2016 Goals: March Update

Progress Report

GOALS FOR 2016

  1. CMSRN credential
    1. Still gotta get into studying so still nothing new to report here.  I suppose I could be studying instead of writing this…but where’s the fun in that?  🙂
  2. Pay off at least $20,000 of debt.
    1. Paid off $3,565 this month!  This is due, in part, to working a few days of OT, as well as cashing in $465 in credit card rewards and having it applied to the credit card balances.  This puts our year-to-date debt payments at $7,731, meaning we are at 39% of our $20k goal for 2016.  If we keep this pace, we are set to pay just shy of $31,000 in debt this year.  However, we are planning a few trips over the next few months that will cut into this, so we’ll see how things continue to progress.  All-in-all, I couldn’t be much happier with our success thus far!
  3. Weight loss:  weigh 200 pounds by the end of February (complete) and 185 pounds by the end of April – monitoring with weekly weigh-ins
    1. Weekly weigh-ins completed:  as of my last weigh-in for the month, Tuesday the 29th, I weigh 189.2 pounds with a 36.5 inch stomach.  Total weight-loss year-to-date = 25.2 pounds and 5.5 inches off my gut, keeping me on pace to reach my goal by the end of April.  😀
  4. Increased meal planning with eMeals
    1. Diet continues with improved food choices and decreased processed foods.  We are still enjoying our REAL Wisconsin cheese and are making an attempt to cut back on our store-bought bread, as we realized that it has cellulose powder in it, as well.  Homemade bread costs about 1/4 the amount of store-bought, makes some incredibly delicious French toast (which my son and I make every morning :-D,) and we know EVERY ingredient that goes into it.  While I don’t anticipate being able to keep up with replacing all of our bread, simply due to time constraints, every bit helps.  Hopefully we can turn it into a regular habit and part of our normal routine, saving us money and further improving our general health.
  5. Month-to-month junk food buying ban
    1. No change here…the ban continues!!!
  6. Decreased soda :  $24 = 3 cases/month
    1. I continue to average about 3 cans/day so I’m a little over “budget” but not stressing about it.  #Balance
  7. Using our treadmill for at least 20 minutes per day when I am off work
    1. This one has been a no-go this month.  However, up until it snowed a few days ago, we’ve had some super nice weather this month and have spent a great deal of time outside with our kiddo, keeping us relatively busy/active with him.
  8. Improved planning and crop yield from the garden
    1. I’ve plotted out my tentative garden plans on an Excel spreadsheet (color-coded and beautiful :-D…lol) and even ran the tiller through the larger of the two plots.  Due to the nice weather we’ve had, our strawberry plants that we planted last year have begun sprouting.  Some of our lily bulbs have come up, as well.  HOPEFULLY, the few inches of snow we just got (and the presumed snow in April/beginning of May) doesn’t kill them all!
  9. Read a minimum of 5 books in 2016
    1. I finished James Patterson’s Along Came a Spider (an excellent book,) and am now working on Glenn Beck’s Agenda 21:  Into the Shadows, the sequel to the book I read in January.  After I finish it, I think I’m going to work on Stephen Hawking’s A Brief History of Time…we’ll see.
  10. Increased personal time and appreciation for my wonderful and loving wife, who is the greatest momma I could ever hope to have for our amazing son.
    1. Although my wife and I have been together for nearly 11 years, the 25th of this month was our 2nd wedding anniversary.  Our day consisted of an out-of-town lunch date with our kiddo at Pizza Hut and a milk shake from Frosty’s.  The pizza was mediocre, at best, but the company was spectacular!  😀  We had a busy evening so she and I ended up having a late dinner after our kiddo went to bed…we fed him, I swear!  I grilled some incredible steak, alongside a humongous, delicious salad and we relaxed on the couch, watching some Hulu.  Couldn’t ask for a better day!  😀

Overall, the Nurse on Fire family had another successful month.  I would like to say thank you very much for your time and, if you’ve been following along with our family, I’m truly honored.  If you’re not yet following along, we would love for you to join us for our journey.  Please follow along through WordPress (if possible) or sign up to receive updates via e-mail.  Thank you, again, and have an amazing day!

