The Get Rich Slowly file vault

A new Get Rich Slowly subscriber emailed me yesterday to alert me of two problems.

  • First, all of the free resources I share on Google Drive have magically switched from publicly-available to private.
  • Second, the automated email sequence for new readers is broken (which means that folks aren’t receiving The Money Boss Manifesto).

Fixing the email sequence will take some work. It wouldn’t take much effort to make it functional again, but while I’m in there mucking around, I might as well make a pass to revise it. The info and examples are five years old. (Meanwhile, the current version of The Money Boss Manifesto can be downloaded here.)

Fixing the shared documents on Google Drive was easy, though. They should once again be publicly viewable. Please let me know if they’re not.

The Get Rich Slowly File Vault

This seems like a good time to remind readers that the Get Rich Slowly file vault exists.

The GRS file vault contains a whole host of free resources that I’ve gathered over the years. Some of those resources are from me, but most are from other folks. Everything in the file vault is free and legal to share.

What kind of cool stuff can you find in the Get Rich Slowly file vault? Here’s some of what’s currently available.

The Get Rich Slowly file vault also contains a handful of “GRS Originals”, documents that I’ve created over the years to share with various audiences. These include:

  • The Money Boss Manifesto, the 87-page ebook that summarizes the Get Rich Slowly approach and philosophy. This is the same info that you’ll find scattered in various articles around this site. It’s also a sort of working draft for what became my Audible course.
  • The Money Boss Method, which is a one-page version of the GRS approach and philosophy. It’s basically an outline of the modern approach to financial freedom.
  • The one-hundred words poster I created in 2013 in partnership with my friend, Lisa. This is a short list of guidelines meant to help me lead a happier life. Other folks wanted a copy, so I added it to the file vault.
  • A one-page PDF with an exercise meant to help you create your personal mission statement.
  • For my article on the six stages of financial freedom, I shared an image that summarizes the path from financial dependence to financial abundance. By popular request, I’ve created a PDF version of that roadmap.

I would love to have help with the Get Rich Slowly file vault.

If you know of other free resources that should be added to the GRS file vault, let me know. And if you notice any problems — if you’re unable to access the files — drop me a line. My aim is to make this a fun and useful collection of stuff for people to browse.

Future Plans

Now that Kim and I have resolved our uncertain future, now that we’ve moved to Corvallis, unpacked, and begun to settle into our new lives, I find that I once again have time and motivation to publish here at Get Rich Slowly.

But I don’t want to set expectations too high! I am not in a headspace where I want to churn out 3000-word articles on deep subjects. Instead, I’ve found myself wanting to pursue three different aspects of the site.

  • First, I want to devote most of my time and energy to creating what I think of as an online textbook about personal finance. This would essentially be an organized collection of the most important and useful articles at this site, and it truly would be organized as if it were a textbook. So, for instance, I might take all of the many “get out of debt” articles I’ve written over the years and combine them into a single, definitive piece about how to get out of debt.
  • Second, I want to create a library of personal-finance resources. I have dozens of book reviews at this site, but no organized way to view them. I don’t do a lot of personal-finance product reviews, but I’d like to do more. (Or, more precisely, to have my business partner Tom do them.) And so on.
  • Lastly, I want most of my “new” articles (as opposed to the “old”, revised pieces for the “textbook”) to be brief write-ups of interesting stories I find around the web. Amazon rigs its search results? Shocking! What makes a job meaningful? Thoughts on the pursuit of childhood joy? These are all things that might be of interest to GRS readers, but which don’t merit 3000-word articles, you know?

Anyhow, I hesitate to share these plans because I know I have a piss-poor track record of actually following through with my intentions lately. (So, no need to remind me of that haha.) But as I think of what I’d like to do with Get Rich Slowly, these are the primary outlets I’m aiming for.

from Get Rich Slowly

Your First Rental Property

It’s official: Kim and I have moved from Portland to Corvallis, Oregon. We closed on our home — a 1964 daylight ranch with fully converted basement — at the end of August, and we’ve spent the past six weeks moving and unpacking. I thought I’d have time to post the gory details of our purchase, but obviously that hasn’t happened. We’ve been too busy!

The short version is this: After offering $128,000 over asking on our dream home (and still losing out to a cash offer), we came close to joining in another bidding war on a similar house. But we didn’t. While other folks were bidding up a place down the street from $589,000 to $707,000, we snuck into a home we liked better for $680,000 — just $5000 over asking. We got lucky.

And while I was worried that we might experience buyer’s remorse, I’m pleased to report that absolutely has not happened. We love our home and we love Corvallis. How could we not?

Corvallis is the best biking city in the state of Oregon. (Yes, even better than Portland.) Our home isn’t a walker’s paradise, but it is within range of two grocery stores and a handful of restaurants. Corvallis has hardly any traffic congestion. The town is surrounded by forested foothills filled with hiking trails. Every day, we have squirrels and deer and wild turkey in our yard. There are two off-leash dog parks nearby. Our neighbors are super friendly.

I could go on, but I won’t. You get the picture.

My view while writing this article

We had high expectations for Corvallis, but so far the city has exceeded them. I’m not kidding. This is exactly what Kim and I were looking for during our three-month search for a new place to live. It’s our Stars Hollow.

And our home, while ginormous for two people, has also exceeded our expectations. Sometimes it feels as if it was custom-designed for the two of us and our lifestyle. Early days yet, I know, but after six weeks we’re pleased.

A Tiny Real-Estate Empire

Kim and I also like that we’ve already begun building friendships in town. I’ve spent some time with Jeff from The Happy Philosopher, for instance, and Kim does weekly dog walks with one of the neighbors. Last weekend, we enjoyed happy hour with our real-estate agent and his wife.

Michael and Rae have lived in Corvallis for maybe ten or twelve years. In that time, they stumbled on the idea of “financial freedom” without ever discovering the burgeoning FIRE movement. (FIRE is a clumsy acronym for “financial independence and early retirement”.) Like many others who eventually find FIRE, these two invented their own version in a vacuum.

Michael and Rae have been slowly building a tiny real-estate empire, which currently comprises six homes. They’ll buy a place, live in it while making improvements, then rent it out when they’re ready to buy another property. Their goal, which they’re approaching, is for the cash flow from their rentals to cover their monthly expenses.

Michael and Rae's real-estate empire

Last week, over cocktails and appetizers at Magenta, Kim and I grilled Michael and Rae about their experience.

“Now that we’ve settled here in Corvallis, we’ve begun to talk about the idea of buying rental properties ourselves,” I said.

“I just turned 49,” Kim said. “My years as a dental hygienist are starting to take their toll. My back hurts. My shoulder hurts. My wrist hurts. I want to find a way to earn money without killing myself.”

Michael nodded. “We’re happy to share what we know,” he said. “But you need to understand that this isn’t some magical path to wealth. It’s work. Maybe not the same kind of work you do now, but it’s work. And it takes time to build an income stream.”

“I get it,” Kim said. “I get it. It sounds like you guys have it figured out. Didn’t you tell us that you’re renting only to college students? And that they come back year after year after year?”

“We don’t rent only to college students,” Rae said, “but it’s mostly students. Right now, one of our six homes is rented to a ‘normal’ family. But you’re right. We’ve been lucky to have low tenant turnover.”

“We try to maintain long-term relationships with our tenants,” Michael said. “We don’t want to be their friends, but we do want to have good communication. We want them come back every school year. Often that means we don’t raise their rent. Or, when we do, it’s a very small increase.”

“That’s smart,” Kim said. “It makes your tenants more loyal and prevents turnover. Turnover is probably tough.”

“It is,” Michael agreed. “We’d rather keep our tenants in place at rents slightly below market rate than deal with turnover every year. When somebody moves out, then we can move things to match the market. Besides, building strong relationships with our tenants seems to help keep them motivated to care for the place. And we’re starting to see it helps when their siblings come to school in Corvallis. They contact us because their brother or sister had a good experience with us.”

“I like your ethical approach,” I said. “And listening to you talk about this makes me want to learn more about real-estate investing.”

“You know that I want to learn about it,” Kim said. “I’ve been saying that for years.” (She has!)

“You know,” I said, “many of my colleagues are into real-estate investing. I’ve talked with them about it, even though I haven’t ever pursued it for myself. Do you read any of the real-estate blogs?”

“Not really,” Michael said. “I’m familiar with Paula Pant at Afford Anything, though. I like her stuff.”

“Paula and I are good friends,” I said. “We’ve been close since 2012, and we often call or text to catch up on life. In fact, we just hung out last week at Fincon in Austin. She asked me to help promote her real-estate course.”

“You should do it,” Michael said. “I haven’t seen the course, but she has solid info on her site.”

I thought for a moment.

“You know what I should do,” I said. “I should help Paula promote the course, sure, but more than that I should take the course for myself. I should take it so that I can learn about real-estate investing.”

“Yes, you should,” Michael said. “Not that I have an ulterior motive in having you buy more properties.” We all laughed at that.

“You know what’d help?” I said. “Whenever a rental property comes on the market, you send out a video that analyzes its potential. I love those, even if I don’t completely understand everything you’re talking about. I particularly like the spreadsheet you use to crunch the numbers.”

“That’s no surprise,” Kim said.

“Would you be willing to record a YouTube video that explains your rental property spreadsheet?” I asked. “I could play with that spreadsheet myself while I take Paula’s course at the same time.”

“You bet!” Michael said. “I’ll record a video for you next week.” And that’s just what he did. Here’s Michael explaining the spreadsheet he uses to screen potential rental properties.

Your First Rental Property

I recently read Todd Tresidder’s How Much Money Do I Need to Retire? I may write a full review of the book at some point. The key thing to understand at the moment, though, is that Todd thinks that it’s somewhat risky to use the four-percent rule as a gauge for financial freedom. He makes a compelling argument that it’s much safer to define financial independence the way Vicki Robin does in Your Money or Your Life: that point at which your passive income exceeds your expenses.

While my recent move to Corvallis has led me to once again become financially independent when defined in terms of the four-percent rule, I am not financially independent based on cash flow. My expenses exceed my passive income. I’d like to change that. And I think rental properties could be a part of a strategy for doing so.

Your First Rental Property

This morning, I signed up for Your First Rental Property, Paula Pant’s real-estate course. Reading the sales copy on the landing page was entertaining. I generally hate sales pages, but it was as if Paula had written this one with me in mind. It sounds as if the course is perfect for my needs.

It helps, I think, that I know Paula personally. Over the years, she and I have talked a lot about her various real-estate adventures. I’ve watched her slowly build her rental portfolio. Plus, I know that she’s both smart and trustworthy. If I’m going to pay anyone for a real-estate course, it’s Paula.

I also like and trust Chad Carson. Coach Carson’s real-estate courses would be a good option too, and I may actually look at them for myself in the future.

Here’s the thing. I get a lot of requests to promote books and courses and events here at Get Rich Slowly. I nearly always decline. I’ve never wanted this to be a platform for promoting products. I want GRS to be a platform for education.

That said, I do enjoy sharing books and events that I believe you folks will find valuable. That’s why I’m keen on Ramit Sethi’s I Will Teach You to Be Rich. That’s why I’ve been personally involved in this year’s EconoMe Conference, and why I’m urging others to join us in Cincinnati next month. Some of this stuff is terrific and ought to be shared.

Obviously, I cannot yet vouch for the quality of Your First Rental Property, but I did just plunk down my own money to purchase it. (“Did you mean to buy the course?” Paula’s assistant emailed me. “Yes,” I said. “I want to take it.”) I’m going to ask Kim if she wants to work through the course together. I think it’d be fun to do as a couple!

And who knows? Maybe in a few years we’ll have acquired some rental properties of our own…

Your First Rental Property, like many online courses, has a limited window of availability. (I think Paula offers it only once per year.) Sales for this cohort end October 14th. Get Rich Slowly earns a commission on each sale through our site.

from Get Rich Slowly

We offered to buy a home for $128,000 over list — but it wasn’t enough!

