<![CDATA[dadbodfi.com - Blog]]>Sun, 07 Apr 2019 14:05:56 -0400Weebly<![CDATA[What to do when you hit a road block]]>Sun, 07 Apr 2019 17:48:37 GMThttp://dadbodfi.com/blog/what-to-do-when-you-hit-a-road-block5484982Beer Review - Basement IPA - Scofflaw Brewing Co. (Atlanta, GA)
"SHH! Don't ask what is happening in the basement!" is the tagline for this "Juicy and Dank IPA". It should have been the tagline for my parents house where my three brothers and I were raised...if only those walls could talk. Anyways this baby came in hot at 7.5% ABV and I could taste it. It was way too bitter for my liking and I couldn't pick up any of the citrus it claimed to have. It even tasted a little skunky. Scofflaw recommends pairing it with a cheeseburger or pizza, so that explains the experience they're trying to offer.  Official Score: 5/10
Well shit. I have been on this journey for a little over 6 months. I have created a budget and paid off a good chunk of debt. I have started a side hustle and invested the extra earnings. I have cut the cord, insourced whatever I could, and "Tidied Up".

My income will not drastically grow in the foreseeable future but my expenses unfortunately might. I will have to pay for things like school for my children and car repairs. I am not going to retire tomorrow and the road seems so far away. So what now?

Here's my answer: find out what else you can improve on, it may not have to be financially relevant. Don't steer away from your goals, but try something new. You don't HAVE to listen to a financial podcast every day on your way to work. They will still be there when you want to hear them. 

For me, I have turned to running. I never (ever) thought I would say that. There is a 1-mile route in my neighborhood that has a ton of hills. I've ran it about 20 times and my time has gone down all but once. I track my progress in a journal along with my net worth, total debt, and weight. It is amazing to look at the progress I've made. 

If I get discouraged it's important to take a second and compare where I was before I started this journey. I was making minimum payments on debt, investing a small amount into my 401K, and hoping I would have excess cash leftover at the end of the month. But now the plan is in place and I am certain I have already slashed a couple years off my working career.

An early retirement will not come overnight, but I need to stay the course and enjoy the ride. If you're like me and feel like you need to be doing something every minute to get there, go read a book, build something for your house, or even take an Amazon Turk survey for cash. Just remember it's okay to take a breather, your personal capital page can be checked next week. 

Here's to us.
<![CDATA[The Only Expert You Need]]>Wed, 13 Feb 2019 01:52:21 GMThttp://dadbodfi.com/blog/the-only-expert-you-needKBR:

Lakewood Brewing IPA - This sweetheart of an IPA is billed as a balanced American India pale ale bursting with grapefruit, papaya, and tangerine, with hints of bravo (no idea what that is), citra, mosaic, and mandarina hops. According to the folks at Lakewood beer, this serves as an everyday IPA that’s “bold without being brash.” This is a smooth IPA but I enjoy a little more punch out of my IPAs. Maybe give this one a whirl if you’re in TX and let us know your thoughts. Rating 7/10.

Throughout each step on our path towards financial independence we learn something. We learn about 401Ks and Roth IRAs. We learn a lot about debt and the ways it can hold us down, getting in the way of our ambitions. We learn about kick ass travel hacking and the ways to grab free flights across the world. We even learn about which grocery store in our area meets our needs in the most cost efficient ways. Let’s talk about none of those topics for a bit.

There have been really great books written on the topic of money. I recently read the Millionaire Next Door by Thomas J. Stanley. It’s a data-driven book about what the people around you choose to do with their income. I found it to be a good read and think it might be worth your time. There are plenty of other solid books out there and we will post our thoughts about them as we read them, no doubt. There is also no shortage of gurus who talk us through some great ways to get out of debt and empower us from a personal development standpoint. Through youtube videos, work seminars, etc. we can hear from successful people and obtain their insight for free. Information is so readily available these days, we can teach ourselves just about anything. But there is one subject that only you are the expert on. It’s you, how you operate, and why. There have been exactly zero books written about you and how you want to build your life.

