Mika, the boys and their cousins trying to stay cool in the river
I’m back with another update, but I almost didn’t get it out on time. We’ve been suffering through a ‘heat dome‘ here in Vancouver, and it’s sapped me of all my energy, ugh! Two days ago, we reached a high of 42°C (108°F) which smashed all previous Vancouver temperature records. That’s REALLY hot for us!
Thankfully, the heat finally broke, and will soon be back down to the high-20s. That’s still a tad hot for me, but it’s way better than 42°! Anyway, you didn’t come here for a weather report… I promised an overdue update, so let’s get started.
April, May and June were both uneventful and momentous. It was uneventful because, well, we’re still in a pandemic. But it was also momentous because we’re finally on our way out of this mess!
This is about as uneventful as life gets, but I wanted to mention it because it’s fun and might inspire others.
A while back, Kid 2 complained that our daily walks with Mika were getting boring. (Admittedly, I agreed with him—the last 15+ months of COVID have been more than a little repetitive.)
We brainstormed a bunch of ideas, including listening to music, taking photos, scavenger hunts, and geocaching. Kid 2 wasn’t overly enthused with those ideas, so we kept mulling it over.
A couple of days later, I was perusing Dr. Plastic Picker’s blog, and a lightbulb went off. Dr. Plastic Picker picks up plastic and other litter at her local beach… we could do the same in our neighbourhood!
It would not only make our daily walks more fun but would also be good for the Earth. In addition, Kid 2 has grown increasingly informed and concerned about the state of our planet. He’s pushed us all to find ways to do more, and litter picking fits the bill perfectly.
I shared the idea with him, and we both knew right away that it was a winner.
Finding the perfect litter pickers
M got to work, researching litter pickers that would meet his list of exacting criteria:
- Ergonomic design.
- Easy-to-squeeze trigger.
- Good quality.
- Made mostly of metal (which is recyclable and less likely to break than plastic).
- Designed to be durable (no springs or plastic parts that could fail).
We’ve been using these pickers since March, and are happy to report that they’ve lived up to all of M’s high expectations.
An unexpected benefit
We knew we’d enjoy litter picking—if only because it made Kid 2 happy and is good for the planet. However, we didn’t anticipate that it would also be a conversation starter.
Quite often, we’re stopped by neighbours or passersby to thank us, cheer us on, or ask where we got the pickers from. It’s been heartwarming to see how our small action has uplifted others.
Hopefully, it inspires them to do something good for the Earth too. It’s also been good for Kid 2 to contribute to a cause he believes in (while also enjoying some quality family time).
We’re halfway to normal
That’s right—my family of four is now half-vaccinated! M and I got our first Pfizer jabs on May 19th and the boys got theirs on June 8th. Both times, it felt like a momentous step out of this awful pandemic.
I’m still in awe of the achievements of the scientists who made these vaccines a reality. They truly accomplished the impossible. Thanks to their hard work, we can finally see the light at the end of the tunnel.
M and I will receive our second shots in July and the boys a few weeks after us. After that, we’ll get back to the non-urgent, routine medical care we’d mostly skipped since March 2020: full dental cleanings, health screenings, eyewear prescription updates, etc.
If all goes well, we’re hoping to finally go on our trip to Japan in Spring 2022. (We just need Japan to catch up with their vaccinations!)
Back in 2019, I mentioned M’s eye condition (Coats Disease) as one of the reasons why he wanted to get his dream car sooner rather than later. Well, as most of you know, he got the car, which has been so amazing for him.
It’s a good thing we did because since then, M’s vision has further deteriorated. He’d been receiving monthly steroid injections and laser treatments, but unfortunately, they stopped working. His doctor decided to try surgery as a last resort.
And so, in early June, M underwent surgery to clean out the scar tissue, cauterize a few vessels, and implant a slow-release medication. Hopefully, this will prevent further damage.
It’s sad and difficult for M to lose so much of his vision at such a young age, but we’re trying not to get too down about it. Situations like these remind us that life is short and good health can’t be taken for granted. Hopefully, M will maintain the vision he still has for many years.