Sunday evening, Kim and I made an offer on a house. The Greenwood Place (as we’ll call it) was listed at $649,000. We offered $677,777 escalating to $777,7777; no repairs required; and a $50,000 appraisal gap waiver.

Our offer was not accepted.

The Greenwood Place

That’s right: Two months after selling our home — and three months after beginning to search for the next place — Kim and I have waded back into this crazy housing market. We’re not sure how long this process will last (or what the outcome will be) but we’re prepared to be searching for many weeks, if not months.

Both our mortgage broker (Michael S.) and our real-estate agent (Michael K.) tell us we’re doing things exactly right for this market.

  • Kim and I both have credit scores over 800. “Everything looks unbelievably perfect here,” Michael S. told us in June. “That’s amazing. Perfect credit.”
  • We’ve sold our previous house and are currently renting a place while we search for another. This allows us to make offers without home sale contingencies.
  • We’re willing to take calculated risks to increase the strength of our offers, but we’re not willing to compromise our financial health in doing so. “You can borrow $850,000 all day long,” Michael S. told us. “You’d probably have zero difficulty qualifying for $1 million.” We don’t want to borrow a million dollars though because doing so would severely compromise our other goals.

All the same, there aren’t many homes on the market right now. Demand far outpaces supply, which is driving prices up and creating insanely competitive situations. It doesn’t matter whether we’re doing everything right. We’re still going to get outbid by more than $128,000 on homes listed at $649,000.

Our plan? Be patient. Remain vigilant. We don’t need to buy a home at the moment — and, in fact, perhaps it would be best if we didn’t — but we want to be prepared to pounce if/when we find the right place.

Today, I want to share a bit of our thought process as we attempt to buy a home in 2021.

Where We’re Starting From

Currently, Kim and I are paying $2300 to rent a 1000-square-foot home in a nice, walkable neighborhood on the south side of Portland. We like it. (True story: Two days ago as I was walking the dog, a neighbor stopped me. “Is your name J.D.?” he asked. “I’ve been watching your YouTube videos!” First time somebody has recognized me from my tiny YouTube channel haha.)

This $2300/month rent payment is comfortable for both of us. Kim doesn’t have the extensive retirement savings that I do, but she’s in good shape compared to most people. She can afford $1150 per month for housing. And while she (and I) would love to have a lower housing payment, she’s willing to go as high as $1200 per month.

Our current housing situation leaves me swimming in money. That’s the way it feels, anyhow.

You see, one of the reasons I wanted to move was because I’d managed to cripple my monthly cash flow. I had too much invested in our house. I owned it outright. One-third of my net worth was locked into the home and couldn’t be used for other things — such as buying food.

When we owned the home on Wisteria, my monthly housing expenses were $377 for taxes and insurance. (Kim had no housing expenses. The home was mine.) Based on my non-retirement investments and savings, I had a monthly budget of $2059 to get me to age 59-1/2 (at which time I could access retirement accounts). That $2059/month budget was far below my actual spending, which averaged about $4200/month.

By selling the home and moving into this rental, an amazing thing happened. Even though my monthly housing expenses jumped from $377 to $1150, my free monthly cash flow increased from $2059 to $7588 — all because I now have a pile of cash in my bank account.

My monthly budget at Wisteria and here

This improved cash flow is 100% because we I no longer have $500,000+ locked up on home equity. It’s in my bank account. Yes, some of it will soon be in home equity once again (we hope) because we’ll use it for a down payment on the next place. But I’ll retain a sizable chunk of that to bridge the gap between today and 25 September 2028, when I turn 59-1/2.

So, today I feel like I’m swimming in money. Instead of running a $2100 monthly budget deficit, I have a $2300 surplus. I am, once again, financially independent.

This is our starting point. As we hunt for homes, I maintain a running spreadsheet that (among other things) tracks my projected monthly budget for each home. In fact, this monthly budget is my number-one consideration in purchasing a home.

Selecting a City

I am fifty-two years old. In the past thirty years, I’ve purchased four homes — and I’m about to buy a fifth. My homebuying habits are almost perfectly aligned with the American average. Homeowners tend to stay in one place for about seven or eight years, on average.

In other ways too, my homebuying habits have been typical. If I’m not careful, for instance, I can get wrapped up in the emotional side of the process.

When my ex-wife and I bought our hundred-year-old farmhouse in 2004, I was 100% motivated by emotion. There was nothing logical about the decision. When Kim and I purchased our most recent home in 2017, we allowed emotion to over-ride logic to our detriment.

This time around, I’m trying to be logical and deliberate. After four years in a house that proved problematic, and in the midst of a housing market that seems to have gone mad, I want to make a smart decision.

So, my full-time “job” for the past couple of months has been house-hunting. I’m not saying that my process is perfect (nor applicable to everyone) but it’s a hell of a lot more logical than any of my past home purchases.

To begin with, Kim and I spent twelve full days during the last three months driving all over western Oregon and western Washington in search of a place to live. We love Portland — despite what some media outlets would have you believe, it has not become a wretched hive of scum and villainy — but the place has grown too big for us. Both of us grew up in small towns. We want a slower-paced lifestyle without all of the chaos of a big city.

While there are several cities that appeal to us, ultimately we’ve decided to move to Corvallis. Corvallis is a town of roughly 60,000 at the base of Oregon’s coastal mountain range. It’s an hour from the Pacific but still very much of the Willamette Valley, the agricultural region where I grew up. It’s home to Oregon State University. It’s the #1 biking town in the state (even ahead of Portland!) and has just enough stuff to do to keep us happy.

After we decided on Corvallis, we made an effort to spend some time there. We’d pack up the dog on Saturday mornings, drive ninety minutes south, then spend a few hours exploring the city. We liked it — a lot. Even so, we were having a tough time getting a feel for the neighborhoods.

Enter our real-estate agent, Michael K. One day it occurred to me that maybe I could “outsource” learning Corvallis neighborhoods. Searching YouTube, I stumbled upon this video of a Realtor narrating a driving tour of the town.

This helped us both so much that we contacted the narrator to ask if he’d take us on as clients. He agreed. For the past two weeks now, we’ve been working together to find a suitable location.

Crunching the Numbers

As you’ve probably heard, there aren’t many houses for sale right now. I don’t have the exact figures, but my memory tells me that the U.S. housing inventory is about half what it typically is. That means pickings are slim. And when you’re searching for a place in a smaller city like Corvallis, pickings are even slimmer.

Still, there are maybe a dozen new listings each week that meet our criteria. Michael K. has set us up with an automated tool that emails us when homes come on the market that match what we’re looking for. Plus, I spend hours each day on Zillow looking at the other homes that come up for sale — just in case, you know?

What sort of filter are we using? Well, we’ve set an upper limit of $800,000 — remember that our mortgage broker told us we could borrow $850,000 “all day long” — and we’re looking for places larger than 1500 square feet on at least one-tenth of an acre. Like I said, I use Zillow to find possible fits that slip through this net.

Of the homes that come to market and make it through our filter, maybe half of them are places we’re actually interested in: the price is acceptable, the house and yard look well-suited for our lifestyle, and so on.

I put all of these matches into a spreadsheet that looks something like this [click for larger view]:

My househunting spreadsheet

As you can see, my spreadsheet only tracks a handful of stats, but those are the stats that are most important to me. I don’t track bedrooms and bathrooms, for instance, because our filter already screens for these. (Plus, I figure square footage is a reasonable proxy for beds and baths.)

Here are the variables that matter most to me when hunting for a house:

  • Price, of course. But price isn’t the only financial consideration, nor the most important. I don’t want to overpay for a place, of course, but I look at the down payment (and eventual equity) as a transfer of assets. I’m not spending $300,000 if I buy a $300,000 house. I’m simply transferring money from cash to real estate. (The money lost to interest, however, is indeed an expense.)
  • Size of the home. Again, this serves as a proxy for other things, such as the number of bedrooms and bathrooms.
  • Lot size. Kim and I like a large yard. We recognize, however, that we’re not going to find an acre of land in the middle of a city. Still, it’s nice to have this number handy.
  • Year the home was built. I want to know when a home was built for a variety of reasons. The building date can give me a rough idea of possible maintenance concerns. Plus, it’s also a good guide for the style and layout of the house.
  • I have three columns of numbers related to the monthly cost of the house. The “Each” column is most important to Kim. This shows her share of the housing payment each month. The “J.D. budget” column is most important to me. The “J.D. budget” number assumes that I’m using my savings to make a 50% down payment, then calculates what my monthly budget would be after my share of the housing payment. (Remember: this number is $7588 in our current rental and it was $2059 at our last house.)
  • Walk Score. I like a walkable neighborhood. Walk Score isn’t perfect for my situation — I don’t care if I’m close to a school — but it’s close enough. My main concern is that I’m within an easy walk of a grocery store. This is a huge deal to me. Walking distance to a park would be good too.
  • Location. In which neighborhood is the house located?
  • Notes. This is a catch-all for info like apparent condition of the home, HOA fees, and so on.

In practice, the most important item in the spreadsheet is the “J.D. budget” column. No joke: I tend to remember all of the other details about the various houses. Given my notoriously poor memory, this is something of a shock.

As you can see, I’ve color-coded everything too. I’m using good ol’ ROYGBIV, with red being the “bad” end of the spectrum and violet being the “good” end. This allows me to glance at the spreadsheet and know, say, that the Grant Circle house gives me an amazing budget but the Clarence house would put me in almost the same financial predicament as the home we just sold. (That Grant Circle house looks perfect on paper, doesn’t it? It’s not. It’s a rental that’s seen some tough love in the past.)

A few other quick notes: Homes listed in bold are homes we’ve viewed in person. Shaded lines represent homes that are under contract, so are no longer available. And that one green line? Well, that’s the home we made an offer on.

Making an Offer

As you can see, Kim and I have viewed eleven homes. A couple of these seemed fine in photos but were not good matches in person. Most were average. But one — the Greenwood house — was amazing. it was an almost perfect fit. (Why almost perfect? First of all, price. Second, walkability was marginal.)

We toured the Greenwood house on Saturday afternoon. We loved it. As we drove around Corvallis the rest of the day, we discussed whether or not we should make an offer. “I think it’s going to be out of our price range,” I said. “It’s not going to sell for $649,000. You heard Michael. He called it an ‘atomic potato’. He thinks it’ll go for much, much more.”

“I know,” Kim said. “But don’t you think we’d regret it if we didn’t at least try to make an offer?”

“Yes,” I said. “We’d regret it very much.”

That evening, we met with Michael to go over paperwork. Then I spent most of Sunday running the numbers through other spreadsheets. (What? You thought I had only one?!?)

While I have my personal spreadsheet for tracking properties, the spreadsheet that actually matters most is the one from Michael S., our mortgage broker. This file allows us to make projections using actual numbers such as down payment, property taxes, and current interest rates.

If we alter any one of the variables in the mortgage worksheet, we alter our projected financial obligations. As you can imagine, this can lead to many, many permutations of monthly payments and down payments.

Our mortgage spreadsheet

Generally speaking, Kim and I are planning to do the following: I will make a 50% down payment from the cash I have on hand after selling our last place. She and I will then split the monthly mortgage payment 50/50. This should work for 95% of scenarios we’re exploring.

In order for us to make an offer on Greenwood, however, we had to break away from our standard plan. Our default assumptions would lead me to making a $325,000 down payment on the $649,000 list price, then my monthly budget would be $3803. But we knew that Greenwood wasn’t going to sell for $649,000. It’d sell for something more. (Probably much more.)

Ultimately, we figured we had to offer at least $100,000 over asking. Fortunately, the sellers were allowing escalation clauses, which meant we could offer $750,000+ without risking that we’d overbid anyone else by, say, $30,000.

After much internal debate (and even some external discussion with Kim), I decided I’d be willing to buy this house if I could keep my projected budget at about $3800 per month. This is close enough to my current spending that I felt okay with it. Worst case, I’d find a part-time job to cover the gap, right?

