we were in a more solid financial position this is one more cost that we would not need.  Currently I have a mortgage, one car loan, and student loans that I am contending with.  Once these are all gone my cash flow should greatly increase allowing me to save more in other accounts.  My plan is to first max out my ROTH as loans disappear and then put anything over that into pretax accounts.

Pre-Tax Accounts

Currently we are putting a decent amount of our savings into Pre-Tax Retirement Accounts.  Based on the current amounts about $7,400 a year as well as $2,075 going into a defined benefit pension.  Once Debt is paid off this will likely increase to about $17,000 a year, or more, as we will no longer need as much cash coming into our checking accounts to pay for bills.  Currently this money is all being invested via index funds.

Roth IRA’s

These accounts are building up income producing assets, currently all dividend growth stocks, in which I can use just the income they produce to help fund my retirement.  Currently I plan to invest approximately $5,600 a year into these funds and this amount will increase as loans are paid off upto the maximum allow by law (which currently is $11,000 between the two of us).

Taxable Investment Accounts

It may seem odd that I am putting money into taxable accounts without maxing out the tax advantaged accounts.  There are multiple reasons for me to do so, starting with I need a 5 year buffer between my ROTH IRA and brokerage accounts in order to a ROTH IRA ladder retirement strategy to be successful.  The wife and I don’t gross six figures, and even with raises during this time frame I kind of doubt that we will be grossing that high.  It could potentially be possible to reach that amount of income before we retire, but I am not planning on spreading the gap between my income and expenses more than it is now.  If our income does outpace our personal inflation then we will be able to max out our ROTH accounts sooner and possibly not need as much in our brokerage accounts.  Never the less, brokerage accounts also server as part of our emergency fund.  And investing an average of $1,200 a year into these accounts isn’t going to kill me on the lost tax benefits while still providing liquidity.

The Big Picture

Total Annual Savings and Debt Payments

Right now my plan is to in have at least a total of $27,270 each year going towards the combination of savings and debt payments.  Currently I exceed this figure, but I estimate this a bit lower so that if we have kids in the future we will be able to still reach this goal.  These accounts also do not include the savings I am putting in my HSA account which can also provide a boost for medical costs.  Eventually I desire this account to grow to be self funding where the interest and dividends can pay for the deductible in any given year and there would be no need to contribute anything further.  With a $6,000 deductible that figure right now is $150,000 so I don’t think I will reach an also guaranteed self sustaining health account by the time I retire, but it is possible to continue growing it as long as nothing would arise.

Safe Withdrawal

I plan on using dividends to provide the safe withdrawal for income based on $650,000 assets investing in today’s dollars.  Stock prices fluctuate much more than dividends so it will provide a safer stream of income in retirement.  If interest rate rise again I could consider using bonds as well in the portfolio along with some REIT’s.  I also plan to invest some still in index funds to provide some long term growth and diversity.  Although my total assets by 2030 will be about $685,000 a portion of that is locked up in my defined benefit pension program.

The Assumptions

I did a basic interest calculation for the prior year balance increasing 8% and no gains for the present year contributions.  I also am not counting any interest the pension fund may earn.  It does earn some, but nothing significant and I don’t plan on rolling those funds over the an IRA when I leave either.

Margins of Safety

My major margins of safety in this plan include:

• Social Security – all income from this program will be a bonus
• Pension – at age 60 I will qualify for a pension with my work.  Based on working at my current job for a total of 17 years with only raises matching inflation, this benefit will be worth another $8,100 in annual income once I reach at 60.
• Health Savings Account (HSA) – No figures from this were included as they are not available to withdraw, but will help offset future medical costs
• Earnings from work – if I work at all for an income past age 43 that money will all help in adding a margin of safety

Why I Might Wait to Retire

There are two main reasons why I may wait to retire once I am financially independent.  The first is I would like a larger fund for traveling.  This can be accomplished with maybe two more years of work to build up the accounts a little more to provide enough passive income for international travel on an annual basis.  This also could be supplemented by working part time to fund each vacation, however that would remove that margin of safety.

The second reason is that my wife and I eventually plan to have kids and depends on things are we may decide to earn some extra money to help fund their college educations.  The tricky thing is that systems change and the way things are right now if we could drop our income considerably before they graduate they could qualify for federal grants because our income would be below the point in which assets are counted.  If the system changes this may not be the case, but this will be something to be decided much later in the future.  But to be honest, when I get to this point I should just pull the trigger, because life is just too short.

How about you, what is your plan to reach financial independence?