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I hate being cash poor

August 21st, 2024 at 01:11 am

Warning: First World Problem whining about to start.

Well this is sure no fun.  I came into this year knowing things would be a little tight, but figured I would be ok with my finances.   The tightness is due to doing a large Roth conversion in January, and then I would have my Tesla loan payments, and there are property taxes here in Virginia, but I figured I could take a bit from savings to make it work.

Have you ever heard of go-go, then no-go, years?  Basically saying you will likely spend more right after retirement due to being able to travel and do things, and as you get older you will slow down, and slow your spending (finally ending with hi-spend due to medical issues).  I figured I wouldn't do much travelling this year, but boy was I wrong.  And with that spending has gone up to probably more than I have done in a long time.  And of course that means my assumptions at the beginning of the year sure have been way off.  Ouch.

First it was driving cross country.  Next it is this trip to Europe in October.  And then to Florida in November.  And I need to (make that I should) get new tires for my car due to all the driving.  And then the property tax bills on my house and car.  And all the insurances.  OK, yes, I am whining at this point.  

As has been told to me, "don't stress, this is what your savings are for, and you won't even take out 1% of your savings".  Yep, that is true.  

I just took out $2,000 of dividends to help pay for things, and I went today and gave the C.U. instructions to not roll my $5,000 of CDs over this coming October, so there is that money too.

Yeah, I can always take more out of the brokerage, selling as needed.  But I wanted to try and avoid that and keep myself from getting into a too high tax rate for this year.

Anyway, nothing to do but stick with the plan.  At times like this I feel it would be easier to be like my cousin.  (please ignore if this bothers you, but it is the phrase "fat, dumb, and happy" that he remind me of).  Instead here I am, knowing how to optimize things, and due to this I am having an aggrivating financial day.  OK, just a First World Problem - this will pass.

Posted in Frugality, Finance | 5 Comments »

5 Responses to “I hate being cash poor”

  1. Turtle Lover Says:
    August 21st, 2024 at 12:29 pm 1724243383
    1724243383

    Are you enjoying what you are doing? Doesn't sound like you are REALLY going overboard or anything .... but we all need to have "balance" .... and then pay for it. LOL I get you!

  2. Dido Says:
    August 22nd, 2024 at 01:05 pm 1724331921
    1724331921

    Chances are that there will be some volatility around the election, which might give you the opportunity to do some strategic tax loss harvesting. If you see a dip, you can sell some highly appreciated stock for a tax loss in the brokerage account, then buy the security back in 31 Days to avoid triggering the wash sale rules. Tactically taking tax losses like this can help offset the gains if you did any selling that triggered gains in the brokerage account. And if you are using the dividends for cash flow, then set the securities not to reinvest the dividends and capital gains distributions. You'll pay tax on the dividends and cap gain distributions in the brokerage account whether you pull the dividends or leave them in the account. It's what you earn, not what you take from the account, that triggers the tax. Building up a cash reserve inside the brokerage account will give you some spending flexibility. What you want to avoid is NEEDING to sell for cash at a point when the market has dropped 20%!

  3. rob62521 Says:
    August 25th, 2024 at 07:10 pm 1724613010
    1724613010

    First world problem, but it is frustrating when on paper you feel like you have decent amount, but cash on hand, not so much. But you'll figure it out. Better you are enjoying yourself and doing things and not living like you are in total poverty. I have a retired friend who has always been cheap. Not frugal, but downright cheap. He never travels. He rarely buys anything new, actually rarely buys anything unless he absolutely has so. And one can tell he isn't a content person, just keeps worrying about money and believe me, he has more than enough.

  4. PatientSaver Says:
    August 31st, 2024 at 09:19 pm 1725139177
    1725139177

    I have noticed how taxes and how to minimize them has become front and center in my thinking since I've been retired. Your trips may all be coming all at once, but hey, travel is a wonderful thing! I'm sure your cash flow will even out in future years. I retired earlier in the spring, but this will be my LAST YEAR of living very frugally. For the sake of not having to pay anything back when I do my taxes and report my income for affordable health care purposes.

  5. Tabs Says:
    September 7th, 2024 at 09:55 am 1725702948
    1725702948

    Roth conversion is a concept that I have never thought about before, until more recently, and it's amazing to realize just how that can be so impactful into the future.

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