By Sunday evening, I’d come up with an offer amount: $777,7777 with a $250,000 down payment. This would give me my $3800/month budget assuming Kim was willing to pay $1200 per month toward housing (which she was). With at 50% down payment? Well, then my budget would be $900 lower each month. Still better than at the house we just sold, but less than what I want.

Why a goofy number like $777,7777? For fun. I’m not joking. Real-estate transactions are deadly dull affairs. I think it’s fun to spice them up with numbers like this. (Plus, we thought it might send a positive signal to the sellers.)

When I bought my condo on the river in 2013, I deliberately offered 4.01% over asking price because it was unit #401. The selling agent later confided that the owners had noticed the number and that it played a small but important role in their decision to sell to me.

The offer we submitted on Sunday night looked like this:

  • We offered a $677,000 starting price — $28,000 over asking. But our offer escalated in increments of $7,777 up to a top price of $777,777. We were offering to beat other offers by $7,777 up to our limit.
  • We agreed to “no repairs”. We’d still perform an inspection, which would allow us to bow out of the deal if we found something catastrophic, but we wouldn’t ask the seller to do any repairs.
  • We included a $50,000 appraisal gap waver. If our offer was accepted at $760,000 but the home appraised at $720,000, I would make up that $40,000 difference with my cash reserves.

The next 36 hours were painful for Kim. She had become emotionally invested in the house. While I was hoping we would win the bidding war — our agent himself wrote two other offers for the house! — I was surprisingly cool and collected about the whole thing.

Moving Forward

Michael K. called on Tuesday morning. He didn’t beat around the bush. “Your offer wasn’t accepted,” he said without preamble (which I appreciated). “I’m a little surprised. You wrote a strong offer.”

Right now, we don’t know how many offers Greenwood received and we don’t know the amount of the winning bid. We won’t know that until the place closes in a few weeks. But we’re dying to know how much more we needed to offer in order to buy the place.

Ultimately, however, we have no regrets. We know that we made the highest offer we possibly could. There was nothing more that we could have done without compromising our other financial goals. We’re at peace with this outcome.

Now, though, it’s back to househunting. We’ve already lined up a couple of home tours for tomorrow afternoon. The places look promising — and one of them is much cheaper than the Greenwood place! I reamin hopeful that we’ll find a nice home in Corvallis with a walkable neighborhood, a yard for our animals, and space for Kim to do yoga and gardening.

Still, a part of me knows we’ve only been at this for two weeks. The folks who bought our house in May had been shopping for ten months. The market is crazy right now, with far more buyers than sellers.

Who knows? Maybe I’ll be writing offer recaps through the winter and into next summer. But I sure hope not!

from Get Rich Slowly

Series I savings bonds: A safe investment with a high return

I get a lot of questions about money. These questions tend to vary based on the asker and her needs, but there’s one question I get more often than any other: “What’s a safe investment with a high return?”

For the past decade or so, I’ve had no answer to this question. Savings accounts and certificates of deposit are safe, sure, but they’re no longer attractive investments. Since the Great Recession of 2008/2009, interest rates have remained shockingly low. This is by design. The government doesn’t want you parking your money in a savings account. They want that money out circulating in the economy.

Over the long term, the stock market offers excellent returns. But when people are asking for “safe” investments, they’re wanting avoid short-term volatility, which means stocks are out of the question. (And stuff like Bitcoin and precious metals are even more out of the question!)

Today, however, while catching up on my blog reading, I stumbled upon a link from Michael Kitces’ weekly roundup for financial planners. The story he shared blew my mind. Writing in The Wall Street Journal, Jason Zweig explains the safe, high-return trade hiding in plain sight. (This article is behind a paywall.) That safe, high-return trade? U.S. government Series I savings bonds.

These inflation-adjusted bonds are currently yielding 3.54% annually!

Zweig writes:

Economists say there’s no such thing as a free lunch, but I bonds offer a guarantee from the U.S. government that you can recover your original capital plus any increases in the official cost of living along the way. The only catch is that this isn’t an all-you-can-eat buffet: The maximum purchase is $10,000 per year per account holder (unless you elect to take your tax refund in the form of an I bond).

Ironically, the less you earn and have to invest, the more powerful a tool I bonds are.

Because I was unfamiliar with I Bonds, I spent a couple of hours reading about them today. I think I’m going to begin adding them to my investment portfolio. You might like to also. Let me share what I’ve learned.

The Basics of I Bonds

Series I savings bonds (or simply “I Bonds”) are inflation-indexed bonds with a variable interest rate. That variable rate comprises two components.

  • A fixed rate. On the first business day in May and the first business day in November, the U.S. Treasury adjusts this fixed rate for new bonds. But once you purchase a Series I bond, this fixed rate never changes. If the fixed portion of your I Bond is 2.10% when you purchase it, it’ll remain 2.10% for thirty years (or until you sell it).
  • A variable rate indexed to inflation. This rate also adjusts at the beginning of May and November. It’s based on changes to the Consumer Price Index. Currently, the “semiannual inflation rate” (as it’s officially known) is 1.77%, which translates into a 3.54% annual rate.

The fixed rate and variable rate components are added together to generate the current composite interest rate. Because inflation can go negative (a.k.a. deflation), the variable rate can also go negative. When that happens, the current yield on your I Bonds can fall below the fixed rate. However, interest on these bonds can never yield below zero. They can never lose value.

Interest compounds every six months. I Bonds are exempt from state and local taxes, but they’re subject to federal income tax when they’re redeemed.

Does that all sound complicated? It’s not, really.

When you buy a Series I bond, you lock in your fixed rate. Then, every six months, the variable rate adjusts based on inflation.

Currently, the fixed rate on Series I savings bonds is zero percent. In fact, the fixed rate has remained below one percent on all Series I bonds issued since May 2008. Why then would you consider adding them to your portfolio? Because despite the low fixed rate, these things still out-earn savings accounts and certificates of deposit.

Now, having said that, cash you put into these bonds is a lot less liquid than the money you put into the bank.

  • You must hold the bond for at least one year. You absolutely cannot redeem a Series I bond until it is twelve months old.
  • You can redeem the bond after one year. But if you haven’t held the bond for at least five years, you lose the most recent three months of accrued interest.

There are a couple of other drawbacks you need to know about. First, you can only buy I Bonds electronically from Treasury Direct. (This is an official U.S. government site, so it’s safe. Or should be.) Second, you’re only allowed to purchase $10,000 of I bonds each year.

Did I say “only”? I lied. Sort of. You’re also allowed to purchase I Bonds with your income tax refund. Doing so allows you to acquire up to $5000 more in I Bonds each year. And bonds purchased this way are paper bonds, not electronic.

There are other minor things you might want to know about these investment vehicles. If you’d like more info, check out the official Series I Savings Bond FAQ. (And you might also like this table comparing I Bonds to TIPS, Treasury inflation-protected securities.)

I Bonds by the Numbers

Because I’m a money nerd — and because I was curious — I created a spreadsheet that documents historical Series I bond yields since they were released in September 1998. (This is based on the official table from Treasury Direct, but I’ve made it prettier and easy to update in the future.)

This is a wide spreadsheet, so it’ll be unreadable here on this screen. You’ll want to open the image in a new tab. (Clicking on the image should do that for you.) Even then, you may need to manually re-adjust the image size to be able to read it.

Historical I Bond returns

Here’s how to read this spreadsheet.

  • Each row tracks the interest rate on Series I bonds issued for dates in that range. For example, the “05/08 – 10/08” row tracks how the interest rate has changed on bonds issued between May and October of 2008. The first number in each row (the “fixed rate” in the green column) shows the permanent fixed rate for the bonds issued during that time period. For the “05/08 – 10/08” bonds, that fixed rate was 0.00%.
  • Each column tracks semi-annual changes to interest rates. The Treasury adjusts rates on (or soon after) May 1st and November 1st. The top line of each column shows the official inflation rate used to calculate total bond yields. So, you can see that the “May-08” column indicates that the semi-annual inflation rate was 2.42% (meaning annual inflation was 4.84%), and the rest of the column shows effective rates for various bonds.
  • I’ve also tried to compile historical data on average certificate of deposit rates. I haven’t found a source I trust and love for this info, though, so am open to recommendations. (I’d also like to find a source for historical savings account data. I’ve been searching for years and have never found anything I like.)

Looking at this spreadsheet, you can see that I Bonds don’t always outperform five-year certificates of deposit — but they usually do. And there have been a couple of occasions when even a one-year CD has offered a better yield for a few months.

The Bottom Line

I have never purchased a savings bond. That’s about to change.

I like the idea of using I Bonds as a vehicle for medium-term investing — saving for a house, saving for college education, etc. If your time horizon is longer than five years but shorter than, say, fifteen years, these are an attractive option, especially if it’s money you cannot afford to lose. Right now, I like them better than a savings account or CD!

For longer time horizons, and for money with which you can take greater risk, you’re better off investing in index funds. Series I bonds won’t earn as much as stocks over the long run. Not based on historical averages, anyhow. But that’s not the point. These bonds aren’t meant for growing your nest egg. They’re meant to keep your nest egg safe.

Even if these don’t appeal to you now, you should keep an eye on Series I bonds to see where their fixed rates go. If they creep up to the three-percent range (as they did 20+ years ago), they’re a terrific deal.

from Get Rich Slowly

We sold our house!

June has arrived and it’s glorious! The sunshine and warmer weather make living in Oregon wonderful this time of year. October is better, but June is a damn fine month here in Portland: wild roses, blackberry blossoms, and strawberries; birds, squirrels, and bicyclists; outdoor dining, evening strolls, and morning coffee on the porch.

I’ve been in a great mood for the past week, and it’s not just because of the weather. It’s also because, after three months of hard work, Kim and I have sold our country cottage. We’re not sure what the future holds, but for now we’re renting a small place in the Lake Grove neighborhood. It’s fun!

And now that all of that work is finished, I can turn my attention to other things — such as writing about money. To kick things off, here’s the story of what I’ve been up to for the past few months, of how we sold our house in this crazy real-estate market.

Background Information

When we bought our house in June 2017, I paid $442,000. The previous owners had listed the place at $450,000, but our home inspection revealed a lot of issues, so we asked for concessions. They weren’t willing to move much, dropping the price only $8000. We bought it anyhow.

During the next three years, we did our best to address (nearly) every problem from the inspection report. I spent $157,000 on repairs and upgrades — far more than the $8000 in concessions that the sellers had granted us. Thus, my “cost basis” for the house was $599,000 (and Kim spent an additional $14,000 on the place).

In prepping our home for market, Kim, Andi (our real-estate agent), and I had some long talks about pricing. Andi called our place a “quirky”. She said it was a “unicorn” with very few comparable properties from which to gauge pricing. I realized that even though I’d spent $157,000 on remodeling, I was unlikely to recoup the bulk of that. I thought we should list the place at $550,000. Andi and Kim thought $550,000 was too low.

Ultimately, our listing went live at $580,000 on the evening of Thursday, April 15th.

Three Offers

By noon the next day, we had an offer: $595,000 with the home in AS-IS condition. The catch? The offer expired within 24 hours.

“I think we should take it,” I said.

“No,” said Kim. Andi said the same thing.

“The buyer is trying to prevent you from holding the open house this weekend,” Andi said. “I know it seems tempting, but I think you’ll get additional offers — for more money! — if you let the open house proceed.”

So, that’s what we did.

Kim and I spent Saturday and Sunday driving around northwest Oregon, exploring all of the small towns. We tried to picture ourselves living in each place we visited. Some, we could. Others, we couldn’t. Meanwhile, strangers streamed through our home.

“What’s the news?” we asked Andi on Sunday night.

“Well, feedback is about what we expected,” she said. “People think this is a quirky house. But they also love the yard. I think you’ll have two or three offers by tomorrow evening.”

