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July Wrap up

August 15, 2018

Much belated due to being out of town a lot!

Net Worth and Money

It is summer salary season!  T has a “9 month salary”, which is by default is paid out over 12 months. In the summer, he can use grants to earn additional salary, spending his full effort on furthering his research. Summer grant money is not guaranteed (he has to apply for and win grants), but it is predictable on a timescale of a couple of years. Most professors in his department can consistently pay themselves summer salary, but there are funding environments where this is not true.

With the extra cash flow this summer, I refilled our property tax account so the money is on hand for the December & March tax bill payments. This is out of convenience and allows me to avoid budgeting these on any monthly level.  They are a bit high for me to feel comfortable cash flowing.  We’re still holding a lot of other miscellaneous cash for now, but when my upcoming maternity leave comes to a close (and T finds out about tenure), we’ll reevaluate.

Between the two of us, we have over $10k in outstanding travel reimbursements owed to us by our employers right now.  I booked travel lodging for ~1.5 months for 3-4 people and it is all on my personal cards. I don’t track this in my net worth, but having $10k outstanding is an anomaly.  In the end this is not terrible – I get cash back/credit card points, and we can cash flow this.  It is still slightly alarming!  I’m getting a good chunk of this back within a few days, but I’m still incurring expenses.

I’ll be done maxing out all of my retirement options with the paycheck that arrives at the end of August.  T is on pace for an end-of-year max-out (assuming he logs in and slightly adjusts his 457b contributions).

We received our new tax assessment, and I updated our house value accordingly.  Our tax assessment lags my estimate of our market value by at least $100k, but practically speaking, our home value has limited influence on our financial plans.  Generally, we intend to stay in this house and RETIRE in this house, so the important thing is to eventually kill the mortgage and be able to cover the rest of our spending with our investible assets.  After four years, our total remaining payments are now equal to our purchase price, assuming we make no additional prepayments that knock off more interest in the amortization schedule.

With all of this, our net worth went up about 3.7%

Spending

I’m behind on tracking this again…  My spending on food and such is low due to work travel, but we’ve been spending on home projects and (a little bit) on baby prep.

Work

I spent more nights in my own bed than away in July, which is unlikely to be true for August.  We spent two weeks “in the field” traveling for work, then came home for a week to rest up before heading off for the final and longer stretch. Things went really well during that two weeks, and it was tiring and fun.

There was a lot of coworker social time on the work trip.  This was fun, but something that I’ll need to watch out for in the upcoming longer stretch. I need some time to recharge and have to be sure I take it when the opportunity presents itself.  Also, a bit of the social time leaned a bit towards the “let’s drink a lot!” side, which was marginally annoying. Thankfully, this was infrequent and limited to a few people. It was easy enough to accommodate/ignore, and there were plenty others who seemed almost as disinterested as pregnant-me in partaking.

Other work has been really hard to keep up on, so I had to strictly prioritize during my week home to ensure I didn’t drop too many balls. It has been pretty busy – I feel like I’m failing to keep everything moving.  My main project has been really supportive of my side project AND upcoming leave, not to mention really fun and meaningful over the years. I don’t want to let them down.

House Projects

T did a bunch of landscaping work in July, although progress seems to have stalled a bit.  We also got a new light fixture for our entry way and finally hung up a proper coat rack to replace the plastic command hooks that have been “temporarily” holding our coats for a couple of years.

Pregnancy / Baby

As far as pregnancy goes, everything still has been pretty easy!  I had a lot of bloody/stuffy nose issues while on travel (dry air / air conditioning / altitude change?), but it was easily manageable.  I know the 3rd trimester will likely get uncomfortable, but I’m happy that things have been smooth so far.  We had another checkup, and nothing to report.  I have had some Braxton Hicks contractions, which started around 20 weeks and are standard.  Nothing much else to report for July!

