Happy Anniversary!

I don't remember the exact date, but I remember the circumstances very well.

After 3 months of marriage, three months of crying all the time, feeling very depressed, having occasional 'good days', going from pre-marital counseling straight into marriage counseling, hearing that 'the first year is SO hard'. After all of that, I left a counseling session feeling so much worse while my H was so much relaxed and at ease. The next morning I found myself Googling "Is it abuse if he doesn't mean to?" That day was my turning point.

The answers I found were very clear. Intention, I learned, was the wrong question. No one questions if it's abuse if he beats you up, so why would we question it for any other type. Then I found an assessment for Christian women to differentiate a difficult marriage from a destructive marriage. The last few questions of the assessment measured how likely the situation was to affect your physical health in the near future. The woman who shared the assessment on her blog noted that when she took it, her answers were all 'never' and that is what they should be for a healthy (non-abusive) marriage. My answers scared me. There were a few 'never's, but they weren't the majority. My score for the physical effects was particularly frightening.

That was the day that I said: This is abusive. This is not normal. This isn't just a hard marriage.

It was sometime a year ago. So, Happy Anniversary! Yay! (This is not sarcasm.) There are still people who don't believe my story, who think I'm exaggerating, who think we just need to try harder to make marriage work. And that's hard. It's sad. I'm exceedingly grateful that my story isn't one of 20, 30, 50 years before I realized and called it abusive. I'm grateful that we didn't spend those many years in marriage counseling trying to fix a problem that marriage counseling would never fix. Guess what: Abuse isn't a marriage problem. It occurs within a marriage, but that's just the context.

I remember that in those three months, I had looked up abuse before. I found a list of types of emotional abuse. In my desire for us to work things out, I shared with him some of the things I knew he was doing. His response: "Well, you do some of those things too!" At the time, I was quite naive about abuse, so I didn't recognize that he was using another tactic: blameshifting. Instead, I responded "Yes, and it needs to stop." I was able to own that I was doing some things wrong. He didn't. And that's the reality of the situation still today. He can't own what he is doing and has done. Without owning the problem, there's no potential for change.

That's the one key piece to why we are separated. It's the piece that counselors have said leaves little room for repentance and change. My Christian friends who value (idolize) marriage as more important than individuals tell me not to give up on God. It sounds so spiritual. But how is facing the reality of another human being and their free will to choose not to change giving up on God? I would love to be able to reply in full conviction, "Blasphemy!" Telling me not to give up on God when who I am giving up on is a human being. Effectively, they are telling me that my H is God. Blasphemy! God doesn't guarantee specific outcomes. He doesn't subvert free will of individuals. A person can't repent without confession of sin.

So, I remain separated for now. I wait for God to lead me. For now, I'm not led to return to oppression (sorry, can't say reconciliation because that takes two people) nor am I led to bring a legal end to a dead marriage. It's curious, but I can see how my remaining married has had it's benefits while traveling. I'm learning a lot about not oversharing and not trying to win anyone's approval. Hard lessons that I've needed to learn for a very long time.

"For am I now seeking the favor of men, or of God? Or am I striving to please men? If I were still trying to please men, I would not be a bond-servant of Christ." Galatians 1:10

The Catapult

I find myself in Tbilisi, Georgia. The country. I'm in a digital nomad capital. I've been living out of a suitcase and doing online work for a little over 3 months now. It's a marvel how I got here.

I sold my house, packed up all my belongings and began teaching online. Not necessarily in that order. Then I found a cat sitting gig in France and bought a plane ticket that I justified as being about the same as I would pay for rent in the US, so it was the cost of a month's housing in France. Then I meandered to Cyprus, and now I'm in Tbilisi.

But the story isn't that easy. It starts with how I got married to who I thought was the man of my dreams. He promised to be everything I had been waiting for. Then he wasn't. Not even close. I'm still untangling what happened. But, he was the catapult.

I couldn't live with him anymore. Not if I wanted to be able to stay sane. I was having panic attacks and in the worst mental state I have ever experienced. The day I moved just a suitcase out and back to my old house was so hard. But, my whole countenance changed between our shared apartment and opening the door to my house.

