Getting started with gratitude — a 30-day challenge for the new year

Bring GratitudeIt arrived. I opened the box and held it up to enjoy it. It was a new wireless speaker. It was solid black, a beautiful piece of technology. I couldn’t wait to listen to it.

I plugged it in and for some reason I couldn’t connect my phone to it. I googled it. I found out I needed to update the software. It took almost an hour to figure out the issue. When I updated the software, it worked!

I played “Stray Cat Blues” by The Rolling Stones. It sounded pretty good, but as the song played I felt a pang of regret. I had an older speaker that didn’t sound quite as good…but it was good enough. I didn’t really need the new speaker.

I’ve seen this habit surface again and again. I’ve gotten better, but it’s a daily struggle: Why can’t I be happy with what I have?

Bring Gratitude

A few years ago, I put myself on a mission to be more grateful for the small things in life. It’s done wonders for my mindset. As I continue to grow and improve my practice, I’m more aware of my internal dialog:

  • I “need” a new speaker.
  • I “need” a new bike.
  • I “need” a new jacket.

The reality is none of these are needs. My old speaker was fine. My old bike is okay. My old jacket can be cleaned.

As I listen to my internal dialog, I’ve noticed my desire to want more things and newer things. The awareness helps. This is not who I want to become. Besides, it costs me too much money.

I’m working on appreciating what I already have instead of wanting to buy something to replace it.

That’s why gratitude is so important. Gratitude helps us shift our mindset to enjoying what we have instead of wanting more. Do you ever struggle with the desire to get that new gadget or another pair of shoes?

Those are two of my main vices that I turn to when I’m feeling down. It’s why I wanted the new speaker. I wanted that feeling of having something new. I thought it would make me feel better.

I’m not perfect, but I’ve learned a lot over the past few years. I keep a daily gratitude journal and it’s done wonders for helping me appreciate what I have instead of focusing on buying that next thing on my list.

The Gratitude Journal

I’m always surprised that it took me so long to keep a gratitude journal. Perhaps the most powerful mindset tool that we have is gratitude!

I’m really big into self-help books and learning new things, but I always consumed instead of taking action. I think it’s this attitude that also encouraged me to collect new gadgets instead of appreciating what I had or knowing that I didn’t really need to buy anything new.

In one book, Why We Do What We Do, researcher Edward Deci explains that when someone has six positive interactions to one negative, they are 31% more productive.

When you have positive thoughts and interactions, it’s easier to focus on what matters. That may be spending time with your family, traveling, or writing. Positive interactions free you up to have the energy to do what matters to you.

One terrific way to foster positive thoughts and interactions is to deliberately and consciously bring gratitude into your daily life. For me, keeping a gratitude journal serves this purpose.

Great Questions

I believe everything starts with our internal dialog. If we let our negative inner voice dictate our happiness, then we’ll constantly feel like we’re not enough. That we don’t have enough.

Next time you are stuck in a difficult situation, watch how you talk to yourself.

Do you ask yourself things like:

  • “Can this person be more boring?”
  • “Why is this taking so long?”
  • “What do I have to do to get noticed?”

Try switching this inner dialog on its head. Try tapping into your curiosity to see if you can ask questions that help you see the interesting parts of the situation.

  • “What am I learning in this situation?”
  • “How did I get so lucky to be in this warm environment?”
  • “What do I notice about this situation that is interesting?”

Great questions help you focus your attention. They enable you to fuse gratitude onto your attitude. Exploring questions like these in your a gratitude journal can help you discover your mindset and motivations.

Keeping a gratitude journal

Start Small

If you’re like me and sometimes get jealous of what other people have, this envy can be a great place to start appreciating what you currently have. As you become better at appreciating what you have, move on to appreciating the people and situations in your life.

Explore these emotions in your gratitude journal. You can start by making gratitude entries about what you appreciate. You could start with looking around your home and being grateful for the kitchen table or your shoes that fit comfortably.

You’ll probably notice what entries energize you, and then you can continue down this path for a few days.

For seven days, try writing what you’re grateful for and why. Start small, and if it feels good then keeping going. I suggest something like this:

  • “I’m grateful for my shoes because they are so comfortable.”
  • “I’m lucky to have a phone that can call my mom, brother, friend, etc.”
  • “I’m grateful for my coworker because she is always willing to listen and help.”
  • “I’m grateful for my ability to dance in my car seat when I’m stuck at a traffic light because it allows me to release my stress.”
  • “I’m grateful for my pets because they make me feel loved and needed.”

The key component here is your why. It’s important because it helps deepen the gratitude journal experience. Within just a few days you’ll probably notice an improvement in your attitude.

