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Posted on Aug 14, 2013 | 0 comments

Good Things Happen at Night

Though we didn't take this picture, we did see this meteor ourselves. It was stunning!

Though we didn’t take this picture, we did see this meteor ourselves. It was stunning!

As a teenager I remember hearing a statement by well-meaning adults that went something like “Nothing good ever happens after 10:00 PM.” Well, no offense to those people but this last weekend was yet another example of how there are always exceptions to every rule. (I’ve never really understood why adults feel the need to impart statements that only serve to elicit eye rolls and intentional contradictions from teenagers but that’s another issue entirely.) Last Friday and Saturday night were late ones for us but very rewarding in that we were able to spend some real quality time with Dan’s brother Kyle and his wife Becca.

Partially due to our influence Kyle and Becca have been putting a lot of thought into moving somewhere warmer with a better quality of life. Kyle has recently graduated with a bachelor’s degree in engineering and has quickly come to the realization that the promises made by college recruiters a few years ago weren’t all that they were cracked up to be. Friday night at around 10, he called us up and they came over to get some advice on budgeting and planning for their future goals. (After we got out of bed… yes we are the 20-something, old people who are in bed on Friday night at 9:30.) We talked with them at our kitchen table until 1:30 in the morning about dreams and goals that they have and how to figure out where to start. They left with plans to come back the next night and start by finding their baseline…where are they now? where do they want to be? and what to they need to do to get there?

After dinner together on Saturday night of the fabulous grouper that Kyle speared in Panama City (remember the Most Beautiful Beaches?) we jumped right in and started sorting through the last six months of bills, bank statements, and credit card purchases to find a complete understanding of their current spending and to build a good budget that will let them save the kind of money that they hope will get them where they want to go. For anyone who has never done this before, you should because it can be eye opening to see how just rearranging your spending a bit can significantly impact your goals. I have no doubts that if Dan and I hadn’t done the exact same thing 2 years ago at the start of all of this that we would be nowhere close to the financial situation we are now in. It was immensely gratifying for both of us to see Kyle and Becca getting that same kind of focus and understanding together that we have shared.

After working hard and getting to a good stopping point, we decided to reward ourselves with a night of spectacular star gazing. Every year at the beginning of August is the Perseids meteor shower, the most active one of the year. We bundled up the sleeping baby into the car with the four of us and plenty of blankets to lay on and headed out of town to a camp about half an hour away. The sky was free of so much light pollution and with no moon to hide them, the stars were out in force. We trekked down to a small valley with just the five of us in the large prairie and spread our blankets out to watch the show. Nothing can compare to watching shooting stars with people you love.

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Posted on May 1, 2013 | 2 comments

Book Review: Once Upon a Gypsy Moon

onceuponagypsymoonOnce Upon a Gypsy Moon is not so much a sea-tale as it is a man’s introspective journey into his own motivations, actions, and dreams. While Gypsy Moon (his 32-foot sloop) carried Michael from Annapolis to Nassau and beyond physically, the time he spent single-handing her over that distance carried him much farther emotionally and spiritually. He started his journey lost and lonely after an ugly divorce and ended it as a man with hope for the future.

Here are a few of my favorite quotes from the book:

The world has a way of working itself out, in my experience. There are things unseen. Life is not always easy or pleasant, and it is often unfair, but it seems to unfold according to some plan of which we are only peripherally aware – like a dream, the details of which are vivid only when we are sleeping. We cannot remember- much less comprehend- that dreamworld with the powers of a rational mind.

Sailing has been a love of mine for almost as long as I can remember, and that love endures…But over the years, the idea of sailing long distances over oceans, unobliged to return, became for me less about adventure than escape- a kind of trapdoor beneath the uncertain footing of a marriage and a personal and professional life that seemed at various times to teeter on the brink of collapse… With no escape hatch, we have to face life head-on, admit our weakness, rely on our relationships, and trust others to catch us when we fall.

The insight in the book was compelling, though at times it did get a little dry. The boat journey was somewhat less exciting than the cover lead me to believe as it was mostly individual legs of a trip broken up by repair stops on his old boat rather than a continuous time line. The final chapter entitled “The Loss of the Gypsy Moon” was certainly the most thrilling of the book as *Spoiler Alert* Michael did eventually have to abandon ship during bad weather after a nasty knock-down and subsequent rescue by the US Coast Guard. Maybe someday she will be found and resuscitated but it seemed a fitting end to the tale of a man who no longer needed his escape hatch.

 

We would like to pass the book on to one of our readers in our first giveway! If you would like the chance to read Once Upon a Gypsy Moon yourself, there are four ways you can earn entries to the giveway:

  1. Subscribe to this blog via email (look for “Receive updates by email” in the right sidebar)
  2. Leave a comment on this post
  3. Follow us on Twitter @sv_horizon
  4. Like us on Facebook https://www.facebook.com/FollowTheHorizon

Each way gets you 1 entry into the drawing, for a maximum of 4 entries. We’ll do the drawing next Tuesday evening and announce the winner on the blog next week! Hope to see your name!

