About Grumpus

Personal Finance Blogger, Father, Husband, Student, Hobby Horticulturalist, and Retired U.S. Military

University of the Golden Albatross: Roth Options Vs. Traditional Retirement Accounts

Study Hall

Do you have a favorite teacher from your time at school? How about one that particularly challenged you to be a better student? It could be a primary, secondary or college instructor who you remember particularly fondly. I had one in 5th and 6th grade (I went to a weird school where we had the same teachers for two grades in a row). Let’s call her Strictus Academicus. She was strict but fair and taught me how to channel my smarts and energy in a positive direction. I thrived under her tutelage, and the academic discipline she forged within me carried on for the rest of my life.

Yep. Just like I remember it.

Much like Strictus Academicus, I am going to break out the ruler and be stern but fair with you. Don’t worry, no one’s knuckles are getting rapped, and no one will be staying after class. However, I am assigning some prerequisite reading and podcast listening. The prerequisites are for those of you not familiar with the difference between Traditional and Roth retirement savings vehicles. Many apologies for doing this, but I cannot allow you to continue reading the bulk of this post until you read or listen to the following articles.

I can hear the groans already. Yet, I need to talk higher level stuff, and if you don’t have the basics down, then I am afraid I will lose you. I may loose you anyways because this stuff is not the most exciting. The knowledge could save you money, time, and hassle though. And I would rather loose your attention out of boredom than confusion. As for your assignment, since other people have explained the basics much better than me, it will be easier if you to simply learn from them. For those of you Roth and Traditional Retirement Account (TRA) novices, see the bullet points below prior to class convening. And don’t worry I was just like you two years ago.

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An Unintentional Meander Up Grumpy Avenue (Part 1)

Posted on 02-July-17 by Grumpus

“You only have to do very few things right in your life so long as you don’t do too many things wrong.” — Warren Buffett

Learning Lessons the Hard Way

In the fall of 2004, I sold 300 shares of Amazon stock as part of a down payment on my first, and to this point only, home. Wait, before you say “Man, that Grumpus is an idiot” there is more to the story. I bought a home in Southern California (SOCAL) only eighteen months before the height of the housing bubble. For those of you unfamiliar with historical SOCAL housing prices, I’ve posted the below chart of what housing prices did in San Diego from 1987 to 2015:

Yep, that’s bad. So bad, in fact, that my home’s value only recently passed the original price for the first time since the bubble burst. In the meantime the amount of Amazon stock I sold in 2004 would have done this:

The sky is the limit for Amazon!

OK, now you can say it now — I am an idiot.

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Multi-Task Your Way to Financial Independence (FI)

Posted on 28-June-17 by Grumpus

Since the day I met her, Mrs. Grumpus has insisted that men cannot multi-task effectively, unlike women. My typical Confucian-like retort used to be something along the lines of, “the woman who splits her attention among multiple tasks does none of them well”. These days though I believe I’ve harnessed my inner woman enough to master the art of listening to podcasts while doing other more menial tasks. Work and family demands mean time is too precious to let self-improvement opportunities slip by while commuting, cutting the lawn, gardening, cleaning the garage, driving the Grumpus Minimi (pronounced min-nee-my) to swim lessons, or listening to Mrs. Grumpus talk (just kidding honey!).

Confucius had nothing on me

In fact not only do I double-up on tasks, I now triple-up by commuting on my bike with a pair of earbuds. For you math challenged out there: commuting, exercising, and listening are the three tasks.

Wonder what she is listening to?

I discovered the value of podcasts while stationed in Europe. I was cut off from my standard commuting radio selection of NPR, NPR, and more NPR.

Someone who likes NPR more than me

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3 Books + 2 Booklets + 1 Chapter = Financial Independence (FI)

Posted on 27-June-17 by Grumpus

The Three-Legged Stool of FI Knowledge

The two avid readers of this blog site (my parents — Grumpus Maternus and Grumpus Paternus) might recall a mention in a previous post of my three-legged stool of financial independence (FI) knowledge. They might also recall that I built that stable platform of knowledge through blogs, books, and podcasts. In the first leg, I discussed financial independence blogs. In this post, I review financial independence books.

