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Posted on Jul 22, 2013 | 0 comments

A New Car with a Side of Friendship

Small but mighty!

Small but mighty!

Over the last few months, several times Dan and I have brought up selling our GMC Jimmy and buying a vehicle with better gas mileage. Though we had only owned the Jimmy for a little over a year, we’ve had multiple repairs that we’ve had to make in addition to only getting around 15 mpg on average. We figured out that even though we only are planning to own our cars for one more year or so, there was still significant savings to be made so we starting searching for a reliable car with good gas mileage. We got a little help from the financial blogger Mr. Money Mustache who has a list that we used of the top rated small cars for reliability.

We quickly found that we really liked the look, efficiency, and pricing of the Scion xD and xA hatchbacks. These cars are stylish and fun while getting great gas mileage and having plenty of interior room for the three of us. (Note: they are still pretty small cars so anything more than 2 adults and 2 small kids is going to feel cramped.) We found an xD on craigslist only about 45 minutes from us and decided to check it out.

As Dan went on the test drive (we had Carter with us so I stayed behind) I started talking to the couple that currently owned the car, Kyle and Becky. The conversation sounded something like this:

“So, why are you selling your car?”

“Well, we’re pretty much selling all of our stuff because we are moving to Belize.”

“Really? Are you going there to do anything specific?”

(apprehensive pause) “We’re planning to be self-sustaining farmers and work at an orphanage there.”

How cool is that! Just in the course of a few minutes I got to hear about how this couple about our age are getting ready to head out on their own epic journey and follow their hearts off of the well worn path. Even though I could tell Becky was obviously nervous about telling us their plan (as I understand completely) I’m so glad she broke the ice. We were able to share some of our experiences in trying to plan for the unknown and made new friends. Most of all it was so encouraging to meet other people who share in common with us their belief that we are not prepared for our current life to continue on without change. Their journey will be very different from ours, but it comes from the same desire to live more extraordinary lives while we have the opportunity.

We were happy to be able to help fund their goal in some small way by buying their car (which we love by the way) and if you would be interested in buying their house in Lincoln, Illinois here is the listing. We wish the best of luck to Kyle and Becky and hope that they see their dreams come to fruition very soon. Maybe if we make our way over to Belize in the next few years we will meet up with them again.

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Posted on Jun 27, 2013 | 0 comments

Boat Review: Morgan Out Island and Cape Dory 33

While we were in Panama City we decided we should take a look at a few boats that were potential candidates for us in the future. Most likely none of these exact boats will still be on the market in a year from now but it was important for us to get an idea of what condition boats were actually in that would be in our price range. It’s one thing to tour beautiful, brand-new boats at a yacht show and something else entirely to get a look at what we could realistically expect for $50,000 or less. We were a little apprehensive before going in though cautiously optimistic due to the amount of research we’ve already put in.

First up was the Morgan 41 Out Island. We have seen a lot of these on the cruiser’s forums as recommended family liveaboards (though it didn’t make the Mahina list). It has two good-sized staterooms and a nice big settee as well, so I can certainly understand why families with kids would like it so much. The center cockpit was also large and spacious and would certainly make a great space for entertaining. There was a lot of storage space throughout the cabins and the extra living space in the aft master stateroom would make for a relaxing retreat.

There were only a few negatives (in our opinion, they might not be for others) that we noticed about the boat. First, we aren’t very big fans of having 2 heads aka bathrooms on a boat. That might not seem like a problem, but we figure it’s wasted storage space and more hassle to deal with. Also, the walk-through hallway is pretty darn tight, as in Dan and I could not pass each other at all and we aren’t very big people. There is plenty of cabinet storage but I have a feeling that it would be somewhat cumbersome to use with how narrow the hallway is and it would be especially tight trying to work on the engine which is also accessed there. Overall, the Out Island was a very nice boat and one we wouldn’t be disappointed with, but we just weren’t really feeling it. (This particular one at least. The Out Island can be found in many different layouts and every boat is different.)

