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The no-pants guide to spending, saving, and thriving in the real world.

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Meditation

Life

Life is crazy.

 “Really, Jason, that’s news?”
I spend so much time going in so many different directions.
Cleaning out our inherited hoarding house, managing the remodel, work, side hustles, kids, friends, family, relationships, maintaining our house, maintaining a relationship with my wife, garage sales, school starting, junior high football season, insurance policies, probate, rush hour, insomnia.
Some days, I feel insanely scattered.  I can’t focus.  I have a hard time making decisions.  I waste time.
Those days, I need to clear my head.
That’s where meditation comes in.
I don’t do the money hum. (Om mone padme, Om)
Instead, I have three activities that demand a total focus.  They drive out any scattered thoughts or unimportant concerns.
They have to because, quite frankly, they can be dangerous if I don’t concentrate.
1. I shave.  I use a double-edged safety razor, so bleeding for the throat is a real concern.   For 10 minutes, nothing else in the world matters.   It has only recently struck me how valuable this is.  That value makes me want to start shaving every day, with a straight razor.  More focus, more often.
2.  I ride.  For the past couple of years, it’s been hard to find time get my motorcycle out.   Small children seem to want attention every day.   It got to the point where I was ready to sell my bike.   This spring, it was seriously misbehaving.  Finally, at the end of the summer, a friend got it running better than it ever has.   I took it out for a couple of hours and came back feeling more clearheaded than I have in a long time.  I won’t be selling my bike until I have its replacement.
3.  I shoot.  Shooting involves a series of simple actions that require concentration to do well. Load the gun, line up the sights, which eye is dominant, breathe, don’t breathe, squeeze the trigger, hole in the paper.   Again, it’s not an activity that’s conducive to worrying about the bills or work.  It’s a way to shut out the world for a few minutes.
For me, a few moments or a few hours of shutting down everything except one thing is the way to stay sane and focused.
How do you deal with it when the world comes crashing in from every direction?
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Karate Guess So

Finance, Life

琉球国唐手家・明増盛の「慈恩」(Ming Zengsheng, 1869 - 1945)
Image via Wikipedia

“Walk on road, hm? Walk left side, safe. Walk right side, safe. Walk middle, sooner or later, [makes squish gesture] get squish just like grape. Here, karate, same thing. Either you karate do “yes”, or karate do “no”. You karate do “guess so”, [makes squish gesture] just like grape. Understand?” -Mr. Miyagi

It occurred to me that lately, I’ve changed my day-to-day cash flow plans a couple of times.

A year ago, I was running on a fairly strict cash-only plan.

A month ago, I was running on a strict budget, but doing it entirely out of my checking account.

Now, I’m loosening the budget reins, and moving all of my payments and day-to-day spending to a credit card, including a new balance that I can’t immediately pay off.

The thing is, changing plans too often scares me. Like the quote at the beginning of this post, I start worrying about being squished like a grape.

The simple fact is that any plan will work.

If you want to get out of debt, just pick a plan and run with it. If that means you follow Dave Ramsey and do the low-balance-first debt snowball, good for you.  Do it.  If you follow Suze Ormann and do a high-interest first repayment plan, great. Do it. If you follow Bach and pay based on a complicated DOLP formula to repay in the quickest manner, wonderful!  Do it!

Just don’t switch plans every month. If you do that, you’ll lose momentum and motivation.  Squish like grape! Just pick a plan and go. It really, truly does not matter which plan you are following as long as you are following through.

This applies to other parts of your life, too.  For example, there are a thousand fad diets out there.  Here’s a secret: they all work. Every single one of them, whether it’s Weight Watchers, slow carb, or the beer-only diet. The only thing that matters is that you stick to the diet.  If you manage that, you will lose weight on any diet out there.  Except for the jelly bean and lard diet. That one will make you extra soft.

Another secret: the productivity gurus are right. Every single one of them. David Allen, Stephen Covey, Steve Pavlina, and the rest. They all have the One True Secret to getting the most out of your day.  Really.   Pick a guru and go! But don’t try to Get Things Done in the morning and do 7 Habits at night. Changing systems, changing plans, changing your mind will make you sabotage yourself.