Sure enough. By Monday at five, we had two offers, both with escalation clauses. (Plus, the first offer asked us to keep him in the loop.) One offer topped out at $620,000. The other topped out at $621,000 (and would have gone as high as $628,500). After some debate, we decided to accept the offer for $620,000.

Then the waiting, uncertainty, and stress kicked into high gear.


When we bought our house, the inspection report had been pretty bad. It almost scared us off — but not quite. We decided we were willing to take on the house as a project. We bought it with the knowledge that there’d be a lot of work to do. We were okay with that. What we weren’t okay with was the fact that the previous owners had clearly tried to hide some problems from us — problems the inspection report failed to find.

As a result, we vowed to take the opposite approach when selling the house. We tried our best to share everything we knew, both the good stuff and the bad. (That includes sharing all of my blog posts and videos on the subject!) Yes, all home-sellers are required to make mandatory disclosures. We did that, but we tried to share more too.

We were pleased to see that the buyers were even more thorough about inspections than we had been. Their well inspection was more comprehensive than ours had been. Their septic inspection was more detailed than ours was. And while we were not present during the actual home inspection — and we never saw a copy of the final report — we were told that the inspector found several other issues that we had been completely unaware of.

“There’s more rot under the house,” Andi said. “It’s not just under the bathroom. There’s rot under another wall. Plus, the inspector feels that your new carport is causing structural issues. It needs to come down.”

“Wow,” I said, my stomach sinking. “I had no idea.” We’d spent a lot of money to build that carport. It had never occurred to me that it might actually be damaging the house itself.

The buyers’ inspections took place during the last week of April. Their inspection deadline was May 4th (Star Wars day!) but because they found so many issues, they asked for an extension to May 7th so that they could have contractors assess the work they’d need to do.

All of this made sense, obviously, and the rational part of me was pleased that the buyers were being so diligent. If they proceeded with the sale, they’d know what they were taking on. But the irrational part of me — the emotional side — was a nervous wreck. It was eighteen days from the time we accepted their offer until the inspection deadline expired. That’a a lot of waiting and a lot of uncertainty! I’m not good with uncertainty.

The Decision

The day before the inspection deadline ended, we received the buyers’ revised purchase agreement. Based on all of the problems they’d uncovered, they were dropping their offer from $620,000 to $580,000 and they wanted us to cover $13,000 of their closing costs. Their net offer was $567,000.

“They’re asking for $53,000 in concessions,” Andi said. “That’s a lot. You’ll have to decide if it’s too much for you. Remember, the backup offer is still good at $621,000. They’re still interested. But I want you to consider this. At this point, these buyers know more about your house than you do and they still want to buy it. That’s good news.”

We agreed. It was good news. But we also agreed that $53,000 was a lot to give up. Kim and I spent the evening sipping beer at a local pub, trying to decide what to do. Accept the offer in hand? Go to the backup buyer? Something else?

“Here’s the thing,” I said after we’d talked it out for the billionth time. “I originally thought we should ask $550,000. $567,000 is still more than that. And after I heard how lousy the inspection was, I’d decided I could take $565,000. That’s almost exactly what they’re offering now. I know we put a lot of work into this house, and I know that you love it here, but I think we should go through with it.”

“You don’t even want to counter?” Kim asked.

“No,” I said. “I want the buyers to be happy with this deal. I want them to have room to make the repairs they need. We weren’t able to get everything done that we wanted to. Maybe they can.”

In the end, we agreed to the buyers’ terms. It felt like the right thing to do. And we truly do hope that this allows them to finish making repairs on the house so that it’s in great shape for years to come.

Renting Like College Kids

While the process of selling the house caused me consternation, Kim was completely unfazed. “You’re worrying about nothing,” she told me several times. What worried her was finding a temporary place to rent. She was afraid we’d be unable to find a place that’d take all four of our beasts.

I’ll admit: My initial research had me worried too. There were lots of places that would rent to you if you had a dog or two cats, but none of the listings I saw allowed three cats and a pup.

Fortunately, Kim managed to find one listing that seemed perfect: a small (1000-square-foot) home on about a quarter acre in the middle of the city! We visited the place at the end of March, but that was well before we knew what our future held. We weren’t ready to commit. When we re-contacted the landlord at the end of April, she had good news. The place was still available, if we wanted it. We wanted it.

Despite agreeing to terms with the buyers, I still felt stressed about selling the house. In fact, I was so stressed that on Sunday, May 9th, Kim ordered me out. I’m not joking. “I think we’d both be happier if you spent the night over at the rental,” she said. So I did. In fact, I moved over and never moved back.

For one week, Kim and I lived semi-separate lives. She stayed at the house we were selling; I stayed at the rental, spending my nights on the floor in a sleeping bag. During the days, she continued with her normal life. I began to slowly move our stuff to the new place. We ate dinner together, but that was it.

Then, on the weekend of May 15th, Kim and I recruited a friend to help us move all of the big stuff out of the house and over to the rental (and/or storage). Once we had things mostly arranged, we brought the animals over to their new home. They hated it at first, but they love it now.

For the past two weeks, Kim and I have felt like we’re college kids. It’s weird. This house feels like the sort of place where we might have lived when we were in school. Plus, we both know it’s a temporary stop. It’s a transitional home while we decide where we want to live long-term.

But you know what? We like it. Sure, the place is small but it’s homey. The animals have found their groove. The neighbors are nice. We’re once again within walking distance of everything. And it’s liberating to not be responsible for anything.

This very moment, for instance, a repairman is here to fix a leak in the fridge. I told our landlord we had an issue, and she took care of everything else. (“Holy shit,” the repairman said when he got here. “I haven’t seen a model like this in a decade. Maybe longer. This fridge is from the 1960s.”)

And did I mention we have peacocks? For whatever reason, a flock of 30+ peacocks roams this neighborhood. They’ve been here for decades. Our next-door neighbor has lived here for thirty years. She says the peacocks had been around for more than twenty years when she moved in, so they’ve probably been here for fifty years or more. It’s fun. (And very, very noisy. “Kee-yah! Kee-yah! Kee-yah!”)

Next Steps

Despite my fretting and fussing, the sale of our home mostly went by the numbers. The deal closed last Monday, and the proceeds hit my account on Tuesday. Last Friday at noon, we turned the keys over to the buyers. We are no longer homeowners.

Now it’s time to figure out what comes next.

Kim and I still think we want to move to a small town, probably in Oregon or Washington, probably near the water. But more and more, we’re not sure. After three weeks of living in a walkable neighborhood again, I’m reminded of just how much I love this lifestyle. I’m energized and happy when I can walk to accomplish nearly all of my errands. It brings me joy.

“What we really need,” Kim said the other day, “is a newer home in a small town with a large lot that’s still within walking distance of grocery stores and restaurants. Is that too much to ask?” We both laughed because we know that it is too much to ask.

“What we need,” I said, “is to buy Lorelai’s house in Stars Hollow.”

“Yes,” Kim said. She knew exactly what I meant.

While there’s no doubt that I’ve been browsing Zillow obsessively, it’s more to get a feel for what’s out there than with any kind of seriousness. Kim and I need to get some clarity about where we want to live and what we need/want in a home before we begin searching in earnest.

Our first step, I think, is to research a possible mortgage. I’ve purchased my last two homes with cash. I don’t want to do that this time, if we can help it. I want to use leverage, and I want to take advantage of low interest rates. To that end, I’ll be contacting mortgage brokers later this week. We’ll see what sort of home we can actually afford.

And, of course, now that all of the chaos is over, I can resume other aspects of my daily life — such as writing here at Get Rich Slowly. Yay!

For the numbers nerds, here are some final stats.

I paid $442,000 for the house in June 2017. Quicken says that I spent $157,000 on upgrades during the four years we owned it, for a “cost basis” of $599,000.

We sold the house for $580,000 less $13,000 in closing costs, for a net of $567,000. After fees, etc., I received $534,000. From that, I gave Kim back the $14,000 that she had put into the house. So, my net proceeds were $520,000.

That’s a loss of $79,000, which makes me sad.

But look at this math! If we had stayed in the condo in Portland, we’d have continued to pay about $600/month in HOA fees. That’s roughly $29,000 over the past four years. Plus, the entire complex was hit with a special assessment for plumbing repairs. That would have cost us $50,000. Holy cats! So, that’s $79,000 we’d have lost if we’d stayed.

Weird, huh?

And one final way to look at things: If you divide that $79,000 loss by 47 months, you get $1680. One way to look at it is that I just spent $1680/month to rent a country cottage for a few years. That’s not so bad, is it?

from Get Rich Slowly

An uncertain future

On February 17th — in the middle of nine days without power due to an ice storm — we had the foundation contractor out to re-inspect our house. We experienced some settling last fall, and I was worried that might indicate deeper problems.

For thirty minutes, the contractor explored the crawlspace while I sat in the living room, fretting. When he finished, he came up to tell me what he’d found.

“Look,” he said, “my assessment is the same as when you had me out here three years ago. Your foundation is fine. It’s not failing. The house isn’t falling down.”

I felt a wave of relief wash over me.

“That said,” he continued, “I do think you’d feel better if you were to reinforce one section of the foundation. It looks to me as if you’re seeing some minor expansion and contraction of the soil, which is what’s causing your settling issues. It’d cost about $9000 to remedy that.”

Plan for reinforcing foundation

That evening as Kim and I huddled in our powerless living room, bundled in coats and jackets and using flashlights to read, I made a confession.

“I want to move,” I said. “I know we both love this house and this yard, but it’s taking a toll on my mental health.”

“I know,” Kim said. “I know you’ve been struggling. Ever since we moved in, I’ve seen how you’ve grown increasingly depressed and anxious. I’ll do whatever it takes to make you happy, but I think maybe you should give up on your dream of owning an old house.”

She’s right. I love old houses but my personality isn’t suited for them. They stress me out. (My ex-wife and I owned an old house too — she still lives there — and it caused me endless stress, as well.)

For the next couple of weeks, Kim and I spent many hours discussing our best course of action. Then, one month ago today, we made a decision: We would sell the house as soon as possible (to take advantage of the crazy Portland real-estate market), then rent a place for a while as we made a careful, calculated decision about where to live next.

Springing into Action

March was a crazy flurry of activity. From the moment we decided to sell, Kim and I have been working almost non-stop to get the house ready for market.

  • We’ve performed nearly all of the repairs that we know need to be done. We have a couple more scheduled. (And we’re deferring the foundation reinforcement. We’ll disclose that inspection and estimate to the buyers and let them make the decision.)
  • We rented a storage unit and have been methodically packing our unnecessary stuff and moving it over. Plus, I moved out of my rented office space, putting all of those things into storage too.
  • As we pack, we’re trying to do a deep clean on every corner of the house: scrubbing walls, washing windows, wiping out cupboards, and so on.
  • We’re also cleaning the yard. During our four years at this country cottage, we’ve collected a variety of stuff — spare lumber, old fenceboards, unearthed stones — that we’ve stacked in various piles. We’re clearing out those piles.

Honestly, the house looks better now than at any point during which we’ve owned it.

While we prep, we’re torn. We do love this house and yard. The yard, especially, is almost perfect for us. But there’s absolutely no doubt that this home, for whatever reason, causes me mental anguish. I can’t live here.

In fact, I spent the entire first half of March in a deep, dark place. I was filled with anxiety as I ruminated over the house. Whenever it was possible to catastrophize, I catastrophized: “What if the house doesn’t sell? What if the contractors we call in find more things wrong? What if we can’t sell it for what we’ve put into it?”

I was a mess. And it was taking a toll on my relationship with Kim.

Finding Myself Again

Fortunately, the past two weeks have been better, and for a variety of reasons.

First, the contractors who’ve come out have not found more trouble with the house. In fact, they each say similar things: “Yes, this thing I’m fixing is a problem, but it’s not as bad as you think it is, and I don’t see anything else wrong.”

Second, I’ve been trying to practice mindfulness. As new fears surface, I acknowledge them and move on. “Oh yep, there I am stressing about the gutters again. But we’ve fixed the problem out front and the contractor said there’s nothing else wrong, so I’m just stressing over nothing.”