If you’re interested, you can join the free 30 Day Bring Gratitude Challenge (running January 1st thru 30th) to help you strengthen your mindset. Come join us and you’ll get email updates and a private Facebook group. If you have any questions, I (Karl Staib) am available seven days a week.

A postcard from Europe: A mid-journey update on my travels

Greetings from Prague! I’m just over halfway through my European vacation, so I thought it’d be fun to share some of my adventures and to take a glimpse at the financial side of this journey.

This trip is unusual for me because I’m traveling with a party of six. My cousin Duane has terminal cancer and wanted to see some more of the world while he still can. A few family members decided to join him. We’re exploring Christmas markets as a group.

The Roth boys in Vienna

For the most part, Duane’s health has been fine over the past two weeks. He tells me that he’s felt great lately, and he’s hopeful he has more life left in him than the doctors say. (Who knows? Maybe he and I can squeeze in another trip before his time on this Earth expires.) That said, he did have to take a short rest yesterday because he became dizzy and disoriented as we strolled the cobblestone streets of Prague. He’s obviously not feeling 100%.

Our group doesn’t have a set agenda. We’re merely moving from city to city, exploring the Christmas markets and other touristy delights. Often when I travel, I’m a traveler not a tourist. Right now, I’m a tourist. I wouldn’t want to do this every trip, but I’m fine with it at the moment.

General Impressions

So far, we’ve been we’ve been to Vienna, Budapest, and Prague. I liked Vienna. I loved Budapest. But after 24 hours here, I’m ambivalent about Prague. I didn’t like it at first, but the city is growing on me. I think one problem is our location.

In the first two cities, we were a mile or two outside the downtown core. We stayed in residential neighborhoods. (In both cases, we were relatively close to university areas too, but that was pure chance.) We were directly across from metro stations each time, so it was easy to get where we wanted to go.

Here in Prague, however, we’re staying in the downtown core, which means we’re immersed in the tourists. (Yes, I realize that we ourselves are tourists and thus part of the problem.) There’s no escaping the crowds and commercialism because of our location. This is an interesting lesson to learn for the future: Stay close to downtown in popular cities but not in the downtown. If you’re close to a transit station, it’s plenty convenient to get where you want.

The Christmas markets have been festive and fun. They remind me of Portland’s Saturday Market, a craft market held every weekend in my home city. Vendors erect small stalls where they sell either food or wares.

A lot of the stuff being sold at the Christmas markets is the same from stall to stall — ornaments, winter clothing, jewelry, souvenirs — but occasionally there are vendors with unusual items, such as cookie stamps, wooden toys, and hand-forged knives.

Shopping at a Christmas market in Prague

I’m more interested in the food stalls. In each individual city, these “huts” are similar to each other. But the food offered varies from city to city.

  • Vienna food stalls sold wieners (“wiener” literally means “Viennese”), wurst, spaetzle, baked potatoes, toast with cheese, and roasted chestnuts. The drink vendors sold hot punch and glühwein. (Glühwein is mulled wine. It’s very popular in Vienna.)
  • Budapest food stalls sold paprika sausages — Hungarians love their paprika! — and pig knuckles and delicious goulash. The drink vendors also sold mulled wine and a variety of punch.
  • Prague food stalls sell chimney cakes, fire-roasted ham, toasted cheese (with jam), and a sort of potato-onion dumpling dish. Here they sell mulled wine too, but they also sell hot mead and cold pilsner. (Pilsner comes from Bavaria, and it’s available everywhere. I like the Czech word for beer — “pivo” — and I enjoy asking for it at the market: “Pivo, prosím.”)

A food stall at a Christmas market in Budapest

The one factor our group failed to consider was the cold. Actually, we considered it…but not enough. We prepared for Oregon cold, not central European cold. (It didn’t help that Duane emailed us from Paris to say that the weather wasn’t as cold as we’d feared.)

We all brought warm clothes, but each of us has had a turn getting chilled to the bone. One night in Vienna, I was the coldest I’ve ever been in my life. While the rest of the crew enjoyed ice skating, I made a brisk one-mile walk back to the flat so that I could take a hot bath. Everyone else has been equally cold at some point.

I’m a little worried about Switzerland. The forecast low for when Duane and I arrive in St Moritz tomorrow night is -25 celsius (-13 fahrenheit). Holy cats!

J.D. enjoying Christmas market food on a cold day in Prague Continue reading

The big fat truth: J.D. Roth interviews JD Roth

I’m not the only semi-celebrity J.D. Roth. For more than fifteen years, I’ve been receiving email and tweets and Facebook messages intended for the other JD Roth, the former executive producer of The Biggest Loser — and tons of other television shows.