Finally—we can picnic again
Well, that was a bit heavy! Let’s switch back to a happier topic. In BC, we were allowed to meet outdoors again (up to 50 people)—just in time for Father’s Day. Our families took advantage of the sunshine and regained freedom to meet up for a picnic.
This was another momentous step back to normal, out of this awful pandemic. We all enjoyed seeing each other in person again, after too many months of Zoom-only meetups.
We also got to enjoy some yummy takeout at the picnic—my sister kindly offered to pick up vegetarian banh mi (Vietnamese subs) from Dharma Garden for everyone. They were sooo good!
Even my meat-eating hubby enjoyed them and couldn’t tell that they were meatless. If you’re in Vancouver, I highly recommend these banh mi! They’re delicious, healthier and cheaper than meat, and better for the planet—it doesn’t get much better than that!
Back in October, I wrote about our decision to choose remote learning for our kids this school year. It turned out to be an amazing experience!
Kid 2 was thrilled to finish on June 10th (19 days earlier than regular school) and Kid 1 on June 18th (one day early).
I plan to write a full update to share all the details, including whether we’ll continue remote learning next year. Watch for that later this summer!
FI and investing update
The stock market continued its upward trend, helping our liquid net worth to reach more new highs:
- April 2021: +5.1% (new net worth high)
- May 2021: -0.7%
- June 2021: +6.0% (new net worth high)
I continue to shake my head in disbelief. Our investments keep climbing, yet the pandemic is still very much here. I really wonder where the stock market will go once we’re fully back to normal? Could it go even higher, once regular spending resumes?
In May, we recorded a podcast episode with Mark Seed where we discussed FI drawdown strategies. It got me thinking about our drawdown plans—and I realized it had been a while since we’d met with Ed (our financial planner).
We booked a meeting with him in mid-June and went over our FI progress and decumulation plans. It’s still too early for us to get into the specifics of our drawdown strategy, so we could only discuss general ideas.
But I like to think about things well ahead of time, so Ed humoured me. As usual, I thoroughly enjoyed discussing the numbers with Ed and his team. I once again realized how complex and personalized drawdown/decumulation is.
In my opinion, simply knowing the math and strategies isn’t enough. There are a lot of moving pieces, and (unique to FIREees) an unusually long timeline to account for. It’s comforting for me to be able to lean on Ed’s knowledge and expertise.
April, May and June were also interesting in that we spent and saved significant amounts.
One year of COVID spending
In my December 2020 FI update, I’d tallied up our spending for 2020 and found that our annual spending had dropped by 21%. However, given that 2020 included 2.5 months of non-COVID spending, that wasn’t the most accurate number.
I decided to tally up our spending for an entire year in COVID (April 2020 to March 2021) and compare that to 2019. Well, I was shocked to find that one year of COVID spending was 30% less than what we spent in 2019!
Note: The biggest contributor to our drop in spending was the lack of travel, so I took that out to compare the numbers again. Even then, our expenses were still significantly lower—17% lower!
As an ‘Optimizer Extraordinaire’ (as crowned by my friend Court) that’s astounding! I honestly believed that we’d already optimized everything as much as we could. COVID showed us otherwise.
Most of us can live quite comfortably on less than we think. That’s reassuring for me to realize. When we reach retirement one day and hit a downturn, at least I know we can cut back and it won’t be overly painful.
Our big, new purchase
It’s a good thing our expenses have been lower than usual… in June, we spent over $3,000 on two fancy, new, adjustable beds! I resisted these for a very long time, but in the end, M made a good case for them and won.
Yes, that’s beds—plural. We had to get two so that each side could move independently. (Sometimes M stays up later than me. With my own bed, I can flatten my side and go to sleep first.)
After much research, M picked these Ghostbeds from Costco and couldn’t be happier. He loves being able to sit up in bed to read and watch in comfort. Plus, as a technophile, the extra features (such as under-bed lighting and built-in USB ports) are right up his alley!
