Golden Albatrosses Killed Your Golden Goose

No Birds Were Hurt In The Making of This Post

Wondering where I’ve been lately? Well, I’ve taken advantage of some post-operative convalescent leave to concentrate on finishing my book. As a result, I haven’t spent any time writing new content for the blog. Fortunately, though, Chris Pascale saved the day and offered to write a guest post for this month. Chris is a published author, father, husband, accountant, teacher, and former U.S. Marine (although I’ve been informed there’s no such thing as a former Marine). He’s also a big fan and friend of the blog.

Chris reached out to me last year (2018) after he heard my interview on the ChooseFI podcast. He believed we had a lot in common including military service, money issues, and PTS. To prove it, he sent me a copy of his most recent book of published poetry called War Poems: A Marine’s Tour 2003-2008. Continue reading

Choices and Thankfulness

Choices

I’ll have you know that I do most the cooking on Thanksgiving in our house.

Happy Thanksgiving

“What are you thankful for this year?” is a commonly asked Thanksgiving question. It’s usually asked around dinner tables, which is where we Americans typically celebrate this holiday designed to bring us together and reflect on the bounty in our lives. In fact, Mrs. Grumpus and I asked our children the same question tonight as we ate.

Grumpus Minimus #1 (the older one) dutifully answered that he was thankful for his mom, dad, family, and friends. He then proceeded to list every single one of his friends. Grumpus Minimus #2 (the younger one) said he was thankful for Hickam Air Force Base, where he likes to go and watch Hawaiian airline’s planes land (Hickam AFB shares a flight line with the Honolulu airport). I bet no Air Force Base has ever been loved as much as GM#2 loves Hickam.

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Trade War Part Quatre: 3-to-9 Year Investment Mitigation Strategies

Last Call

This is the last article in my Trump Trade War series. In it, I address investment strategies to mitigate what I perceive as the worst potential effects of the Trump Trade War for investors on a three to nine-year investment horizon. This is by far the hardest time period for which to devise investment strategies due to the uncertainty surrounding the next potential recession and Bear Market. However, I felt I owed it to my readers who’ve stuck with this series thus far, and to those who also find themselves within this investing window. Continue reading

Trade War Part Deux: Risk Mitigation

Trump’s Trade War

Risk Mitigation

What’s the worst that could happen?

Hey! How’s it going? In my previous post on President Trump’s Trade War, and its potential to impact your wallet and retirement, I mentioned a future post where I would outline prudent risk mitigation measures an investor might take. Given the fact that the main front of the Trump Trade War kicked off for reals with China on 06 July 2018, it seemed appropriate to pen further articles now. I’ve seen nothing in the intervening days to change my gloomy outlook. In fact, I may have underestimated how bad this situation might get.

I’m getting ahead of myself though. For those of you who missed the first Trump Trade War article, you can find it here. In it, I outlined what I thought was a significant misunderstanding of macroeconomics and strategy (or is that strategery?) within the Trump administration. I showed how the steps they’ve taken on tariffs, free-trade, taxes, and immigration seemed specifically designed to make the next recession worse. I also opined that the administration’s actions may be hastening the onset of the next recession through inflationary pressures. While I bemoaned the idea of a three front trade war, two of which are against some of our closest allies and trading partners; I didn’t necessarily dismiss the need for action on China. Only the method. Continue reading

Four Golden Albatross Financial Lessons

A Message to Future You

financial lessons

Four Golden Albatrosses take flight

If you’re reading my articles in chronological order, either in real time or at some undetermined time in the future, you’ll know that my two preceding articles were counter-points to other people’s financial ideas. As much fun as I had writing articles that used macroeconomics to argue against other people’s theories; doing so courts a certain amount of negativity. Granted, the counter-points needed to be made, and I believe I kept the articles congenial, lighthearted, and fact-based. However, at the end of the day, I still argued against someone’s work as opposed to building my own. As a result, I hit the pause button on the Risk Series this week, in order to focus on a more positive message.

Ironically, despite my online negativity I’ve actually been doing some positive stuff in the real world — which just might be the understatement of a lifetime in regards to the internet. Over the past three weeks, I counseled three different military members and/or their spouses on financial issues. Two of those counseling sessions took place face-to-face; while the third took place via email. All of them proved a great experience … for me at least. I learn a lot about myself and other people every time I counsel someone. Whereas I felt like a reluctant financial voyeur during my first counseling session; I actually enjoy them now. Continue reading

The Golden Albatross vs. Risk (Part 1)

Doubting Grumpus

I spent a recent weekend and a good part of the following week “engaging” in the main ChooseFI Facebook group on the topic of whether or not it’s a good idea to invest your Emergency Fund (EF). This debate was prompted by ChooseFI Episodes 66 and 66R in which the “Invest Your Emergency Fund” thesis was broached, examined, and positively endorsed by the hosts and their guest. Just to be clear, I argued (congenially, of course) that in general terms, it was a doubtful thesis. More importantly, though, I pointed out (along with several other people) that the framework for the debate was poorly constructed. This was primarily due to a lack of defined terms.

risk

Fund?

