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Wanna know more about me? Well, today I have a guest post on Financial Health and Wealth! Go check it out here.

The post Interview on Financial Health and Wealth appeared first on Dads Dollars Debts.

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Last week I had a guest post on Your Money Geek. Michael is new to the blogging world but has been quite active. He is posting regularly on his site and via guest posts. In fact, he had a post on my site recently about How to Build your Savings. Now it is my turn to return the favor and talk about saving on his site.

Today, I am going to share a post I did for his site titled Saving For Retirement: High Income Edition. Go over to his site and you can learn why it is hard for doctors to save for retirement despite their very high incomes!

The post Guest Post- Saving For Retirement appeared first on Dads Dollars Debts.

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Dads Dollars Debts by Dadsdollarsdebts - 2w ago

So here we are, another month in my attempt to Buy Nothing New!  I don’t think I am killing it, but hey that is part of the challenge. I am surely learning more and more about myself every day. So how did June go?

Well…Buy nothing new June 2018

June 1st- Some pliers while camping. I had bought my son a fishing rod and it broke. I tried to fix it with my teeth (trying to pry off a bolt). Bad idea and I definitely chipped a tooth. So I did the grown-up thing and bought some pliers to fix it. It is part of my still small, but ever-growing toolset.

June 11th – I bought an alarm clock. Super fancy. The one you see above. It was bought in an attempt to stop relying on my cell phone as an alarm clock. The act of having it in my room was leading to an early morning wake up. No bueno. So I tried to cut it out. So far so good.

June 17th- My thumb had been hurting, so I bought a brace for it. I think I pulled a tendon by lifting my son so frequently (even at the age of 3). I had done this previously when he was much younger. It’s called Mommy’s Thumb (a bit gender conforming if you ask me) or the much more medical Dequervain’s tendonitis. Here is an article about it if you are interested.

That is it. I did not buy anything else. A bit surprising to myself as I sit here and read this. I guess the 6 months of purposefully not buying anything is finally paying off. Plus, we already have all of our camping gear.

I will mention a recent no buying win. My son and I were at the hardware store the other day. We were looking for sand for his ant farm. All they had were 50 lb bags which seemed excessive. While walking around I picked up a plastic storage bin that I had been wanting for some of my papers and a toolbox.

I walked around the store with them and when it was time to check out, realized I did not need them. I was just buying them because I was at the store. My current toolbox is a shoe box and it has worked just fine. My papers are in a slightly bigger container then is needed, but why buy a new one just to buy one. Old me would have bought those items. New me resisted and put them back on the shelf. So a win for me and the buy nothing challenge!

Running list of material things I have bought in 2018
  • Hair clipper (personal hygiene)
  • Retainer for my teeth (health related)
  • Free t-shirt’s x 2
  • Microphone for a podcast (business)
  • Picture frame hangers (should have used nails but the frame is quite heavy and we live in earthquake country)
  • Ant baits (home maintenance)
  • Yoga mat (health related)
  • Fancy shoe inserts for my flat feet (health related)
  • Bromine tablets for the hot tub (home maintenance) and lavender smelling stuff (frivolous)
  • Fancy cooler (frivolous but useful)
  • Hubcap x 1 (frivolous but makes me feel good)
  • Suits- his and his….(mine was for future business and my son’s was frivolous/experience)
  • Hot tub calcium hardener (home maintenance)
  • A tent (planned)
  • Luggage and a backpack (needed for all the traveling we do)
  • A child carrier (frivolous and fell for the sale)
  • Walking shoes (for my health or unnecessary? You decide.)
  • Plastic water pipe cover (home maintenance)
  • Camping great including air mattress, tarp, cooking and eating supplies (wife purchase but both of us use this stuff). Also 3 chairs, a sleeping bag, an inflatable mattress for me, and 2 headlamps.
  • Khaki shorts (personal)
  • Pair of jeans and workout shorts (personal)
  • Pickle Monster Truck (frivolous but worth the smile on my son’s face).
  • Hairpin, bracelet, necklace, and earrings (gifts for my wife! Happy Mother’s Day)
  • A screwdriver.
  • Another screwdriver, a socket wrench, and a step stool (tools, but used to build memories with my brother-in-law)
  • A stove and propane tank, roasting sticks, pocket knife, and sleeping bag (more camping gear but we should be complete now! Why all the camping gear? Well we have at least 3 summer trips planned and maybe adding more to the schedule. Ah Northern California!).
  • An ax, 2 chairs, 10 tent stakes, and a fishing rod (I hope the camping spree is done).
  • Pliers
  • An alarm clock
  • Thumb Brace

The post Buy Nothing New- Month 6 appeared first on Dads Dollars Debts.