To be honest, I was perfectly fine with our previous bed. It was just as comfy, and I don’t need all the fancy features. But M’s worked hard and wants to enjoy some of our money—is it so bad to spend on wants that aren’t also needs?
No, it’s not. But as a frugal, eco-conscious consumer, it took some convincing for me to come around. In the end, I agreed that it was a worthwhile way to spend some of our hard-earned income.
I may not need or use all the fancy features, but M enjoys them very much. Being able to finally buy these beds meant a lot to M. And that, of course, makes the $3,000+ worth it!
Car insurance savings
One of the major areas where we’ve reduced our spending this year is our car insurance. All three of our cars became much cheaper to insure, all for different reasons:
My 2012 Mazda 5
In May, the insurance on my Mazda 5 dropped from $1,922 to $1,324. This huge decrease was due to ICBC’s new no-fault, enhanced care coverage. It’s still too early to know how equitable this new system will be, but I can’t complain about the $598 savings!
M’s 2008 Mustang
Since M’s still working from home, his 2008 Mustang is still parked and covered by storage insurance. It’s really cheap, especially since we raised the deductibles to the maximum of $2,500 (more on this in the section to follow). This car previously cost $1,826 to insure, but now only costs $72!
M’s 1965 Mustang
After an arduous application process, M’s classic Mustang qualified for collector’s insurance, which is significantly cheaper (but comes with stipulations). The savings on this isn’t as clear because we switched mid-term, but it’s at least $688 cheaper. That’s a lot!
Insurance deductibles: psychology versus math
As mentioned in my How Much Does it Cost to Live the FIRE Life interview, one of my favourite ways to save on insurance is to increase deductibles to the highest amount allowed.
However, as I called around to get new quotes on my Mazda 5 insurance, I started questioning myself on this. That’s because the three insurance agents I spoke with seemed to think I was crazy to choose the maximum $2,500 deductibles.
They said it was ‘only’ saving me about $300 per year and didn’t see how that was worth it. In their opinion, I was making a ‘risky’ decision. Since we can cover a $2,500 expense with our regular cash flow, I don’t see it as risky.
Still, after the third agent gave me a hard time about it, I asked the ChooseFI Canada Facebook group for their opinions: was I as crazy as these agents thought I was? Was it a dumb idea to have such high deductibles?
I received lots of thoughtful, insightful answers and noted that people fell into two main camps:
- Low deductibles don’t cost much more and provide a sense of security. (People who made large claims in the past tended to prefer this option.)
- High deductibles provide instant savings and claims are unlikely—why wouldn’t you choose this option?
For me, reading the group’s replies helped me to see that the decision around insurance deductibles comes down to psychology versus math. It’s a gamble either way, with no certainty of what the best choice might be.
However, I’ve always erred on the side of math, probabilities and knowing my likely scenarios. Given that I’ve never made a large claim in over 25 years of driving (and I drive very little now) the chance that I’ll make a large claim is quite low.
I decided to stick to my decision to go with high deductibles. However, I’m glad I asked the group—if only to better understand my decision and the reaction of the insurance agents.
Related: In You Don’t Need an Emergency Fund (You Need an Emergency Plan) I detail how I work out the math and probabilities for the emergencies in our life.
Bonus: let’s play a guessing game!
Before I end this update, I thought it’d be fun to play a little guessing game: Can you guess the single most common item we come across when litter picking?
Note that I’m not referring to a category of items (like paper or plastic). I’m talking about a single item (like receipts or toothpicks).
Maybe you won’t be surprised by the answer, but I’ve been shocked to find so many of this one thing everywhere. It outnumbers any other single item BY FAR. Think up a few guesses, then hit “Reveal Answer” below to see if you guessed it correctly!
I’d love to hear what your initial guesses were—share them in the comments below!
And that’s a wrap!
I’d love to hear how the last few months have been for you. Have you done a tally of your spending after a full year in COVID? Any notable shifts? Also, what’s your opinion on insurance deductibles—do you go for the lowest, highest, or somewhere in-between?
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