Apparently the other JD Roth has a lot of fans. Actually, I’m one of them. I’ve been watching his shows since 2009, when season seven of The Biggest Loser inspired me to start my own weight-loss journey. When he published his book The Big Fat Truth in the spring of 2016, I read it the day it was released. I thought it was great, and wished that I could interview the author, but Kim and I were in the middle of our 15-month RV trip across the U.S. and I couldn’t make the logistics work.

In 2017, when I learned that Roth had created a TV version of The Big Fat Truth, I knew the time had come at last: J.D. Roth was going to interview JD Roth. Last August, we made it happen.

Note: It can be tough to tell the two of us apart. We’re both 5’8″. We both have the same facial hair. We both have beautiful wives/girlfriends. And we both share similar underlying philosophies regarding success and personal development.

That said, there are some subtle differences between the two of us.

  • I spell my name J.D. Roth; he spells his name JD Roth.
  • I live in Oregon; he lives in California.
  • I have one producer credit on IMDB; he has 51 producer credits.
  • I have 22,030 followers on Twitter; he has 848 followers. (You should follow both of us, by the way!)
  • When I was younger, I looked so much like Star Trek‘s Commander Riker that some of my friends actually called me Riker! The other JD Roth was actually one of the final candidates for the role of Wesley Crusher.

For the purposes of this article, here’s how to tell us apart: When I write about myself, I won’t do it in the third person. I’ll say “I” and “me”. When I write about the fitness JD Roth, I’ll use proper journalistic form and refer to him by his last name.

The Big Fat Truth

“I’ve been watching your new show [The Big Fat Truth], and I really like it,” I told JD Roth at the start of our phone conversation. “I like that it’s less of a game show and more about helping participants address not only their health, but the other things they’re struggling with in their lives.”

“Yeah, it’s all interconnected.”

“Plus, The Big Fat Truth feels less produced than The Biggest Loser. There aren’t any weekly weigh-ins and there’s not dramatic music. It’s you sitting down and helping real people living their real lives facing real challenges — but still achieving real results.”

“Thank you.”

“In one episode, for instance, you have a couple analyze how they allow words to hurt them — how they use what others say as an excuse to make bad food choices. Or there’s the mom episode where you go over to Nancy’s house and it’s a mess. Her basement is a disaster, so you ask her to clean it up. I think you say something like, ‘Fix your mind and the body will follow.’ I love that.”

All of these things in your life — your basement, your bank account, your belly — are a microcosm of what’s going on in your mind. Being ready to assess your inner life is probably the hardest part of losing weight. But it’s also the most important.”

“Here’s an exercise I’ve used in the past,” Roth said. “I tell participants to go home and clean out their bedrooms. If you want to lose weight, empty out your bedroom. Let yourself wake up to peace, organization, and calm. Give yourself this one oasis to escape from the chaos of life. This small step is a great place to start.”

From Desire to Transformation

“How do you help people move from desire to transformation?” I asked. “Many people want to lose weight, just like many people want to get out of debt. How do you move them from wanting to doing?” Before Roth could answer, I explained my own approach. Continue reading

Moving from emotional to analytical (with finance and fitness)

This morning, for the first time in more than eight years, I weighed in at 200 pounds.

I am not proud of this fact but it’s the truth. I own it. I got to this point through my own actions, not because some cruel tormenter force-fed me cheeseburgers and beer.

When I’m overweight, I tend to internalize the problem, which generally leads to a vicious cycle of overeating, shame, and self-loathing. While I’m older now and more aware of my mental processes, I still struggle with self-defeating thought and behavior. (This is exacerbated, of course, by my recent battle with depression. In fact, I suspect the depression has a hand in my life-long weight issues. The onset of both seem to be correlated.)

Being fat affects my self-confidence and self-esteem. I’m less likely to be social. When I do go out and see people, I’m less engaging (and I know it). Right now, my weight is actually hindering my work too. In April, I started a Get Rich Slowly channel on YouTube. My goal is to produce a couple of videos per month — but I’m not willing to put myself on camera at the moment.

In short: Like many people, I allow my physical make-up to dictate my mental make-up.

People are funny like that. We internalize stuff that ought not to be internalized. When we do, it becomes much more difficult to do the right thing, to make the changes that need to be made.

Take money, for instance.

Net Worth Is NOT Self-Worth

People allow their net worth to dictate their self-worth. This is true at every level of wealth.

At one extreme, you have folks like the guy in the video below who — because they’re rich — believe that they’re better than everybody else, exempt from the normal rules of society:

On the other end of the spectrum, you find folks who feel terrible about themselves because they’re buried under a mountain of debt.

In my personal life, I’ve seen tons of examples of how folks conflate net worth with self-worth. Heck, I’ve done it myself!