 

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Planning for a Baby: Childcare

July 26, 2018

Editorial Note:  I updated my post on maternity leave with a graphic on the normal California leave (up to 16 weeks paid at >$1200/week!) and noted the leave I get (just a few weeks partly paid if I deliver on my due date).  I do, however, have a boatload of PTO banked, and will be able to be paid for nearly all of my 16 week leave using this saved time.

The baby is still a few months away from coming, but childcare was something we started thinking about right away.  We don’t have it figured out for sure yet, but we have a good understanding of our options. I’m not sure what age we will start needing childcare.  I’ll go back to work when the baby is about 4 months, with my initial plan to have some reduced hours.  The need for care at that age will depend on 1) how much care T can do while still being productive in research during his semester without teaching 2) how much I can juggle my schedule to support that.  I suspect we’ll want some part-time care at the point when I go back to work – but I can’t say for sure what will be enough.

The goal:  Find a safe place for our infant to be while we work.  Ideally, we’d start out with a part-time schedule (both T and I intend to have reduced hours initially).  We’d transition to full time at some undefined point in the future, probably depending on my job demands.

We’d prefer something that minimizes commutes, but given my current 5 minute commute, commute will be impacted.

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Costs noted below generally ignore the small tax break we can get for using a dependent care spending account.

The choices:  

  1. Daycare center: This is our leading option, although we have nothing confirmed and are on a couple of wait lists.  My favorite choice is over $2,200/month for full-time care and does not offer part-time care. I’m unconvinced part-time infant care in a center will be available at all, because the centers all have very few infant slots and prefer to use them for full-time families.  No day care centers satisfy our goal of minimizing commute time – the are all inconveniently located.  The cost of this is about $27k/year, plus we’d seriously consider getting a 2nd car to save some commute time.

  2. Nanny share:  The concept is that you team up with another family, and you each pay something like $14/hour for a nanny who watches both kids at the same time.  Sometimes it is hosted at one house, and sometimes it is shared between both houses.  We have a large and energetic dog (and I’m absolutely confident we can manage him with our kid), so it could be hard to host this at our place. I love this idea, but finding a match seems logistically challenging. Finding a part-time match seems even more difficult.  This is about $31k/year for full-time care.  This potentially could have a more optimal commute situation.  Nanny shares seem to be forming several months out / after birth, so I’ve made no progress here. We’ll keep this option on the table.
  3. Dedicated nanny:  My guesstimate is that a full-time nanny would cost about $50k/year (including the nanny tax).  This number is not something I can stomach, though technically we can “afford” this.  A dedicated part-time nanny may be an option, but in the long term we’ll need full time care.  This obviously would have the best commute situation!  Again, it seems to be too early to find a nanny if I don’t need care until February/March.
  4. In-home daycare: I’m not yet comfortable with this, but I do suppose it is an option.  It is not something I’m seriously considering yet so I’m not familiar with the costs.  It would be cheaper than a daycare center, but I don’t know how much yet.  These tend to have openings shortly before you need them, so we can’t start looking yet.  This also could have a better commute situation, but not necessarily.
  5. One of us staying home: This is more of a financial cost than any of the above options. I did some math on this here. I suspect that working is a better fit for both of us.  If my current job went away due to us running out of business, I would be picky about something new. Most jobs that are a good match for my skills have terrible commutes – but there are some options. T staying home is not a serious option, as the entire reason we live where we live where we do is to further his career.  I consider this is a fall-back plan if my work situation changes in a way that is unworkable for our family.  And it would be a temporary fall-back until business picked up.

Did these numbers give anyone a heart attack, or did they seem about right for those of you in high cost areas?  How did you decide what to do when your infant needed care?  If you hired a nanny or a nanny share, how did you do that hiring?

Food Lately

July 8, 2018

We’ve been eating more meat-based dinners than typical.  This is both because it seems like generally a good idea from a nutrient standpoint in pregnancy, and because I’ve simply been in the mood for meat and heavier meals more often. (I realize that non-meat sources of nutrients and protein are possible.) My weight has been right on track so far just by following my appetite.