FI is going to challenge you in a lot of different ways so it’s important to know yourself and what you value. Don’t feel discouraged if you make a change to your life and you find that change doesn’t work for you in the long run. That’s a good thing! You’re going to be exposed to tons of different tips and tools that people in the FI community are using but they are not all going to work for you so don’t expect them to. What’s much more important than the specific action you take, is that you take any action at all. I’ll give you an example. Once I learned about the concept of FI, I spoke to a couple buddies of mine about it. Turns out, they found value in it too, so we decided to meet monthly to chat about our journey and learn from each other. We discuss podcasts we have come across, financial successes and pitfalls we have encountered, and shortly after that we launched Dadbodfi.com. This formula clicked for me. Every time we meet up I get value out of our conversations and the whole setup fits who I am as a person. But your journey could look completely different than mine. Maybe you rock better researching FI concepts on your own. Maybe a group of three isn’t big enough for you. It just doesn’t matter. What matters is that you take some action. Download one Podcast, explore your local library, make a budget. Do something that feels right to you. Do something that makes you tick. This journey isn’t all about following step-by-step directions that have been written by others, it’s personal. Every day, you wake up and take some sort of action. It’s all up to you. You are the expert on what gets you fired up and no one else.

If you think your friends might dig FI, bring it up and see where you guys land on it. If you enjoy researching topics and going down rabbit holes on your own, research FI and tweak your financial habits accordingly. Don’t get frustrated or discouraged if concepts you research don’t work for the way you operate, just understand that you are the expert on your financial life. Take action and make some changes to your ways or blow up the whole blueprint and start over. All of this is up to you but the time to take action is now. What are you waiting for?

<![CDATA[Debunking the 5 biggest Myths of FI]]>Fri, 18 Jan 2019 17:48:06 GMThttp://dadbodfi.com/blog/debunking-the-5-biggest-myths-of-fiBeer Review: Ice Punch Thirst Quencher (Gatorade Co., Chicago IL)
My whole family is recovering from nasty colds. I'm trying to load up on fluids. 
Official Review: 1/10
The Financial Independence Community is one that has a pretty common theme: Cut your expenses, increase your savings rate, invest the difference. As a member of this community, I concur with that strategy and follow it best I can. My best guess at an early retirement is 15 years from now. It may be 10 or it may be 20, there are some factors to that timeline. It will not be when I'm 59-1/2, you can write that down and take it to the bank. 

There are however, multiple views from the outside (as well as some from the inside) that attempt to poke holes in this strategy. I took some time to research the 5 most common myths surrounding Financial Independence and came up with a more accurate outlook. Here we go:

Myth 1: You cannot start your FI journey until you have paid off all of your debt.
"Look Mom, it says here I get to pay these off until I'm 45!"
What do you consider the journey? My journey started 7 months ago and I still have student loan debt. I found this community after I had a conversation with one of our writers on the golf course. I took some time to dig into my finances and come up with a strategy to retire early. I slashed my expenses (cut the cord, smarter grocery shopping, stopped dining out). I eliminated the debt that I could (small student loans, wife's car). What I found was that I was doing a little bit of everything with zero strategy. I was making minimum payments on debt, I was investing a little into my 401k and ESPP, and I was buying some smaller stocks with a brokerage account and had no monthly budget planned. If you're doing this - you are NOT on the journey.

Actuality: You can start your journey whenever you want, but use your extra savings to pay off debt OR invest. Don't do a little bit of everything and be mindful of interest rates vs. return rates. 

Myth 2: You should not purchase a home, but if you do then your mortgage is still good debt.
Rent vs. Buy - What is best?
This is a huge split within the community. The truth is that you can reach FI by renting your entire life or you can reach FI by purchasing a home. The key is how you do these things.

If you're renting a home, what did you do with the money that you saved on a down payment? Did you invest it or did you let it slowly leak out of your savings account?
If you're purchasing a home, did you put down enough to avoid PMI payments? How about those savings come tax season?

If you're renting a home, where will you stash the the savings due to not having to pay for lawn service or home repairs?
If you're purchasing a home, what value do you put on walking through the door of a house that YOU own? 

Actuality: You can rent forever or you can buy a home, but be smart with the savings. 

Myth 3: Low-cost index investing is the only way to invest your money. You cannot beat the market.

