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Personal Situation

Reviewing my 2019 Goals and Objectives

by Evan December 22, 2019

I know it is such a cliche statement, but I can’t believe how fast 2019 came and went! For the past decade or so, I would write down goals and objectives for myself in late December or early January, and here is the important part, go over those goals and objectives a year later to see how I have done. Most people forget that second part.

Usually I’ll apply an overarching theme applied to various parts of my life. In 2019 my theme was,

For 2019, my overarching theme would be to get back to the basics!

I am not too sure how well I kept that theme in mind as I moved through 2019. Nonetheless, for the past 10 years or so I have organized my goals and objectives into the following categories:

Professional Life
Blogging World
Online Income World
Financial Goals
Personal Life

Professional Life 2019 Goals

I gave myself two goals:

1. Create a Quarterly Sales Tool/Idea for the financial planners in my office. This is already in the works with the first one to be approved next week. I already have 2 more ideas, and then I just need one last one for Q42019.

I am going to give myself a B+ on this one. I did 3 of these sales ideas.

2. Meet with planners that I just don’t know to see how I can help their practice. My office currently has over 100 planners. If I interact regularly with 25 of them that would be a lot. If I could bump those numbers up even a tiny bit I could effect real change in the bottom line of the company.

I am going to give myself a B- on this one. I did start to work with a lot more planners than I have in the past which I believe made a difference in the organization. It just wasn’t in the way I originally thought (meeting with individual planners), rather it ended up being in a managerial role assigning others to try and help planners.

My Law Practice

I have completely failed in previous years from taking my very small law practice to just a small law practice. I think it is mainly because I choose to focus on other things in my off time (see below). Instead of going all out with a goal that I am likely to fail on, I am going to keep things simple for 2019.
My goal is to follow up on known opportunities.

I will go with an A on this one. I kept much better tabs on following up with referrals.

I also wrote in this section,

Recently, I have had a friend of mine diagnosed with a particularly aggressive type of late stage cancer. Luckily, he followed up with me to make sure his planning was done and he has mentioned how the work we have done together has put him at ease.

He lost his battle with cancer this past summer. I am still in the middle of helping his family navigate the legal side of things. It is the least I can do for him.

Blogging World

I’d like to get back to the basics! This means two things to me:
1. I need to seek out like minded bloggers and discuss what is on their mind. I have not been active the in the PF blogging world in quite some time. My 2019 goal would be to comment more on other sites.
2. Continue to work through old posts to make sure they are optimized for SEO purposes (well, at least to the best of my abilities).

FAIL. I didn’t do either of those things.

Online Income World

In addition to this personal finance blog, I own a bunch of other sites that I don’t discuss often here. After speaking with my business partner we decided our joint goal for 2019 was to expand our mini-business. Once a quarter, at the end of each quarter we are going to contact dying/dead personal finance blogs and see if we can purchase them (buy low).

FAIL. While we have made strides with the business this specific goal was a complete and utter failure.

Financial Goals

I laid out a couple of financial goals for myself this year:

The first has to do with paying down some long term debt. I have reasonably sized student loans and an outstanding HELOC, and while the interest rates aren’t particularly high I would like the cash flow back (not enough to liquidate out of the market and pay them off, but enough to make it my first goal for 2019).

SUCCESS – A. I have been able to set up an account that is aggressively paying back my student loans.

The second goal would be to continue/build on two asset classes I haven’t given much attention. The first are my whole life policies. I’d like to continue to proactively build this non-correlated asset, and I think the easiest way for 2019 would be to make a concerted effort to convert some of my blended policies. Additionally, I would like to continue my physical gold purchases.

SUCCESS – A. All year I have been buying gold and adding to my whole life policies. They were both in small amounts but I did it nonetheless.

The third goal is to get back to the basics with my dividend investment portfolio. Despite being one of the smallest parts of my financial world, it is easily my favorite. Last year, I made my $500 to $750/mo investments and I’d like to continue to do so in 2019. The difference between 2018 and 2019 I want to reduce the risk I have been taking with selling naked puts. I think if/whenI am able to roll out of the positions I am holding because of being assigned shares (as of this post $BUD and $LB) my plan is to only sell naked puts in companies that pass a similar screen that I use for my dividend purchases. This way I know that if I am assigned at least it’ll be at a good price (theoretically ). That being said, I am done selling naked puts until I am out of the positions I am in today.

SUCCESS – A. I have rolled out of some of the assigned puts (picked up others), but I have only been selling puts on companies that have increased their dividends for at least 10 years.