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I am excited to say I have a guest post on The Happy Philosopher. A fellow physician, he muses on life in general. After the Tubb’s Fire, he asked me how I was going to rebuild my life after losing everything. At that point, I was not sure what we would do, but it turns out that we were starting our path towards minimalism.

If you are interested in seeing how I have started over, then go and check out my post here. It will give you more insight into how my life has been over the last few months.  If you have any comments, feel free to leave them over on The Happy Philosopher’s site.

The post Guest Post on The Happy Philosopher – Losing Everything appeared first on Dads Dollars Debts.

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Today we have a guest post by Dave about savings. He does not run a blog from what I can tell and reached out to post on my site. Dave is a little bit over 60 and has been trading Stocks, Options, and Forex for over 19 years.  He has a Master’s Degree in finance and his favorite hobby is collecting watches. His second passion is sharing finance news. We have no financial relationships, so take it away Dave!

How to build your savings!

Thinking about building your savings may seem overwhelming, especially when you just paid for your car insurance, student loans, and rent. Taking more money out of your paycheck, even if it’s to put into your savings account, can feel impossible. Chances are it isn’t and although there is no magic solution to increasing your savings, these tips will help steer you down the right path.  

Make a Realistic Budget 

This may seem daunting and repetitive, but building your savings and staying consistent requires a clear plan. You don’t have to create a budget alone. There are a variety of budgeting apps that can help get you started (e.g. Mint, Wally ), but the most important thing to remember is to make your budget realistic for your lifestyle — start small and work your way up. If your budget is too strict you will drive yourself crazy and you may give up on your plan altogether.

Try to divide your income into three categories:

Bills and necessities: Figure out how much you are spending each month on bills and things you really need. This should include your phone bill, rent, student loans, car payment, food shopping, etc. Once you determine that number, put it aside.

Savings: Establish how much money you would like to save each month. Again, start small and be realistic, even if that means saving only $50 each month. By putting $50 aside every month, you will add $600 to your savings by the end of the year.

Just for fun: Just because you’re saving money, doesn’t mean you need to deprive yourself of entertainment. You can still go out with your friends for drinks or take a weekend trip with your spouse. Just plan for these expenses and spread them out over time.

The Change Jar Method 

Oh yes, dust off that old childhood piggy bank and put it to good use! The loose change in your pocket, on your car floor, and underneath your couch cushions can add up in the long run — especially if they are being stored in a jar and left untouched. We’ve heard plenty of stories from customers who created emergency funds, paid off debt, or booked a vacation simply by throwing all their loose change into a jar and never spending it.

Here’s a small trick to fill up that piggy bank quickly — pay cash for almost everything. Put away your debit/credit cards and start paying with green. That way, at the end of the day you will have a better chance of having loose change and $1 bills in your pocket to throw into your jar.  

Cut Costs Around Your Home 

Think about it, how many things around your house could you part ways with without losing any sleep at night? Or how many little things could you do to cut down your monthly living expenses? For starters, cut that cable. Cable costs are ridiculously high these days, and in the world of streaming-devices, there is no need for it. Part ways with your cable provider and opt for a subscription service instead (Netflix, Hulu, Amazon Prime). Take what you save and put it right into your savings account for a $50-$70 monthly boost. Nice, right?

You can apply that approach to other things around the house. Get rid of your home phone and eliminate any unread magazine subscriptions. Lastly, be conscious of how much electricity you are using every day around the house. Turn off the lights when you don’t need them on, lower the heat or turn off the air conditioning when you are not home, and cut down on shower time. If you stay consistent with these small changes, you will start seeing a difference in your monthly electric bills.

Get a Side Gig 

Having a side job is an excellent way to accelerate your savings. Do you love to knit or have a knack for DIY projects? Consider creating a shop on Etsy and selling your pieces online. Are you a night owl and enjoy concerts or sporting events? Find a part-time gig working at a stadium at night or on the weekends. The possibilities are endless.

Set-up Automatic Transfer 

Out of sight, out of mind. Ask your bank how to set up an automatic transfer to your savings account. Allocate a certain percentage of each paycheck to be automatically placed into savings. This is one of the best ways to build your savings account.

Make Some Sacrifices 

If you are truly serious about building up your savings account, you’re going to have to make some sacrifices. This may mean fewer nights eating out with your spouse, putting an end to your monthly music-streaming subscription or canceling a meal kit service. At the end of the day, you lived without those things once upon a time and you survived. Plus, it will all be worth it once you start seeing that savings number climbing higher and higher.