– Nurse on Fire

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FIRE Calculator

If you’re working your way to Financial Independence, and in case you haven’t done so already, I wanted to provide you with a way to calculate at what age you are currently on pace to hit your FIRE number.  In full disclosure, the basis of this spreadsheet came from J. Money over at Budgets are Sexy so please head over there and show him some love.  It’s likely you’ve heard of him before, but if not, you’re in for an extreme wealth of information.  My contribution to the spreadsheet was the addition of the Projected Monthly Retirement Budget box, allowing you to personalize your budget and individualize each monthly expense (as opposed to entering an overall total,) and I also extended the age of reaching FIRE from 55 to 60.

I highlighted the boxes where you need to input your own numbers.  Also, please note that the box showing at what age you will hit FIRE (cell B14) is only formulated for ages 30-55.  If the box reads “0” you will have to look at the column to see if your age is projected between 56-60.  If you’re hoping to retire early and your monthly retirement budget requires a larger sum than is calculated to the age of 60, you are going to need to seriously consider what changes you can implement to increase your savings and yearly investments, decrease your monthly retirement budget, or better yet, BOTH.

 

My current projections, assuming a 4% withdrawal rate, modest 5% return and yearly investments of $30,000 (this is presuming our debt payments convert over to investing once we reach debt freedom – and will presumably increase over the next several years,) is that we will hit our FIRE date when I turn 44 (I’m currently 29.)  This will also be dependent on not having a mortgage, car payment, or any other consumer debt.

Additionally, and this is my FAVORITE part…this doesn’t take into consideration any part-time nursing/other work I may choose to take on, which theoretically will provide for the potential to, at least partially, retire even earlier.  Remember:  The Power of 300 says that if I work enough to earn even $1,000 a month (~3 or 4 shifts,) that decreases our required nest egg by $300,000!  That alone has the power to knock off nearly FIVE YEARS of full-time work!

You can maximize the Excel document with the icon in the lower right corner.  Download it, play with your numbers, update it as you progress through your journey, see where you can tweak things in your favor, helping you reach FIRE sooner than you ever thought possible!

So at what age are you currently on pace to retire?  Are you happy with that number?  If not, what are you gonna do about it?  Let me know in the comments below!

Good day my friends!

– Nurse on Fire

The Power of 300

According to History:  Born in 530 B.C., Leonidas ascended to the Spartan throne around 490 B.C., where he would remain until his death about ten years later.  Leading an army of 300 Spartans, allied with another 6,000-7,000 Greeks from the neighboring region, Leonidas went up against the invading Persian army, led my Xerxes I.  The Battle of Thermopylae took place at what was known as the “Hot Gates,” named for the sulfur springs in the area, and consisted of Leonidas and his men taking advantage of the narrow passage in order to funnel the approaching enemy, who far outnumbered them, to a more manageable number to fight at one time.

Spartan males were trained from childhood in the ways of the hoplite warrior, learning to fight with a spear, short sword, and a round shield.  In battle, they would stand near one another and overlap their shields, protecting one another from a frontal attack.

Unfortunately for Leonidas and his 300 Spartans, they were betrayed by a Greek citizen, who had informed Xerxes’ army of another passage, allowing them to surround the Spartan army and overtake them.  Leonidas’ stand against the Persian army and ultimate death was an inspiration, demonstrating Sparta’s commitment to the Greek region.


Now, how am I relating this history lesson to personal finance?  Please proceed…

Financial Independence = your monthly expenses x 300

This isn’t a new concept; I just wanted to put my own spin on it while talking about some history and an awesome movie.  🙂

For every dollar you want and/or “need” to spend each month in retirement, you need to have $300 invested in order to apply the 4% “safe withdrawal rate” principle.  Rather than multiplying your yearly expenses by 25, this is simply looking at it from the perspective of monthly expenses (25 x 12.)  I like to look at our retirement number in this way because it allows for a more detailed understanding of the fact that every.single.dollar. counts.