The hero of the FI Community - VTSAX
Make no mistake, this investing strategy is perfectly fine and one that I use. If you do not have the time to research individual stocks or refuse to pay for a financial adviser, this is the way to go. But in a world where our largest taxi service has no taxis (Uber/Lyft) and our largest hotel chain has no hotels (Airbnb), which direction do you believe we're headed? When my children grow up, will they even need to learn how to operate a car? How long will it take them to get across the country to visit family? What will their mobile phone look like?

The workhorse of this community will continue to be index funds like the S&P 500. But with our world changing so drastically, it's okay to hedge some smaller bets on funds like technology stocks. The potential return (with research) greatly outweighs the risk. 

Actuality: Invest heavy in index funds, but be mindful of what's happening around us. Is Airbnb going away? Will marijuana legalization go backwards?

Myth 4: You must purchase used cars and pay cash.
A good ol' Jalopy
Have you spent some time is a used car lot recently? Have you attempted to make a large financial transaction on Craiglist? These are not the "cleanest" places to find a car. 

That being said, the argument for this myth is a strong one. If you can avoid car payments and find a perfectly good vehicle that depreciated $10,000 just because it drove off the lot, then why buy new?

But what if you're a "car person"? What if you read Car & Driver magazine every morning and you find tremendous value in driving your family around in a car that's never been touched? How about if your wife makes weekly round trips to visit her mother 2 states away and you're not sure what secrets may have been untold from under the hood of that potential used car? The person described in this paragraph is my father, and he is one of the most financially sound people I know. 

Actuality: It's okay to buy a new car if you find value in them. It's even okay to finance if it fits in your monthly budget. Just be mindful of interest rates and make sure to stay in your price range.

Myth 5: You have to have a high annual income and buy virtually nothing to retire early. 
This is simple math. If you make more money, have no debt, and don't buy anything then you will have more to invest, and you can retire earlier. 

I enjoy my job for the most part. It pays well and I like the people I work for/with. I have a company car and last quarter outperformed everyone in my division. That being said, I am quite certain that if I took a couple of weeks to update my resume and research some higher paying jobs then I could increase my income. I know I could find a job that puts me behind a desk every day from 9-5 with slightly higher pay, but that's not for me so I'm happy where I'm at.

My wife has (to a point) come to terms that I would like to retire early. She knows my favorite part of the week is "Pizza Friday". We make our own pizza and celebrate the weekend with our kids. We have good wine and play good music. This usually ends in a dance party with our boys. My "back-of-the-envelope" math tells me that I will have a total of 936 Pizza Nights with each of my children before they turn 18. Then that number will decrease every year after that. 

While I would love to retire tomorrow, I also want to make sure I'm enjoying the ride to retirement. Could we start making cheap pasta every Friday and drink water instead of wine? Yes. Could we cancel our Amazon music subscription and play Youtube from our phones? Yes we could. However these actions would slowly take away from what makes Pizza Night great. 

Last Saturday morning we were sitting in our living room watching cartoons. My wife softly said "I wish we could go out to get bagels this morning, but I know we're saving money". I immediately felt a weird, bitter-sweet, feeling in my stomach. On one hand I was very proud that she understood the cost savings of eliminating restaurants from your monthly budget. However on the other hand I was ashamed that I had created a feeling in my home that we were not allowed to spend money on things we didn't need - regardless of the value. I grabbed the kids and we all drove to breakfast. It was the best breakfast I ever had. 

Actuality: Yes the statement is true, but financial independence is not about suffering for 10 years so you can stop going to work. It's about changing your financial lifestyle and realigning what is most important to you. Find what brings the most value to you and your family. You have to enjoy the ride or the ride is pointless.
<![CDATA[Save Money By: INSOURCING]]>Wed, 28 Nov 2018 20:04:22 GMThttp://dadbodfi.com/blog/save-money-by-insourcingBeer Review - Guinness Draught - Guinness Brewery, Ireland
It's officially Guinness Season. The only time of the year that I drink Guinness is when the temperature drops below 50 during the holiday season. There is something about coming home from a family walk after being all bundled up and enjoying one of these. I love the experience of pouring the tall can into a pint glass, hearing the that nitrogen filled capsule roll around, and watching the light brown color turn dark as the beer settles. It's all about the experience. Official Score (During Winter): 9/10
in-sourc-ing (noun) - Doing shit on your own rather than overpaying someone to do said shit
(Official DadBodFI Definition)
Insourcing is one of the staples in the financial independence community. After all, we do not say financial "dependence". Since I have started my path to FI, I have done everything in my power to mitigate expenses. This includes the monthly necessities like groceries and utilities - but also the variables such as unexpected home repairs or projects. 