  • Back when I was trying to figure out how money worked, my debt made me feel like I was drowning, like I could not catch a breath. I felt miserable. I felt like I’d never amount to anything, as if my debt were an accurate measure of who I was as a person.
  • My father — who would have turned 73 yesterday — internalized money too. For most of my childhood, my parents struggled to make ends meet. Dad often told us that he felt like a failure because he couldn’t give us everything he wanted to give us. When the ladies from church brought us food, he was mortified. Mom and dad rarely had people over to the house because they were ashamed that we lived in a run-down mobile home.
  • More recently, my little brother (who, at 45, isn’t exactly “little” anymore) went through some rough times. A decade ago, he lost two homes to foreclosure. He declared bankruptcy. He moved his family to Seattle to make a clean start, but he couldn’t find work. “I don’t feel like a man,” he told me at the time, unknowingly broaching an interesting issue of gender dynamics. “I can’t provide for my family. My wife is the one earning money. It’s killing me.” (I’m pleased to report that Tony has managed to turn things around and seems to be doing well these days.)

In some ways, it’s natural that we internalize factors like our fitness and our finances. They are, after all, scorecards of sorts. When I weigh in at 200 pounds, that’s an objective reflection of everything I’ve done to my body during my 49 years on this planet. My net worth is an objective reflection of every penny I’ve earned or spent during my life.

Both weight and net worth serve as a scorecard for how well we’ve managed our fitness and finances, but they’re not complete measures. That’s why we use other numbers, such as BMI and muscle mass (for fitness) or saving rate and income (for finance).

Plus, it’s important to note that while for most of us, most of our weight and/or net worth is a result of the quality of our decisions, chance does play a role. Some folks are born into better situations than others. And some people suffer misfortune (or enjoy lucky breaks) that drastically affects their situation.

If I believe we shouldn’t internalize factors like weight and net worth — and I do believe that — what then is the alternative? Continue reading

The death of Anthony Bourdain: Thoughts on productivity, pleasure, and depression

Warning: This is a rare GRS post that contains salty language. If you don’t like salty language, don’t read this article.

Anthony Bourdain killed himself Friday morning.

“So what?” you might be thinking. “He’s just another fucking celebrity who didn’t know how good he had it.” Maybe you’re right. But his death has weighed heavy on me all weekend.

On Friday morning, as I wrote the weekly Get Rich Slowly email, I thought about Anthony Bourdain. On Friday afternoon, as Kim and I worked in the yard, I thought about Anthony Bourdain. On Friday evening, as we soaked in our new hot tub with a friend, I thought about Anthony Bourdain. Yesterday, I thought about Anthony Bourdain. Today, I thought about Anthony Bourdain.

Now I’m writing this article as an act of catharsis. Maybe it’ll help me to stop thinking about Anthony Bourdain.

The Depression Trap

I believe Anthony Bourdain’s death touched me deeply for a couple of reasons.

  • I was a huge fan. Since listening him read the audio version of Kitchen Confidential a decade ago, I’ve loved his work. Parts Unknown was probably my favorite travel show: raw and real — and filled with food. Bourdain connected with everyone he met. His joy for life was contagious and his mind was sharp.
  • Like Bourdain did, I struggle with depression. All my life, I’ve experienced periodic descents into darkness. The first time this happened, I missed five weeks of sixth grade. In the nearly forty years since then, I’ve developed a variety of coping mechanisms but they don’t always work. In recent months — since the middle of March — the darkness has deepened and I don’t know why. (And just as I missed five weeks of school back then, I’ve been unable to get my work done in the present.)

Let me make it clear that I am not suicidal. Right now, the biggest symptom of my depression is my inability to get shit done. But whereas suicide seems strange and senseless to most everyone else, depressives understand the appeal — even if we’d never consider it personally.

One of the many stupid things about depression is that the condition doesn’t care how awesome your life is. It doesn’t care how successful you are. It doesn’t care how much money you have. Depression is not rational. If it were, it’d be easy to think your way out of it.

Paula Froelich, one of Bourdain’s ex-girlfriends, put it like this:

Tweet about Anthony Bourdain's suicide

Bourdain’s death didn’t just make me introspective. It also led to a couple of interesting conversations about pleasure and productivity — and about what really matters in life. Continue reading

April 2018 spending update: Did moving to the suburbs save me money?

When Kim and I moved last summer from our riverfront condo to this country cottage on the outskirts of Portland, one of my primary aims was to slash our spending on both housing and food.

Although we owned our condo free and clear, living there still cost us roughly $1200 per month. Plus, there were the added costs that came from living so close to bars and restaurants. Sure, we didn’t have to eat out as often as we did — we understand that was a choice — but we enjoyed exploring what the neighborhood had to offer.