The fourth goal would be to keep myself open to real estate opportunities. I have talked about becoming a landlord for 7 of the 10 years of owning this site, and I really thought 2018 was going to be it (until it wasn’t), but I don’t want to just ignore that asset class.

SUCCESS – A. I took a really long way to get there but I kept myself open to real estate opportunities and I am now a landlord.

The fifth goal is really getting back to the basics – CHECK ACCOUNTS MORE OFTEN. Back in the beginning of this blog I would sign into all credit cards and bank accounts daily (if not more to the annoyance of The Wife), well as evidenced above, that just doesn’t happen anymore and it needs to!

Unfortunately this is just at a B. I have been better but not like I once was a few years back. I did check more, but not daily or even every other day.

Personal Life

With regard to general health I have two goals. The first to participate in more workouts that I know I am going to suck at, and those, are often those that have anything to do with high reps/high cardio. The second is to work on my flexibility/mobility. I am pretty sure it is byproduct of getting older, although I was never particularly flexible, but I find myself getting injured more due to bad form based on shitty mobility. This needs to be fixed. I am thinking once a week some type of intentional mobility/yoga routine should help.

With the first goal I am going to go with an A. I was doing more and more workouts that I knew I would be bad at when I had a membership at a CrossFit box. Then I ended up quitting, when The Wife and I got a peloton which has been great for me since it is the opposite of a workout I would choose to do. I have completely failed with the second goal as I have not worked on flexibility or mobility.

Last, and absolutely the most important thing, is time with my family. I don’t have any goals except to continue to be as involved in my kids life as much as I can which is way more than most I know (see above re: job). If I had to give myself a specific goal it would be to make sure they continue working on their sign language (my brother’s deaf so their eventual fluency is important to me).

I have continued being a very involved father, maybe more than ever which has been great. SUCCESS with that one, but I completely failed on the sign language front.

Putting it All Together

It has been a pretty amazing year with a lot of massive changes, but I think I have succeeded with most of the important goals. I am excited to see what 2020 has to hold for myself and my family – I have some pretty great goals and objectives to write up next week.

December 22, 2019 0 comment

Budget Commerce Revenue Accounting Assets Concept

Personal Situation

November 2019 Net Worth Update

by Evan November 1, 2019

With another month in the books it is about time to add up my assets subtract the liabilities and see where the chips fall. I have been doing this for years. Honestly, I believe creating and updating a net worth statement is an exercise that every grown adult should do. How else would one know if they are systematically making correct decisions for themselves and their family, month after month?

Thoughts before calculating: I usually have a feeling about how I have done over the past month, sometimes I am right and sometimes I am wrong (in both directions). I’d like to believe that I am usually right. I think this month is going to be a slightly down month as I think consumer debt has creeped up a bit more than I would like it.

My Assets

For years I would write that my assets are “pretty straightforward” but I don’t actually think they after really thinking about it, nonetheless, here they are:

Emergency Fund – In the month of August The Wife and I, scarily, went to zero on this when we closed on the new house. Not cool. I got it up to a respectable amount, but it is not currently at a number I am comfortable with.
Wife’s Mutual Funds – From years of grandparents and parents gifts this has grown to a nice amount. When I first got involved they were invested in some terribly priced mutual funds, we changed that right away. Earlier this year, when we decided on the house we moved to I liquidated almost everything just in case the market corrected and we needed (more liquidity). Right now, I am going to leave the two-thirds liquid because The Wife and I have discussed some bigger projects on the new house and this is where it will be coming from.
Dividend Growth Investment Account – One of my favorite assets/accounts. Every month I screen the dividend champion and some of the dividend contenders list to find possibly undervalued companies that have paid an increasing dividend for more than 20 years. In addition to new capital/savings I also sell naked puts on those same companies to further provide positive cash flow in an effort to create a self sustaining stream of income later on in life. Recently, I have been reducing some of this exposure just because I have some in the money puts that I have been dealing with (i.e. rolling). Once I amount of those it is off to the races again.
My Wife’s Roth IRA – Nothing special – just a mixture of cheap index funds and individual companies that capture my attention.
My 401(k) – I went back to a long term allocation rather than trying to market time. This is allocated at almost 100% equities and is by far my largest investment account.
My Traditional IRA – Just a few stocks that have captured my attention.
Physical Gold – In 2018 I decided on buying a small amount of physical gold every month or two. After doing some quick math, I am getting killed in transaction costs. I set up a capital one 360 account to save the amount I would be buying in gold and I will make a larger purchase less often.
Cryptocurrency Account – Earlier in 2018 bought a tiny amount of Bitcoin. By the time my initial payment cleared bitcoin had dropped 40%. I am not exactly sure what I am going to do with this account just yet. Right now I am going to ignore it.
Cash Surrender Value Life Insurance – I am not a “buy term and invest the difference” kind of guy. Mainly because no one actually invests the difference! I have been building my Cash Surrender Value for a number of years, but I never captured it on these statements until 2019.
Rental Property – I am very excited to add this line item! I have been talking about getting into real estate for years, so it is finally nice to be in it. For my net worth statement I am going to keep this as a net number eliminating the debt from my balance sheet.
My Home – Our new home takes over the main residence line item! It is going to hurt watching the mortgage payment basically pay for the interest, but such is an amortization table.
Law School Repayment Fund – I took a piece of my bonus and created a separate checking account which is going to be used to pay back my student loans at an accelerated pace. I could have just wrote the check (and maybe I do that one day), but I like having the liquidity on the sideline. The added benefit is that this bill is no longer coming out of my main checking account providing some relief to my monthly nut.
Random Home Increase Fund – I took the amount of my increase in housing costs and put aside 6 months. This way if things get tight I can turn to this account for some relief. I have chosen not to include this in my emergency fund yet, because it really is earmarked to be spent when needed. I used a small piece of this to pay back some consumer debt this month – my goal is not to use this that often but if I do, hold myself accountable here.

Liabilities

My Law School Loans – I still have a significant amount of law school loans but they are locked in at 3.5%. I figured out last year that my student loan company, NELNET, was misapplying my extra payments but that is all fixed now. As described above I am paying this amount back quickly (should be paid off within 2.5 years if I don’t pull the trigger before that).
My Main Residence Mortgage – Starting over on that amortization schedule hurt, but it is what it is!
Credit Cards – ~~My favorite card is my~~ ~~American Express Premier Gold Card, whose fee I fight every year~~. I am in the middle of moving away from the AMEX Gold card because they wouldn’t let me fight the annual fee. I open and close other cards to get ridiculous offers but right now I am rolling out of them with nothing on the horizon.

Last month I removed my old house’s debt and just created a netted line item in the asset column.

My Net Worth Change

From October 1st to November 1st my net worth increased 1.05%
Year to date my net worth has increased 56.54%

There was a definitive increase in debt this past month, but the grown on my assets and pay down of long term debts completely covered it up and then some.

How was your month?

November 1, 2019 0 comment

Life Insurance

Life Insurance Audit

by Evan September 24, 2019

Life insurance is usually one of those personal finance topics that people set and forget. Similar to investment accounts, debt contracts and other monthly nut items I believe that your life insurance should be audited and reviewed.

This year’s audit is particularly meaningful to me as I lost a friend of mine to pancreatic cancer. He was 40 years old with 3 children. As much as I have been involved in the life insurance, financial planning and estate planning world for the past decade or so, this has been the first time that someone so close to me has died leaving young children. First thing I did was take a look at some my recent life insurance audits:

It was in the 2018 life insurance review I wrote,

A friend of mine was recently diagnosed with stage 4 pancreatic cancer. He has 3 children 7, 5 and 3. The 7 year old is in the same grade as my son which is how we got to know the family and the 3 year old has become good friends with my daughter. To say it is an awful situation would be an understatement. He is putting up the good fight, and I know he has done some survivorship planning as a responsible husband and father, but I am not privy to what amounts (nor should I be). If you find yourself in a similar situation, please research your options with a guaranteed life insurance policy.
This terrible situation made me want to audit my life insurance, both regard to products and amounts.

Unfortunately, he didn’t make it. The specifics of my particular situation do not matter as much as the message – LOOK AT YOUR OWN FAMILY’S SITUATION AS SOON AS POSSIBLE.

An Overview of my Life Insurance Policies

I own a variety of life insurance policies. I am not a “buy term and invest the difference” kind of person, because virtually no one actually invests the difference! If it were the case that everyone who bought cheap term insurance and invested the rest our savings rate wouldn’t trail the rest of the world.