Related to this, I’ve been asking myself, “What’s the worst that could happen?” We bought this place for $442,000. We spent another $150,000 or so on repairs and remodeling. (I’ll have a precise number by the end of today.) Our cost basis for this place is thus about $600,000.

“The land itself is worth $300,000 easy,” I tell myself as I browse Zillow to see what other homes are selling for. “With the house, we should have no problem getting $442,000. And with all of the upgrades we’ve made, it should fetch $500,000. Maybe even $550,000. So, even if I do lose money on the house, I probably won’t lose much.” Basically, I do my best to talk myself out of the catastrophizing.

Finally — and perhaps most importantly — just over two weeks ago I began taking my ADHD meds.

When I was diagnosed with ADHD in 2012, my therapist and doctor prescribed Vyvanse, a mild stimulant. I took the stuff briefly, but stopped after a few days because I hated how it made me feel. While there’s no question that it settles my mind, the Vyvanse makes me physically tense. My mind calms, but my body coils like a spring for eight hours. So, I’ve only ever used the stuff occasionally, when I know I have to get stuff done.

Then, Kim and I read this article about ADHD from our friend, David Cain. “David’s article could be about you,” Kim said. She was right. Everything he wrote was as if it were coming from my own mind and my own experience.

At the same time, I read an article that described the connection between ADHD and depression/anxiety. Suddenly everything clicked. “Holy shit,” I thought. “What if my depression and anxiety are exacerbated – or even caused — by the ADHD?”

So, at Kim’s urging (and the urging of my business partner, Tom), I started taking my ADHD meds every day. I’ve been taking them every day for nearly three weeks now. And you know what? The depression and anxiety are (mostly) gone. I’m serious. No, I don’t like the side effects from the Vyvanse, but those side effects may be worth it when I consider the benefits.

I still notice various flaws with the house, but they no longer send me into a mental tailspin. Everything about my mind seems somehow calmer, more organized. My short-term memory has improved markedly. (Both Kim and Kris have long told me that I have a terrible short-term memory. I’m now seeing that this could be tied to the ADHD.)

Plus, as one might expect, the Vyvanse keeps me focused. I’m able to do work like a normal person! I wake in the morning, take my pill, drink my coffee, then I tackle my to-do list, one task at a time. I don’t jump all over the place, moving from one chore to another. I just pick one job and work on it until it’s finished.

As an example, I sat down to write this article about 45 minutes ago. I’ve written continuously without distraction for that entire period of time. More exciting (to me), I’ve written this piece linearly instead of bouncing all over the place from beginning to end to middle to end to beginning to middle to end. I started at the beginning, am now in the middle, and am approaching the end. Writing like this is revelatory!

An Uncertain Future

Our future is murky.

Right now, Kim and I have no idea where we’ll be living a month from now, let alone a year. But we’re okay with that.

If all goes according to plan, our home will be ready to list in about ten days. Like many other parts of the country, Portland has low housing inventory right now and homes are selling quickly — even quirky homes like ours. It’s very possible that the place will sell the first weekend that it’s on the market.

Once we’ve accepted an offer and the home has passed inspection, we’ll look for a place to rent. (This is the one thing that’s causing Kim stress, by the way. She’s worried we won’t find a place that will take all of our beasts: three cats and a dog.) While we rent, we’ll take our time looking for another place to live.

It’s possible we’ll stick around the Portland area, probably in a small town further away from the city. But it’s also possible that we’ll find ourselves settled on the southern Oregon coast. Or maybe somewhere in Washington. Or perhaps in Omaha. (I spend far too much browsing homes on Zillow. You can get smoking deals on nice homes in Omaha. Wouldn’t it be fun to live just a few blocks from Warren Buffett?)

An inexpensive house in Omaha

Yesterday, my friend Castle came out with her husband to haul away old fenceboards. (Castle and Jim are artists. They turn old fenceboards into cool crafts that they sell at Portland’s Saturday Market.) They told us about the place they bought a few years ago.

“We live about an hour north of Portland on the Washington side of the river,” Castle told us. “We have a few acres, which gives us a buffer between us and our neighbors. Plus, it gives us room for farming and gardening. We bought a manufactured home, but it’s awesome. It’s so nice and so much cheaper.”

Kim’s eyes lit up. “I love that idea. I could live in a manufactured home,” she said. Then she looked at me. “I don’t know if J.D. could do it, though. He grew up in one. He doesn’t have fond memories of it.”

I shrugged. At this point, I’m not ruling out anything. I grew up in a beat-up mobile home, it’s true, and I’ve long felt like it was a stamp of just how poor we were.

Since then, though, I’ve lived in a standard ranch house. Twice, I’ve lived in quirky old homes with large yards. I spent fifteen months on the road in a motorhome. And for four years, I owned a penthouse condo overlooking the river. I’ve come to realize that a house is just a house. Right now, I feel like I could live almost anywhere — just not here.

from Get Rich Slowly

My life philosophy: 52 lessons from 52 years

Now we are 52And now we are 52…

On this day in 1969, baby J.D. entered the world. I don’t think there’s any way my parents could have predicted the path their firstborn would take through life. It hasn’t always been easy — no thanks to the obstacles I’ve placed in my own way — but I’ve really had a wonderful (and interesting) life, and I look forward to whatever time is left me.

As I do every year here at Get Rich Slowly, I’m going to commemorate my birthday by sharing some of the most important things I’ve learned during my time on Earth. These are the most important pieces of my life philosophy.

Let’s start with a look at the core takeaway from my 52nd year, the newest addition to my life philosophy.

What I Learned During My 52nd Year

This past year, especially, has been an interesting one. I know that’s true for the world as a whole, but I personally have experienced a great deal of growth over the last twelve months. It’s been a deeply introspective year.

If you were following along, you could see me process some of this introspection in real time, both here on the blog and at the Get Rich Slowly channel on YouTube.

In July, I wrote that I am the one thing in life I can control. In August, I wrote about eliminating net negatives (or trying to). In October, I wrote about the pursuit of quality. And just a few weeks ago, I wrote about the power of low expectations.

What I’ve realized in recent weeks is that all of these Deep Thoughts seem to be a manifestation of the same fundamental problem in my life: my ADHD. For years, I suspected I had ADHD. In 2012, my therapist confirmed it. In consultation with my M.D., my therapist prescribed a medication (Vyvanse) that I was meant to take every day. I hate the side effects, though, so I never did. I took it only as needed.

But in searching for answers regarding my ongoing depression and anxiety, I’ve come to understand that these two debilitating mental illnesses can actually be caused by ADHD. My inability to focus leads me to become overwhelmed. When I become overwhelmed, I get stressed. When I get stressed, I get anxious and depressed.

It all seems obvious today, but it was never obvious before.

Anyhow, I’ve begun taking my Vyvanse regularly. Today is the sixth day in a row that I’ve used it. It seems to be helping. Meanwhile, I’ve been trying to practice mindfulness in everyday life. Plus, Kim and I are taking some big steps (to be discussed here in the coming weeks) to alleviate some of the things that overwhelm me on a regular basis.

Coming to grips with the fact that my ADHD is more pronounced than I believed (and that it’s probably the source of so many of the things that bring me suffering) has been eye-opening. As I reviewed this list, for instance, I was surprised at just how many pieces of my philosophy directly tied to ADHD coping mechanisms. It’s crazy.

So, the biggest lesson I learned this year is the age-old maxim: know thyself. As far as possible, know what makes you tick — and how that affects your goals, actions, and relationships.

My Life Philosophy

Before we dive into the rest of my life philosophy, I want to make something clear: I am no wiser or smarter than anybody else. And I’m certainly no better. But I am an individual.

I’m my own person with my own personal preferences and personal experiences. These have all jumbled together over the past 52 years to give me a unique perspective on life (just as you have a unique perspective on life). To quote my favorite poem:

Much have I seen and known; cities of men
And manners, climates, councils, governments,
Myself not least, but honour’d of them all;
And drunk delight of battle with my peers,
Far on the ringing plains of windy Troy.
I am a part of all that I have met…

So, these 52 nuggets of wisdom are things I’ve found to be true for me — and, I believe, for most other people. (But each of us is different. What works for me may not work for you.) These beliefs make up the core of my personal philosophy of life.

Some of these ideas are original to me. Some aren’t. When I’ve borrowed something, I’ve done my best to cite my source. (And I’ve tried to cite the oldest source I can find. Lots of folks borrow ideas from each other. There’s nothing new under the sun and all that.)

Here are 52 principles I’ve found to be true during my 52 years on this planet. I’ll lead with this year’s new addition.

  • Know thyself. All of us are similar, but each of us is different. It’s these differences that make us unique individuals. It’s up to you to discover your strengths (and weaknesses), to figure out what’s important to you, to plot your own course through this world. Taking time periodically to re-asses what makes you tick is an essential part of building a life that allows you to flourish.
  • Love yourself. All my life, I’ve struggled with low self-esteem. There have been times when I’ve hated myself. Recent years have been especially tough for me as anxiety and depression proved to be crippling for months on end. Working with a therapist helped. She helped me to understand that it’s important to learn to both accept myself and love myself — even though, like everyone, I’m imperfect. I still have a long way to go, but I’m making progress.
  • Self-care comes first. If you’re not healthy, it’s tough to be happy. Before you can take care of your friends and your family, you need to take care of yourself. Eat well. Exercise. Nurture your mind, body, and spirit. Your body is a temple; treat it like one. If you don’t have your health, you’ve got nothing.
  • You get what you give. Your outer life is a reflection of your inner life. If you think the world is a shitty place, the world is going to be a shitty place. If you think people are out to get you, people will be out to get you. But if you believe people are basically good, you’ll find that this is true wherever you go.
  • Life is like a lottery. You receive tickets every time you try new things and meet new people. Most of these lottery tickets won’t have a pay-out, and that’s okay. But every now and then, you’ll hit the jackpot. The more you play — the more you say “yes” to new friends and new experiences — the more often you’ll win. You can’t win if you don’t play. That said, however…
  • Luck is no accident. What we think of as luck has almost nothing to do with randomness and almost everything to do with attitude. Lucky people watch for — and take advantage of — opportunities. They listen to their hunches. They know how to “fail forward”, making good out of bad. [Via the book Luck is No Accident.]
  • Don’t try to change others. “Attempts to change others are rarely successful, and even then are probably not completely satisfying,” Harry Browne wrote in How I Found Freedom in an Unfree World. “To accept others as they are doesn’t mean you have to give into them or put up with them. You are sovereign. You own your own world. You can choose…There are millions of people out there in the world; you have a lot more to choose from than just what you see in front of you now.”
  • Don’t allow others to try to change you. Again from How I Found Freedom in an Unfree World: “You are free to live your life as you want…The demands and wishes of others don’t control your life. You do. You make the decisions…There are thousands of people who wouldn’t demand that you bend yourself out of shape to please them. There are people who will want you to be yourself, people who see things as you do, people who want the same things you want. Why should you have to waste your life in a futile effort to please those with whom you aren’t compatible?”