For instance, if you’re spending $150/month on satellite TV and want to continue your service after retiring, you need $45,000 in your retirement portfolio just for that one monthly expense…for friggin’ cable!  We cancelled cable months ago, saving us $90/month – that equates to $27,000 we no longer need to save in order to reach our financial independence number.  Once our Jeep is paid off and we are no longer shelling out $500/month for that, there goes another $150,000 dollars we won’t need in retirement.  I need $9,000 invested just to cover my $30/month soda habit – that expense will definitely have to go bye-bye.  The list goes on and will no doubt continue to dwindle as we inch closer to FIRE.


Like Leonidas’ Spartan army, our dollars have the capability of standing strong, protecting one other, multiplying their strengths, and kicking serious ass…but only when we don’t sabotage them.  We must, instead, make purposeful decisions regarding how they will be put to use, thereby maximizing their value and simultaneously minimizing the number of soldiers we need fighting for us in retirement.


It’s too late for Leonidas…but will your Spartans be victorious?  What costs have you already slashed to decrease your FI number?  Any more cuts coming?  If you haven’t already calculated, how much are these changes decreasing the amount you need to retire?  I’d love to hear your thoughts in the comments below!

– Nurse on Fire

P.S. – If you haven’t seen the movie 300, watch it!  Guys, fair warning, your lady friend will likely not share in the love (other than for a half-naked / booty shot of Gerard Butler.)  The first time I watched it, my wife (then girlfriend) FELL ASLEEP and I’ve never been able to convince her to watch it with me again.  #FrownyFace

Personal Finance & The Lion King

Inspired by Vic over at Dad is Cheap‘s post regarding personal finance messages hidden in Beauty and the Beast, which was initially inspired by Sarah at The Yachtless, I’ve decided to write up my own observations from one of my personally favorite Disney movies of all time…The Lion King.


I was about 8 when this movie first came out so, of course, I grew up loving it.  Now, all grown up with a child of my own, I can’t help but notice the more philosophical aspects of the dialogue within the movie.  Recently, I’ve been watching/listening to it while playing with our son and realized that, while there are numerous life lessons to be gleaned, there are at least a couple lessons to be learned that can be applied to the realm of personal finance.  Here they are:

First, I’ve made countless mistakes in my past, both financial and otherwise…and Rafiki the wise baboon is right, they can hurt like hell.  While I still hold on to a certain amount of regret over past decisions, some of which will never subside, it’s a fact that there’s nothing I can ever do to change it.  The only option I have is to learn from those missteps and apply them toward better decision making as we move forward.  In doing so, speaking from a financial standpoint, I will avoid debt whenever possible and continue to set us up on the path to financial independence and early retirement.

 

 

 


 

Secondly, Timon and Pumbaa’s attitudes and nature are what I envision FIRE to be like.  When they first show Simba their backyard view of paradise, Simba says something like “you guys live here?!” to which Timon replies, “we live anywhere we want.”  Having the freedom to not be tied to a particular geographical location based on a job or specific responsibilities, accompanied by a nest egg capable of supporting our chosen lifestyle for the seemingly indefinite future will certainly lead to a life of “no worries!”


 

Have you noticed any other parallels between The Lion King and personal finance that I’ve missed?  Please let me know in the comments below!  And if you aren’t already, don’t forget to follow along with my family’s journey; we would love to have you along for the ride and learn about whatever journey you may be on, as well!  🙂

– Nurse on Fire

Coffee! :)

Thanks to my pal Ernie over at Purple Sweatpants, I have forsaken my love of Starbucks Veranda blonde roast.  My new love, Honest Roast Coffee’s Morning Blend is an organic, freshly roasted (literally four days before I got it and tasted my first cup!) coffee that is incredibly smooth.  It shipped two-day priority mail, so it could’ve been enjoyed a bit sooner but we only head to the post office about once a week so it likely sat there for a day or two.  My one-cup-a-day Starbucks has increased to two and even three cups with this new stuff.  It’s so good that I’ve even cut my use of creamer by about half!