Well, I’ve now had time to gather enough data to determine whether we were able to achieve this goal, to cut our monthly costs. I’m pleased to say the answer is “yes”! But for a few years, this gain is going to be completely negated by our massive home remodeling project.

Let’s look at some numbers.

Saving on Housing

To start, here’s how my monthly housing costs have changed:

  • During the first four months of 2017, we paid an average of $1169.91 to live in our condo. Of that, $644.65 went to our HOA and utilities. The remaining $525.27 was spent on taxes and condo insurance.
  • During the first four months of 2018, we paid an average of $472.55 to live on our house. Of that, $187.91 went to utilities and $284.64 went to taxes and insurance.

Before we made the move, I estimated that it’d cost us about $500 per month for housing expenses. That was a good guess. My expenses are actually a little lower than that. And because Kim is paying me $500 per month to “vest” into ownership of the house, my net monthly housing costs are actually minus $21.45. I’m making money by living here! (Haha. I wish.)

Food for Less

Meanwhile, our eating habits have also changed. We don’t go out to eat nearly as much as we used to. When we do dine out, we choose cheaper places. (Our current neighborhood isn’t quite as hip as our old neighborhood.) Last night, for instance, we hit up our favorite pub. It cost us $54, and that’s expensive for this neck of the woods. In our previous neighborhood, we’d often hit a hundred dollars when dining out.

Here’s how my food spending has changed:

  • During the first four months of 2017, I spent an average of $568.42 per month on groceries and $554.14 on restaurants. That’s a total of $1169.91 per month on food. Holy cats! (And that doesn’t include money that Kim paid for groceries…)
  • During the first four months of 2018, I spent an average of $477.33 per month on groceries and $332.01 per month on restaurants. That’s a total of $809.34 per month on food.

Let me be the first to point out that I spend a lot of money on food. I acknowledge that. This wasn’t a weak spot in my budget back when I started Get Rich Slowly in 2006, but it certainly is today!

That said, moving to the suburbs did indeed help me spend less on food. My grocery bills aren’t down as much as I’d expected — only about 16% — but that’s still saving me nearly $100 per month. Meanwhile, my restaurant spending has been cut nearly in half! Overall, my monthly food budget has declined by 28% (which is more than $300 per month).

Creating Cash Flow

When we were planning for our move last spring, I wrote that I hoped my cash flow would improve by $1200 to $1300 per month. With the reduction in housing and food spending, I’ve saved an average of $1010.58 per month so far in 2018. When you add in Kim’s monthly $500 “mortgage” payment to me, my cash flow has improved by $1510.58.

That’s outstanding!

“But wait, J.D.” you may be saying. “Have other aspects of your budget ballooned because of the move? Are you driving more, for instance? And what about your outlandish home improvement projects? You’ve already admitted that you’ve spent roughly $100,000 on renovations since moving in!”

I am spending about twice as much on fuel as I was before. During the first four months of 2017, I spent an average of $25.79 per month on fuel. So far in 2018, I’ve averaged $56.69 per month on fuel. Other than that, however, the move has had no adverse effect on my finances…except for the very expensive remodeling projects we’ve been doing.

The Big, Fat Elephant in the Room

I haven’t included the remodeling costs in the above numbers because they’re not a regular expense. Trust me: I’m perfectly aware of how much I’m spending on home improvement, and it’s caused me plenty of anxiety. But those costs aren’t recurring, so I don’t include them when calculating average monthly expenses.

What I have been doing is some mathematics gymnastics:

  • My cash flow has improved by $1510.58 per month.
  • Our pre-deck (and hot tub) home improvement costs totalled $92,934.61. Of that, $59,000 came from selling the condo, which means we’ve had $33,934.61 in un-budgeted home improvements since moving in.
  • We don’t have a final tally on the deck and hot tub project (and won’t for several weeks), but I expect it to be close to that $33,934.61.

Based on these numbers, we can calculate how long it will take to recover the remodeling costs (compared with having remained in the condo). Dividing our $33,934.61 excess costs by my $1510.58 per month improved cash flow, we find that it’ll take 22.5 months — just under two years — to compensate. And, of course, it’ll take roughly the same amount of time to compensate for the deck and hot tub.

Translation for non-nerds: Moving from the condo to this house saved me just over $1500 per month. This savings has been temporarily negated by all of the home projects. But after about four years — assuming we find no further problems — we’ll pass the break-even point. At that time, the move will become a financial win!

Fingers crossed, my friends. Fingers crossed.

Helping Mom apply for Social Security — More complicated than it needs to be?