An Early Birthday

  • Be impeccable with your word. Be honest — with yourself and others. If you promise to do something, do it. When somebody asks you a question, tell the truth. Practice what you preach. Avoid gossip. [This is directly from Don Miguel’s The Four Agreements.]
  • Don’t take things personally. When people criticize you and your actions, it’s not about you — it’s about them. They can’t know what it’s like to be you and live your life. When you take things personally, you’re allowing others to control your life and your happiness. Heed the Arab proverb: The dogs bark but the caravan moves on. [This is also one of The Four Agreements.]
  • Don’t make assumptions. The flip side of not taking things personally is to not assume you know what’s going on in other people’s heads. Don’t assume you know the motivations for their actions. Just as their reality doesn’t reflect your reality, your life is not theirs. Give people the benefit of the doubt. [Another of The Four Agreements.]
  • Always do your best. Your best varies from moment to moment. Some days in the gym, for instance, I’m able to lift heavier weights than on other days. Some days I can run faster than usual; some days, I’m slower. That’s okay. What matters most is that I give my best effort every time. No matter what you do, do it as well as you can. This is one of the keys to success and happiness. [This is the last of The Four Agreements.]
  • Effort matters more than skill or talent. “Effort counts twice,” argues Angela Duckworth in Grit: The Power of Passon and Perseverance. Skill, she says, is talent multiplied by effort. The more you do what you’re good at, the better you get. But achievement is the product of skill multiplied by effort. Effort counts twice. (This may be why psychologists say it’s better to praise your child’s efforts instead of her results. Praise her for spending time on her homework, not because she got an A.)
  • Embrace the imperfections. If you do what is right, and you do your best, then there’s no reason to feel bad about the outcome. Nobody’s perfect. Don’t beat yourself up if you make mistakes. And don’t sweat it if other people get upset with you too. If you’re doing the best you can, that’s good enough.
  • The perfect is the enemy of the good. Too many people never get started because they don’t know that the “best” first step is. You don’t know the best guitar, so you never learn to play. You don’t know which Spanish book is best, so you never learn to speak. You don’t know how to bench press, so you never go to the gym. Don’t worry about getting things exactly right — just choose a good option and do something to get started.
  • There’s no single “right” way to achieve success. Each of us is different. We have different goals, personalities, and experiences. We each need to find the tools and techniques that are effective for our own situations. There’s no one right way to eat, love, pray, or pay off debt. Don’t believe anyone who tells you there is. Experiment until you find methods that are effective for you. (Note, however, that there are wrong ways to do these things — steer clear of obvious bad choices.)
  • Be present in the moment. Accept life for what it is, without labels or judgment. Yield to events; don’t block them. Go with the flow. Nothing exists outside the present moment: Don’t dwell on the past or worry about the future. Improve the quality of the here and now. When you do something, do that thing. When you’re with somebody, be with them. Don’t multitask. Put away the smartphone or the computer or the book. Be all there. [This is an ancient concept made popular by The Power of Now.]
  • Spirituality is personal. The desire for one person (or group) to impose her (or their) beliefs on others is the source of much of this world’s strife. Believe what you want, and let others do the same. “There is no need for temples, no need for complicated philosophies. My brain and heart are my temples; my philosophy is kindness.” — the Dalai Lama
  • Be skeptical — but keep an open mind. Don’t believe everything you hear — from others and from your own internal self-talk. Practice healthy skepticism. But keep an open mind. Don’t automatically assume that everything is fake or false. Do your best to analyze the things you see and hear to determine whether they actually make sense.
  • Don’t yuck someone else’s yum. Just because you don’t like something doesn’t mean it’s bad. Pursue your passions, and let others pursue theirs. If you don’t like something, fine. Don’t make a big deal about it.
  • You can’t prevent every possible thing from going wrong. Don’t even try. Instead, learn to deal effectively with minor problems. You’ll build self-confidence, which will lead to an increased willingness to take calculated risks. (Similarly, you can’t make everyone like you. It’s foolish to try.)
  • Be flexible. Goals are good, but single-minded devotion to a goal can often blind a person to other opportunities. And it’s a mistake to cling to one path out of sense of obligation. If you enter law school and discover you hate it, then quit. Don’t endure years of misery because you feel like it’s expected of you. That’s dumb. You have more options than you think, but you may need to slow down and open your eyes in order to see them.
  • Be encouraging. Support the creative, positive actions of others. There are a lot of people out there who want to tell others what’s wrong with their actions, why the things they want to do can’t be done. They’re quick to criticize small mistakes instead of praising the greater effort. Don’t be this way. Do what you can — in ways both big and small — to help others achieve their goals. [Taken from Action Girl’s Guide to Living.]

Keep Dropping Keys All Night Long

  • You are the author of your own life. Everyone has a story they want to tell you about yourself. Society tries to push a “standard narrative” on us about how life should go. Ignore these stories. If you don’t like the story you’re living, it’s up to you to change the plot. You didn’t write the beginning of your story, but you have the power to choose the ending. Choose and adventure you love instead of one that makes you unhappy.
  • You don’t need permission. When we’re young, we wait for our parents and teachers to say it’s okay to do the things we want to do. As an adult, you don’t need permission from anybody else. Do you want to quit your job and travel the world? Do it. Do you want to learn how to ride a motorcycle? Do it. Don’t wait for somebody else to give you the go-ahead. You are the only one who needs to give yourself permission to do these things.
  • Don’t let fear guide your decision-making process. My girlfriend Kim told me this on one of our first dates, and it echoes something my accountant once told me. He says that too many people make money moves based solely on the tax repercussions. “That’s dumb,” he told me. “You should do what you want because you want to, not because of the tax hit.” This applies in all aspects of life. Make decisions based on what you want to do. Move toward something, not away from something.
  • Action cures fear. Thought creates fear; action cures it. What we’re actually afraid of is the unknown. We like certainty, and choosing to do something with an uncertain outcome makes us nervous. Taking the first step can be scary, but each additional step becomes easier and easier. When you act, you remove the mystery. Action creates confidence. It creates motivation. (Most people think motivation comes before action. They’re wrong. Action creates motivation.) [This is an old idea but this phrasing is from The Magic of Thinking Big.]
  • Action is character. If you never did anything, you wouldn’t be anybody. Superman is a superhero because he does heroic things, not because he talks about doing them. And a writer is a writer because she writes, not because she talks about writing. What we say doesn’t matter; it’s what we do that counts. We are what we repeatedly do. [From F. Scott Fitzgerald’s notes on The Last Tycoon.]
  • You’re more likely to regret the things you don’t do than the things you do. That’s not to say you should be an asshole, or that you won’t regret making big mistakes. But generally speaking, you’re more likely to be sorry that you didn’t introduce yourself to the barista at the coffeehouse, didn’t go bungee-jumping with your friends, didn’t stay in touch with your friends. [This is the central idea in The Top Five Regrets of the Dying.]
  • Give without the expectation of return. Help other people — even if it costs a bit of money or time. Don’t always expect a financial payoff. Don’t get offended if your effort isn’t acknowledged or appreciated. Help because it’s the right thing to do, not because you want to be noticed.
  • When good things happen to people you know, help them celebrate. Their success does not diminish you. Be happy when your friends and family achieve something cool. If a co-worker gets a raise, be supportive and not jealous. Approach life as if it were a win-win game. Because it is.
  • Happy people almost never criticize, says Steven Pressfield in The War of Art. “If they speak at all,” he writes, “it’s to offer encouragement.” This is true in my experience, as well. Being sarcastic and cutting doesn’t mean that you’re smarter than the people around you. Most of the time, it simply means you’re an asshole. And that leads me to the next lesson…
  • Staying in a relationship out of a sense of obligation or pity is not a good reason. Sometimes you really do have to walk away — from a friendship, from a family member, even from a romantic partner. Yours isn’t the only story in this world; sometimes it’s better to be somebody else’s villain than to make yourself miserable.
  • You have the freedom to choose how you respond to any event. In the classic Man’s Search for Meaning, Victor Fankl writes, “Everything can be taken from a man but one thing: the last of human freedoms — to choose one’s attitude in any given set of circumstances, to choose one’s own way.” He based this philosophy on his personal experience in a Nazi concentration camp. When that jerk cuts you off on the freeway, you get to choose if you’ll get angry or give him the benefit of the doubt. When you get stuck behind the old lady in line at the grocery store, it’s up to you how to respond. When those stupid kids next door vandalize your lawn, you get to choose how you feel about it.
  • You’ll be happier if you focus on efforts and attention only on the things you can control. Each of us has a large number of things about which we’re concerned: our health, our family, our friends, our jobs; world affairs, the plight of the poor, the threat of terrorism, the current political climate. Within that Circle of Concern, there’s a smaller subset of things over which we have actual, direct control: how much we exercise, what time we go to bed, whether we leave for work on time; what we eat, where we live, with whom we socialize. You’ll be happier and more productive if you dedicate yourself to your Circle of Control and ignore your Circle of Concern. [This notion is part of Julian Rotter’s social-learning theory of personality, but was popularized by Stephen Covey in The Seven Habits of Highly Effective People.]

[Circle of Concern vs. Circle of Control]

  • You can have anything you want — but you can’t have everything you want. Everything is a trade-off. You have limited resources. When you choose to spend — time, money, brainwidth — on one thing, you’re also choosing not to spend on others. Do your best to spend only on the things that matter most to you. Don’t really give a rat’s ass about Big Bang Theory? Then why are you watching it? Spend your time and energy on something you do care about.
  • Make room for the big rocks first. It’s easy to let your time and energy be sucked up by trivial errands and tasks. You find you no longer have space for the things you thought were most important. Don’t do that. Always carve out time and attention for those people and activities you value most. If the house doesn’t get clean because you were hanging out with a friend, so what? If you didn’t mow the lawn because you went to the gym instead, that’s a good thing. Tackle the important, then the trivial.
  • If you want to avoid feeling overwhelmed, create margin in your life. Simplicity brings peace. Many people have tried to beat this into my head over the years, but it wasn’t until I read The Life-Changing Magic of Tidying Up that I really understood. Every item you own, every meeting you schedule, every email you receive — every obligation in your life carries both psychic and physical weight. Traveling in an RV for fifteen months, I learned to love owning very little. It was freeing! And it was freeing too to not be a slave to a schedule. As much as you can, build margin into your life so that you can feel peaceful and free.
  • Be your own advocate. Don’t be afraid to ask what you want and what you need — especially if it’s help. Too often, we struggle in silence when we could make our lives better simply by asking a question or two. Better to look ignorant for a moment than to remain ignorant for a lifetime. Don’t wait for others to solve your problems. Be proactive. Find answers. Take action. Learn to help yourself.
  • It’s always best to be proactive. In life, there are often default options. If you don’t consciously and deliberately choose something different, you get the default. When this happens, your life shapes you instead of you shaping your life. Most people go through their entire lives in default mode. They accept what life hands them without question. They’re reactive. Choose to be proactive instead. If you don’t set your own goals, somebody else will set them for you.
  • Quality tools can make life better. For years, I equated low cost with smart spending. Now I know that’s not always the case. Now, I’m willing to spend to buy high-quality things when I know I’ll use them all the time. I have high-quality boots, for instance, and an expensive computer. I’m okay with that. I walk everywhere I go, so the boots are worth it. And my computer is my livelihood. The expense is worth it because it makes working a joy. For items used daily, buy the best. If you don’t use it often, of if it’s not important to you, buy the cheapest possible.
  • The meaning of life is the meaning you decide to give it. Some people are searchers. They wander through life looking for answers…but rarely find them. Others accept without question what an outside authority tells them is true. I believe that the meaning of life comes from within, from the things that you lean to prioritize and value. Nobody is going to tell you what life should mean to you; you have to decide that for yourself.
  • You are the boss of you. Your circumstances might not be your fault, but they’re your responsibility. Don’t blame anyone or anything else for your situation, and don’t expect somebody else to rescue you. If you don’t like where you are, resolve to do what it takes to make a change.
  • Don’t compare yourself to others. I preach this often at Get Rich Slowly. Comparing yourself to others is counter-productive. Generally one of two things happens: You either feel shitty because you’re not as good as the other person, or you feel superior because they’re not as good as you. In reality, nobody is better than anybody else. We’re just different. If you want to compare yourself, compare Present You to Past You — and do what you can to make Future You a better version of why you are today.
  • You can’t get rid of a bad habit; you can only change it. “You can never truly extinguish bad habits,” writes Charles Duhigg in The Power of Habit. “Rather, to change a habit, you must keep the old cue, and deliver the old reward, but insert a new routine.” He calls this the Golden Rule of Habit Change. To change your habit loop, you have to do something different when the habit is triggered. Let me give you an example: I used to be a stress-eater. I’d eat junk food — and lots of it — any time I had a deadline or a conflict with a friend. The act of eating soothed my mind. The stress was the cue (the trigger), and the rush was the reward. No surprise, this habit made me fat. I’ve managed to (mostly) change the habit loop by walking instead of eating. Now if I get stressed, I go for a walk. I get a similar rush for a reward, but my actions are healthier.
  • Positive reinforcement is powerful. When Tahlequah performs a desired behavior — sitting, coming when called, being nice to the cats — we reward her. She learns to connect the treat with the actions we wants, and becomes more likely to offer them…even when we don’t reward her. What’s true for dogs is true for people too. Does nagging your spouse actually work? Probably not. (In fact, it probably has the opposite effect you intend!) But if you reward the behavior your want, you’ll eventually see it offered without prompting. The same thing is true with children, co-workers, family members, and so on. [This is a fundamental principle of psychology. An excellent source for more info is Don’t Shoot the Dog.]