We’ve been using a basic Keurig, with a reusable filter insert, for the past several years, making drip coffee.  I am currently practicing the art of delayed gratification, something that has truly alluded me my ENTIRE LIFE, as I ponder switching to a pour-over system, such as the Kalita Wave…also thanks to Ernie’s suggestion!  lol

I’m not really sure how long of a time span is appropriate for this delayed gratification.  I suppose the ultimate point of the exercise is to wait long enough that my rational brain comes to the realization that I function just fine without it and, therefore, don’t really need it.  Simply delaying an inevitable purchase seems to be, more-or-less, a futile process.  Meaning, my brain is currently operating on the assumption that I’m going to buy it, whether it be in the next two weeks, two months, or what-have-you.  So, as the purchase isn’t overly cost prohibitive, why put it off?

I’ve made several mentions of the idea to my wife and she seems okay with it (right, babe? :-D)  So who knows?  Maybe I’ll wait until next payday…maybe not?  Financially, nothing is stopping the purchase.  It all comes down to whether it’s really necessary and/or would add any additional joy to our lives by improving our enjoyment of our coffee, a guiltless pleasure that we both get great joy out of on a daily basis.  The Keurig continues to function appropriately, producing a fine cup of coffee.  However, we’ve noticed that, although not so often, it does occasionally put off a strong (burnt?) coffee smell that isn’t overly appetizing and results in a bitter tasting cup of java.  So would we truly be happier with a different brewing system?  That’s the million dollar question.

I’m curious…when you find yourself considering a purchase such as this, what do you do to help yourself make an appropriate decision and avoid cognitive dissonance?

– Nurse on Fire

One Lovely Blog Nomination

***To begin, I would like to extend an enormous THANK YOU! to Saving Without Scrimping for the honor of receiving this nomination!***

The rules are as follows:

# Each nominee must thank the person who nominated them and link their blog in the post.

# They must include the rules and add the blog award badge as an image. 

# Must add 7 facts about you

# Then nominate at least 5 people and let them know by commenting on their blog! 

onelovelyblogaward

 

7 Facts about me:

  1. I love to read, although I rarely find the spare time to do so…unless it’s reading to our son.  We read with him about an hour and a half, on average, every day.
  2. I am a sentimental sap and enjoy the moments of my life when I simply sit back and quietly observe my son learn and discover.  For example, a few weeks ago, I was putting away dishes when he walked up to me and asked me for a spoon.  After handing it to him, he walked over and sat down in the living room, pulled the lid off his spill-proof cup of Cheerios, and began eating them with the spoon.  He would spill a few, pick them up and put them back in the bowl, and then try again until he had eaten them all; now he’s a regular pro and it just makes me so incredibly proud and privileged to have him in my life.
  3. I love to cook and even considered studying culinary arts when I was trying to figure out what I wanted to do with my life.  It was one of many ideas I threw around…even “space man,” as my LOVING wife would say!  Thankfully, I ended up in nursing and could not be happier with my career choice.
  4. Long before my wife was pregnant with our son, we had decided we didn’t want to the know the sex of the baby…and we actually followed through with it.  We had the answer in an envelope from the ultrasound tech but never peeked!  Our best friends, who live in Houston, TX, got pregnant about four months after we did and, once they found out they were having a boy, it became a running joke of whether he was going to be getting a wife or best friend from us.  The surprise of discovering we had a son at the moment of his birth was the single most amazing surprise I will ever experience.  When the doctor flipped him up, revealing his manly nature, the first words he ever heard me say were “holy shit!  It’s a boy!”  lol! 🙂  Back to that whole thing about being a sap…I freely admit that I cried like a baby when I first held him.
  5. I swear a lot; however, we have been attempting (failing? :-S) to drastically cut back because, although he hasn’t completely finished the word, there have been instances where our son has said “shh” that could arguably be an appropriate time to say “shit.”  In theory, we have the belief that they’re just words and they only have the power that you give them; however, we also know that he has the tendency to become fixated on some key words from time-to-time and would prefer that not be one of them! 🙂
  6. My wife and I have always loved going to concerts, although we haven’t been to one since she was pregnant.  We have seen the following bands (some of which were together for the same concert):  Nickelback (three times,) Default, Trapt, My Darkest Days, Seether, Daughtry, Staind, Aaron Lewis (incredible!,) Blackberry Smoke (three times – AMAZING!,) The Delta Saints, Billy Joel/Elton John (Face to Face Tour – greatest concert in the history of ever…seriously,) and Aerosmith!  I feel like I may be forgetting some but those are definitely the highlights.
  7. We are also St. Louis Cardinals fans and took our son to his first game last season in Denver (about 7 hours from us) and are planning to go back when they are in town this September.  On a completely unrelated note, because I’m on number 7 now, we enjoy going to live theater.  We have seen Wicked, A Christmas Carol, Chicago, and The Color Purple.  I feel like I’m missing one…my wife will let me know later today!  We really look forward to sharing all of these types of experiences with our son once he is old enough to enjoy them and are really looking forward to seeing The Lion King.  I saw it, as well as Aladdin and The Christmas Carol, when I was in grade school and loved it.  We hope to head to NYC one day and see some shows on Broadway.