Building up your savings is not something that happens overnight, but if you incorporate these six tips into your daily life they will steer you in the right direction. No matter how old you are or what your current financial situation is, it’s never too late to start building healthy spending habits and planning for a richer and more fulfilling future.

The post How To Build Your Savings? Step-by-Step Guide appeared first on Dads Dollars Debts.

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Dads Dollars Debts by Dadsdollarsdebts - 1M ago

Sam from Financial Samurai really had me thinking post-fire. I answered some of his questions here and here, but today will answer his final question which is why after the fire I feel like living in a smaller home.

Living smaller

Now I am not talking about a small home, just smaller. Down from the 3,200 square foot house, we were living into a 2,000 square foot home. Not small by most standards, just average.

Building a smaller home?

Building this smaller home is not financially prudent due to the way insurance pays out, so in fact, I am building a bigger home. As big as makes sense, which in this case is a 5 bedroom, 3.5 baths, 3,500 square foot home. It is going to be nice with 180-degree views and an open, modern concept. Hopefully, it will be so nice that someone will be willing to buy it for big bucks!

Why live in a smaller home

Through my adult life, I have owned 3 homes. The first was 2 bedrooms, 1 bath 850 square foot Cape Cod in Nashville. The second was a 3 bedrooms, 2.5 baths 2,100 square foot modern home in New Orleans. The last one was 4 bedrooms, 3 baths 3,200 square-foot home in Santa Rosa, California.

Of these three, the biggest caused me the most stress. More taxes, more utilities, more space to clean, and more wasted space. The 800 square foot was too small and that was just when 2 of us lived there. So much like Goldilocks, I found the right size. For us that is approximately 2,000 square foot. I prefer a 4 bedrooms 2.5 baths, but more realistically we will end up in a 3 bedroom 2.5 bathroom home.

What are the benefits of a smaller home

Cheaper: There are likely many, but sitting here and thinking about it I would say the biggest benefit is the lower cost to purchase the home in the first place. A 2,000 square foot home is going to be cheaper than a 3,500 square foot home. Substantially cheaper to the 40+ percent. That is no joke. Think of what you can do with all of that extra cash.

Utilities and taxes: Talking about saving money, with a smaller home the utilities and taxes are also going to be cheaper. More savings.

Less wasted space: Even with a 3 bedroom home we will have some wasted space as there are only 3 humans currently in our family. The 3rd bedroom would be used for the occasional guest. I would estimate this room to be used roughly 30% of the year. A smaller home also means no Family Room and Den. Who needs both anyway? All I want is an open, modern concept where the kitchen, family room, and dining room all flow into each other. It is better for entertaining and feng shui.  

Resale value: I know, I should think of a home as a long-term investment! Let’s face it, I have bought 3 homes in 10 years. There is no 5-year timeline I can guarantee based on prior history. That being said, if I buy an average home then there will be more buyers. If I buy a high end, larger home than I am reducing my buyer pool.

There you have it, why I think smaller (in this case average sized) homes are great and why I will be deliberate about the next home we buy. Going from 800 square foot to 3,200 square foot definitely let me know what I like and do not like about homes.

The post Living smaller appeared first on Dads Dollars Debts.

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Sam from Financial Samurai was kind enough to let me post on his site last month. I discussed the basics of home insurance. He also asked me what the living options are after a fire. What can I do with the insurance money? Do I have to rebuild? Can I just keep the insurance money to rent a house or buy a new home somewhere else? So I figured I would answer his questions in a quick post today.

Living after a fire

After the insurance payout for a total loss of my home, there were 4 paths I could take:

Option 1 – Rebuild on the old lot

Insurance will pay the cost to rebuild up to your coverage maximums. In our case that easily is over $1,000,000. So I could rebuild a brand new 3,200 square foot home on a half acre with a beautiful view. This sure beats the 20-year-old house that was there before.

The uncertainty of rebuilding is:

1) what will the cost be with contractors and supplies being in high demand. I will certainly have to pay out of pocket $100,000 to $200,000 to rebuild.

2) Do we even want to live back on the mountain and if we do not, what will the market be in 2-4 years when the home is built?

3) Will insurance continue to cover homes in our old neighborhood due to the recent fires and a similar fire in 1964?

One benefit of our street is that only 4 out of over 30 homes burned. This means most of our street is still standing. This adds value to our lot as there is a neighborhood. If I had a lot on a totally destroyed street I may rethink building.

Option 2- Rebuild on a new lot

Per California State Law, the insurance company has to pay for me to rebuild on another lot if that is what I choose to do. This is less appealing to me for the reasons above (costs and timeline). I do not see the benefit of trying to build if it is not on the same lot.