  • Create your own certainty. Don’t allow yourself to be dependent on the choices and actions of others. I call this “Michelle’s Law” after my friend who taught it to me. But I have another friend — Jenn — who talks about “ensuring success”. When she’s working on something important, whether it’s a relationship or a vacation, she always follows up to make sure that what she expects to happen will happen. This philosophy is akin to the idea that you should trust, but verify.
  • Choose happiness. Do work and play that brings fulfillment. Spend time with people who build you up, not those who bring you (and others) down. Strip from your life the things that take time, money, and energy, but which do not bring you joy. Focus on the essentials.
  • Time is more valuable than money. You can always make more money…but you can’t make more time. This isn’t permission to spend lavishly on anything and everything just because you might get hit by a truck tomorrow. It is, however, an invitation to consider what’s important to you and to focus on that. It’s encouragement to get clear on your personal mission statement and to build your life around it.
  • It’s never too late to be great. It takes time to achieve anything worthwhile. But just because you haven’t started yet — or haven’t reached the level your aiming for — doesn’t mean you can’t or won’t make it happen. Don’t be daunted by audacious goals. Are you fifty and want to run a marathon? Start training. Are you sixty and only now thinking of retirement? That’s okay. Better late than never. Are you seventy and want to write a novel? Do it. History is filled with examples of folks who achieve great things later in life. [This argument is made persuasively by Tom Butler-Bowdon in his book, Never Too Late to Be Great.]
  • Be yourself. This is the most important thing I’ve learned during my 52 years of life. For too long, I tried to please others. I tried to be and do the things I thought they wanted me to be and do. As a result, I was unhappy. And most of the time, my actions didn’t have the results I thought they would. They didn’t make others like me any better. Instead of trying to please others, now I’m just me. I’m honest about who I am and what I want. Maybe some of my old friends don’t like who I’ve become. That’s okay. I’ve made plenty of people who do like who I am.
  • “Everybody is talented, original and has something important to say.” — Barbara Ueland, If You Want to Write.

This isn’t a comprehensive list of my beliefs, but it’s a fair survey of my life philosophy. It has evolved from my philosophy when I was forty or thirty. And I’m sure that my philosophy at sixty will have changed in ways that I cannot foresee right now.

Also note that although I really do believe these things to be true, I also struggle with them. I’m human, just like you. I don’t always live up to my ideal self. I don’t always adhere to my own life philosophy.

How many of these ideas do you agree with? Which do you disagree with? More to the point: What are the core ideas that make up your personal life philosophy?

One Hundred Words

from Get Rich Slowly

My new Audible course on financial independence and early retirement!

Nearly two years ago, I received an unusual email at an address I rarely check anymore. The author wrote:

I am writing to you today because The Great Courses in partnership with Audible is exploring the possibility of creating a high-quality series on Financial Independence. We believe that you may be an excellent candidate to teach such a series. I’ve read many articles at Get Rich Slowly and I’m always impressed by your writing and how much excellent content you create.

At first, I thought this was spam. Before I deleted the message, though, I checked the sender. Sure enough. The sender (and the message) was legit.

I wrote back:

Thank you for reaching out. I get a lot of requests for my time and typically turn them down. Not this one. I feel like this is a terrific idea and well-worth exploring. I am a long-time fan of both Audible and the Great Courses. I’m not joking.

I included screen captures to prove that I owned 72 Great Courses and nearly 372 audiobooks from Audible. Those numbers have since grown, naturally.

My library of audio learning

Discussions ensued, a contract was created, and in December 2019, I began the work of creating a five-hour, ten-part course on financial independence and early retirement. I finished that course last April. I recorded it in May. And last month, at long last, How to Achieve Financial Independence and Retire Early made its way into the world!

FIRE in 40,000 Words

Writing a blog about financial independence and writing a course about financial independence are two different things. A blog is open-ended. It’s personal. It’s informal. But a project for Audible and The Great Courses? Well, that sort of project has constraints and requires a different tone.

You folks all know that I am on a personal-finance journey. You all know that I’m constantly learning about money, and that my understanding and opinions tend to change with time. With this sort of project, though, I have to present myself as an expert. The info I provide has to be self-contained in one neat little package.

In this case, I had some very specific parameters.

The course had to be roughly 40,000 words in length, and the whole had to be divided into ten smaller “chapters”. Why 40,000 words? Because 40,000 words is roughly five hours when read aloud. Essentially, my task was to encapsulate the most important facets of financial independence in ten half-hour (4000-word) lectures. So, that’s what I did.

I also had to decide who the course was for. Was this meant for folks who already knew about FIRE (financial independence and early retirement)? I’m not the best person to offer deep, technical advice (as you well know), so I decided against that. I decided to target folks who were FI-curious: those who has heard about the concepts but needed a crash course in what FIRE entails.

How to Achieve Financial Independence and Retire Early

In the end, I adopted the following outline:

  • Lecture one — What is financial independence? I start the course by discussing the difference between financial independence and early retirement. I also spend some time talking about how society has programmed most people to think about money in only one way. But there are other ways to approach personal finance.
  • Lecture two — The power of purpose. Naturally, I then dive into my pet subject: finding purpose. If you’ve read GRS for any length of time, you know exactly what this lecture contains. This is my core message.
  • Lecture three — The power of profit. With the philosophy out of the way, I explore the numbers behind financial independence and eaerly retirement. I talk about net worth, saving rate, and more.
  • Lecture four — Spend less. The fourth lecture explores frugality and the power of saving on the big stuff, such as housing and transportation.
  • Lecture five — Increase your income. After talking about spending, I talk about income. While most of the material in this course is new, this particular lecture sticks closely to my usual speil about earning more. (But with more resources included.)
  • Lecture six — Your wealth snowball. Once I’ve explained how the gap between earning and spending creates a “profit”, I then share the best ways to make use of this profit: a debt snowball (if you’re in debt) and a wealth snowball (once your debt is gone).
  • Lecture seven — Investing for early retirement. The seventh lecture was, by far, the most difficult to write. How in the hell do you compress all of investing into 4000 words? It can’t be done — but I tried. (And then I sent people to read The Simple Path to Wealth by J.L. Collins haha.)
  • Lecture eight — How much is enough? Next, I explore the factors that affect how much you need to save for retirement, including life expectancy, inflation, withdrawal rates, and more.
  • Lecture nine — Barriers on the road to financial independence. I spend the ninth lecture addressing problems that people encounter when they pursue financial independence — and offering possible solutions to those problems.
  • Lecture ten — Building a rich life. Lastly, I explore what happens once you achieve financial independence and/or early retirement. I urge listeners to build a rich life.

As I said, I did my best to cover the core concepts of the FIRE movement. I made a deliberate decision to keep the course as non-technical as possible, which probably comes as no surprise. And, when possible, I explored the psychological and philosophical implications of wealth.

Because of the limitations of this project, I couldn’t cover certain pet topics of the FIRE community: travel hacking (which actually has zero to do with FIRE anyhow), health care (which is important!), backdoor Roths, etcetera. Nor could I dive deep into any given topic. There just wasn’t space.

In the end, though, I’m proud of the course I created. To my mind — and I know I’m biased — this project is the best introduction to financial independence and early retirement available. I’m not joking.

If you want to share this concept with friends or family, I believe this course is a great way to do it.

An Intro to FIRE

The most difficult part of creating this course was recording it. Early last May — while uncertainty about COVID still raged — I spent two days at a local recording studio, reading my words aloud. It was tough!

I’m a talkative fellow, but I’ve never had to actually read for hours on end. It’s more difficult than you might expect. By the end of the second day, I felt like my mouth was full of marbles. Plus, I worried and worried and worried that my delivery was terrible. (And, in the months since I recorded the course, I’ve had second thoughts about two sentences that I regret including haha.)

So, my biggest fear was that people would hate my “performance” of the stuff I’d written. Much to my surprise, that hasn’t been the case. In fact, my performance is the highest-rated part of the course. Whuh?!?

Current ratings for my course

Ready for some math nerdery? Good, because you’re going to get it.

Your Money: The Missing Manual was released on 01 March 2010. In the eleven years since, the book has received 86 ratings at Amazon. How to Achieve Financial Independence and Retire Early was released on 16 February 2021. In the five weeks since, the course has received 77 ratings at Audible.

What amuses me, though, is that the breakdown of these ratings is nearly identical. Take a look:


Consistently, 5% of folks don’t like my big projects. Another 5% find them to be meh. And — thank god — 90% seem to like them.

Anyhow, my Audible course is out! I’m proud of it. I think it’s an excellent intro to the core concepts of the financial independence and early retirement movement. I hope it proves useful for many people.

As proud as I am of this course, and as much as I hope it helps people, I’d be remiss if I didn’t point out that I first explored these basic ideas in The Money Boss Manifesto, which remains available as a free PDF. The Audible course is much more comprehensive and features my latest thoughts on each subject, of course, but that free PDF is a good resource for folks who can’t (or don’t want to) buy the course.

from Get Rich Slowly

The power of low expectations

At the end of January, I had an epiphany.

Kim and I were sitting in the living room one evening, relaxed in our easy chairs, both reading books. All four of our beasts were nestled nearby. The house was quiet. For the first time in forever, I felt completely content.

For maybe twenty minutes, I paused what I was doing and simply savored the moment. I stopped. I looked around. I made time to be present in the Now.

Eventually, my mind began to wander. “When was the last time I was this happy?” I wondered. I thought back to the late 1990s when my ex-wife and I lived in similar circumstances. Kris and I would read together in the evening, each with a cat in our laps. Life was simpler. I felt no anxiety. I was happy.

Then too, I achieved a similar level of contentment as recently as 2013. Soon after Kris I got divorced, Kim and I began dating. I lived alone in an apartment. My life wasn’t filled with obligations and Stuff. Again, things were simpler. Simpler and saner and more filled with joy.

“But what really is the difference between those two periods of time and the last few years?” I thought. “Why have I been so anxious recently?”

The difference, I realized, has a lot to do with my expectations.

Last week, I had a three-hour coffee date with Kris. Although we got divorced almost nine years ago, she probably still knows me better than anyone. (After all, we were together for 23 years.) I asked her if she considered me an anxious person while we were married.

“No,” she said. “In fact, it used to be you were the opposite of anxious. You were care-free, happy go lucky. You didn’t pay enough attention to the future.”

The anxiety, I think, increased as my expectations of myself (and my life) increased.

The Fundamental Equation of Wellbeing

Our expectations play a profound role in our daily contentment.

In the book Engineering Happiness, economists Manel Baucells and Rakesh Sarin cite the fundamental equation of wellbeing: happiness equals reality minus expectations. I’m sure you’ve all heard this notion before.

  • If you expect more from life than you currently have, you’ll be unhappy.
  • Conversely, if your current experience exceeds your expectations, you’ll be happy.

So, just as you can increase your saving rate by improving income and/or lowering expenses, you can deliberately increase your happiness by improving your circumstances and/or lowering your expectations. But it’s usually easier to lower your expectations.

