September 15th, 2024 paycheck

Created:

The various funds are going back up in value. Therefore, short-term assets, as a percentage of the portfolio are down from the previous article. Of course, it’s not just that the value of the funds has gone up, it’s also that I paid bills.

I also put in more sell orders because we’re below the minimum percent and I don’t have 3 months of estimated expenses available. On the 9th of September, one of the sell orders did execute. I have 9 open orders in my taxable brokerage account, and 3 still open in the Traditional IRA. The Traditional IRA orders intrigue me.

I started placing the Traditional IRA orders for two reasons:

  1. Test and establish a selling strategy before I needed one.
  2. Start moving out of the extended market fund.

One of the fears (or at least anxiety triggers) is having to sell things when the price per share is down. That’s why I use limit orders instead of market orders; something I learned about while still in a position to easily buy more shares. It’s a way to avoid remorse.

Buyer’s remorse when it comes to shares would be buying at the market price when the trade executes, only to have the price drop a bunch of percentage points a few moments later. Thanks to limit orders, when I buy shares I have a maximum I’m willing to spend. 15 percent of that total might buy shares at the market price, but more likely most of the money will buy at 2 cents above the previous closing price all the way to 2 percent less than the previous closing price.

Buying this way is mainly emotional and possibly doesn’t result in a mathematical difference worth talking about in most cases, but I haven’t experienced buyer’s remorse once since implementing it. (It’s worth noting that, in some circumstances, like a 401k, I don’t get to decide.)

Seller’s remorse is less talked about and less well-known twin of buyer’s remorse. In other words, it’s the other side of the coin or transaction. If you’ve ever sold something and said, “I wonder how much I could have gotten had I just held out a bit longer,” then you’ve experienced seller’s remorse. Many of us anchor on how much we paid for something and believe we shouldn’t throw it away or sell it for less than we bought it for; this is usually an effort (conscious or not) to avoid seller’s remorse. Given how effective the mechanics I set up for buying helped my physical, mental, and emotional state for buying, I figured something similar would work for selling, but I wanted to do it in a place with fewer potential negative consequences than my taxable brokerage account. That’s why I did it in the Traditional IRA.

Which brings us to today.

I’m still iterating on the wording before updating my investment policy. So, let’s try this:

  1. Sell orders will be:
    • placed Fridays after paying bills, if necessary.
    • from the holding with the highest long-term capital gains (even if negative).
    • set to expire in 60 days using 3 limit orders to minimize seller’s remorse and maximize opportunistic execution timing.
  2. A target dollar amount will be calculated from which the 3 limit orders will be placed:
    1. 15 percent of the target is priced at 1 percent higher than the previous day’s closing. (I’m considering making this a range of no less than 2 cents above the previous close and no greater than 1 percent, but I haven’t hit a scenario where that would make sense, and I don’t recall any days where the price didn’t fluctuate at least 1 percent in either direction.)
    2. 35 percent of the target is for 2.5 percent above the previous day’s closing price.
    3. 50 percent of the target is for 5 percent above the previous day’s closing price.

Those are the guidelines and guardrails for placing sell orders. Next we need one or more triggering events. For buy orders, it’s when cash is above a certain percentage of the portfolio, when cash is received, or both. For sell orders we have the following triggering events:

  1. If the value of short-term assets is less than 3 month’s of average expenses, I MUST place the sell orders.
  2. If short-term assets occupy less than their target percentage of the portfolio, I MAY place the sell orders.
  3. If 1 and 2 are both true, I MUST place the sell orders.

The target total will be calculated using the following equations, respectively:

  1. 3 month’s expenses minus total value of short-term assets.
  2. (Short-term asset target percentage minus current percentage) times net worth.
  3. See 1.

As it stands, my net worth is still roughly what it was when I left my previous employer. So, almost a full year since my last paycheck and, from a net worth perspective, I still haven’t spent any money (market math). Further, I haven’t earned more money than the standard deduction (not even close), so I should owe (and have paid) 0 taxes.

Downsizing

Section titled Downsizing

We moved the desk out of the second bedroom; effectively turning our two bedroom apartment into a one bedroom apartment. We still have some things to move out of the closet in there, but the bulky items are gone. Becca did a wonderful job getting us there.

We looked at some neighborhoods and apartment complexes today to further solidify where we’re going next.

I’ve scheduled some time to look at three different complexes on Tuesday.

Section titled Job search

This is really the job search and future of this site section.