The picture above was taken after my wife and I redid our staircase. When we first moved into the home, the stairs had an olive green, floral design, plush carpet. It was the first thing you saw when you walked into our home. We knew we needed a change. After researching flooring contractors and looking at pricing for such a task, we decided to try it on our own. We have always loved doing smaller projects together but nothing on this type of scale.

We put the kids down one night and got to work. First we used utility knives to rip up the olive carpet. Under that beauty was hardwood with no less that 200 staples that a trusty pair of pliers pulled. Then we took a palm sander to smooth the surface and filled the gaps with expansion foam. We applied a few layers of paint and some anti- slip additive. Our finished product looked amazing and we had done this all on our own. This project taught us four main benefits of incourcing:

1. COST SAVINGS - This is quite obvious. You will spend substantially less when you do something on your own. There are no labor costs, just materials. Go check your last plumbing bill. They charge around $200 an hour for parts/labor. In 2017 I paid $227 to have my shower cartridge replaced. This year I did my own for a total cost of $12. 
My recent dishwasher repair. New unit - $500. Samsung Repair Quote - $225. My total cost - 1 hour.
2. QUALITY TIME - As I mentioned earlier, my wife and I enjoy doing projects together. We interact much more when we are building a table vs. watching Netflix. My son is even starting to help my with small projects. ​​
Underneath the sink that had to be replaced during the bathroom remodel project my wife and I completed. This took some YouTube studying.
3. KNOWLEDGE - This is priceless. Once you master a household task, you will own that skill forever. Every time I complete a new project or fix, I add it to my list. By the way, you can find ANYTHING on YouTube these days, so there is no excuse for not knowing. 
A light fixture we recently installed. I now know how to change a light fixture with ease. Had no idea what that green screw was when I started.
4. SENSE OF PRIDE - I cannot help but feel a sense of accomplishment when I do something on my own. Even if I build something that looks terrible or fix something that should be thrown away, I feel still good about it. A small reminder that you can really do anything if you work at it. 
Now we insource whatever we can and we're saving a TON of money. Here's a small sample of what we saved recently:
  • Dishwasher Repair ($400)
  • Bathroom Remodel ($1500)
  • Lawn Care/Landscaping ($200/month)
  • Light Fixture Replacements ($120)
  • Haircut ($30/month)
  • Pet Grooming ($20/month)

So before you call someone for a quote on your next leaky sink repair or deck addition, try it yourself. You'll be happy you did. 
<![CDATA[Trial Hacking: Final Review]]>Wed, 14 Nov 2018 19:18:09 GMThttp://dadbodfi.com/blog/trial-hacking-final-review
It's official, we are more than halfway through the college and NFL football season and I have not paid one penny to watch any game I've wanted. Again- I have had zero cable expense since July. My wife has been able to watch her favorite shows and my kids have been able to watch cartoons on Saturday mornings. 

I am able to do this by the aforementioned strategy of Trial Hacking. Basically I sign up for a free trial of streaming service, set a reminder on my google calendar to cancel, and I am never charged for the service. Some trials are 7 days long while others are as long as 30. We have multiple email addresses in our household and because we are combining this with Travel Hacking, we have no shortage of credit cards to use. 

This all started when my wife and I made a bet. If I could go a season without paying for NFL Direct TV Sunday ticket (now up to around $300), she would be fine without her Real Housewives. We have been going strong for over 4 months. 

Overall, as long as you are diligent with your calendar and don't mind taking 5 seconds out of your day to log-on and cancel your trial, this is a strategy that works. Simply sign up when you know you have programs that you want to watch (football, reality TV) and cancel when you're done. I like this strategy because it also eliminates the idea of "channel surfing", or just sitting down to watch TV because you have it. Go read a book or talk a walk instead. 

