Root of Good

The Great American Canadian Road Trip – Summer 2016 Edition

April 25, 2016 JustinRoG Investing, Personal Finance, Travel

I dropped some hints about our big summer plans in my last post, and now it’s time to make it official! We’re going on an almost month long road trip to Canada by way of Kentucky and Michigan. For those following along with my early retirement journey for the past few years, you might be experiencing deja vu because doesn’t a month long road trip to Canada sound familiar?

You aren’t experiencing deja vu. In 2014 we did set out on what was supposed to be a month long road trip to Canada that turned into a two and a half week road trip when we came home early. The exhaustion that comes from superintending a rambunctious two year old combined with a disappointingly dirty Airbnb apartment rental persuaded us that it was time to return back home to Raleigh for some true R and R.

March 2016 Financial Update

April 5, 2016 JustinRoG Financial Independence, Personal Finance

I don’t know about you, but we had a wonderful March! The weather is beautiful and life is going very well at the Root of Good household. March represents the first full month of early retirement for Mrs. Root of Good. Last week the kids celebrated spring break and we had a very successful week of relaxing and enjoying the complete lack of a daily schedule.

In financial terms, March was very kind to us. Our net worth shot up $94,000 in spite of spending almost $11,000 (most of which was a used minivan purchase). Our income was higher than normal at $7,806 thanks to quarterly dividend payments from our investments.

How To Score a $50 Car Payment For Life

March 28, 2016 JustinRoG Financial Independence, Personal Finance

Our latest big ticket purchase included a free membership in the Large Family Club. That’s right, we bought a minivan. “Purchase a minivan by 2008” I typed in my first FIRE spreadsheet back in 2006. Oops, eight years late but it still counts, right?

The main reason we were eight years late buying a minivan is because we didn’t need it prior to the last year or two. It was our planned five week multi-thousand mile road trip up the East Coast into Canada that convinced us that a larger vehicle would be more comfortable for long road trips. We are in the middle of planning our 2016 summer adventure (more details later!) and decided to upgrade to a larger car for this trip.

Read on to find out how we’ll pay $50 per month to periodically replace our new(er) car.

The Many Faces of the Four Percent Rule

March 17, 2016 JustinRoG Financial Independence, Investing

If you are a fan of early retirement and financial independence, then you have probably heard of the four percent rule. And if you haven’t, then welcome to the Club and allow me to explain more.

The four percent rule as developed in the “Trinity Study” way back in 1998 says a portfolio of stocks and bonds can support four percent annual withdrawals, adjusted for inflation each year, for a period of thirty years with very little chance of running out of money during that period of time.

The four percent rate of withdrawal is often called the safe withdrawal rate because the retirement portfolio didn’t run out of money in 95% to 98% of overlapping thirty year periods of past investment returns dating back almost a hundred years.

February 2016 Financial Update

March 3, 2016 JustinRoG Financial Independence, Personal Finance

February was an awesome month overall! Mrs. Root of Good finally quit her job and joined me in early retirement. Our oldest daughter was accepted into one of the best middle schools in the county (our first choice school) which feeds into the best high school in the county.

Our $4,221 income during the month was more than double our $2,030 in expenses. In spite of spending half of what we made, our net worth still declined by $4,000 during the month due to a slight decline in the stock market.

Pitfalls and Subsidies While Signing Up for Affordable Care Act Coverage

February 22, 2016 JustinRoG Personal Finance

While we were planning for early retirement, health insurance was the scariest unknown variable in the plan. This was in the dark ages before the Affordable Care Act’s premium subsidies and guaranteed coverage. Back then, I budgeted $1,000 per month when family premiums were $500 per month simply because I expected insurance costs to go up significantly and to account for the chance that someone in the family might end up in the state’s high risk pool with insane premiums.

In 2014, the Affordable Care Act (also known as Obamacare) proved to be the golden ticket for many hopeful early retirees. Pre-existing conditions no longer mean you are uninsurable. If you make less than 400% of the poverty level (400% of FPL = $113,760 for our family of five) you’ll also qualify for subsidies to help pay for health insurance.

Because Mrs. Root of Good retired early two weeks ago, our family health insurance coverage provided by her employer ends on the last day of February. In this article I’ll outline how we applied for health insurance coverage on the healthcare.gov marketplace including the pitfalls along the way and how we secured subsidies that will pay for 88% of our health insurance.

Mrs. Root of Good Jumps Into Early Retirement!

February 15, 2016 JustinRoG Awesome!, Financial Independence, Lifestyle

I’m looking over her shoulder at 4:30 pm on a Thursday while sitting in our home office. A quick last check of her emails. A moment’s hesitation. Is this really it? A click on the X in the upper right corner of the screen. Fade to black.

Ten years of work culminating in that final click on the X in the corner. One chapter of Mrs. Root of Good’s life is over. Turning the page to a new chapter, she finds the rest of the script unwritten. Her biggest worry becomes the emptiness of all that white space spread in front of her.

For over a month, it’s been a done deal but I’ve kept it a secret. Unlike the last time she resigned, no negotiation this time around. She said in her resignation letter it was time to move on. She is now officially free from the 9 to 5 work schedule.

January 2016 Financial Update

February 8, 2016 JustinRoG Personal Finance

One month down, eleven to go. With the new year came a significant drop in the markets that left our portfolio a little lighter than it was during most of 2015. We suffered a $64,000 net worth decline during the month of January.

Our income remained steady at $6,912 while our expenses ended the month at a modest $2,293. In cash flow terms, we made much more than we spent. However that didn’t mitigate the stock market losses to any real degree.

We were due for a stock market correction for a while and it’s finally here now. Whether this is a real recession and how deep it might become remains to be seen.

Book Review and Interview – Job Free: Four Ways to Quit the Rat Race

February 1, 2016 JustinRoG Financial Independence, Lifestyle, Personal Finance

I recently had the opportunity to chat with Jake Desyllas, another very early retiree. Jake hosts The Voluntary Life, a podcast about entrepreneurship, financial independence, and freedom. In 2000, he founded Intelligent Space, an award-winning consultancy in the UK, that led innovation in the field of pedestrian movement simulation and analysis. In 2007 he sold his business and in 2010 he retired early, at the age of 38. He is the author of Becoming an Entrepreneur and his new book is called Job Free.

Since achieving financial independence, his adventures have included becoming a perpetual traveller, going minimalist, playing in a band, writing books, and creating a podcast. He currently lives in Panama with his wife Hannah.

Budgeting in Retirement – 2016 Edition

January 25, 2016 JustinRoG Financial Independence, Personal Finance

It’s a new year so it’s time for a new budget. For the past two years I used this budget of about $32,000 per year. We spent $34,352 in 2014 and $23,802 in 2015, for an average of $29,077 over the last two years. We ended up an average of $3,000 under budget in spite of undertaking a major home renovation including new siding, new windows, and a roof repair in 2014, and a seven week trip to Mexico in 2015.

The $32,000 per year budget was my first attempt at developing an early retirement budget. I tracked our expenses for a few years before I retired in 2013 and figured out that we spent about $24,000 per year on core expenses that would continue into early retirement. To that $24,000 figure, I added extra expenses to account for increased costs in early retirement like health care and traveling the globe.