I do, however, know of one person doing this. They are rebuilding on a newly purchased lot because their old lot has benzene in the water, making it unlivable. Talk about a kick in the butt. First, your home burns down. Then you find out there is benzene in the water which may not be fixed for 2 more years. Brutal.

Option 3 – Buy a new home

Once again thank you California. Per California State Law the insurance company has to pay for a home of equivalent value if I decide to buy. Ideally, I would buy a home worth more than the one that burned down because the insurance payout will deduct the value of the land.

So if I am covered for a $500,000 for the dwelling, then I should buy a home in the $700,000 range so that insurance will count the land value (let’s say $200,000 – $300,000) and give me the rest of the money for the home.

The downside of this is that I would have to buy a home at today’s inflated home prices. Currently, there is a supply-demand since 5,000 homes went up in smoke and prices are 10-20% inflated. I would be paying more for an older home without a view as opposed to rebuilding.

In all of the scenarios above, I am still paying my old mortgage which is currently at 2.85% (year 2 of a 7-year arm). The mortgage does not disappear and likely would be transferred to the new home (whether it is built or bought). I do still get to keep my land which is currently valued at $450,000 but likely would sell at a deep discount today.

Option 4 – Take the insurance money and pay off the mortgage

Currently, the insurance company would not cover all of my mortgage, but I could theoretically take the coverage A and C monies and pay off the mortgage. Then I would be debt free, own the land which I would hold onto for 5 years or longer, and decide what to do. Maybe we would rent for a while or buy a smaller home in a different community.

Still financially speaking, living in a rental for 2 years while insurance pays it and building makes the most sense. Once the house is built we can decide if we want to move back in or sell it. Also in 2 years, we can decide if we want to buy or not because the insurance loss of use money will be gone.

What we decided to do

Well, we took paths 1 and 4. First I paid off my mortgage with the insurance money. It did not make sense for me to pay out over $1,000 in interest a month while figuring out my next steps. Then 3 months later I decided to build the home.

I did the math and by building, I actually get more of an insurance payout then if I do not build. Then, if we decide to sell, I figure we can make between $200,000 to $400,000 above what we bought it for in 2011 depending on the market. Hopefully, this educated gamble will pay off and we will be even further along on our financial independence path.

The post Options for living after a fire appeared first on Dads Dollars Debts.

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I am honored to have a guest post on ThinkSaveRetire.com about my life post-fire. I am a huge fan of Steve and his site. He is living one of my dreams, traveling around in an RV. Ah…life on the open road.

He also is constantly producing interesting posts all of which you can see on his site.

Living a life post fire

Steve reached out to me post-Tubb’s Fire and asked me some questions about life, living, and life…umm well I guess that is redundant. Anyway, it led me to write the guest post- Living a life post-fire.

I know it was published yesterday, but go check it out now and let me know what you think. Here is the link!

The post Guest post on Think, Save, Retire – Living post-fire appeared first on Dads Dollars Debts.

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Today, Michael Dinich from Your Money Geek has joined us for a guest post. He is a prolific writer and a financial advisor. When asked what posts he wanted me to link back to he chose this and this. They are both good, so check them out.

He said he would answer any question I sent him, so of course, I asked him about financial recommendations We have no financial relationships. So without further ado, I asked him:

What financial recommendations do you have for a young, married person who earns $50K a year?

Here is his answer:

That is a great question!  I have worked with young families just starting out for nearly 20 years.  What I have found is that there’s a shortage of advice geared towards individuals with average incomes, beyond paying down debt, budgeting or making more income. (Like no one thought of that!) Every financial plan needs to be unique and hand-crafted to the saver, however, I do have some best practices that you can follow.

Create a budget

I know everyone says to create a budget and if you’re reading financial blogs, chances are that you know enough to budget. However, I would be remiss if I didn’t mention you couldn’t create a plan or improve upon a plan if you do not have a basic budget and list of your expenses.

Tax Planning

Now that you have a basic budget, it’s time to create a tax budget.  One of the biggest mistakes families with average incomes make is not creating a tax budget early in the year.  The tax code has a number of incentives for individuals and families with averages incomes may qualify for such incentives as the Premium Tax Credit, Retirement Savers Credit and Earned Income Credit. 

The best advice I can give to anyone is print out the income thresholds for any tax credits or deductions they intend to use during tax time, and compare your year to date earnings with the programs income thresholds on a monthly basis. Should you find that you are in danger of losing the tax incentive, you can adjust your 401k/IRA contributions or engage in other tax planning.