Here is a list on the streaming services I've used, in no order:

DirectTV Now
Sling TV
Hulu Live TV
Playstation VUE

Additional non-cable trials:

Amazon Audible - 30 Days Free and 2 Free Books
Netflix DVDs - 30 Days Free with 2 DVDs at a Time
Amazon Music - 30 Days Free Unlimited Music

Sirius XM Radio - 2 months Free
<![CDATA[My Harsh Reminder of Why I'm Pursuing FI]]>Tue, 06 Nov 2018 22:55:29 GMThttp://dadbodfi.com/blog/my-harsh-reminder-of-why-im-pursuing-fi Picture
This past Monday sucked. I woke up around 3 AM and instantly started to think about the work trip I would be embarking on in a few short hours. I thought about having to leave my wife and kids at home and how much I would miss them. I thought about how she would be taking on the arduous task of 2 kids vs. 1 parent over the next 72 hours and how exhausted she would be. I thought about missing my favorite part of the week, where I get to pick my son up from school. I thought about the meetings I had lined up and the pressure to execute. I thought about the long drive and the hotel sleeping arrangements. But this was life right? Every working American deals with this type of anxiety? Later on as I said good-bye to my son before school, it hit me. I actually held back a tear for the first time in a while as I did not want him to see me upset. I was completely bummed. 

I arrived at my hotel that evening and my wife called me. Low and behold she was at an urgent care clinic with the kids. My older son had gotten his fingers jammed in the car door like every other kid has done in his/her life. She had everything under control as always and my son was fine. However shes knows me so well that she actually waited until my son stopped crying to call me. She knew if I had heard him screaming on the way to the clinic I would have hopped back in my car and drove 5 hours straight back home. As she calmly told me what was going on, I realized there was nothing I could do and that this could happen anytime, anywhere. I couldn't help but feel helpless.

The day before this was excellent. My in-laws were in town visiting which is always fun (yes I actually get along very well with my in-laws). We took a family outing to the mall to meet Santa and ride the trolley. We watched ICE AGE and then had a dance party in the kitchen (Free Trial from Amazon Music). To cap off the night, my father-in-law showed me a recent method he had learned for cooking the greatest steak of all time (recipe below) and we enjoyed a couple bottles of fine wine.

How could my stress level change so drastically in less than 12 hours? I enjoy my job for the most part and I work for a good company. They take care of me and I put relentless effort into the grind every day. It has plenty of perks - company car, travel reward points, no 9-5 office computer work. However - find me any human who would rather be working away from his family for one extra second rather than spinning his kids around to Justin Timberlake and I will show you a liar. 

I always try to find the positives in negative situations. Monday dealt me the favor of confirming the decision I have to made to slash my expenses, pay off debt, and increase my savings rate to pursue financial independence. If I can cut the number of Sunday Scaries by 20, 10, or even 5 years, it will be worth every second. The time we have with the people we love is too short to take for granted and I'm going to do everything I can to maximize it. 

Cast Iron Skillet Steaks
  1. Pat dry two medium Rib-Eye steaks. Season with kosher salt and ground pepper on both sides. Let sit for 15 minutes.
  2. Put a few drops of olive oil on a paper towel and coat a cast iron skillet. Heat to high.
  3. Lay steaks onto skillet and cook for 2 minutes, flip and cook for additional 2 minutes.
  4. Flip once more cook additional 2 minutes. Add 2 tablespoons of butter and 3 pinches (?) of Thyme to the bottom of the skillet. When butter melts, use a spoon to drizzle it over the steaks for 2 more minutes.
  5. Place steaks on a plate, wrap in foil, and let rest until cooked to preference (we did 8 more minutes for medium rare).

<![CDATA[Save Money By: Knowing Your Warranty]]>Wed, 17 Oct 2018 19:06:41 GMThttp://dadbodfi.com/blog/save-money-by-knowing-your-warranty
Beer (Wine) Review: Chardonnay - Winking Owl, California (ALDI @ $2.89 a bottle??)
Cheap, well balanced, crisp white wine. I could have easily mistaken this for a $25 bottle. I've been wanting to hop on the ALDI train for quite some time. Today as I was waiting around the auto repair shop I walked across the street to check it out. Way more to come on this store. Official Review: 7/10 (Hard to beat that value)

The path to Financial Independence can be simple if you let it - cut your expenses, eliminate debt, and increase savings. I started this path a few months ago and started to obliterate my budget. I have also been slashing my student loans and most recently I paid off our family SUV. No more car payment feels great. I still can't believe I let that weasel talk me into financing that car four years ago. 