Then I had to navigate life from that point. As I could start thinking more clearly, I still had to work on facing the reality that I was married, but totally own my own. He wouldn't lift a finger to help me do anything to sell the house, pay a medical bill, or even encourage me in the work I had been doing when we met. He told me I needed a real job. He told me I'd be happier if I was busier. He told me that I stole from him when we had a tax bill to pay.

That was a hard reality to face. I still have trouble believing that it's possible to be married and think that way. But it was the catapult.

I took a look at my finances, only mine since we weren't a team, and realized that I had to have a way to earn money quick. But I was also fairly incapacitated by the emotional stress I was enduring still. Somehow, I found online teaching and began doing conversations for pay with students from around the world. As I got more stable from the income and the time away from the man who was emotionally abusing me, I was able to work more.

Then a friend offered to let me house-sit her AirBnB while I worked online. In the time I was house sitting, my own house sold. Then I was effectively homeless. I bounced around for a couple of weeks before I applied for a cat sitting gig in France. And now, I'm in Tbilisi.

After so many years ago of wanting to teach online and become a digital nomad, here I am. All because of the catapult.

Dilettante Polymath

This week, I learned a very important lesson. It's not that I learned new information. I already knew this, but I didn't believe it. I didn't really understand it.

Entrepreneurs have several failed businesses and business ideas before they ever have one successful business. And most... run several at a time.

Me? I'm a perfectionist. I want to do everything right the first time. I want to do everything perfectly the very first time.

I should've realized when I came across a very interesting business card tucked into a variety of advertisements on my favorite coffee shop's wall that it wasn't just something to laugh at, but to ponder. This guy advertised himself as an entrepreneur, stock investor, real estate investor, AND blogger. But on the back of his card, he listed several businesses... roofing, lawn care, and car rentals. None of these seemed connected and I scoffed at him.

But this guy is out there. Likely making a living off of several passions.

How is he any different than I am? What would I put on my card? Entrepreneur, dividend investor, life coach, financial coach, spiritual coach, refugee advocate, dilettante polymath. I think the last one is what describes me best. A dilettante is someone who cultivates an area of interest without great depth, but a polymath is a person with a wide range of knowledge across various topics who can bring the ideas together to solve specific problems. That is to say, I can talk to an approximate depth on a wide variety of subjects. Usually in the areas of language, culture, investment/personal finance, the Bible, human psychology, statistical veracity, and others. There are many, many, many more topics on which I can hold a discussion to a certain extent, but the more intricate knowledge is lacking. Often, my friends and even prior co-workers would comment on the things on which I seem to have knowledge. It's hard being a polymath. Sometimes you get labeled as that person who thinks they know everything about everything. This has forced me to build on my social skills: Asking questions before spouting answers. Praying before speaking to see if what I say would be for their strengthing, encouragement, and consolation. 

Playground Portfolio

I started my foray into dividend growth investing last July. In fact, I spent my birthday researching the words my dear friend told me about: "ex-div", "high yield", and "dividends". Then I made the plunge!

Being relatively risk adverse, I decided to use Robinhood to purchase stocks because there were no commission fees and I didn't really want to invest all that much. I started with $300.

I bought a couple shares in a few good stocks and some really crappy stocks. But every one of them was paying dividends! I made the cardinal sin of dividend investing and started chasing yield. I bought into a few MLPs and didn't even know what that meant, let alone any tax implications. I thought every dividend was a qualified dividend and would thus have great tax implications (lower tax rate!!).

By the end of 2016, I had invested $950 and earned $21.65 in 'dividends'. That's over a 2% return on my investment, in six months! The best I could find on CDs, which was the discussion that led to me discovering dividend growth investing, was about 0.6% for a 6-12 month CD.

I also withdrew about $75 at the end of the year, so maybe I was only $875 in the market... that's closer to a 2.5% return. Not really significant, but still leaps and bounds better than CD investments. I think I also made about $8 or $9 on the sale of a few stocks (those pesky MLPs). And my stock value was really crappy (nasty MLPs). So, I held onto those stocks, hoping against hope that the value would go back up.