Convertible Twenty Year Term – This policy has a current death of $850,000. Originally, this was a $1,000,000 policy before last year, but I converted some of it already (see below).
Blended Whole Life Policy – Sometime last year, I converted $150,000 of the $1,000,000 death benefit above into a blended whole life insurance policy. Instead of converting into a pure whole life I did a 50-50 Blend wherein I basically bought a $75,000 whole life policy and $75,000 of term. The term is slowly getting converted to the full whole life. Currently the policy has a death benefit of $150,052 (2018 – $150,052) and cash value of a $47 (2018 – $12).
Non-Convertible Twenty Year Term – $1,000,000. Cheapest I could find on the market knowing that it will eventually expire.
Ten Pay Whole Life Policy – This policy was started way back in 2013; it is pretty amazing to think that in 4.5 years I’ll have this completely paid up. Currently, there is a death benefit of $45,758 (2018 – $45,392) and $6,942 (2018 – $5,709) of cash value.
Pure Whole Life Policy – Plain vanilla whole life policy with a current death benefit of $110,109 (2018 – $108,179) and cash value of $7,931 (2018 – $6,509).

Not counting any supplemental plans I may have from work I have $2,156,769 of death benefit up from $2,153,623 in 2018 and $2,152,609 in 2017. Given the new home mortgage and property taxes, I think I am a bit underinsured. While I think I’d rather be converting more and more of my 20 year term, I think I am going to have to suck it up and buy some more term insurance as the amount is way important than the type.

I currently have $14,920 of accessible cash in my policies. In 2018 I had $12,230 of cash surrender value and $9,560 in 2017 .

Life Insurance Policies on The Wife’s Life

Convertible Twenty Year Term – Death Benefit of $500,000.
Tiny Whole Life Policy – I bought this policy to help out a buddy who was new to the business. He gets credit for a new policy and I get another whole life in place. It currently has a death benefit of $26,549 (2018 – $25,646) and cash value of $328 (2018 – $90).
Blended Whole Life Policy – Another blended whole life policy. It currently has a death benefit of $250,066 (2018 – $250,041) and cash value of $5,850 (2018 – $4,845).
Pure Whole Life Policy – Currently the death benefit is $123,154 (2018 – $121,599) and cash value is $3,046 (2018 – $1,914).

The Wife currently is insured for $899,769. In 2018 she had $897,286 of death benefit and $871,957 in 2017. Again, given our new home mortgage she is underinsured. I think I am going to have to pick up more term insurance for her as well.

Currently there is a cash surrender value in my wife’s name of $9,224. This is up from $6,849 in 2018 and $4,429 in 2017.

Life Insurance on My Children

I am a big proponent of life insurance on children’s lives for two reasons:

If something were to happen to either of my kids, I am not going to work for a while. Do I have enough death benefit to retire? No, of course not, but do I have enough to take off for a bit of time to find out what new normal looks like.
Each policy has a rider on it that allows the child to increase the death benefit a number of times as they get older without underwriting. If either of them were to become uninsurable for any reason, I have guaranteed them a way to protect their future spouse and my future grandchildren without breaking the bank.

The Son’s Whole Life Policy (payable to age 100) – Current death benefit of $136,911 (2018 – $136,474) with cash value of $3,026 (2018 – $2,543).
The Daughter’s Whole Life Policy (payable to age 65) – Current death benefit of $137,266 (2018 – $136,716) with cash value of $382 (2018 – $80).

Protection doesn’t really matter (hopefully it never does), but cash may be used at a future time and there is currently $3,408 of cash. In 2018 these two policies had $2,623 of cash surrender value while it was $2,070 in 2017.

Life Insurance Audit Results

	CSV	Death Benefit
Me	$14,920	$2,156,769
The Wife	$9,224	$899,769

Given that our new home’s mortgage is well into the $600,000 mark I believe we are both underinsured and will be looking into cheap term options to close the gap.

September 24, 2019 0 comment

Personal Situation

My Last Night in my Second Home

by Evan August 14, 2019

Well after a number of housing updates it is finally the night before we move out of our second home. This home has been amazing to my family for the past six and a half years. We have become part of a community I didn’t know was possible on Long Island. I tell anyone that will listen about the amazing town we live in. It is the only home that my 4 year old daughter has known and I am pretty sure it is the only home that my 8 year old son remembers (although he swears he remembers our old place, and has been known to pull out some ridiculous memories at times).

What is interesting, is that I remember writing a similar post in December 2012/January 2013 when I was out of my first home but didn’t buy this home yet. Re-reading that post, I remember the ridiculous amount of emotions I was having at the time. I wrote some brief thoughts as I sat in my parents’ house waiting to close on that new house,

I was a lot more emotional about the whole thing than I expected.