Here are a few things I’ve made and enjoyed lately:

On the list of things to try is this and this.  I’ve been using Budget Bytes a lot lately – she has some good and easy recipes!

I have a green smoothie (spinach or kale, yogurt/milk, banana, ground flax seed) for breakfast many mornings to help keep my veggie intake up. I snack on high protein yogurt (usually Icelandic-style rather than greek), hard boiled eggs (and pickled hard boiled eggs!), almonds, and berries.  I’m obsessed with guacamole to the point that I’ve bought it pre-made ($$$$) several times. I also have made a spinach dip from this book sometimes.  There is, of course, some occasional unhealthy stuff, like ice cream, pastries, chocolate and such!

I’m hoping I can keep up good nutrition while traveling this summer, but I’m not going to stress TOO much about it.  Food options won’t be ideal and I don’t think I’ll have as much time as usual to cook and meal prep and think about what I want to eat.  Still, there will be grocery stores and some opportunity to cook and eat well.

 

June Wrap-Up

July 3, 2018

Life:

Let’s start here this month!  T had a bunch of work travel in early June, all packed into 3 weeks, with <24 hours home somewhere in there. During that time, I took in a bonus dog for 10 days, which is a favor we trade with our dog owner friends. The dogs settled into an easy routine after several days, and it was nice for my pup to have a friend who can keep up with him.  Once T returned, we took in a different dog for a weekend.  It was the best month of my dog’s life!

I’m traveling a lot starting this weekend, so this is not a good summer for quality time spent together, unfortunately.

Pregnancy is still going swimmingly, with few issues and symptoms. We had the big anatomy ultrasound, and all looks well with baby and me. This was a big relief.  I’m carrying pretty small still, but the bump is there if I wear something that shows it.  I know it could get a lot more uncomfortable later on, so I’m enjoying this time!

Net Worth / Money:

Net worth is up again!  We’re up 2.6% this month, although that is probably skewed by the fact that I didn’t get an update for T’s retirement accounts last month.  The gains seemed more flat in my accounts this month.

It only took 3 months, but we FINALLY mailed in the $8k mortgage pre-payment I’ve been planning since March.  Between my compulsion to pay off our 0% car loan, increased retirement savings over my initial plan, and the desire to see how baby buying stuff shakes out, that may be it for this year for mortgage pre-payments.  We’re going to hit another small mortgage milestone before the end of the year.  Our mortgage pay down trajectory is expected to slow with upcoming daycare expenses.

I’ve been chipping away at the car loan even though it is a 0% loan and we have cash on hand to kill it.  I simply like the idea of that payment going away, and I can’t seem to convince myself to stop, despite the math.

We’re still holding a lot of cash, and I think that is fine for the time being.

Spending:

I don’t have my spending tracked for most June yet, so nothing exciting to say here.  I hope to get caught up this weekend.

I’m trying really really hard to not get sucked into the consumerist part of having a new baby, and we are doing well so far. But everything is so tempting – marketers know what they are doing!

House Projects:

The main project leader in the house was out of town for 3 weeks straight, but still managed to make progress on the landscaping. It will be a long slog this summer.  Everyone who walks by and sees him working says “wow, that’s a big job!”  I’ve been of little help in this arena, but I swear I’ve been busy keeping other things moving. I’ve encouraged him to hire some help, which is something I rarely do for things we can (in theory) do ourselves.

There are a bunch of small projects to do on the docket, but the idea I’m most excited about is a bench like this with shoe storage:

Bench

I’ve been wanting an entryway solution since we moved in, but all the things I can purchase don’t seem quite right.   I really want something custom for the space we have, and this is the first design T has also been enthusiastic about. It is unlikely we can swing a large cabinet like this has (maybe a small one?). We’ll still have to use coat hooks on the wall instead of a decorative picture.  Still, it would be an awesome improvement. It might not happen at all, because it is a lot of work and not essential to have done immediately. It also requires use of some tools of our retired neighbor with a full wood shop. Still, I’m hopeful!  If it happens, I’ll show you a before and after.  If it doesn’t happen, I won’t show you the before, because it looks really really  sad. 🙂

We probably won’t make significant progress on setting up the nursery until September, but that is in the plans too.  In the meantime, I’ll get some older stuff cleared out. I still have a couple pieces of furniture that are from my very first post-graduation apartment. We do not have room for that anymore!