By the end of March 2017, I had made another $18 in dividends and distributions, and bought another $100 worth of stock. I also bought and sold some other positions, so my total investment by the end of 1st quarter was just shy of $915. So, what was the return in 3 months? Almost 2%! That's almost like having a savings account that pays 8% interest. Again, tho, some of my stock values were really down. If I were to have cashed out, even with the dividends, I would've lost about $100. Good thing that I'm not in it for the market, but the dividends!

About this time, I started to realize the value of dividend investments and that the gross amount of cash sitting in my checking and savings accounts wasn't really doing much work. So, I upped the ante and deployed some more cash into my Robinhood account. A little too late, I realized the long-term value in having a DRIP option that could outweigh the cost of paying commissions. My goal is to sell these positions off while building a more long-term portfolio with my idle cash.

Actually, my goals are to:

1. Keep dividend yield over 6% in the account
2. Sell off all MLP positions for net 0 or gain (if possible)
3. Keep 2017 ROI over 2%

So, for now I have the following in my Playground Portfolio (Robinhood account):

Deploying a strategy that involves purchasing stocks in chunks of $300 - $500 that will provide dividends equal to or greater than the commission fee during the first quarter, I have the following positions in a more long-term account:

My goals for this account are to:

1. Purchase only stocks I hope to hold for 10 years or longer (No short-term investments!)
2. Purchase chunks of $300-500 worth of shares that will pay back the commission fee in the 1st quarter of ownership (initial investments until my portfolio is more diverse and/or my income is higher)
3. DRIP stock positions that yield over 4% and have a growth rate over 7% (focus on long-term growth)
4. Never invest more than I will need to cover future expenses (keep liquidity until my income is higher)
5. Have a semi-passive income stream where my dollars work for me to end the need for me to work for dollars (This is my future financial independence portfolio!)
6. Choose debt repayment over dividend investment when debt interest exceed dividend returns. (currently my students loans and mortgage have an effective interest rate of 3.74%)

Musing on Credit, Retirement, and Savings

You know, there's a lot of advice floating around out there.

Recent conversations with friends have pointed out several commonly held beliefs about best practices. I've decided that these are for people who aren't able to truly take the reins of their own financial future. And honestly, that's not a bad thing for some people. It would've been good advice for me once upon a time.

Thankfully, God has allowed my path to deviate from the norm. Studying business and accounting really made a huge impact in how I think about money and numbers. Studying the Bible has made a huge impact on the balance between material wealth and spiritual wealth.

If you're willing to dive in with me, I'd like to discuss some of these commonly held beliefs and fetter out the reality.

1. Pay off your smallest debt first.

Paying off debt is a phenomenal idea! It's second to not taking on debt in the first place. But even I agree with debt sometimes. I would never go back and not take student loans. To do so would've been to delay my education which has made many more things possible. I'm not sure I'd even go back and not take a mortgage for my home. I might wish that I had made better decisions leading up to the mortgage.

So, what's wrong the idea of paying off small debts first? One word: Interest.

It takes a little more time and brain power to consider the long-term effects of debt. Which is going to cost more in the long-run: $10,000 for 10 years at 6% or $2,500 for 5 years at 4%?

Repaying the $10,000 will cost you $13,322.46. Repaying the $2,500 will cost $2,762.48. I'd rather reduce the amount of interest I'm paying on the $10,000 before putting any extra to repaying the $2,500 sooner.

I know many people who will take their income tax return each Spring and put it toward whichever debt it will pay off without consideration of the interest rates. The difference is astounding. If you can continue to make your minimum payments, please put that money toward the debt with the highest interest rate.

The long-term effect is to have less money spent on repaying debt. That leaves more money for investments, etc.

2. The 4% retirement rule

To retire well, I should be able to live on 4% of my retirement portfolio. Wow! That would have to be a reallllllly large portfolio.

Ok, ok. Before I really dig into why I so strongly dislike this idea, let's talk about where it came from and what it means. Because, of course, for someone out there this is the best idea.

