closet clean out + personal finance

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Today I tried to be productive even though I’m home sick; decided I would clean out my closet and put a few things up for sale.  I’ve been putting this task off for a while but was motivated by the indoctrinated guilt of being out sick while working in the medical field.  Back when I was in medical school and when I was an intern, I never took the day off when sick, even when I had pneumonia for two months and fractured my rib from coughing, I still went in.  Things are much different now but it’s still hard to shake the guilt.

I became short of breath when I walked the dog this morning.  By the time I got home, I needed to use a rescue inhaler that the NP gave me after he listened to my lungs.  I don’t have asthma and have never used one before!  The flu test was negative, but I tested positive for RSV, which is not as bad as the flu but worse than a common cold.  It’s like a cold but with a lot more congestion and asthma like respiratory symptoms.

There were a few items in my wardrobe that were in good condition but were just items that I didn’t gravitate to anymore.  They are up for sale here (if you leave a comment that you found any sale item through this blog, I’ll let you have it for whatever you offer, except for the Nisolo shoes because that belongs to the BF).  After I photographed flat lays of each item, I clean them up with a lint roller, package them into pink envelopes, label them, and store them all in the back of my closet.  That way they stay clean and out of the way.  When someone buys, its quick and easy to just then drop them off at at the mailbox on my way to work.

I got an email from my personal finance coach today to check in on me (my job provides free personal finance coaching to its employees).  She wanted to know if I had been doing my homework of tracking all my expenses.  I had to admit that I had been delinquent on my homework and that I didn’t think it was possible for me to keep up with tracking every expense because I’m just too lazy.  I also don’t trust apps like Mint.  I read the book Art of Invisibilitywhich made me very paranoid about hacking and identity theft.  She emailed back saying that it was OK to not track every expense as long as I was setting limits on my spending.   A part of me wonders if she is being too lenient on me.  I kind of want her to get all tiger mom and scold me for not being more responsible, lol.  I think the biggest accomplishment I made with her help has been reducing my spending on food by 50%, saving about $500 per month, but as a result I’ve been washing dishes all the time.  I’ve also scheduled two nights per month where I’m doing my “side hustle” job to earn extra $1000 per month.  With this extra money, I’m hoping to pay off a loan and save for my move back to California.

I’m very close to taking a job in LA right now.  I can pretty much say I have the job but signing on the dotted line takes time with this particular institution.  During the job hunt, I’ve been asking my sister for financial advice in analyzing benefit packages.  As you all know, I am absolutely clueless when it comes to finances.  But luckily for me, my sister is a senior financial specialist for the city of Los Angeles.  She manages the city’s 5.5 billion dollar debt.  I’ve been reading a lot of personal finance blogs out there, and think my sister could actually blow them out of the water if she started one but I think she’d rather spend her free time not thinking about finances since that is what she does all day at work.  The other night I had a thought that maybe it would be a fun idea to interview my sister on this blog, have readers submit personal finance questions for her and post her responses here.  That would be a big shift from what I normally do here, but thought maybe it would be of interest to you guys.  Just an idea that is floating around my head at this point.  Whenever I diverge from the topic of getting dressed here, I have to think long and hard about it.

In any case, after crunching the numbers, my sister advised me to imagine that I will be making much less income than my real income, after she calculated the amount I would get in my retirement and compared that to my pre-retirement income, so that I don’t experience a drop in quality of life when I retire.  So for example, if you’ll get 50% of your pre retirement income after you retire, you should live like you are making 50% of your actual income, and put the rest into savings/investments.  Then the worst case scenario would be that your standard of living remains the same, but if you had been saving up your whole life, then you might have extra in your retirement.

She also reminded me that we have family obligations and aging parents (with no retirement of their own) to take care of as well. The bottom line was to live like you are poor even if you aren’t, #thepoorlife.  She also advised me to decide after two years if I want to stick with whatever job I’m in long term because of how many years it takes to qualify for retirement, ie. people who switch jobs often will have the clock reset and will have to retire much later in life to get their retirement.