For the record, I’m a big fan of the ChooseFI Podcast, and not only because they interviewed me. The hosts, Brad and Jonathan, typically dole out challenging but sound Financial Independence (FI) advice. Although they stooped low to interview me, their guests are also typically top notch. In fact, their guest for the “Invest Your Emergency Fund” episode was Big Ern McCracken. Ern runs the Early Retirement Now blog — of which I’m also a big fan. Ern’s not only a valued member of my Golden Albatross FB group, but we even collaborated on an article for my website. Continue reading

The Golden Albatross vs. The Insurance Industry (Part 2): Annuity Valuation Case Study

Insurance Annuity Valuation Question

Annuity Valuation

What me worry?

A reader, whom I’ll call Lady J, recently asked me if I could value her future insurance annuity scenarios vs. her current cash-out value. She wanted an annuity valuation done in the same manner as the Pension Lump Sum Case Study I wrote for the Pension Series. The question intrigued me. My initial reaction was, yes, I could. Since a Defined Benefit Pension (DBP) is just another phrase for an annuity; I didn’t think it would prove too hard if she could provide the appropriate details. I told Lady J as much, and she promptly supplied me with details I needed.

Surprisingly, the annuity valuation proved both easier and harder than I initially thought. Easier in the sense that based on the numbers provided by Lady J, my Master Pension Value Calculator spit out an answer to her question in no time. Harder in the sense that once I reviewed the terms of her annuity policy, and the facts surrounding her initial investment, it forced me to ponder numerous “what if’s”. Thus, consider this article in two parts. First, I walk through the facts surrounding Lady J’s situation and the process of annuity valuation. Second, I address a few different issues, both good and bad, I noticed with this annuity. Continue reading

The Golden Albatross vs. The Insurance Industry (Part 1): Fees

What’s Your Opinion on Insurance Products?

Let me level with you up front: I don’t have a lot of experience with insurance products — especially the type that mirror investments. Prior to my experience related in the below story; the only other time I dealt with insurance investments was successfully extracting Mrs. Grumpus from one of the two products she invested in as a young worker in her home country. Up to now, I really hadn’t given them a lot of thought. As a result, I never held strong opinions about them in either direction. Maybe the most I ever felt was lucky for not getting involved with them — which I suppose is better than the regret I routinely express from other investment choices!

Of course, I’m not completely unaware of the arguments for and against such products. I hear them routinely denounced on several podcasts I listen to. Jill Schlesinger from “Jill on Money” is probably the most vocal, but certainly not the only one. The costs associated with such insurance “investment” products are often what draws the most negativity. Insurance sales people who push insurance products as a panacea to all money problems, is another issue that stirs emotion the wrong way.

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Thankfulness and Bounty

The Meaning of a Grumpus Thanksgiving

I am sitting at home on Thanksgiving 2017 with a turkey breast on the smoker and some time on my hands to reflect. I find the Grumpus Minimi (pronounced min-EE-my) thankfully entranced with Charlie Brown specials, and Mrs. Grumpus busy making the pumpkin pie. Yes, for this five minutes my life feels like a Norman Rockwell painting (ignoring the Hawaii climate). I have much to be thankful for with respect to my life, this year more than any other. I hope as you’re reading this you feel the same way. If so then I believe our thoughts are aligned with the original intent of this holiday.

Thankfulness and bounty

We’ve moved on to Paw Patrol apparently.

I’ve always loved Thanksgiving. A day set aside by one of the richest nations to ever exist in human history in order for its citizens to reflect with friends and family on the bounty that life found fit to bestow upon them, always appealed to me. Declared a national holiday in 1863 at the height of the U.S. Civil War, I would also suggest that part of the original intent included a belief by then President Lincoln that we should be thankful despite the hardships life has set in our path. As any student of U.S. history can tell you, my nation has thankfully never again seen such hardship as the Civil War. Continue reading

Golden Albatross Pension and FI Decision Trees (1st Draft)

“Exactly What Do You Think Is Happening Here Captain?”

“Fists in the air in the land of hypocrisy.”

Raise your hands if it’s hard to determine where I come down on some of the issues I address in this blog.  You’re not alone.  I do it on purpose.  The way I see it, for some topics, all I can do is describe the problem and provide some options to solve it. The choice is yours as to how to use the information I provide. I was reminded of that this past week as I interacted with several of my Golden Albatross Facebook group members about topics I should include in a money manifesto if I chose to write one for the blog. Continue reading