Back in 1994, a financial advisor by the name of Bill Bengen came up with the idea that if you had a decent mix of stocks and bonds by retirement age (when you're drawing Social Security), that you could withdraw 4% of your portfolio per year to have a healthy retirement income for the remainder of your life (approximately 30 years). The 4% would include some interest, some dividends, and some sales of capital.

Sale of capital... therein is my issue. What sort of investments require you to sell capital to make money? And why don't the dividends being paid equate to more than 4%?? All of my portfolios, even the low-risk, new baby portfolio, have over 4% annual yield right now!

Well, it has a lot to do with the other assumption 60% of this type of portfolio is in stocks and 40% is in bonds. Let's start with the bonds portion of this portfolio. Bonds tend to pay interest close to the current interest rate. What's the current interest rate today? It's less than 1%, right? And what's the currently annual inflation? It's over 1%. So, 40% of that portfolio is probably losing money off the top to inflation (because it's worth less than it earns each year). Then the 60% in stocks probably contains enough stock that doesn't pay any dividends that it's solely reliant upon the stock price going up to earn money.

Let's not even mention the fact that this strategy leads to a smaller portfolio each year. Also, do you really want to wait until you can draw social security to live off your retirement portfolio?

It makes me think of the parable of talents and that one guy who stuck his master's money in the ground. Let's be smart and put Our Master's money that He's entrusted us into something that will at least earn more than the annual inflation rate.

Here are some real number examples:

Today, Bob has accumulated $500,000 for his retirement. He wants to know when he can retire. He decides to email his favorite investment blogger for some advice. He asks "Should I follow the 4% rule for retirement?"

The answer he gets is very surprising. He is told that if he were to retire today using the 4% rule he would have an income of $20,000. If he waits 10 years it will be close to $36,000 per year, and if he waits 20 years, $64,000. However, if he were to take the same amount and allocate it across some dividend investments with an annual yield of about 4% and average growth rates, he would have an annual income of $20,000 today, $55,000 if he waits 10 years, and $163,000 if he waits 20 years. However, if he wants to start drawing the $20,000 a year income today from the dividend investments (rather than reinvesting the dividends), his annual dividend income would still increase to $36,000 in 10 years and $64,000 in 20 years.

3. Max out your retirement savings

I think this is a perfect topic to follow Bob's example above. If you were to max out your retirement savings each year, how much would you have by now? Maybe you'd have as much as Bob, or maybe not. However much you've put into a retirement vehicle (401K, 403B, IRA, etc.) is how much money you can't touch until you're old enough. Queue MC Hammer singing "Can't touch this!"

I know of many people who are following the general beliefs about retirement and work, and are slaving away at jobs they hate so that they can retire well when they are in their 60s or 70s. My question is why?

As a follower of Jesus, I firmly believe in the call to "Rejoice in the Lord always!" (Philippians 4) This means doing work I love, spending time with people I love (even if I have to remember to love them as Christ loves them), and living for something eternal.

I'm pretty sure the measly amount that I have in my retirement savings is plenty to sustain the additional I'll need when I'm retirement age. They key is in 'the additional'. I really don't think I'll need more than 15-20k extra once I can withdraw from a retirement account without penalty. I keep my expenses low now with no plans to do anything but decrease them over time (pay off the house, wipe out the student loans) and I'm increasing my regular income by investing my savings into dividends. The other great part about my current income is that whether my dividends are qualified or not, the tax bracket I'm in is laughably small.

So, what would happen if I put all my extra savings into a retirement portfolio? It would be locked away for another 20+ years. That's 20 years of which I could be drawing dividend income or growing future dividend income.

My advice is simple, if you can manage your money well and plan for the future, put into retirement savings what you will need in the future minus what you will receive from other passive income sources. Dividends are GREAT! They allow your little dollars to go to work every day and bring home a regular (monthly/quarterly) paycheck or multiply into new little workers.

That's all from my soap box today. Maybe next time I'll address my views on tax-deferred savings.

Eternal Dividends

Lately I have been pondering what the purpose is in investing. Are my motives right?