 (In March, we were contacted by Center Street book publishers to do a review on a new memoir that they released on April 16 called Once Upon a Gypsy Moon by Michael Hurley. We agreed, so they sent us a pre-release copy of the book that for some reason we didn’t receive until a couple of weeks ago. This is the first time that we have been contacted to do a review so we’re pretty excited that we are starting to pop up on the radar of the sailing blog world.)

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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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Posted on Apr 4, 2013 | 4 comments

Fast Track to Retirement

Retirement AheadTo start off a month of posts about finances, Dan and I need to make sure that everyone knows our baseline. We come from average middle-class families who have good jobs and provided well for their children in the sense that most middle class parents do: clothes, food, housing, low budget car in high school, etc. Dan’s parents paid for his college education, mine did not, but we still left school with only around $4,000 in student debt and no real savings to speak of. We got jobs after college that made cumulatively $70,000 and bought our first house (a foreclosure in Dan’s parents’ neighborhood) on the $8,000 new home-buyer credit in 2009 for $110,000 (for those of you who don’t live in Central Illinois, money goes a long way in our house market compared to other areas). Then we proceeded to buy a couple of new and almost-new cars with car loans for somewhere in the vicinity of $40,000 total. In 2011, we both got raises and now make a total of around $95,000. (You may note a conspicuous lack of credit card debt. That’s because we’ve never had any. Thanks mom and dad for teaching us that credit cards are good for only one thing…free rewards!)

So, we when started our retirement planning in 2011, it looked something like this:

Income: $95,000/year or ~$5,500/mth after taxes, 401k, and health insurance deductions

House: $150,000 value, $50,000 equity, $1200/mth mortgage, property taxes, and house insurance

Cars: $40,000 value, $0 equity, $900/mth car loans and insurance

Other Debt: $5,000 student loan debt, $50/mth payment

Other Spending (food, clothing, entertainment, etc.): $2000/mth

Savings: Income ($5,500) – Spending ($4,150) = $1,350/mth Savings (though in reality it was usually closer to $1,000/mth that would make it into the savings account)

As you can see, $1,000 a month into a savings account was pretty nice savings compared to most people, but $12,000/year was going to take a long time to turn into enough money to live on the interest and buy a boat, especially because we were starting with around $5,000 in the bank and whatever assumed equity we had in our house. So we needed to save more money and find some better investments that we could use to live on. As you can see above, we were spending a whopping 40% of our after-tax income on our house and cars. In America, banks will tell you that is perfectly affordable and it was…if we wanted to “afford” a 9-5 job for the next 30 years.

Here is what we have done in the last year and a half to improve on our savings rate and investment income:

  1. Sell our over-priced luxury vehicles and buy two dependable used cars with cash. This saves us money on payments and insurance, since now we only carry liability insurance. Cost: $5,000. Savings: $800/mth
  2. Eliminate student debt. The payment wasn’t high, but we didn’t want to have that liability while cruising. Savings: $50/mth
  3. Sell our house and buy a smaller one which will become a rental or get sold when we leave. Savings: $800/mth and $25,000 in cash (after down-payment and repairs on new house)
  4. Purchase 2 rental homes using cash from house sale. Cost: $18,000. Net Income: $700/mth.
  5. Moved $6,000 from savings account into Vanguard 80/20 investment account. Anticipated income: ~$30/mth
  6. Adjusting spending habits (still in progress). Savings: $500/mth

Current Cash on Hand: ~$22,000                  New Rate of Savings:  $3,000-$3,500/mth

Saving money is always a work in progress, which we will go into a little more later this month. Our goal is to purchase 2 more rental houses by the end of this year to solidify approximately $1,000/mth in net profit after expenses and vacancies. Then, we are off to the races to save somewhere in the $50,000-$75,000 range with which to purchase our new floating home. It will be a challenge, but I think we’re up for it!

 

 

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Posted on Feb 27, 2013 | 0 comments

Stop Being and Start Doing

I don't think that smile could be any bigger.

I don’t think that smile could be any bigger.

Our son Carter has had an obsession with toothbrushes since he was six months old. Not trucks, helicoptors, or trains…toothbrushes. He wants to hold them and brush his teeth, carry them around the house, and he knows exactly which brush belongs to which person. I don’t know how many times I’ve heard someone say, “That kid is going to be a dentist someday.” Being a dentist would certainly not be a bad career path for my son to aspire to in the future, but my real hope would be not just that Carter would find a profession he wanted to be, but find something he loves to do. 

I believe that our culture is a little too stuck on this idea of being. I am a Mom, Engineer, Waitress, Police Officer. I want to be a Ballerina, Teacher, or Baseball Player. What if instead of aspiring to be someone, we aspire to do something instead? What do you want to do? Teach, scuba dive, sail, help people, save lives, play baseball, dance…you name it. Now, instead of trying to fit your actions into your label, just forget the label and do the actions. When you are doing what you love, who you are to other people becomes a lot less important all of the sudden.

That’s all nice and fluffy to think about, I know. What about food, and house payments, and my student loans to get that label, you say. Well, the beauty is that usually the people who are really loving what they do are the ones who are the most successful at it. And, unless what you want to do is own a fancy sports car and million dollar yacht, you probably need a lot less money than you think. So let me ask you, what do you want to do? Then go do it.

Follow your Dreams. Follow the Horizon.

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