Form, function, and finances

I specifically review three books, two booklets, and one chapter that when taken together would allow a person to plot a course to FI. The beauty with this list is that it includes a book for each stage in that journey. From those simply needing the motivation to start, to those ready to write retirement plans, create spreadsheets, and make investment moves; there is a little bit of something in here for everyone. Continue reading →

Financial Planning (Part 2): The GRO2W Plan

Posted on 27-June-17 by Grumpus

As you see from the title, this post is a continuation of a previous post on the method I use to conduct financial planning. If you haven’t read the first post I suggest you go back and do so. The content below will make more sense if you do. I would strongly suggest you read my article on the need to track your money as well. Without that knowledge you will not be able to make many of the calculations I discuss below.

If on the other hand, you are continuing from Financial Planning (Part I), and you’ve read my Track Your Money post, it must be because you are ready to build your financial plan. So let’s get to it. Continue reading →

Financial Planning (Part 1): Time and Planning

Posted on 25-June-17 by Grumpus

“In preparing for battle I have always found that plans are useless, but planning is indispensable.” — Dwight D. Eisenhower

Bottom Line Up Front (BLUF)

I received several comments in response to my last post from people who were receptive to the idea of Financial Independence (FI) save but one factor – the amount of time it would take to figure out how to achieve that goal. I get it. Life has a knack of interrupting attempts to plan long term. From babies to hobbies to the day to day grind of work. There just is not enough time in one day, one week, or one month to sit down, study the problem, and conduct the planning that FI requires. No doubt FI takes time – I used a three month Temporary Duty (TDY) assignment to develop my plan. Since I was separated from my family, I decided to put my time to good use. However, you may not be so “lucky” as to get three months of TDY from life’s other responsibilities to conduct FI planning. If lack of time is your biggest obstacle to planning for FI, attached is an outline to follow in an attempt to save you some … time. Depending on how well you track your finances, using the outline will probably cut your required planning time in half. Speaking of the need to track your finances, if you do not already do so, please read my post on the need to track your finances before going any further with this one. Continue reading →

Track Your Money (Part 2): YNAB

Posted on 25-June-17 by Grumpus

Remember how I said Grumpus Brotherus had used You Need A Budget (YNAB) for years? Well, when I asked him to write a paragraph for my Track Your Money post, he sent an entire post’s worth of information back. Instead of editing the material down to a paragraph to fit my article, I decided to give him his own post. I present you here the first guest author for the Grumpus Maximus blog! Now I must warn you that Grumpus Brotherus is a nerd … I mean N-E-R-D. Which is ok these days since the nerds will apparently inherit the Earth. But at points within the article, he does geeks out on software

I can’t believe Brother Grumpus does this since ..

interface and whatnot. It is hard to believe he flies in fighter jets for a living. Although I guess jets are more software than hardware these days, so maybe it makes sense. In any case, I edited a little to de-nerd it for us ‘laypeople’, but otherwise all the themes are his own; completely unprompted by me …. you will see what I mean. Enjoy. — Grumpus Maximus Continue reading →

Track Your Money (Part 1)

Posted on 25-June-17 by Grumpus

I’ve referred to building a retirement plan in several previous posts, and I will show you how I did it in future posts. But before we get to that I need to talk to you about an endemic problem afflicting most Americans…. the problem associated with tracking money. No, I am not talking about the need to track money that finances terrorism or organized crime. I am talking about the need to track your money.

In April 2014 Business Insider reported that 61% of US adults do not track their money. That was only six years after the financial meltdown of 2008! That is pretty damning, but not surprising … at least not to me. As someone who has tracked their money religiously for the past 18 years, I can attest it takes time and discipline. It is often undervalued and much maligned as a “man” activity in my family (just ask Mrs. Grumpus). However, long before I taught myself anything about the investing world, Financial Independence (FI), or early retirement options I used to lock myself away with piles of receipts in my man cave every two or three months– just so I would know how our money was being spent.

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5 + 1 Financial Independence Blogs (Besides Mine) You Should Check Out

Posted on 25-June-17 by Grumpus

The Three-Legged Stool

Are you interested in achieving Financial Independence (FI) either before or after your pensionable career? So was I two years ago, so I started educating myself on personal finances. For those of you who’ve read Grumpus Maximus vs. The Golden Albatross, you know I’ve now spent more time researching FI than I did studying for my degrees. FI blogs, books, and podcasts are the three primary resources I used (and still use) to expand my knowledge. Think of them as a three-legged stool for FI knowledge, and I intend to post on all three “legs” in the future. I decided to start with FI blogs, so below are links to 5 + 1 FI blogs that I’ve found extremely useful during my financial education project.

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