 

My list of those who inspire me:

  1. Love, Laughter, & a Splash of Lunacy
  2. Purple Sweatpants
  3. Saving Without Scrimping
  4. Our Next Life
  5. Mr. Fire Station
  6. Northern Expenditure
  7. Unchained55
  8. Generation YRA
  9. Dad is Cheap
  10. How to Provide
  11. This is My Last Dollar
  12. My Mixed Up Money
  13. How to $tuff Your Pig

 

Thank you to everyone participating in this post; you have all been and continue to be an inspiration to me as we continue our journey.  It has been a pleasure to meet you all and I look forward to continuing to learn from each of you.  Have a wonderful day!

– RN on Fire

Guiltless Pleasures (part 2)

One of the most interesting aspects of blogging, in my opinion, is that I often find myself concerned that I may run out of things to talk about.  Thankfully, however, access to the internet blows the doors and windows wide open to new content to discuss, not to mention the countless learning opportunities that exist online for those willing to reach out and take them.

After posting about our “Guiltless Pleasures” a few weeks ago, I couldn’t help but reflect a little deeper on the subject.  Why do we not feel guilty about our decisions?  Mulling that question over in my mind, the word “balance” kept jumping out at me, followed by a flood of images:  scales, yoga, and the Yin Yang.

From my beginner’s research and minimal understanding, the ancient Chinese Tao does not have a concrete definition, whereby it teaches you to flow with life and to learn acceptance within your life.  The concept of Yin and Yang, again in terms of my basic understanding, is the coming together of two halves to create balance with one another.  Something that is whole is finite, complete, and unchanging; however, I think it is safe to say that few of us live our lives in such a concrete manner.  The Yin and Yang are constantly changing and flowing in order to strike balance with one another.  We constantly seek out balance in every aspect of our lives, whether it be in how we spend the minutes and hours of our day, divided between family and various other time-consuming activities, to how we adapt to our ever-changing environments.


Our budgets can be looked at with this principle in mind, as well.  We sit down with our budget, knowing that there is, more-or-less, a finite amount of money coming in every month.  We must balance our various outflows (i.e. the people/companies we owe money to) in order to achieve equilibrium within the constraints of our budget.  The utilities are $30 over budget this month?  That’s thirty bucks not going somewhere else.  We then juggle these numbers around in order to make the best use of our funds.

In the same way, we must evaluate our priorities in order to strike a balance between our guiltless splurges and the ongoing pursuit of debt freedom and FIRE.  As cliche, yet very true, as it is to say…tomorrow, and even our next breath, is never a guarantee.  While we choose to “sacrifice” cable and ongoing rampant consumption to further our goals, we choose not to sacrifice on things that we truly find enjoyable.  Even with our continued splurging on delicious food, we have still been able to pay off over $4,700 of debt in 2016 thus far, putting us on pace to exceed our financial goals for 2016.  Sure, we could buy cheaper cuts of meat, regular white potatoes, and a 99 cent head of iceberg lettuce, but would the $20-30/month we save and send to a debt really get us to freedom that much quicker?  Literally speaking, yes it would (I’ve always been good at math…lol.)  However, would that small amount of time saved balance out our personally perceived “sacrifice”?  The truth is, there is no single right answer to that question.  It is completely relative to each and every one of our situations, belief systems, and personally determined priorities; as for me and my family, the answer is no.