The next boat that we saw was a Cape Dory 33. To be honest, we really should have looked at this one before the Out Island instead of after. We came away feeling like it was just too small for us which was compounded by the fact that this specimen wasn’t very well cared for and had a lot of junk piled inside of it. I think even a nice one would probably be too tight of a squeeze for 3 people, but it could make a good cozy boat for a couple. The galley area was actually more spacious on the Cape Dory than the Out Island with more working counter space, but that’s about the only thing that was bigger. One of the most pressing issues that I would have living in this boat is not just the living space but the non-existent storage space. I don’t think that our SCUBA equipment would be able to find a home on this little boat and therefore neither would we!

Luckily, the next two boats we toured were ones that we would be thrilled to pick up when the time comes but we will save those for next time!

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Posted on May 16, 2013 | 0 comments

Getting Our Hands Dirty

As part of our new eating-at-home regimen, Dan and I decided to make a small garden in our backyard this spring to help get us some healthy, fresh food options. Last year, we attempted to solve this issue by joining a local CSA (Community Supported Agriculture) group where we bought a “share” of local farmers produce crops that we could pick up once a week. As noted in our post Julia Who?, we didn’t do too well with making use of the many unknown vegetables that ended up in our kitchen so we decided to try out our green thumbs this year.

We started by picking out a spot in our backyard and tilling it with a borrowed gas-powered tiller. A few things came to our attention pretty quickly. First, the soil in our backyard is amazingly rich and black, as in potting soil black. A neighbor told us later that our house used to be the “manor” on a large apple orchard that encompassed most of the neighborhood in years gone by. Because of this, we didn’t need to add any additional garden soil to our bed but just added some tasty cow manure fertilizer. (Carter kept telling me very seriously “there’s cow poop in there, Mommy.” I think he was concerned.) The other thing we noticed was that one side of the garden is almost certainly located over an old gravel driveway which we didn’t realize until after tilling the whole area. Now we have some nice white rock mixed in with that row. Oh well, you win some you lose some I guess.

Next, we attempted to shop the local greenhouse by bike to pick up our preferred crops but unfortunately had to defect to visiting Lowe’s when we couldn’t find much more than flowers. I mean, flowers are nice and everything, but I’m more of a practical girl myself. If I’m going to be down in the dirt, I’d better be getting something delicious out of it. We returned with 3 tomato plants, 1 red bell pepper plant, 1 cucumber plant, a bunch of red and yellow onions, broccoli, arugula, and seeds to grow lettuce, spinach, and cilantro. Being the gardening noobs that we are, we weren’t quite prepared for the amount of plants that 1 little tray actually buys you. We are going to be eating a lot of broccoli and onions in the coming months, that’s for sure!

This week we had a bit of a frost scare (in May, seriously?!) but luckily didn’t lose any plants. Our seedlings are all popping up on schedule and we are looking forward to some fantastic veggies in the near future. Last night we harvested our first small batch of arugula and it was certainly worth the effort! We’ll keep you posted on whether the rest continues to produce such excellent results.

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Posted on Apr 24, 2013 | 0 comments

Margin of Error

A financial safety net is just as important as a physical one.

A financial safety net is just as important as a physical one.

Whenever we are dealing with finances Dan and I like to plan for a pretty decent margin of error. (Dan would appreciate it if I would practice this a little more in dealing with scheduling as well; I am consistently 5 minutes late.) If you could listen in to some of our mini-planning sessions we frequently have, you would hear the phrase “worst case scenario” at the beginning of most of them. We figure that if we plan for the worst case – within reason of course, we aren’t going doomsday here- then we will be left with a much higher comfort level and safety net in times when we’re living on the other end of the spectrum.

The margin of error is especially important when we are talking about making a budget for a lifestyle that we have never lived before. Sure we think that we will be fine living on $1000-$1500 per month based on our research, but that’s all it is right now, research. It’s crucial for us to know that if that doesn’t end up being true we aren’t left high and dry (pun intended). The whole basis of this adventure is our desire for freedom but you can’t have freedom if you are constantly worried about how you are going to pay for the next time your engine needs a tune-up.