A few friends who know about my journey and my desire to teach others about dividend investing have been asking me for advice and I've been enjoying sharing with them. One such friend is in the process of selling her possessions and minimizing with the hopes of moving overseas long-term. We've talked many times about retirement, dividends, student loans, etc. I love the conversations we have about these things, as well as the deep, intimate conversations about God and how He loves people.

So, I had to ask her. What's your motive? Why are you wanting to build up a portfolio? If it's to become so economically self-sufficient that you stop relying on God, we're done talking.

In the words of Jesus,

19“Do not lay up for yourselves treasures on earth, where moth and rust destroy and where thieves break in and steal, 20 but lay up for yourselves treasures in heaven, where neither moth nor rust destroys and where thieves do not break in and steal. 21 For where your treasure is, there your heart will be also.

22 “The eye is the lamp of the body. So, if your eye is healthy, your whole body will be full of light, 23 but if your eye is bad, your whole body will be full of darkness. If then the light in you is darkness, how great is the darkness!

24 “No one can serve two masters, for either he will hate the one and love the other, or he will be devoted to the one and despise the other. You cannot serve God and money." -Matthew 6:19-24

There is so much that we can focus on around us and lose sight of the end goal. Having to trust God with my finances after leaving a cushy job to work part-time and have just enough is entirely worth it! It's actually more motivating to know that I don't have to go sit in a cubicle 8-5 every day. I have the privilege of spending hours alone with God or talking with people from other nations. I have the freedom (and obligation) to set my own hours and schedule each week. I have to make choices about whether to geek out on the internet or write emails and make phone calls. I enjoy this life.

So, back to the question of "Are my motives right?" I think sometimes they are and sometimes they aren't. Ultimately, my goal needs to be focused on that which stores up treasures in heaven, treasures that last for eternity. When I idealize going back to the high-paying corporate job for "one more year just to set myself up for life" it becomes about those treasures that don't last, where moth and rust destroy, where thieves break in and steal. I become slave to the almighty dollar. If my focus is on investing so that I can devote more of my time to loving God and people, then my heart is right. I can rightly serve God and make my money obedient to that end. Money becomes the slave, not me.

I would love to help my friends and anyone else learn to invest for eternity. To put their money to work for them so that they can work for that which lasts. And that work can be in a cubicle, a coffee shop, at home, in front of a classroom, or anywhere else. The goal of investing isn't to live a life of unfettered luxury, but to have freedom in choosing what work to do and to have abundance to give to others.

As I sit in my home, and ponder how great a home it is, I am grateful for what God has allowed money to provide. When I think about the fact that my current job pays slightly above the poverty line and I have no trouble paying bills, I am grateful. Even if another year of a corporate job might've meant not needing any job in order to pay my bills, I know that like Mary (Martha's sister) I have chosen the better thing. (Luke 10:38-42)

What would you choose?

Dividend Growth Investing vs. Trading Stock

I still get very excited about my stock portfolio and dividend investing. I can't help it. The long-term potential is GREAT! But when I start talking about it, there's always someone who wants to talk about buying and selling stocks for a quick profit.

They believe their money making method is better than mine, and I believe mine is better than theirs.

Who wins?

It doesn't really matter. Yet, I am writing a post about the comparisons.

For me, I will choose dividend investments. I'm risk-adverse, afterall. If I invest in a healthy company that pays a decent dividend, I start making money within 3 months without any other effort. And, a really healthy company will increase the dividend annually, if not more often. This leads to more money over time. If I set up automatic dividend reinvestment, then my payout increases even more.

However, with buying and selling stocks, I would have to vigilantly watch the market looking for a low point and waiting for a high point to sell.  How long would it take me to gain the 3-7% yield that I get with the first year of dividend investments? What about the 10-20% yield that the dividends would afford me over time?

The passivity of dividend growth investing is the greatest pull for me. I can invest a set amount today, and leave it alone for years, and what pays $1 this year may pay me $50/year in 20 years.

To get the same increasing payout from trading stocks... I would have to always buy and sell in greater and greater amounts. Continually put my capital at risk.

With both strategies, you could, however, choose to periodically check your investments to determine if you should sell them (because the yield is not increasing at the best rate for dividends or because you've gained enough profit with trading).