As I recall, I shopped around the lot for a few hours test-driving and "negotiating". Towards the end of my journey, I was able to talk the salesman into taking $1,000.00 off the sticker price. He later rescinded this offer, saying that the dealership had mistakenly overpriced the vehicle. According to him, they were going to let it slide this time and I was getting a great deal. I knew this asshole was lying, but I had given enough time to this place and was willing to just sign away. 

As my journey completed, I was escorted into another office where I met with a gentleman named Alex. "Let's talk warranties" he exclaimed. I politely told him "Alex, I'm just fine with the manufacturer's issue". The conversation ensued, and he finally talked me into $5 extra a month on my payment for a 7 year extended warranty. I had no clue what this got me but he made it sound pretty great.

I am not here to tell you that I know much about automobile warranties, or that I am an expert negotiator at the car dealership (that honor belongs to my father - he is the first human that I have ever seen walk into a car dealership and be avoided by the salespeople). In fact, I would avoid any car buying situation that is not a used-car cash sale ( see "Spending: The FI Way" http://dadbodfi.com/blog/spending-the-fi-way ). I simply would advise anyone to research what their warranty actually covers for this reason:

On Friday I went to start our car. The battery was dead. Fantastic. Normally, I would call a friend for a jump or maybe even get a tow to the nearest repair shop. I would then get an estimate on a new battery and be told that I have 12 other things wrong with my car. Instead, I researched my aforementioned warranty from Alex. I found out that I could get a free jump or tow as long as it was under $100. I also learned that my battery was covered for full replacement up to 7 years. 

I called roadside assistance and they came to my house to jump my car. I drove it to a local shop and they replaced my battery. I had to pay taxes and a small labor fee. The entire fix totaled $27.53. If you factor in the tow/jump and new battery, my 15 minute research saved me about $200. That is how you become a little bet better than the guy next to you and reach financial independence. 
<![CDATA[Spending Less – My (Ongoing) Journey]]>Sat, 13 Oct 2018 18:35:35 GMThttp://dadbodfi.com/blog/spending-less-my-ongoing-journey
Beer: Wild Range IPA (ALDI: $5.99/6-Pack)
6/10 - Great price (3 bucks less than the premium selections at the grocery store) Crisp taste to start, but lacks the depth of flavor of a more ambitious IPA. The maltiness described on the package seems to give it a slightly sour finish that trends in the opposite direction of a traditional IPA.

This article is inspired directly by Episode 81 from ChooseFI - The Year of Less with Cait Flanders. Find this amazing episode here and listen to it ASAP:

This was the first episode of ChooseFI that I listened to after the Travel Rewards Episode (009). The founder of DadBodFI pointed me to this podcast and I was instantly engaged with the CC episode but then I didn’t instantly follow up with the next episode in line. Instead I added ChooseFI to my growing list of Podcasts and got wrapped up listening to the same 3 podcasts as usual.

Then episode 81 popped up and began to play on my drive home and I was hooked. I sat listening in my garage for 10 minutes soaking in the message – stop consuming things that you think make you happy. When you do this; you will no longer have the constant pull of retail-therapy clouding your actions and instead you will naturally replace this activity with something that brings happiness and fulfillment. I was transfixed. This was totally me – I love buying new gadgets for my computer, finding new little things on Amazon was a hobby I needed to kick. Furthermore, my wife and I were getting fast food 2-3 times a week, going out to breakfast and dinner on the weekends, and generally not tracking how much we spent on those activates.

I made a statement – I wasn’t going to buy anything for myself, no fast food, no toys/gadgets, no tools – nothing for an entire month. The first two weeks were… interesting. I noticed something about myself. I craved Chick Fil-A. I watched YouTube videos about the newest computer equipment.  I had to try very hard not to instinctively buy a 12 pack of beer during our Sunday runs to the store (@ 15.99 per box). I realized that to re-shape my behavior I had to first change how I spent my time. I wanted Chick Fil A because I was staying up late and running out the door too quickly. I wanted gadgets because I was watching YouTube videos titled “coolest tech under $50.00,” Beer – I was just drinking too much of it so I decided to cut down to 1 day a week and 1 on the weekend.