Work:  

Work was busy this month!  I’m ramping up my small project for our big finale this summer, while trying not to drown in my other work that hasn’t gone away.  :/  I think we have coverage arranged for my leave, but I’m nervous about that.

T has been busy preparing his tenure application materials, so we should find out the results sometime next spring.  The tenure rate is generally high, but there is always some uncertainty and risk in the process. I fully expect his department’s support, but the campus level stuff can be less predictable. They’ve started enforcing some odd new policies. It shouldn’t be a problem, but you just never know.

Preparing for a Baby: Working Full-time Versus Other Options

June 28, 2018

I have been asked whether or not I’m coming back to work, and my answer has been an enthusiastic yes.  Despite the high cost of child care, there is no question that either of our salaries more than “covers” daycare in a single year.  We don’t even have to think about the extra impact of potential lost salary growth over time to come to this conclusion. I also generally enjoy my work and get to do cool things, so it is a good fit for me overall.

Still, I wanted to see some numbers to understand what the various choices mean financially. My baseline scenario is that we both work full-time and pay for full-time childcare at a daycare center. Considering childcare and taxes, I look at how our savings rate and savings dollars change in a single income case and a case where I work part time.  Just for fun/self-torture, I included our current DINK case.

Here are my assumptions:

  • The cost of childcare includes an assumption that we get a small tax break by using a dependent care flex spending account.
  • I used 2018 tax brackets with current itemizations & the child tax credit.
  • All scenarios assume we keep similar spending levels outside of childcare.
  • In the part-time case, I assume we pay half the cost of full-time care. This is not realistic, but it ballparks the scenario.  Working 50% hours is not very easy to organize anyway, so I don’t see a need to overthink this.
  • I don’t account for work incidentals, like commuting or wardrobe or whatever.  These are not significant costs in my work lifestyle.
  • The exact method of calculating our savings rate calculation isn’t important, other than it is the same in all scenarios. I’ll note it is skewed by our high levels of pre-tax savings since a pre-tax dollar is worth less than post-tax dollar, and taxes are somewhat obscured in the calculation.
  • I assume we fund retirement savings first, and cash savings second.  Realistically, could reduce retirement savings a bit and still be saving more than enough.  We have access to an unusual amount of pre-tax savings (way more than $18.5k/person).

The results are summarized in the table below, obscured a bit by being made into percentages.  The savings rate is self-explanatory, and the retirement/cash savings are as compared to the baseline case,

Screen Shot 2018-06-27 at 8.27.34 PM

These results were better than I expected! The 1.5 income case is particularly compelling, but difficult to implement logistically.  The reason it is so nice is because we are able to maintain a large chunk of our pre-tax retirement savings, which maintains about 2/3rds of the tax savings that we get in the single income case.  That is pretty neat.  I was also happy to conclude that if we both work full-time, we can keep our current retirement savings and maintain some cash savings, even with the high cost of daycare.

At any rate, all of these results make me happy! None of the scenarios scare me, even considering the imperfections in my assumptions. There are disadvantages to waiting this long to have our first kid (too late for that now!), but finances is one big advantage.

[This post is one example of me using personal finance spreadsheets an an anxiety outlet.]