The real secret to accomplishing great things, whether it’s paying off $100,000 of debt, dropping 40 pounds in 3 months, or tripling your productivity is to do it. Just get started and, once you’ve started, don’t stop. If you keep going and stay consistent, you’ll accomplish more than anyone who hops from system to system every few weeks.

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Fat guy running

Life

As part of my effort to improve every part of my life, I have decided to get back in shape. Twelve years ago, I worked in a factory during the day and cooked in a resaurant in the evening. I didn’t have a car, so I biked 5 miles in between my jobs. Fast forward 3 kids, a desk job, and 100 pounds later. I don’t enjoy getting winded on three flights of stairs and I like running while my daughter rides her bike. I’m going to get back in shape.

As a part of that effort, I recently bought a bike. I thought I was getting it for a steal, until I took it out. The chain kept slipping, the shifters were difficult, and it was too small for my frame. I took it back. A bike that would work well for me would cost $200-300, more than currently fits in my budget. Running is cheap, right? It is, unless I go for the runner-geek purchases. Every hobby and activity can become expensive if you let it. I may invest in some running shoes, but that will be the extent of my runner-geek shopping.

My plan was to run according to this this schedule, running every other day. Run one day, rest the next. The first day in week 3, I got petellofemoral pain, or “runner’s knee”. I went to the doctor and got x-rayed. There is nothing even hinting at major damage, which has always been a fear of mine, due to my barometer knee pain. The doctor gave me a sheet of stretching and strengthening exercises to do and told me to put running on hold for a bit. I will be doing the exercises every day this week. Next week, I’m starting over with my running schedule. I will be giving my knees an ice massage after each run and doing the exercises on the off days.[ad name=”inlineleft”]

I am writing this in October and have been running for half of September. Hopefully, the city will keep the roads plowed enough that I can run all through the winter. The schedule may slow down a bit, depending on weather, but I’m hopeful. By the time this posts, I will have a lot more information about how well I am doing.

Update: Mid-November.  Where did the last month go?  It’s amazing how fast time slips away if you aren’t watching it.  My barometer knee pain has been back, and life has been hectic.  I need to get his habit going again, before it freezes to much to start.

How Much is Too Much?

Business, Finance, Life, Parenting, Relationships

I work.

A lot.

Aside from my day job, I’ve got my gun training classes, this site, advertising and online marketing for a few companies, and a large custom software project.    I’m working 60-70 hour weeks and have been for at least 2 years.

When it all started, it was all necessary.   We were in debt, I was underpaid for my industry, and we couldn’t make ends meet.   Today, our debt is nearly gone, our savings has grown, and I make considerably more money that I did 2 years ago.

But I’m still running as hard as I can.

My wife is unemployed, but I don’t think that matters much.   I probably make enough at my day job to cover our lifestyle.   I’ll know for sure in 2 weeks when my benefits all kick in.

But I’m still hustling.

When someone calls me up to ask to pay me for a project–a highly skilled, high-margin project–how can I turn them down?   When the headlines drive people into my classes, how can I say no to the money?

I’ve been accused of being a workaholic, and I can’t argue with it anymore.   I’m working all of the time, and the rest of my life–my marriage, my kids–is suffering for it.  I’ve spent so long with not enough, is it possible to just enjoy what I’ve got?

I’ve got no hobbies.   I rarely spend time with anyone.   I quit working an hour before my kids are asleep, and see them in the morning just long enough to get them to daycare.

I’ve got to scale back.  That means my plans to go self-employed are getting paused, but that was mostly an exit strategy for my last job.  I enjoy my current job.  I’m doing what I love in an industry I care about.

What can I cut?

  • This site.  I could sell this, make a bit of money and reclaim that time, but I need this vent.  I need to be able to talk about my finances and release whatever pressure is building up.
  • Gun classes.   This business takes up about 10 hours per class, with 1-2 classes per month.  It’s not a huge time sink.  Right now, business is booming.   There is an old saying: “You have to make hay while the sun is shining.”   Eventually, the market will slow down, but for now, we’re one of the most successful businesses in our market.   I can’t turn this tap off.
  • Marketing company.   This is the biggest time sink I’ve got.   It’s also the most profitable.    This is where I spend my time every evening, and where I think I need to wind down.  I’ve got a couple of major commitments I can’t back out of, but when they are done, I think this has to go.  I simply can’t keep going like this.  We’ll keep the business entity, so we’ll be able to say yes to the right projects and be ready to go with the next brilliant idea….crap, there I go again.