I made the change and it was empowering; I planned it and I did it. I think this must be one of the fastest Action/Result loops out there and it’s addicting when you get over the initial hill. I kept going and the next month was easier (July). Then into the next month (August)… I faltered – I spent $100.00 dollars online on something that I didn’t need. In fact, it wasn’t even something I could get value from. I got excited about Football season and I spent $100.00 so that I could gamble on an impulse. I felt so guilty and the worst part – I was holding my wife accountable to the same standards and I knew I had let her down.

So now I was a hypocrite. I could have kept it quiet; I manage the money and I have access to that account and she trusts me with this responsibility. But I wrestled with the idea and ultimately I just couldn’t betray that trust. Her reaction when I confessed is just one of the reasons I love her so much. She called me out on it and was righteously frustrated (hence my week-long wait before finally giving in). She had been making sacrifices to adhere to this rigorous routine that I implemented for us and I broke the code. BUT, here is the best part: she didn’t go out and spend money to get even. She made sure I stayed accountable moving forward – that teamwork and stubborn resolve to stick to our plan was amazing. I was surprised by how disappointed I was in myself but then blown away by how my wife totally decided not to give in and instead challenge me on staying the course.

​That was 2 months ago and we are still going strong.

<![CDATA[A Dad Bod's Look at Life Insurance]]>Wed, 03 Oct 2018 00:39:36 GMThttp://dadbodfi.com/blog/a-dad-bods-look-at-life-insurance
Look, in life there are some things that just need to get done. Unfortunately, a lot of those things result in you doing them because if you don’t, they’re never going to happen. Getting your car serviced is one example. It sucks, but no one is going to knock on your door and offer to burn half a day at the service shop sitting in an uncomfortable chair flipping through People magazine from last April. That task is 100% on you. At DadBodFI we kicked around these type of tasks and landed on one that is at or near the top. Shopping for and acquiring a life insurance policy. I know.. It’s not fun at all but hang with us for a minute and let’s work this through.

We write a lot about the journey towards financial independence and it all boils down to time. The decision to value our time above our money. We invest our hard earned dollars in an effort to make our wealth grow to do what? Acquire more time that is not earmarked for work. The second piece to the life insurance puzzle is family. We want to increase the amount of time spend with our family because that’s the time we value the most. We think of life insurance like this: It gives us the opportunity to provide the people we care about most with a tool to acquire time. If you pass away tomorrow it’s going to suck for your family. We don’t mean to present the idea of life insurance as crass by any means, but here’s the bottom line.. Either your family loses you, or they lose you and your income. The choice is yours. Having a life insurance policy is going to feel a lot like stroking a check to nobody for nothing. That can be a tough pill to swallow. However, the key is understanding that while you won’t have anything to show for it tangibly, you are buying something extremely valuable. We’re going to get into specifics here in a moment but we think you’re going to see pretty quickly that the value proposition a life insurance policy offers you is much larger than its cost. Also, we believe that there is a window of time in your life in which life insurance makes sense but in a lot of cases, it won’t be longer than 10 years. Some people say life insurance is either something you have at all times or never have. As if it’s some big decision that can only be made once. We don’t believe that’s the case at all. We believe there is a period of time in which your family losing your income would be particularly devastating. It’s when you’re in the wealth accumulation phase of your career yet at the same time you are well on your way to building your family. The issue of life insurance is after all a matter of risk and we want to mitigate risk where possible. Let’s fire up an example to illustrate this.

