Monday, May 8, 2017

Step 2 - The Prep Work

I had a great hike this weekend (went to Jones Run/Doyles River) and am ready to continue on with the next step of The Plan.

Step 2 is the big one.  It reads:
Between now and the time my son graduates from high school (2027, assuming he holds up his end of the bargain), do the following:
  • Enjoy trips to the house in Maine
  • Hike a lot
  • Save enough money to retire
  • Prepare the house in Maine for full-time residence
That's a lot, so I'll have to break those steps down further later on.  But for now, let me give you the high level.

2a.  Enjoy trips to the house in Maine



This is a fun step.  We have this beautiful little cabin in Maine, so we need to enjoy it.  Living several hundred miles away means we can't do that as often as we'd like, so we need to pick our spots.

Currently, my parents spend their summers there.  The girlfriend and I try to take trips up at least once per season - a spring trip to open the winterized cabin before my parents arrive, a summer trip to enjoy the lake, a fall trip to help winterize (and get a peek at the foliage), and a winter trip to play in the snow.

Neither of us have four weeks of vacations (like most Americans, I'd wager), so we try to build our trips around holidays and long weekends whenever possible.  And since we're trying to save to retire early, we try to keep the budget for these trips manageable.

To keep the budget manageable, and because neither of us really like flying, we drive.  Since my car gets decent mileage, gas for the trip isn't too bad.  We pack snacks and drinks for the road and have a blast road tripping it.

While we're up there, it's tempting to eat every meal at all of the wonderful restaurants around, but we don't.  A quick trip to the grocery store is one of our first stops.  That said, it is a vacation so we don't want to spend all day in the kitchen.  We keep the time/effort low and do a lot of crockpot cooking in the winter and grilling out in the summer.  It works out well.  We do make sure to hit our favorite spots while we're there, though.  There's one pub in particular that gets a visit every trip.

2b.  Hike a lot



Whether we're up in Maine, or home in Virginia, we try to hike as much as we can.  It usually works out to a couple of hikes per month.

All of the hiking is really central to our plan for a few reasons.

First of all, it is healthy and fun.  If we're going to live long enough to enjoy retirement to its fullest, we need to stay healthy and have something to look forward to doing.

Second, it is low cost entertainment.  Once you have all of your primary gear purchased, the only expenses required for a day or even a weekend of hiking is some gas money and some food.

Finally, as I've mentioned before our plan is to hike the entire Appalachian Trail as our bridge to retirement.  We need to have our trail legs ready to go, our gear selections dialed in, and plenty of trail food recipes if we're going to successfully hike almost 2,200 miles.

2c.  Save enough money to retire



This sub-step is the one that's going to require a lot more discussion.  There are countless blogs devoted to just this topic.  Some of these folks managed to save $1 million by age 30, cut their expenses to $25k/year, and retired happily ever after.  We're not quite that hardcore.  I'm aiming to be done by age 49 with enough in the bank to support a $40k/year lifestyle.  If things get tight, I'm not opposed to picking up some seasonal work or odd jobs.

To save money, I'm feeding the piggy bank through 401k contributions, Roth IRA, and taxable accounts.  I have a son who will hopefully go to college someday, so I am balancing this with also funding a 529 plan for him.  None of this is new or unique, but as this blog progresses I'll pass along some lessons learned and tips I've come across for making those accounts grow.

The first tip I'll pass along is this - I automate these savings as much as possible.  When the paycheck hits my account every few weeks, a good portion of it is already allocated out to automated transfers to my various accounts.  In most cases, the money doesn't sit in my checking account for more than a few hours.  Since I don't have time to see that money before it magically disappears from the account, I never miss it.  Same with 401k contributions - I've never seen a check with less than 15% going to my 401k.

2d.  Prepare the house in Maine for full-time residence



Admittedly, there's not much to do with this.  The house is livable year-round as is.  But since I just recently purchased it from my parents, I need to find ways to make it feel like my house instead of their house.  But I need to do it respectfully and retain the charm of the home.  And since I will be living there year-round, and it's a small home, I need to improve the storage situation whenever possible.  Space is at a premium.

I also want to beef up the energy efficiency and comfort level for winter living.  Right now, the entire house is heated with a Rinnai propane heater.  It does the job admirably well considering it's just one wall unit for the entire house, but the bedrooms (the furthest rooms from the unit) get a little cool.  Also, the floor, being tile throughout the house, stays pretty chilly.  On the plus side, the walls and ceiling of the house are insulated very well, so what heat is there stays in.


Well, that's about it for now.  Please stay tuned for step 3.  And if you need to, go back and check out step 1.

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