In what areas of your life do you find yourself seeking balance?  This doesn’t necessarily have to pertain to finances.  We are constantly pulled in a thousand different directions, often all at the same time!  I (as I’m sure you do, as well) find myself constantly seeking balance with my time between working, sleeping, and spending time with my family.  Until retired, my time devoted to work is pretty consistent, pending any picked-up overtime, so the balancing act is generally between sleep and family…family will always win in my book.  That is what I look forward to the most about retirement…divvying up the time that I now spend working between additional sleep and, ever so more importantly, family time.  I work 84 hours (without additional OT) every two weeks; that is 168 hours each and every month that, once retired, will be spent playing outside with my son, teaching him valuable life lessons, and/or having  lovely and hilarious conversations with my incredible wife; now that is truly PRICELESS!


Do you achieve the balance you seek in life?  If not, what prevents you from doing so…and more importantly, what are you gonna do about it?  Let me know below  🙂

– RN on Fire

A More Fitting Name

In response to this recent post by Our Next Life, in which they discussed their reservations over using the term “frugal” to describe themselves and their situation, I commented, in part, with the following:

…I believe that frugality comes with many definitions from each individual or family’s point of view. Like you guys, we would probably not truly be considered frugal in a lot of areas of our finances. However, I still consider us to be relatively frugal because of the fact that, right now, we are shelling out well over 50+% of our income, paying off debt and eventually increasing our investment options once we reach debt freedom. We don’t scrimp and rarely tell ourselves no…it’s all about intentional living, thereby utilizing your finances to best further your own agenda and goals.

Upon further pondering about this subject, I came to the realization that, while I stand by my personal view and general definition of being frugal, we do not truly fit the ideal picture of frugality either.  It’s a fact that we are, indeed, utilizing over 50% of our income to systematically destroy our current debt and have every intention of continuing to utilize the same (and more) for investments once the debt is gone; however, in most other realms of our finances, we’re not overly frugal.  Rather, we more fit the bill of intentional living and mindful spending of our money on things that we find to be enjoyable and fulfilling of our goals and general happiness.

In recent weeks, I have found myself constantly thinking about our purchases, often thinking to myself…”well, that’s not really the frugal thing to be doing.”  I find this to be rather stressful, a drain on my mental faculties, and a general waste of my valuable time.

Therefore, inspired by the above mentioned post and upon introspective reasoning, I have decided to forgo the idea of being “Frugal RN,” and am in the works of making a transition of this site over to a new primary web address.  However, I will be keeping “frugaltravelnurse.com” active, as it will certainly fit-the-bill and come in useful in a few years when we hit the road and I begin working as a travel nurse.

However, from here on out, I will refer to myself as the…

“RN on Fire”

…as I believe it more closely aligns with the overall purpose of this blog, as well as our general life goals.  Regardless of the path we blaze to get there, whether it be through frugality or simply more mindful spending, FIRE is our ultimate goal.

If we’ve already met and you’re following along with my family’s journey, thank you so much!  It is an absolute pleasure to have the opportunity to get to know you and follow along with your journey, as well.  If you’re visiting this site for the very first time, thank you and I really hope you will decide to join us by following along.  I would love to hear from you and learn from you as we navigate this crazy experience we call life and make our way toward financial independence and early retirement.

I hope you all enjoy the new look of the site!

Your Humbled and Gracious Host,

– RN on Fire

PROPOSED Changes to Retirement Accounts

According to Forbes, Market Watch, and Main Street, Washington D.C. is considering changes to some of the rules when it comes to our retirement accounts.  If you would like to read the complete 150 page budget proposal for Fiscal Year 2016, put forth by the Obama Administration at the beginning of February, you can find it here.  While it is often said that a president’s final budget proposal has essentially zero chance of going anywhere, the fact that these ideas are being presented and discussed makes me question whether they may ultimately come to fruition.