Gordon is a 32 year old married, father of two. He and his wife bought a $250,000 house about a year ago, have $25,000 in savings and they have another $150,000 in Gordon’s 401K. His annual income from his employer is $55,000 per year. The risk of removing Gordon’s income from the equation is particularly devastating for two reasons. The first is the fact he and his wife have two young kids. They could be 5 years old or 11, but any way you slice it, they have a long way to go before they can earn a living for themselves. The second reason is that Gordon hasn’t had a ton of working years to build up his wealth. He’s only a decade or so into his career. A life insurance policy can mitigate Gordon and his family’s risk in a major way, here’s how. Gordon can purchase a 10-year term life insurance policy for about $40 per month, that would payout $1,000,000 upon his death. Suffice it to say, if Gordon gets hit by a bus tomorrow, his family would be left with options. Yes, they will have lost him but we are talking solely about his income so don’t get all teary eyed on us. Good news is, Gordon is a fictional individual.. Dude’s going to be fine just stay with us here. Focus on the risk that Gordon is dialing down by purchasing the policy. Another piece of good news is Gordon isn’t going to be vulnerable forever. Let’s fast forward 10 years when his policy has run its term. Now 42 years old, Gordon and his wife have been able to save $100,000 in cash, and because he contributed diligently to his 401K, his balance is over $600,000. His children are also now 10 years older. If Gordon and his family decided at this point the risk of losing his income no longer warrants having life insurance, he is under no obligation to buy another policy. If they end up on the other end of that decision, Gordon can shop for a new policy. At any rate, it’s mission accomplished. Gordon protected his family when they needed it the most. He didn’t waste money, he just bought them options that fortunately for him, they didn’t end up needing.

Check out www.quotacy.com for the latest insurance options available to you. Let’s mitigate some risk.

<![CDATA[Why you need an HSA...yesterday]]>Mon, 01 Oct 2018 18:27:28 GMThttp://dadbodfi.com/blog/why-you-need-an-hsayesterday
Beer Selection: Corona (Light)
Still has a slight bite to it, and I needed a little less calories after a weekend full of craft beer. I love to pair it with something spicy, maybe homemade fish tacos. This 99 calorie pilsner may help ease the pain of my fantasy football team being 0-4. Unless every player on the Chiefs tears their ACL tonight, then I can win. Official Review: 6/10

An HSA, short for Health Savings Account, is a vehicle that most insurance companies offer to help cover the cost of medical expenses. As a father in the FI community, I took some time to dive deeper into these accounts and find out the best way to utilize them. The benefits are outstanding
  1. Tax Free Contributions AND Withdrawals. That's right, the government cannot tax you on this money and you can withdrawal it for medical expenses tax-free. I began by auto-deducting $200 a month from my paycheck and putting in my HSA. This was a great way to pay for my kids' pediatrician check-ups and prescriptions, while not having to use my standard taxable income.
  2. But what about the large medical expenses? It turns out that delivering a baby can be expensive. It also turns out when those babies get hurt and the only nearby facility is an emergency room, that too can be expensive. (Side note, if you have the time and choice to take your child to an urgent care clinic or emergency room, do the former. The bills are drastically different.) So what happens when I only have $200 in my HSA but I'm faced with a $1000.00 ER bill that's about to become past due? Reimbursement is the answer. The HSA bank will allow you to reimburse yourself for any out-of-pocket medical expenses as long as you keep your receipts to avoid getting audited. You simply link your regular checking account to the HSA and can transfer funds. They will be available in a few days. So- when I had to pay off that large medical bill, I used a rewards credit card, raised my monthly HSA contribution to $1000, and paid myself back tax-free the following month.
  3. Investing HSA Money. The final benefit of the HSA is using it as a nest egg for retirement. This is another pre-tax "bucket" where you can contribute portions of your income. The 2018 annual maximum contribution is $6900, up from 2017's $6750. Once you have the minimum saved up (around $2000), you can set up and transfer to a brokerage account to invest in stocks, bonds, or mutual funds. My HSA bank offers services with TD Ameritrade and Devenir. TDA even offers Vanguard index funds. I will be saving towards the minimum balance and investing in Vangaurd's Total Stock Market Index Fund - VTSAX. 
  4. Withdrawing for Non-Medical Expenses. So say we have another bull market run and your HSA account compounds and grows from $6,900 to $69,000. Can you still take this money out tax and penalty free? For medical expenses, yes. However, if you just want to withdraw the money and use it for something non-medical related, you will have to pay income tax in addition to a 20% penalty - unless your 65 or older. If you are approaching an early retirement, here's where you would withdrawal from you Roth, brokerage, or emergency fund before drawing down the HSA. 

So if your insurance offers an HSA, look into it ASAP. This a great way to make sure you never pay taxes on medical bills again. It's also another way to fill up your retirement buckets and keep the government's dirty hands off your hard-earned dollars.