I’m starting to feel a little anxiety mixed with joy. Odd as that mix might sound.

The anxiety is mainly around concerns that my luck might run out soon. “Luck” in this case being that I’ve managed to live pretty well (for me) this past year without reducing my net worth. I lack the hubris to believe it’s because I’m a genius when it comes to portfolio management and investing; I leave that to the tech- and crypto-bros.

I knew going into this that if I started needing to sell shares to pay bills, I would be jeopardizing true financial independence.

That’s the math.

The joy is from having a strategy I’m comfortable with when it’s actually time to shift to de-cumulation mode. It’s not as simple as choosing a safe withdrawal rate, dividing by 12, multiplying the value of the portfolio by that, and selling the biggest winner to get that much cash. However, it seems to satisfy the needs I’ve expressed above.

Having said that, at this point, I’ve reached my first Coast FI number, which means I shouldn’t need as big of a shovel as I had before. So, I have flexibility when it comes to the jobs I apply to and accept.

I’m looking toward staffing agencies again. I’m targeting remote work that is strictly temporary (not temp-to-hire). This should help me avoid doing the thing (or things) I’m not good at and find exhausting (sales, marketing, and lead generation) without incurring expenses while not sacrificing my mobility and client flexibility.

This brings me to a potential future for this site.

I’m considering shifting the emphasis and focus from free and public content creation toward a curriculum vitae brochure site a la LinkedIn (which I’m also using less and less).

What’s in my head at the moment is:

  1. Area for recruiters to go and read my full job history (might link to detailed stories). This should also make tailoring résumés easier because alternatives I’ve tried have been less than effective.
  2. Pay what you can newsletter for people interested in the content I’ve been publishing regularly (mainly this series, I don’t know). If no one signs up, no need to spend time writing that content.

Journaling has been a practice that comes and goes with me. Having a personal website has also been something that comes and goes with me. As a creator wielding various media, I’ve spent a non-trivial amount of time considering the artist-audience paradigm and relationship.

Much like the “no margin, no mission” line from the nonprofit world, with no audience, there is no artist.

That’s not to say the creator isn’t an artist or that what they create isn’t art, it’s just they’re a tree falling in a forest with no one around to hear it.

As I continue emphasizing my personal relationships through one-to-one conversations something struck me: Most of the people I talk with regularly, don’t visit this site regularly (some don’t even know it exists). If I send them a link they might show up, but they don’t typically tell me about it.

(It’s worth noting that I am grateful whenever someone reaches out or mentions appreciation for something I’ve put on this site, and in 20 years I can count the “uniques” on my fingers, and the non-uniques might quadruple that number.)

For the audience members who love me deeply (like Becca, Katrina, and a few others), we talk about a lot of this stuff anyway. So, they shouldn’t lose anything. And maybe I’ll make one-pagers or something they can hand out to people for the content they do direct people to.

Another interesting point is the traffic to this site is pretty much the same as it’s been for the last 20 years (between 2 domains), which includes 3 years of the site being nothing more than a blank screen (I literally set the background color to gray). This indicates that what I’m creating isn’t remarkable, which is to say it does not inspire those reading it to remark about or share it in a way that causes others to come, read, tell their friends, and return.

Further, there is no indication that the traffic I receive is here for what I’ve built or wrote. Most traffic appears to be bots trying to crack the site; lots of hits to URLs for common login and admin panels of various platforms—custom build and no admin panel for the win. Next to that seems to be search engines and other bots and scrapers (the latter are violating the terms of service, just sayin’).

This is not woe-is-me.

This is just the perceived (possibly demonstrated) reality as exposed by the numbers.

A product looking to pivot or be deprecated entirely.

(Not gonna lie, if the Aussie rugby player offered me a few grand, I might not say no.)

That said, I still appreciate and see benefit in having my own little corner of the internet; mainly a place for me to escape to when other people’s platforms piss me off. 😂

Anyway, it’s basically just the cost-benefit analysis and return on investment conversation I help guide people through all the time, only applying it to myself and this site…got to eat my own cooking, so to speak.

Find what works for you (and your goals) and double down, cut in half the things that don’t. Repeat.

And for the love of all that is, don’t beat yourself up if what works for is different than what works for someone else or what people tell you to try. There will always be someone telling you that you just didn’t wait long enough, or you got in too late.

If you made it this far, you are a true fan, and I appreciate you sincerely and deeply.

Don’t worry too much, any changes will be rolled out incrementally, not a light switch. Again, eating my own change management cooking.