When I think about how my own expectations have influenced my happiness, I recall the early days of Get Rich Slowly. Back when I started GRS in 2006, I had a problem. I had high expectations for myself and this site. Very high expectations.

After the first few months of finding my feet, GRS experienced rapid growth. As the audience grew, I felt pressure to to provide as much quality information as possible. Get Rich Slowly shifted from a curious hobby to a near full-time endeavor.

As part of that, I set a publishing schedule. I told myself that I wanted to post two articles every weekday, plus one article each Saturday and Sunday. My aim was to produce twelve articles every week. That’s a lot of work for one guy, as I’m sure you can imagine. And more often than not, I failed to meet these expectations.

Instead of writing twelve articles per week, I usually managed to share ten. It drove me nuts.

Now, you and I both know now that ten articles per week is an amazing rate for one person to create content. Back then, though, I felt like a failure. Yes, I was producing ten articles per week, but I was falling short of my goal to produce twelve articles per week. I felt like I was letting people down. Worse, I felt like I was letting myself down.

After a few months of feeling miserable, I realized my expectations were too high. “What if,” I thought sometime in early 2008, “what if instead of expecting two articles every weekday, I only expected one article every weekday?” My aim would be seven blog posts per week instead of twelve.

Do you know what happened? Nothing changed except the stress level in my life.

I continued to churn out roughly ten articles every week. But now instead of being angry with myself because I’d fallen short of my goal, I felt pleased because I had exceeded my expectations. My production rate didn’t change one whit. My expectations changed. And with the lowered expectations came increased happiness.

An Ode to Low Expectations

I’ve been thinking a lot about how that one small change in expectations yielded an outsized increase in happiness. How can I apply this concept in other areas of my life?

Last week, I read a (very) short piece at The Atlantic that offered some insights. In “An Ode to Low Expectations” [possible paywall], James Parker writes:

Strive for excellence, by all means. My God, please strive for excellence. Excellence alone will haul us out of the hogwash. But lower the bar, and keep it low, when it comes to your personal attachment to the world. Gratification? Satisfaction? Having your needs met? Fool’s gold. If you can get a buzz of animal cheer from the rubbishy sandwich you’re eating, the daft movie you’re watching, the highly difficult person you’re talking to, you’re in business. And when trouble comes, you’ll be fitter for it.


Revise your expectations downward. Extend forgiveness to your idiot friends; extend forgiveness to your idiot self. Make it a practice. Come to rest in actuality.

This excerpt — which is literally half of the entire essay — struck home for me. “Come to rest in actuality,” Parker writes. Translation: Don’t allow your expectations to exceed reality.

Then, completely out of the blue, my cousin Duane (who is continuing to kick cancer’s ass, by the way!) sent me an article about Charlie Munger, the business partner of Warren Buffett. The piece features some recent wisdom from Munger that directly relates to the fundamental equation of wellbeing:

A happy life is very simple. The first rule of a happy life is low expectations. That’s one you can easily arrange. And if you have unrealistic expectations, you’re going to be miserable all your life. I was good at having low expectations and that helped me. And also, when you [experience] reversals, if you just suck it in and cope, that helps if you don’t just stew yourself into a lot of misery.

Duane sent me this article (and this quote) because he knows me. He knows me well.

Not only do I tend to have high expectations — for life in general, but especially for myself — but I also tend to stew about my problems. Our house sucks! I forgot to pay my car loan last month! I have too much work to do! I fret and fret and fret about things. I stew myself into a lot of misery.

The Power of Low Expectations

I’m sure that by now you’re seeing the connection between expectations and various aspects of personal finance.

For one, managing expectations is directly related to lifestyle inflation and the hedonic treadmill. People naturally become accustomed to whatever it is they have. When your circumstances improve, you feel an initial burst of excitement because your new life is better than your old life. Your reality exceeds your expectations.

In time, though, your expectations adjust to the new reality. You grow accustomed to your improved circumstances. A seven-buck dinner at Dairy Queen used to be a treat. Now you barely enjoy a $70 dinner at the local Italian place. You’re not happy until the next time your circumstances experience a boost.

This is lifestyle inflation. This is the hedonic treadmill.

Expectations also play a role when it comes to making decisions. I frequently cite The Paradox of Choice by Barry Schwartz. In the book, Schwartz describes his research into two groups of people, Maximizers and Satisficers:

  • Maximizers are those who only accept the best. Every time they make a purchase (or do anything else, for that matter), they need to be sure they’ve made the best decision possible. When shopping for shoes, for example, a Maximizer wants to look at all of the options. He wants to compare of the prices. And even after he’s made his purchase, he worries that maybe he missed a better shoe or a better price at another store.
  • Satisficers, on the other hand, have learned that, contrary to conventional wisdom, good enough often is. Satisficers have learned to settle for something other than the best. A Satisficer still has expectations and standards, but once she’s found something that meets those standards, she buys it. When shopping for shoes, a Satisficer makes do with a pair that meets her needs at a price she can afford.

As you might guess, Maximizers are not as happy as Satisficers. In his research, Schwartz has found that:

  • Maximizers are more likely to regret their purchases despite the fact that they have (in theory, at least) come closer than Satisficers to making the best decision.
  • On the flip side, Satisficers generally feel more positive about their purchases. They know they’ve made a choice that met (or exceeded) their expectations.
  • Maximizers enjoy positive events less than Satisficers, and they don’t cope as well with negative events.

This concept is closely related to perfectionism, which I’ve begun to think of as “the curse of high expectations”.

When you expect the best, you’ll never be better than satisfied. If you do get the best, you’re getting only what you expected. There’s no way for anyone or anything to please you by exceeding expectations. And most of the time things won’t live up to your expectations, so you’ll be disappointed.

When you lower the bar, however, you’re less likely to be disappointed. Sure, sometimes people will fail to live up to your expectations, but because you don’t expect perfection, these failures will happen less frequently and cause you less woe. Most of the time, you’ll get exactly what you expect. And sometimes someone or something will exceed your expectations, and that will bring you joy.

Lowering My Expectations

I grew up in beat-up old trailer house. I grew up poor. I grew up in family with very low expectations. These low expectations served me well for many, many years. They made me adaptable and resilient. From the time I left for college in 1987 until the time Kris and I bought our second home in 2004, everything about my life constantly improved upon what had come before. There was nowhere to go but up!

But sometime soon after that (around the time I started Get Rich Slowly in 2006), my expectations began to shift. I experienced anxiety for the first time. I lost that “happy go lucky” spirit of my youth.

I want to reclaim that spirit.

My epiphany at the end of January has caused me to think deeply about the direction of my life. I’m asking myself some fundamental questions, most of which (but not all) are related to my expectations.

For instance:

  • Should Kim and I get married? It’s embarrassing to admit, but I realized I hadn’t fully committed to Kim. I’m not sure why, but part of me was holding out. I wanted her to be better. I wanted her to be perfect. Kim isn’t perfect. She’s human. I love Kim, and it’s unfair of me to not be wholly invested in this relationship. I’ve decided I’m ready to wholly invest.
  • Should Kim and I move? Our house has caused me stress since the day we bought it. I’ve poured an enormous amount of time and money into improving the place, and there’s still more work to be done. It makes me anxious. It’s reached the point where I need to fully commit one way or the other. We either need to accept this place for what it is and adjust our expectations, or we need to move on. I need to stop stewing myself into a lot of misery, as Charlie Munger would say.
  • How much work should I be doing? As in the early days of GRS, I find myself lately feeling pressured to write articles and/or record videos. I’m putting this pressure on myself. Somehow, I’ve shifted from perceiving myself as “retired” to perceiving myself as business owner. I don’t like it. I want to return to the retired mindset. I want my expectation to be that Get Rich Slowly is a fun pastime, a hobby, not a serious business.
  • How can I spend more time with friends and family? I used to spend a lot of time with my friends. That’s no longer true, and it’s not simply because of the pandemic. When Kim and I returned from our year-long RV adventure, I did a shitty job of reconnecting with people. During the past month, I’ve deliberately made an effort to connect with people — even over the gasp! telephone.

To add to this introspection, I’ve been reading a lot about mindfulness and Buddhist philosophy.

In his book Waking Up, Sam Harris explains that “the Buddha taught mindfulness as the appropriate response to the truth of dukkha“. Dukkha is often translated as “suffering”, but Harris argues that “unsatisfactoriness” is a better equivalent.

“We crave lasting happiness in the midst of change,” Harris writes. “Our bodies age, cherished objects break, pleasures fade, realtionships fail. Our attachment to the good things in life and our aversion to the bad amount to a denial of these realities, and this inevitably leads to feelings of dissatisfaction.”

Quite clearly, Harris is writing about our expectations and how we manage them. He continues [emphasis mine]:

Some people are content in the midst of deprivation and danger, while others are miserable despite having all the luck in the world. This is not to say that external circumstances do not matter. But it is your mind, rather than the circumstances themselves, that determine the quality of your life.

In other words, the Buddha was an ancient proponent of the fundamental equation of wellbeing: happiness equals reality minus expectations.

Managing expectations is working for me. February was probably my best month in years — since April 2016, at least. My anxiety subsided. My depression was dormant. I was active and engaged with life. I read. I wrote. I played. Most of the time, I was mindful and present in the moment.

I attribute all of this to my epiphany at the end of January, and to my lowered expectations for myself — and for everyone and everything else in my life.

from Get Rich Slowly

An ice-cold update

Ah, life. It’s funny sometimes, isn’t it?

On Thursday, I began writing an article about the difference between personal finance in Mexico vs. the United States. You see, last week I spent several days in Mexico with a friend (who also happens to be my accountant). I had planned to finish the article on Friday. I came close. I got the YouTube version done and was nearing completion on the blog version.

But then Portland was hit with a winter storm.

Kim and I spent Friday afternoon prepping our yard for ice. Good thing, too. That night, our neighborhood was blanketed with an inch of freezing rain.

I’ve lived through a handful of ice storms over the past couple of decades. Two of them were worse than this when measured in inches. But when measured in sheer damage? Wow, this year’s storm takes top billing.

In our neighborhood, anyhow, it’s like a bomb went off. Dozens of downed trees and hundreds (thousands?) of fallen limbs and branches. These trees and limbs have taken down utility lines all over the place. Lots of people have damage to homes and cars. Fortunately, we don’t.

One of many fallen trees in our neighborhood

Kim and I have been without power and water and cell service since 10:30 on Friday evening. We’re safe though, as are our animals. We’ve been able to make do. We’re going to lose everything in the freezer at this point, but that’s not so bad, right? There’s no way to tell whether we have damage to our plumbing until power is restored, and there’s no estimate for that. It’ll probably be days. It could be a week or two.)

Like many other Porltanders, we booked a room in a local hotel for a couple of nights so that we could shower, shave, and have some warmth. But even that plan went awry. While booking over the phone, we requested (and were promised) a dog-friendly room. Turns out the hotel was not dog-friendly. So, after a quick shower (and after charging all of my devices), I drove our pup home. I spent the past two nights sleeping alone with our beasts in a cold, cold house.

Tonight, we may be borrowing a generator from one of Kim’s patients. We don’t know how to use a generator (and it’ll be dark when she gets home), but we’ll try to figure it out. Can’t be too complicated. Plus, YouTube is my friend.

As crazy as this is for us, I know it’s been worse for many other folks around the U.S. I’m not complaining — only observing.

Meanwhile, this week was supposed to see the launch of my new FIRE course at Audible. And, in fact, the course was released yesterday! But all of my grand plans for promoting the thing have been put on hold.

How to Achieve Financial Independence and Retire Early

I don’t have the power or internet needed to do the work, you know? Right now, I’m grabbing a few hours of access from a friend who has graciously allowed me to use his office for the afternoon. But that doesn’t give me time to do any sort of serious promotion work. That’ll have to come when power is restored — which may be another week yet.

(p.s. We had our foundation inspected this morning. The house isn’t falling over, but to mitigate existing issues will cost $9000. I consider this a win, believe it or not!)

from Get Rich Slowly

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