My mother turned seventy a couple of weeks ago. This means a couple of things:

  • First, she’s reached the age at which she can receive maximum retirement benefits from Social Security.
  • Second, it’s time for her to start taking Required Minimum Distributions from her retirement accounts.

If you’ve been reading Get Rich Slowly for a while, you know that these two routine tasks are less than routine for my family. My mother has fought a long-time battle with mental illness. After a crisis in 2011, my brothers and I realized that she could not live alone. We found a highly-regarded local assisted living facility that specializes in patients with memory issues. (Mom has some sort of cognitive disability that includes memory loss, but which the doctors have been unable to diagnose.)

For the past seven years, Mom has lived at Happy Acres in a comfortable apartment with her cat (Bonnie) and her television. When I see her, I often ask if there’s anything more she needs or wants. She assures me that this is all she needs to be happy.

Mom and Bonnie

At this point, Mom struggles with routine personal hygiene, so there’s no way she can take care of tasks like signing up for Social Security or taking withdrawals from her retirement accounts. As her sons, that’s now our job. (And we’re happy to do it.)

You might think that this process would be easy — but you’d be wrong. I suspect that in most cases, getting retirement benefits started is easy, but it’s much less so in our situation. Continue reading

Just solve the problem!

While the contractors were working to replace the siding on our new home last summer, they discovered a termite infestation outside the bathroom.


Further investigation revealed that the floor under the tub was not only wet and damp, but had actually completely rotted. So, we hired somebody to repair the damage. On the first day he was here, I went into the bathroom barefoot. Oops. I stepped on a shard of glass tile. That splinter was stuck in my foot for weeks.

At first, it didn’t really affect normal activity. If I wore sneakers and socks, I barely felt it. But if I wore sandals, I got a sharp stabbing pain in the side of my left foot. If I tried to run, the same thing happened. And forget about going to the gym!

Now, the obvious response here is, “Why didn’t you remove the sliver from your foot?” Great question!

On the very first night, Kim did try to remove the sliver, and we thought she got it. But the next morning when I took Tally for a walk, I realized the sliver was still there. But I didn’t do anything about it. I lived with it for weeks, a constant source of low-grade irritation.

This, my friends, is a perfect example of a couple of things.

  • First, it’s my family’s mentality in action. For some stupid stupid reason, we Roths don’t like dealing with medical issues. When we’re sick, we suffer for days (or weeks) before going to a doctor. When we’re hurt, we just suck it up. When I was young, my mother sprained her ankle. She limped around for months before seeking medical attention. In college, I broke a finger playing touch football over Thanksgiving. I dealt with the intense pain until Christmas break, at which time I finally decided to see a doctor.
  • Second, this a perfect example of putting up with a problem instead of finding a solution. Most people — myself included — are willing to tolerate a great deal of dissatisfaction and discomfort before deciding to remedy whatever is wrong in their lives. I’m not sure why this is the case, but it’s true.

With the glass shard in my foot, most of the time I barely noticed. But sometimes the pain was especially bad. I remember one morning while walking the dog, it felt like somebody was stabbing me with a needle. “I just need to solve the problem,” I thought to myself — and that reminded me of some wise advice I once received.

Just Solve the Problem

About a decade ago, I worked with a life coach. Each week, we’d have an hour-long phone conversation about the ways I was trying to become a better person. I made great progress in some areas, but little progress in others.

One day, we were talking about my inability to eat a healthy breakfast. I’ve always been the sort of guy who knows he should eat a nutritious breakfast but doesn’t actually do so. My coach had been encouraging me to make this a habit in my life, but I kept complaining about all the reasons it wasn’t possible. Eventually, she’d had enough.

“J.D., you’re being ridiculous,” my coach said, exasperated. “This isn’t rocket science. Millions of people eat a healthy breakfast every day. You can too. You need to stop making excuses. You need to identify the problem and solve the problem. Just solve the problem!” Continue reading

My mom is a millionaire!

When I woke up last Thursday, I thought my mother was flat broke. I went to bed with the shocking realization that she’s a millionaire.

Long-time readers will recall that my mother has struggled with her health for a number of years. She’d been living on her own, receiving ongoing treatment for schizophrenia, since my father died in 1995. Things gradually got worse until in 2010 we three sons had check her into a psychiatric ward for a couple of weeks so she could receive intensive one-on-one care. She seemed fine after that, but a few months later she experienced a crisis. She drove her car through the back of her garage.

Mom's garage

We took Mom to the hospital, but the doctors couldn’t figure out what was wrong with her. When she was discharged, we placed her into a “memory care unit” at a local assisted living place (which I call Happy Acres).

“I’m not sure how we’re going to pay for all of this,” my youngest brother (Tony) said at the time. “Mom only has $20,000 in the bank.”