My 16 Week Maternity Leave Plan

June 19, 2018

My plan is to take 16 weeks of maternity leave. In addition to FMLA, I’m covered under the California Family Rights Act (CFRA).  CFRA is 12 weeks, but unlike FMLA, it does not start until I’m no longer covered under disability (6-8 weeks after birth).  My short-term disability insurance (SDI) starts 2 weeks before my due date, for a total of up to 22 weeks of protected leave. Except for when I’m covered under SDI, this is unpaid or using PTO.  Financially, I could take longer than 16 weeks, but I don’t see how I can be gone for ~6 months and still get back into my project without missing too much.  Even 16 weeks is tough, but it does overlap with the typically slower holiday season. If I were to leave my current project, there is a very real risk I won’t be able to find a new one when I’m ready.  We are low on projects right now and it isn’t a good time to be looking.

My main project  will be the most impacted by my leave, and they have no legal (FMLA) obligation to keep me on the project.  They aren’t my direct employer. There is an argument to be made for simply transitioning me off the project, and I’d bet you lots of money someone has suggested this.  I don’t think they’d do that unless I wasn’t performing, but working with me in California is a huge accommodation and favor to me personally.  We worked out a leave coverage plan, but I still get anxious that an ambitious coworker will butt in and steal all my work. I was questioned twice as to whether  I was really coming back. Did they mean back to that project, or back to work in general?  I’ve put a lot into my career, and never given the impression I’m ready to throw in the towel.  Admittedly, phasing off that particular project makes some sense due to location challenges, but I don’t have a better option on the horizon.

For various reasons, I am not covered under California’s state programs, which provide some amount of paid family leave for most Californian parents (including leave for partners).  Here is how leave works for most Californians (source):

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There is a total of 16 weeks paid, with a maximum weekly payout of $1,216 (maybe there is an unpaid 7 day waiting period – unclear).  The SDI portion is not taxed, but the PFL portion is taxed at the federal level.

My SDI starts 2 weeks before birth, and seems specifically designed to minimize benefits for pregnancy (the most common use of it, I’m sure) by forcing use of sick leave (if you have it) for several weeks before it kicks in.  It’s annoying, but at least it is something.  Assuming I take a total of 8 weeks (2 weeks before, and 6 weeks after), I think my net payout will be just under $5k, compared to ~$20k under the state program. If I deliver early, I’ll get even less.  On the other hand, it will cover me in the case of any longer term complications, which is the main reason I wanted it.  If I deliver late, I just get more leave paid.

It looks like I have banked enough vacation and sick time that I actually won’t have to take unpaid leave, although I’d prefer not to come back to work totally bankrupt in vacation.  We are in an incredibly lucky position where unpaid leave is almost a non-issue.  Yet, it still is stressful to figure all this out. When considering what could make this easier for American families, paid leave is only part of it. It’s a very important part, and should be addressed at least in the basic way California has begun to address it (for most people!). Beyond that, the work culture does not support accommodating long leaves, nor does it easily accommodate alternative schedules when parents return to work. Further, subsidized and easy-to-get-into childcare (as available in some European countries) would be incredibly useful in supporting women going back to work, if that is what they want to do. More on childcare later. Spoiler alert: We don’t have this nailed down yet, and infant-care in daycare centers in my area is over $2k/month, and the wait lists are long.

 

May Wrap Up

June 18, 2018

I was delaying this post until I got the numbers from T’s retirement accounts, since he was traveling so much. At this point, I just will leave them as they were last month, and update next month.

Net Worth / Money:

Our net worth went up by about 2% this month, with most of that in contributions and growth in my retirement accounts.  I’ve also slowly been paying extra on our 0% car loan, because I like the idea of that obligation going away before maternity leave.

We’re holding what I consider to be a slightly excessive amount of cash right now, and it feels like the right thing to do.  Once baby is born and here and has all the stuff baby needs and we are through maternity leave, I will re-evaluate this.  Once we find out if T gets tenure, we may blow some of it on a few major house projects, like a new roof.  We’ll at least get another assessment of the estimated remaining life, which was pegged at ~5-10 years when we moved in 5 years ago.  It definitely is coming.

House Projects:

A lot got done in May!  The burst in home productivity just might correlate with the end of the semester for my husband, and before his traveling started.