I remember how uneasy, anxious, nervous and just plain sad I was when I moved to this house. I don’t feel that way almost at all which is frankly weird but like most things in life I have a theory!

I think a lot of those emotions were based on the unknown. I was moving to a different town out of the 3 mile radius that was my bubble for my entire life. I know I can’t compare it without seeing the movie play out but I believe leaving that bubble may have been one of the best things that happened.

The Wife and I built an amazing life in this town, and this new house doesn’t change any of that. We have the same community, friends that have become family, but this time the move just provides us with a slightly upgraded home with intangibles that no matter what we did couldn’t be changed on our current home (bigger piece of property and a much quieter street). Also, and I think this is a big part of it for me, I am not selling the home. I am renting it out, and this lets me believe that no matter what I still can “visit” those memories in years and decades to come.

August 14, 2019 0 comment

Personal Situation

Thinking about Paying off Low Interesting Debt!

by Evan July 29, 2019

With the upcoming home purchase (without a home sale on the other side), I have really been giving a lot of thought to my monthly nut. An unhealthy amount. Then I came up with an idea described in excruciating detail below.

My Increased Monthly Nut

I believe that most adults should have at least an idea of what they spend a month. I have been in the back office of a wealth management firm for over 12 years, and I can’t begin to tell you how many people do not have any kind of clue as to what they spend each month. Money only has 3 places to go:

You pay taxes with it
You save/invest it
You Consume it

That is it! When you run down that exercise with a client/producer it is amazing how fast people start to realize that they consume way too much. I digress. I have been struggling with figuring out what my new normal looks like as it relates to my “monthly nut.” Since we agreed to buy our new home without selling the old home a large portion of my net worth is still tied up in the walls of the old place. This has lead to an alarmingly huge jump in my monthly nut. Specifically, my housing costs (principal, interest and taxes) are increasing from $3,100 a month to $4,600 a month! That extra $1,500 is a huge jump that has me a bit freaked out. But I have a plan…one I am not too sure about a plan nevertheless.

Next to being able to look back and remember pieces of my life that would otherwise be gone, this blog’s next best benefit to me is the ability to write out an idea and see where I land after 500 or 1,000 words.

Paying off Low Interest Debt to Clear Cash Flow

My net worth has a few liabilities that are at 0% or extremely low interest rates, and while I am paying very little interest on them they are a drain on my monthly cash flow. Specifically we have:

$440/mo going to a credit card with 0% interest. The balance is a little under $7,000. The idea was that I figured out the monthly amount that would pay it all off without any interest.
$170/mo going to The Wife’s credit card that was used for her corrective eye surgery. The balance is at about $1,500, and again is at 0% as long as I keep paying before the time on the deal runs out.
$385/mo going to student loans. The debt is at a low, 3.5% fixed for 30 years with a balance remaining of $34,500.

So my idea is that for approximately $43,000 of capital I can clear up $995/mo in ongoing costs. This is not an easy decision for me (nor should it be for anyone where $43,000 of capital isn’t just easily available), and the pros and cons basically write themselves.

On the one hand, this is low interest debt! I mean it is basically free money at this point. Why would I use capital that could be deployed elsewhere and growing over the hurdle rate of 0%, 0% and 3.5% shouldn’t be particularly difficult. Use the power of the leverage and invest that money.

On the other hand, I am freaking out at about a 50% increase in housing costs! If I were to shove this amount into our yet to be finalized loan I would literally be saving only about $200/mo I can remove 60% of the increase with just these 3 easy moves.

There is also this nagging feeling that IF a democrat takes back the white house there could be a student loan forgiveness program that I may qualify for. I don’t think a program should get off the ground, but if it does and I paid back this large of an amount to watch other people have their loans wiped I am going to be pissed, like really pissed.

Final Decision

I am sitting on a plane writing this post, and I think by the end of next week, I am going to wipe out all the credit card debt. That will clear up approximately $600 of monthly payments going out. I know that mathematically this is a bad decision but I will feel so much better the moment it is done, so that has to outweigh a bit in this case.

I am really struggling with the student loans. I can’t get my head around the idea that if the next president and congress essentially wipes out this line item and I didn’t take advantage of it I am going to be furious. This is the only reason I am not moving forward with this move. In addition it is time to audit my other fixed monthly nut costs to determine how to trim some fat.

I am struggling because if someone gave me this set of facts, asking for advice, I would probably land in a very different place.

July 29, 2019 1 comment