There are a couple of big ways that we are dealing with the margin. The first is in how we are planning out our rental income. Dan has created a spreadsheet that we use to evaluate any potential rental properties that we look at which takes into account all expenses (including property management costs at the highest rate we’ve seen in our area) and also vacancy rates of our tenants. We have separate columns for vacancy rates at 0%, 4%, 7%, and 11%. The current accepted vacancy rate in our area is a very low 2-3% but we use the 7% rate as the amount that we use for budgeting purposes. We hope this will give us a very safe expectation of income from our rentals even if the market worsens a bit before we leave. Hopefully we’ll continue filling vacancies within a week or two as we have done with our first 2 houses and also find a manager we like at a lower price, but if we don’t we are still fairly comfortable.

The second part of the plan is maximizing our income earning potential while cruising. Dan is currently a certified PADI Dive Master and plans to become a PADI Open Water and Specialty Instructor as soon as possible. Because PADI is recognized worldwide we are hoping that this will give us a nice back-up option if our income falls short of expenses. We also intend to log our sailing time once we start cruising to begin the process of getting Coast Guard Captain’s licenses (6-pack at least) which would allow us to complete deliveries and also increase Dan’s marketability as a SCUBA instructor who is licensed to carry divers himself. Finally, investment income on other savings and maybe some future swing trading as described in Live on the Margin in addition to some small income from this blog (yes we have recently added ads to the site) eventually could all add to a few hundred a month for extra flexibility.

Best Case Scenario: our costs will not overextend our rental income, we will have renters who stay for years at a time and financial stress will be a thing of the past in our new life. Worst Case Scenario: we have crappy renters who tear up our houses, our boat breaks down too often and Dan has to take up part-time work doing his favorite hobby. Sounds like a pretty nice life either way.

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Posted on Apr 17, 2013 | 0 comments

Simplicity or Moderation?

 

Everything you need to know about cruising is in here!

Everything you need to know about cruising is in here!

So far in our month of finance posts, we’ve gone over our savings goals and reducing our current spending. But of course all of this is meaningless unless we have a plan for how much we will be spending while we cruise. People have asked this question on every blog and every forum available to cruisers of all levels and with something as individual as personal spending it is a fairly difficult question to answer. The most common response is “it costs whatever you have” or “that’s the same thing as asking how much it costs to live on land…its all up to you.”

While I appreciate the idea behind the answer, I also think that there is a way to generalize expenses for people. I can tell you that it is possible to live on $750/month or less for a couple in my town if you rent or own a one bedroom shack, eat peanut butter sandwiches every day and don’t own a car or have other insurance. You could spend $2000/month living in a small 3 bedroom home, eating good meals at home, driving one car rarely and being otherwise frugal. Or you spend $5000/month on a nice home in a good neighborhood, drive expensive cars that get terrible gas mileage as much as you want, and eat out for every single meal to normal restaurants. I can’t tell you how much it would cost your family, but I can give you the basis to help you figure it out on your own.

That’s exactly what Beth Leonard has done in this fantastic article entitled “How Much Will Cruising Cost You?” and also in her book The Voyager’s Handbook. She details the spending habits of three fictional cruising families: the Simplicity’s in a 33 ft cutter, the Moderation’s in a 40 ft catamaran, and the Highlife’s in a 54 ft ketch. In my opinion, this is the best document on cruising budgets that I have found in any of my research, and is what Dan and I based many of our calculations on when trying to figure out how much we would need monthly and yearly to live at the level we desired. We believe that we can budget somewhere between the Simplicity spending of 8,000/year and the Moderation level of 20,000/year leaving at somewhere in the $1000-$1500 per month range. This budget was also verified by a seminar called Three Cruising Budgets given by George Day of Blue Water Sailing magazine at Strictly Sail Chicago this year.

Obviously, we don’t know for certain yet how much we will spend once we start sailing, but it is important for us to have some sense of direction to work with while planning. No one else will have the same budget as us (and certainly not one man on a forum that told us we would need at least $50,000/year…he and his wife spent $1500/month on food alone!) but we think that using a generalized picture has given us pretty realistic expectations. We’re always open for comments or suggestions, so leave one for us below!

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