We finally purchased curtains to go on the sliders in the living room to augment the UV film we put up when we first moved in.  This should further help keep the heat out on those rare hot days in the summer.  (I hate vertical blinds and all traditional slider door blind solutions, so we went with curtains.) We also purchased, but did not yet install, blackout blinds for a small window in the future nursery, which match the ones we put on the big window a long time ago.

We purchased and T installed a bathroom vanity in the bathroom we remodeled earlier this year. T wanted to build a custom one, but his list of projects he wants to do was just too long.  We saw the price we could get for a vanity at IKEA, we decided to satisfice and go with that.  I’m super happy with it!  It took some effort to cut his own holes in the drawers for our plumbing, since we did not want to use the IKEA plumbing that you are supposed to use with it.

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We completed re-coating the deck, although we ended up needing to buy more coating to finish the job.  All of the patio furniture is back in place and ready for the summer!

Finally, my favorite project of all!  T cut out all of the overgrown front hedges and put them into a giant yard debris bin!  The bins are provided by the city (“free” via property taxes) to help homeowners remove excess brush to mitigate wildfire fuel.  At the moment, it looks terrible since it is just the remnants of hedges and nothing to replace them.  Still, I’ve hated those overgrown and un-trimable (dead insides) hedges for the last 4 years.  Replanting and building some rock walls to mitigate erosion will happen later this summer.

Still on the list for the year: painting the nursery (and guest room?), another closet system, glass shower door install, and as much DIY landscaping as we can manage.  I’m trying to limit the to-do list because I don’t think there is time to do everything we want to do.  We may get quotes for exterior painting too. I kind of want to put it off for a year so we can DIY.  I do not see us having time for a DIY painting project this summer.

Spending:

The big one was a replacement iPhone 8 for T.  He’s had an iPhone 5 since 2012 (with one warranty-covered replacement due to battery), but the battery finally made the phone unusable. (My iPhone5 died sooner and I have an SE as a replacement).  I personally don’t think that iPhones are the best thing on the market for the price anymore, but they have managed to keep us sucked into their ecoystem. We also bought a new wireless router.

House and maintenance spending was also pretty high (~$1300) to complete the above projects (deck coating, curtains, blinds, and vanity).

I made my first second-hand baby item purchase! I’ve started the process of stalking Craigslist and Nextdoor for items on my wish list. Not only will this save $, but it will help reduce overall waste.  We’ll buy the carseat new, and my in-laws want to buy us our stroller.  I don’t see a need for a new stroller, but I won’t turn it down.  I’m logging my purchases and plans here.

I also bought some maternity clothes. So far, I can get away with most of my normal tops, but not my normal bottoms.  Still, I’ve found this whole process annoying and more expensive than I was hoping.  I might post more about it later, but it makes me grumpy.  Some of it was just my own mistakes, and some of it is the fact that buying clothes that are temporary is just annoying.  My SIL sent me several things that she hadn’t donated yet, so that helped a lot!

Work:  

May was a fun month for work on my “small” project, which will become a big portion of my time for the next 3 months.  I finally told everyone at work about my good news, and it seems like accommodations will be able to be arranged.  Legally, my job is protected for some amount of time (I think more than 12 weeks with additional California laws), but I am obviously worried about my specific role and projects.

Life:  

I visited my family in my home town the week after Mother’s Day to tell them the good news.  They were really excited!  There hasn’t been a baby in my immediate family for about 10 years.  I can’t remember what else fun happened in May!

As far as pregnancy stuff goes, I’m still getting by with very minimal negative symptoms.  A few headaches here and there, a bit more peeing, some stuffiness and nose bleeds – but no real pain or sickness at this point.  I’ve been a bit less tired than I was early on, but still a few more naps than usual!   My weight is right on track, my doctors appointments have all been fine, and the major anatomy ultrasound happens in late June.  The 2nd trimester is supposed to be the easiest, but honestly, it has been mostly easy and I am feeling very lucky so far!