“We’ll figure it out,” my middle brother (Jeff) said. And we did.

Managing Mom’s Money

Jeff and I gained power of attorney, which has allowed us to manage mom’s accounts and to make decisions for her well-being. Although it hobbled the business, we structured it so that the family box factory channeled some of its profits directly to her care. (Since she owns 60% of the company, this seems perfectly reasonable.)

For the past six-and-a-half years, Mom has enjoyed a pleasant routine at Happy Acres. After a short stay in the memory care unit, she moved into an apartment of her own. I took her to the Humane Society to choose a cat. She loves Bonnie and Bonnie loves her. Mom has a group of friends that she eats lunch with every day. Mom is quiet. She doesn’t say much. But she likes it when we drop by to see her. (To be perfectly honest, my middle brother sees and cares for her more than me and my youngest brother.)

At the end of 2017, Jeff sent me an email. “Mom got a letter from Social Security. She has to start taking payments when she turns 70 in April. I have no idea how to deal with this. Can you handle it?” Can I handle something related to personal finance? You bet!

Last week, I drove down to the box factory to take a look at the paperwork. I opened the envelope containing Mom’s statement of benefits from the Social Security Administration. “It says here that she should get about $2161 per month,” I said.

“Wow!” Jeff said. “That much?” I’m not sure he’s ever looked at his own statement of Social Security benefits before. (Later today, I’ll share how you can check your current statement online.)

“Yes, that much,” I said. “And she’ll probably need to start taking required minimum distributions from her IRA.”

“What are those?” Jeff asked.

“Once you reach a certain age — 70-1/2, I think — you have to start pulling money from your retirement accounts. Here, let’s look it up.” We pulled out her most recent statement from Vanguard.

Mom is a Millionaire!

Our research revealed that mom has $243,400.80 in a SEP-IRA (a self-employed IRA). Running the numbers through the Vanguard website revealed she needs to withdraw a minimum of $8883 per year — or about $740 per month.

Required Minimum Distributions

“It looks like she’ll be receiving roughly $2900 per month in benefits,” I said. “Not bad. That’ll help defray some of her costs. It might actually let us increase her standard of living, too.”

Then something occurred to me.

“Jeff, does the box factory own this land or does Mom own this land?” I asked.

“Mom does,” Jeff said. “Why?”

“Let me look it up on Zillow.” I pulled up the current estimate of the land value for the box factory. Zillow believes those two acres are worth $349,000. Then, for kicks, I pulled up the value of Mom’s house. (She owns a small home on two acres, the home where my father grew up in the 1940s and 1950s.) Zillow estimated the value of that property at $414,225.

“Jeff,” I said. “You’re not going to believe this. Mom isn’t broke. Mom is a millionaire.”

“WHAT?!?” Jeff said.

“I’m serious. When you combine the value of the two properties with the value of her retirement account, she has a net worth of $1,006,625. She’s a millionaire. Plus, she receives rent from the tenants in her house and rent from the box factory. Meanwhile, because she owns 60% of the business, she’s getting a chunk of the profits every month!”

We were shocked. Mom is a millionaire! For years, we’ve believed that she’s broke. Her bank account barely has enough to support her monthly expenses. But all this time, she’s been sitting on a pile of wealth.

Looking to the Future

The sad part, of course, is that Mom isn’t able to enjoy that wealth. She’s not in any condition to travel the world, to enjoy luxury accommodations, to buy fancy clothes. She’s nearly seventy years old and suffering from both physical and mental ailments.

Yes, we can employ that net worth to make sure she receives the best care possible, but she’s not going to be able to have fun the way a seventy-year-old millionaire should have fun.

Mom’s situation also demonstrates why some people do not include home equity when calculating net worth. They understand that money is a portion of their wealth, but it’s also illiquid. It’s wealth that cannot be accessed quickly or easily. So, some people leave it out of their net worth calculations. (My argument is that net worth has a precise definition. I understand the reasons for wanting to leave home equity out of your considerations, but the number you’re calculating is then not net worth by definition.)

In the short term, Jeff and I plan to get Mom’s Social Security benefits and retirement distributions flowing to her bank account. After we see what that cash flow is like for a few months (or a year), we can make more informed decisions about her future. Long term, we’re not sure what should happen. We know for certain that we’ll sit down and have a chat with her to see if there’s anything we can use this wealth for to make her life better.

Mom is a millionaire, after all. She should enjoy her wealth!

Mom and Bonnie

January 2018: By the Numbers

I’ve been waiting a year for this day!

At the start of 2017, because I was worried about lifestyle inflation, I began tracking my expenses for the first time in years. Using a rusty copy of Quicken 2007, I resumed updating the same budget database I’ve been using since February 2004.