My name is Jason, and I’m a workaholic.   The idea of shutting down my business hurts, but the idea of losing my wife and kids hurts more.   I don’t know how painful winding some of this down will be, but rest assured, I’ll be sharing the progress here.

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All About Tax-Sheltered Annuity Plans

Finance

This is a guest post.

If you’ve previously heard of tax-sheltered annuity plans but are unsure of what they are, let this guide help you. Here’s what you need to know about tax-sheltered annuity plans.

What is it?

First things first, what are tax-sheltered annuity plans? A tax-sheltered annuity plan, or a 403(b) plan, is a retirement plan for some employees of various institutions to participate. This plan allows employees to contribute a portion of their salary to the plan. The employer may also contribute to the employee’s plan.

Who is Eligible?

Eligible Code Section 501(c)(3) employees tax-exempt organizations may participate, an employee of a public school, a state college, or a university, and eligible employees of churches. Employees of public school systems organized by Indian tribal governments, Ministers employed by Code Section (501)(c)(3) organizations, and self-employed ministers may also participate. Ministers must be employed by organizations that are not Code Section 501(c)(3) tax-exempt organizations, and they must function as ministers in their day-to-day professional responsibilities with their employers.

What are the Benefits of a 403(b) plan?

In a 403(b) plan, contributions are tax deductible. Taxes are paid on distributions in retirement, which is when a lot of people are in a lower tax bracket. As mentioned earlier, employers can match 403(b) contributions on a pretax basis. Loans can be taken against a 403(b) plan, which will help in certain situations, like buying your first home.

What types of contributions can be made?

In a 403(b) plan, you can have several types of contributions:

  • Elective Deferrals – These are contributions made by the employee under a salary reduction agreement. This allows an employer to withhold a certain amount of money from an employee’s salary to deposit it in their 403(b) account.
  • Nonelective Employer Contributions – These are any contributions to the 403(b) plan that were not made under a salary reduction agreement, which include matching contributions, discretionary contributions, and certain mandatory contributions that were made by the employer. The employee will pay income tax on all of these contributions, but only when they’re withdrawn.
  • After-Tax Contributions – These are contributions made by an employee, which are reported as compensation in the year they were contributed and are included in the employee’s gross income for income tax purposes.
  • Designated Roth contributions – These are elective deferrals that the employees elects to include in their gross income. The plan must keep separate accounting records for all contributions and for all gains and losses in the designated Roth account.

Can Employees Exclude Employees From Contributing?

Absolutely. The 403(b) plan must allow allow employees to make elective deferrals under the plan, but under the universal availability rule, if the employer permits one employee to defer salary by contributing it to a 403(b) plan, they must extend the offer to all of their employees. The only exceptions are employees who would contribute less than $200 annually, those employees who work less than 20 hours a week, employees who participate in a 401(k) or 457(b) plan, or students performing services that are described in Code Section 3121(b)(10).

So When Can Employees Get the Dollars?

Employees may withdraw from the 403(b) plan when the reach the age of 59 and a half, have a severance from employment, have a financial hardship, or become disabled. Money can also be taken out if an employee passes away. The employee will have to pay taxes on the amount of the distribution that was not from designated Roth or after-tax contributions, and they may have to pay an additional ten percent early distribution tax.

Are There Rules for In-Service Transfers or Exchanges?

Yes. Contract exchanges with a non-payroll slot vendor are permitted only if the plan permits it, the accumulated benefit after the exchange is, at the very least, the same as before the exchange, if the employer and the non-payroll slot vendor agree to share information regarding the plan’s terms, if any pre-exchange benefit restrictions are maintained after the exchange, and if the vendor complies with the terms outlined in the plan.

How Much Can be Contributed Annually? Does the Employee Have to be Current?

As of 2013, the maximum combined amount that an employer and an employee can contribute to a 403(b) plan is $51,000. That number may go up, depending on the annual cost-of-living.

If the plan allows, an employer can contribute up to the annual limits for an employee’s account for up to five years after the date of severance. No portion of the contributions can come from money that was due to be paid to the former employee, and these contributions must cease if the employee passes away.

There’s much more to learn about a 403(b) plan, but these are the basics. Does your company have a 403(b) plan?

 

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