My next step is to decide whether or not to buy long term disability.  A lot of doctor friends tell me this is wise, but my sister expressed doubt about this.  Luckily my cousin has a high level position at a major insurance company, so at some point, I will consult with him about whether the disability insurance route is something that makes sense for my unique situation.  So stay tuned for that.

new yorker caption

And just for fun, here is what I submitted to the New Yorker caption contest today.  Fingers crossed I win (fat chance).  🤷🏻‍♀️

23 thoughts on “closet clean out + personal finance

  1. I would LOVE if you had more features with your sister here. I’m always interested in smart, well-rounded blogs by women anyway. I am also considering a job move to LA, but from the midwest it is a huge cost of living differential. And I am pretty good with money but could use more financial knowledge anyway. I’m interested too in the mention of your parents – my parents have retirement, but my husband’s don’t (or not that much) and I am overwhelmed by the cultural distinction between my WASPy money goes to retirement and children, not parents, and his more Asian money gets split between children and parents which leaves me very nervous. We talked it out and are cool, but still the idea of giving some support to parents is something I never grew up planning.

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    1. LA is a great city to live in if you actually live in the city proper. It’s expensive but it may be worth it to basically live in 70 degree weather year round and be surrounded by everything you could possibly want from any city. Thanks for feedback about featuring my sister. I would say the need to support parents is not so much a cultural thing as it is a class thing. It just so happens that asian immigrants, like many immigrants because, often started from nothing in this country, didn’t have the opportunity to set aside retirement funds, and will need to rely on their children. It’s definitely a hard pill to swallow. Even though I’ve been mentally preparing myself for this obligation, it’s hard not to feel overwhelmed by it.

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  2. I think your sister is right. Still, there is ZERO possibility of me living on 50% of my income! I could do it, but I would be bored and unhappy.

    I have deliberately set up my non-negotiable living expenses below average for my area (small house, non-flashy car, etc.) because I hate to feel like I’m on a budget when I go to the grocery store or a restaurant or clothes shopping. I also set aside more than the recommended percentages in my 401K and other investments. That being said, every year at tax time (this weekend for me) I review my spending and regret that I didn’t save more. Approximately 35% of my income goes toward saving and investments, plus I get the extra 6% match from my employer for the 401K.

    One thing I try to do, most years, is automatically adjust my regular saving and investment contributions each year to offset whatever raise I’ve received. (Obviously, the 401K contributions are calculated on a percentage basis so I don’t need to worry about increasing those.) As a result, I see roughly the same biweekly deposit in my general checking account in 2018 as I did in 2014, because the raises have been allocated elsewhere. This year, because I’m thinking about switching to a job with fewer bonus opportunities, I might keep the raise for myself. We’ll see.

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    1. Sounds like you are doing REALLY good with savings! I think the take home point was to try and conservatively predict what your post retirement yearly income will be and mentally prepare yourself for that now. It doesn’t have to be 1:1, but should probably not be like a 75% drop in what you have become accustomed too (if you can help it).. not everyone can even think about retirement now because they are barely scraping by… of course lots of other things come into play too.

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    2. Also my sister is pretty extreme, so anything close to her advice is pretty damn good. For example, she makes a good salary, but consciously makes the decision to not own a car, not pay for internet access at home, lives in a tiny studio apartment; unrelated but she’s also very eco conscious, composts, recycles, is almost zero waste, and grows her own vegetables etc. But she will indulge in things that make her happy like expensive dinners and traveling.

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  3. I am always up for more personal finance discussion. I’m a resident, and for the last few years keep asking people (financial advisor people) if I should be paying down my loans or investing all my pennies, but I don’t feel like I’m getting a soild answer.
    Basically I’m really jealous about your financial coach.

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    1. I think the answer depends on your loan type. Do you have income based repayment? If so there is absolutely no incentive to pay more than the minimum because the loans will be forgiven after 10 years if you work for a non profit. Now if you have a traditional loan, then there is incentive to pay them down ASAP, before saving or investing. Then again, a resident’s salary is barely enough to get by in most cases so it might be worth shelving the stress of paying them down until you graduate. I’d recommend you check out the white coat investor book and check out the corresponding blog.

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  4. Good on you for getting it together. Money matters are so hard… I feel so lucky in some ways but have very little cushion outside of mom and dad, who I really don’t want to count on at my age. They’ve been retired for some years now and they didn’t count on a mooch child, so any decision I make in the service of a fun city life could be at their unexpected expense. Still, costs in CA are astronomical (a one bedroom is 3000+), so life right now is unsustainable and I have zero retirement. As in I have less than a couple of thousand in the bank, which isn’t enough for a rainy day. It’s early in my career but comparatively late in my life–I used to be in finance (ironic) before career changing in my late twenties. Now I’m sort of in denial about money matters because things don’t look good, but I figure it’ll be a while before I make enough money to put away any significant amount…