After three months of tracking every penny I earned and spent, I had enough data to draw a conclusion: As much as Kim and I loved where we lived, our fancy neighborhood was costing us a small fortune. Our mortgage-free condo took more than $1000 per month to maintain (between HOA, insurance, and taxes). Meanwhile, I was forking out $500+ per month for groceries (and Kim was spending some too!) and $500+ per month for restaurants.

Prompted by these high expenses — and other factors — we sold the condo and moved twenty minutes south. We now own a smaller, older home on an acre of land just beyond the edge of Portland’s urban growth boundary.

The burning question since July has been: Did this move save us any money? Now that January 2018 is in the books, we have an answer. That answer is: “Hell yes!”

January 2018 Expense Report

On the surface, I actually spent more last month than I did in January 2017. My expenses show as $5419.29 versus $4801.76 last year. That said, about $2500 of those are unusual one-time expenses, such as $811 to repair the RV so that we can sell it, $225 for an electrical permit so that I can wire my writing studio, and $425.58 to get shots for our new kittens.

Kim with the kittens

When I compare “problem” expenses from 2017 to those from 2018, I see lots of improvement. Here’s a sample of the numbers:

  • In the condo, property taxes and HOA combined came to $1093.56 per month. In our “country cottage”, property taxes run about $250.31 per month. That’s a monthly savings of $843.25!
  • Last January, I spent $535.77 on groceries and $554.95 on restaurants for a total food expense of $1090.72. Where we live now, groceries are less expensive. Plus, we’re not within walking distance of bars and restaurants. We have to make an effort to go out to eat. As a result, I spent $397.53 on groceries last month and $190.49 on restaurants for a total food bill of $588.02. That’s a savings of $502.70!
  • Other expenses remained relatively constant. In January 2017, I spent $135.34 on transportation and $296.33 on utilities. In January 2018, I spent $147.29 on transportation and $301.61 on utilities.

I’m pleased with these numbers. I had hoped that moving would save us about $1200 per month. With one comparison month in the books, that guess looks accurate.

One final note on my financial situation: In January, my net worth rose 3.71% over December. It was up 3.33% compared to the same month last year.

I need to temper this good news with the fact that we’ve spent around $70,000 for repairs at the new place. This old house has been a money pit. We had a $59,000 “profit” on the difference between the sales price of the condo and the purchase price of the house. That profit vanished into a new bathroom, a new roof, new siding, and new floors. Without these repairs, my net worth would have been up 7.04% compared to the same month last year. (I realize some of these repairs should convert to increased home equity, but for now I’m treating them as a lost expense.)

Our new home

2018 Goals Update

Meanwhile, how am I doing on the goals I set for myself at the beginning of the year? Pretty good — but not perfect.

  • At the start of January, I said that I wanted to run at least one mile every day in 2018. That goal went out the window when I caught pneumonia and the doctor ordered me not to exercise for ten days. Still, I ran every day that I could in January for a total of 34.01 miles. (My revised goal is to run 1000 miles in 2018 — no “every day” component to it.)
  • I also said I wanted to eat three servings of plants every day in 2018 (by which I meant an average of three servings per day). This is one of those goals that seems stupid and easy to many people, but is actually very difficult for me. (I’m a meatatarian.) In January, I averaged 2.42 servings of plants per day. That’s progress, I guess.
  • Kim and I tend to drink a lot. It’s our hobby. (This afternoon, for instance, we’re headed to the Portland Seafood and Wine Festival.) I want to drink less, though, so I’m aiming to have only 500 servings of alcohol in 2018. In January, I drank 33 servings. That’s below my target pace, so yay! (One subgoal is to drink no beer until my birthday at the end of March. So far, so good.)
  • I also set a goal to publish 500 articles at Get Rich Slowly this year. In January, I published 34 articles. (These 34 articles contained 51,051 words, for an average length of 1502 words per article.) This puts me behind my intended pace, but I’m fine with that. This lofty goals is really meant to push me to publish as much as possible. If I aim for 500 pieces and only publish 400, that’s not exactly a failure.
  • Finally, I said I wanted to read one book for pleasure each week this year. I haven’t hit this one at all. I didn’t finish a single physical book in January (although I did read most of Pillars of the Earth). I consumed a lot of audiobooks, but that’s not what my aim was here. I want to read physical books. I’ve got to figure out how to fit this into my schedule.

Again, I’m pleased with this progress, although I recognize there’s room for improvement. I want to find a way to encourage myself to eat more plants! Plus, I need to set aside time to read for pleasure. I think both of these things will come with time…

How are you doing with the goals you set yourself for 2018? Are you making progress? Are you struggling? And how’s your financial situation now compared to a year ago?