The five proposals that I find to be most concerning are as follows:

  1. In an effort to “close loopholes,” the Obama administration’s final proposed budget includes shutting down the “backdoor” Roth IRA.  While this is talked about in terms of prohibiting this approach by “high income” earners, they fail to account for those of us seeking early retirement and utilizing it for the obvious tax benefits, as well, with several early retiree bloggers having touted this concept.
  2. They want to impose Required Minimum Distributions (RMDs) on Roth accounts, in addition to those already required for Traditional accounts.  RMDs would be eliminated if you have less than $100,000 in ALL of your accounts, though.
  3. The proposal calls for a cap on what you and I can save for retirement, whereby once you reach this limit, you can no longer contribute any further funds, apparently even including further contributions by your employer.  According to Market Watch, “The cap would be calculated by determining the lump-sum payment it would take to produce a joint and 100% survivor annuity of $210,000 a year, beginning when you turn 62. Currently, this would cap retirement savings at approximately $3.4 million.”  Albeit I don’t foresee myself working long enough to reach that high of a contribution amount, I still find it asinine that the government is so full of itself to tell us “oh, I’m sorry, you’ve saved too much!”  – PLUS…not to mention (although not surprising,) THEIR MATH IS WRONG!!!  $210,000 a year out of $3.4 million equates to a 6% withdrawal rate.  According to my cfiresim calculations (please double check MY math :-D), this scenario only has a roughly 44% chance of success over a traditional 30 year retirement.  And if this “annuity” is referring to an investment vehicle that provides a fixed income ($210,000 in this case) for the individual and surviving spouse during their lifetime, in most cases, that leaves nothing to pass along to heirs.
  4. If, when you die, you pass your IRA on to anyone other than your spouse (with some exceptions, of course,) it would be mandatory that the funds be distributed within five years.  I don’t know about you, but I have every intention of passing on a (hopefully) substantial sum of money (via a Roth IRA) to our son and any future children/grandchildren we may have.  Playing by the proverbial rules my entire life should not result in a tax bill for my progeny and they should be allowed to let that account continue to grow and benefit them in their own retirement.  The Market Watch article states “the stretch IRA, by providing tax benefits to individuals the accounts were never really intended to benefit, costs the government a lot of money” (underlined emphasis added by me.)  My response…BOO FRIGGIN’ HOO!!!  The writer of the article further postures that this “isn’t an unreasonable position for the administration to take,” but I beg to differ.  In the words of Dave Ramsey, I am working today in order to forever change my family tree.  While this entails educating my son in the ways of personal finance and teaching him how to set himself up for financial success, as well, it should also afford me the privilege of passing on an unimpeded legacy with the potential to positively affect the future generations of my family and those I love.
  5. The budget proposal also calls for eliminating the student loan interest deduction, as well as Coverdell accounts, and “roll(ing) back a portion of  the subsidy for 529 savings plans” – both of which are aimed at “new contributions.”  We contribute, and intend to continue doing so until he turns 18, to a Coverdell for our son’s future education so I take  an extreme issue with this topic.  Screwing with me is one thing, but screwing with my kid and his future is a whole other ball of wax.

I’ll be the first to admit, I didn’t read the entire budget proposal.  There may well be some excellent ideas tucked away in there on a multitude of topics.  I’m not here to judge the entire document.  Rather, I’m touching on a few key points that resonate with me and that I feel should be shared with my community of fellow bloggers and readers (aka you amazing, wonderful people :-D.)

The takeaway:  my vote is that the government needs to stop looking for ways to raise revenue, whereby taking more and more money out of our pockets.  Instead, what they should be doing is focus on living within their means, thereby decreasing their need for more and more tax money, allowing it to remain in the hands of the citizenry.


So what do you think about these proposal ideas?  Do you support them?  If so, I would love to hear your reasoning.  If you don’t and are as irritated by them as me, I would love to hear your thoughts on that, as well.  No matter your viewpoint, just let me know what’s on your mind in the comments below!  Have an awesome day and weekend!

– Frugal RN

Thought for the Day

To me, this quote it is the embodiment of achieving financial independence and the resulting early retirement that it brings.  FIRE represents unimpeded time with family and loved ones, time to nurture new interests and pursue new passions, and time to give freely of myself to causes that I find myself passionate about.

What does this quote mean for you?