    BTW I scrolled down just now and saw the photo of Freddy with his MINI FREDDY right next to him. 🙂

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    1. A studio in a prime location should not cost you more than 2000. I’m looking for two bedrooms in the heart of LA and some are going for as low as 2400, but nice ones are closer to 3000. If you are willing to live in some area you can pay much lower than this. Don’t fall for the west LA trap that so many non native LA people fall for. Unless you have to be there for work. I know plenty of people who have NO money and make it work in LA. It all depends on what your life goals are. And most of my friends in their late 20s even to early 30s still get help from their parents so it’s not that unusual. I think I would be in much better shape if I had that luxury. But it’s not uncommon is my point. And yeah funny you noticed Freddy’s mini me. He loves his little brother and is they only toy he doesn’t rip to pieces. 🙂

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  5. Feel better soon! It sounds pretty serious, but it’s good that it’s not the flu. I’m still in awe that you were able to cut food expenses that much. It’s significant savings! Good luck with your upcoming move – I can only imagine that the costs associated with a cross-country move would be immense.

    Your sister sounds super-knowledgeable and financially savvy. It would be cool to hear from her, though I wouldn’t be able to think of any good questions to ask. My interest in and knowledge of personal finance all leans very basic, which I hope is sufficient for now (the goal is to just pay loans and save aggressively, mainly into my tax-advantaged retirement accounts). I’ve never put any thought into life insurance or disability insurance outside of the coverage available at work.

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    1. Hi Xin, thanks for the well wishes! My food expenses started out really high (1000/mo) so it wasn’t too hard to cut down. Plus my lunch is paid for by my employer so it wasn’t too hard. I’m still spending about 500 for food and for some people’s standards that’s still high. I never thought about it until now. It’s easy to not think about it. I’ll probably procrastinate on it for a while.

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  6. I would love to see personal finance posts. I love talking about money in general. Talking with others about how they “do” money has helped me figured out what works best for me. And I don’t see how you (generic you, not you specifically) can talk about consumption ad nauseum and not talk about finances.

    I’d definitely love to hear more about your sister’s and cousin’s views on disabilty insurance. We’ve been in the middle of trying to get it for the last 6 months and I just can’t pull the trigger on it. Relative to life insurance (which we just got last year), our quotes have been pricey (100-150/month, so presumably twice that for my husband too) for not that much payout (unless we wind up needing it for decades). And, of course, I’m overly optimistic that nothing bad will happen to me, so it’s a big monthly expense for nothing in return.

    But then again, my friend’s dad (a doctor) was diagnosed with Crohns and he’s been unable to work. They’ve been living in the Bay area off his disabilty insurance payments since she was a kid….so…there’s that real life example that hits fairly close to home.

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    1. Exactly, talking about finances adds an element of reality into the conversation about clothes. Thanks for sharing that story about ur friends dad. I think whether or not you have kids factors into the decision majorly. As a child free person, it is harder to decide.

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      1. Actually, getting married buying a house rather than kids triggered the current bout of responsibility. If something happened to either me or my husband and we were renting, that would be way easier to handle and adapt to. We’re less flexible as homeowners, and it would be extremely difficult to leave our wonderful community, which really would be part of our support network if something terrible happened. In a worst case scenario situation, we have more options with insurance than without it.

        And although we don’t have kids yet, we plan to. It’s easier to qualify, and you get better rates when you’re young and healthy. My co-worker had this totally random health scare a couple of years ago – heart and lung issues – and although he wound up being totally fine, he wasn’t able to get life insurance when he had his first kid a year later. When he tried again the year after, he did get offers, but it was exorbitantly priced, and he couldn’t afford it. It definitely scared me into getting life insurance ASAP. For us, kids are in the 1-2 year horizon, so we bought with kids in mind. Taking care of it now means we don’t have to deal with it after they’re born, when there’s less time and energy for that kind of stuff.

        Anyways, insurance didn’t much sense 4 years ago when we first finished grad school, but the calculus changed fairly quickly. I’m having more trouble talking myself into disability insurance, but if I’m being honest about it, I can’t afford to forgo a paycheck for an extended amount of time.

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      2. It’s such a complicated decision. Your comment is giving more motivation to hit up my cousin to get the lowdown on life and disability insurance. Maybe he’ll let me post his direct responses here, with his identity hidden of course. Thank you!

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    1. Thanks. Selling is the way to go.. also promotes smarter shopping from the beginning. If you buy things able to resell, it’s probably higher quality than let’s say forever 21. I’ll check out ur post.

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