Do not leave tax planning to tax season (mid-January to April 15Th). After December 31, there is very little that can be done to reduce taxable income. Every year during tax season, I meet people who missed out on valuable tax incentives because they were not familiar with the income limits and waited until it was too late to engage in tax planning.

Create a financial disaster preparedness plan

There are some differences between high-income earners and average income earners. In particular, average income earners have less margin for error.  A 100K medical expense that would bankrupt a family making 50k a year is survivable, although unfortunate, for a family making 200k.

A financial disaster preparedness plan should include:

  • An Emergency Fund, starting with a few months of expenses and try to grow it to a few months of income.
  • Legal Documents, such as estate planning documents, guardianship documents for minor children, powers of attorney and pre-nuptial/post-nuptial documents.  Hire a competent lawyer: don’t trust boilerplate forms downloaded off of the internet.
  • Asset protection, if you have a small business, a side gig, rental properties, act as a freelancer or as an independent contractor, talk to your CPA/lawyer about asset protection.
  • Business credit. If you have a business, develop business credit as quickly as possible to avoid using your personal credit for business purposes. (When a business is new in credit terms, lenders will expect you to personally guarantee your business’ borrowing.)
Be Creative

Being successful on modest incomes often means thinking outside of the box. Hopefully, you followed step one. What is your biggest expense after taxes, health care, and insurance? If it is energy and you own your home, consider having a home energy audit done. Putting 10k into additional insulation may not be as sexy as buying an investment, but if it can save you $1,200 dollars a year in oil or propane, the returns might be better. 

Can you install solar, upgrade to a heat pump or install more energy efficient central air?

Don’t own a home, no problem. Can you barter with your landlord? Maybe they will cut you a break on rent in exchange for doing some property maintenance.  If you are renting until you have a down payment saved up check onerent.com where you can earn free money towards your home down payment.

The possibilities are endless. Do not limit yourself to just investing in other companies via stocks and mutual funds. Oftentimes, the best returns on investments are investing in money-saving improvements. Things such as working on your own career, starting a side hustle, or launching a small business.

The Most important thing for anyone to know starting out is that you can live a great life at just about any level of income. Do not judge yourself by other people’s standards; find what works for you and your situation. Life is about balance: save some, spend some.

The post Financial recommendations for someone making $50,000 a year! appeared first on Dads Dollars Debts.

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Dads Dollars Debts by Dadsdollarsdebts - 1M ago

This weekend I was in Seattle and we stumbled on a Marina Day Celebration. There was music, games for kids, and tours of boats. Two groups of people living in a boat were kind enough to open their homes to us for a tour.

Living in a boat

It was quite cool. We met a family of 5 in one boat and a couple of retirees in another. These people live full time in their boats on the Marina. I was intrigued as I had talked to my wife about doing after the Tubb’s Fire. She quickly knocked it down because 1) I have never learned how to sail and 2) we have a toddler. Both good points, but now that we were here, I figured we might as well get some info.

The family of 5 lived on a boat that was 2 levels. The main floor had a small living room and kitchen with a deck off the back. There was then two sets of stairs leading down to a total of 3 different bedrooms. There were all small rooms. It was a nice boat, but I could not see myself living there, especially with 3 kids.
The retirees’ boat was pretty sweet. It was 3 levels with a nice roof deck up top, a big living room on the main floor, and a kitchen with 3 bedrooms and 2 baths on the bottom floor. I am not sure what the boat terms for each of these floors are, but I am sure there are specific terms (maybe my wife has a point about my lack of sailing knowledge).
The master bedroom was big enough for a queen bed with dressers and a full bath. Very comfortable. The other 2 bedrooms were small but doable.

Cost?

So I asked our host what the cost of her boat was. She said her’s, which was older, cost approximately $200,000. Then to dock it is $1,200 a month which includes water. Electric bills come in quarterly and run about $400.
So I figure, after the cost of the boat, it is running her $1,333 a month or $16,000 a year after the initial purchase. This is not too bad, considering how expensive Seattle is. An average 2 bedroom apartment is over $2,000 to rent. The median price to own a home is $729,000!!! Ouch. So now it looks more affordable to live in a boat.
After this experience, would I recommend living in a boathouse to save money? Well no!
But if you want to live in a boat, I suspect that it is the most cost-effective way to live in an expensive city.
As for me, I am less intrigued after seeing the quarters in person. Maybe if we did not have a toddler, but not right now I will stick with the idea of partial RV living and full-time house living.

What about you all? Any desire to live in a boat?

The post Living in a boat appeared first on Dads Dollars Debts.

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