10 Steps to Financial Success for New Grads

This post is sponsored by SoFi. SoFI recently created a Work Dashboard that you can use to keep track of your goals. This includes a Student Loan Debt Navigator. And if you decide to pay off loans aggressively, SoFI can also refinance your loans (here’s my affiliate link). Please see Step 5 before doing so.

First and foremost, Congrats! You’ve made it out alive (barely, perhaps?). Now that school is out, it’s time to make money in. Whether you’ve started your first job or are just figuring out your next move, it’s important to start thinking about your finances from the get-go and to act intentionally about money. In an effort to get you closer to a life of financial independence (or at least just enough to quit a job you don’t like and have the freedom to pick-and-choose), let’s review 10 steps you can start to take for success. If it all sounds too overwhelming, no worries. Take it one easy step at a time. I recommend breaking them down over a few weekends to ensure steady, solid progress over time.

10 Steps to Financial Success

1. Review Habits

You want to know where you stand with your money. More specifically, you want to know where the money is going. Whether you’re aware of it or not, the way you handle money is centered around the habits you’ve formed over time. The best way to find that out is to create a budget. That is the very first step we took towards our path to financial independence. Without tracking where your money goes, you cannot ever analyze your habits or learn from your mistakes. You don’t know where to improve. This step is so important to our financial journey that I even wrote an entire course around it: How to Master Your Budget. You can access my course for FREE. After the course, I would highly recommend signing up for a budgeting tool, to streamline the process. It makes it more fun rather than feeling like a chore. The one we use is YNAB (You Need A Budget)! Find out how YNAB helped me pay off $84,000 in student debt within my first year of loan repayment.

2. Build Credit Score

If you’re like me, I had a whole slew of debt when I graduated college. I decided to tackle all of my credit card debt and improve my credit score. Graduating from school is a great time to build habit #1: Pay off all your dues in full each month. After you do that, go ahead and tackle the bigger payments like car loans and student debt. By making monthly payments on time, you’ll build your credit score in no time. Don’t forget that a poor credit score can make your life harder in the future, so avoid it at all costs. In fact, it could cost you more money too, since a low score typically lands you a higher interest rate on future loans!

3. Pay Off High-Interest Debt First

High-interest debt increases the amount of money you lose paying off the interest. I had a lot of credit card debt when I graduated dental school because I pretty much had no money and was living off of my dreams and thin air. I tackled credit card debt first because the interest rate on those was 16-24%! YIKES. Get that high-interest debt off your plate, so that you can focus on paying off your student loans (if you have any).

4. Pick a Strategy for Your Student Debt

I am being honest when I say that it doesn’t matter what strategy you pick for paying down student debt – as long as you have one and you stick with it! I personally needed to pay off my student debt as aggressively as possible, but if your lifestyle better matches with the loan repayment and forgiveness programs, then go ahead and do it! It is important to be well-versed in the different repayment options, so do the research and choose wisely.

5. Talk to a Professional

If you have any doubts at all, I would highly recommend speaking with a professional. That’s what I did! I spent my entire first paycheck paying for a financial advisor. They aren’t cheap, but their return is ten-fold! I have two I would recommend. Travis Hornsby from Student Loan Planner saved us thousands of dollars by picking the correct plan. Andrew Paulson, from White Coat Investor, is another option. Once you’ve decided which path to take, determine if refinancing is something you should do. SoFi is a company that does student loan refinancing but there are plenty others out there, too. Shop around – I’ve listed a few in this previous post!

6. Max the Match and Other Contributions

The earlier you start saving for retirement, the better. There are plenty of options out there, but whether you choose a 401K or an IRA, if you have a company match benefit, make sure to maximize it! That is free money that not everyone has the privilege to have. I certainly don’t, but we definitely max out my husband’s match from his company.

7. Save up

I am certain future you will have wants and wishes. There are many things out there you probably plan to buy, some of which are quite big purchases. If you wish to buy a graduate degree, a car, a home, or anything else of that nature, you’ve got to learn how to save up. Remember those habits you formed at the beginning of the journey? Well now it’s time to benefit from them. For me, I don’t mess around with my savings, especially if it’s a short-term goal. I am quite conservative in that way. I stash my savings in a high yield savings account like Marcus, where I can gain interest on my savings at a higher rate than a traditional savings account, without risking losing money (as opposed to investing my savings in a brokerage account). Find out how a Marcus High Yield Savings Account can help you reach your short term goals. If you’d like to sign up, my referral link here will give you a 0.2% APY increase on the current rate.

8. Invest With Your Head – Not With Your Heart

I consider investing an advanced finance skill. However, I can’t argue with the fact that the sooner you start, the better you become. Like any other skill, it takes practice. However, if you haven’t learned how to control your spending, get rid of debt, maximize your retirement opportunities and save money for your future goals, then there’s a chance you’ll lose the investing game – and bad! Perfect Steps 1-7 first, and then remember this advice: Invest with your head, not with your heart.

9. Find Your Tribe

They say it takes a village to raise a child. Well, the same goes for being managing money. You need people in your corner who won’t tempt you to spend your hard-earned dollars. People who will understand if you would rather order pizza than go out. Friends who won’t ditch you because you said no to a few happy hours. You want someone in your corner cheerleading you on your way to financial independence. Your tribe is very important. It can be the making of your success, or the downfall. I don;t want to be elitist, but even your friend group should be an intentional choice.

10. Set A Date

All of this should be given an end date. Make a plan, then set it in a calendar. Life can get in the way – so make sure to revisit your plans, goals, credit score, and debts once every six months. Look at that date you’ve created for yourself when you lose your way. Soon enough, you will be financially free!

I don’t know about you, but navigating the post-grad world can be tough! It’s easy to feel overwhelmed by the advice out there, or worse, completely lost and with no one to turn to. I hope this guide has helped to at least start the journey. Other related posts that you may find helpful:

Thoughts On: Slowing Down

In 2020, I suffered from a period of overwhelm. It was brought on by the flooding of current event updates disguised as news but served unto me as advertisement. The only way I knew how to save myself was to shut off my phone from all the noise.

I found that the proliferation of chatter was the reason behind useless anxiety caused by the need to be plugged into the information (and misinformation) of others. Ironically, this connectedness with the living world led to a disconnectedness from the self which resulted in confusion and agony, leading up to the miseries plaguing our species – doubt, fear, uncertainty, etc.

I wonder, upon looking at those around me, whether the proximity of our noses to our cell phone screens is the factor behind the lack of proximity to other human beings. I wonder how the big companies have won. How the attention economy has grown so that we pay companies in terms of our precious brain cells rather than dollar bills – and when exactly did they decide to target our thinking power and our time?

It’s like they knew that dialing the volume meters on our social media apps is the exact method by which they could silence our voices. By letting us share experiences, they took away the motivation to make our very own – a robot army full of knowledge and lacking any real stimuli.

It worked, you know?

Shutting off my phone to shut up the noise.

Turning off the media was when I started to hear myself.

The cadence of my neuronal firing returned to a humanly beat and reality was returned to me. It isn’t a matter of never subscribing to knowledge or information, but rather, one should learn from slow-living and be concerned by the RATE with which we gather information – lest we be reduced to a tiny node in the homogenous network created by a handful of “thinkers” spreading a singular message of their choosing.

I hope to impress upon others the importance of processing information with adequate space and in due time – the factors that increase our overall human experience and reconnect us to being a part of this planet. It is no longer a matter of having experienced enough if you aren’t even immersed in the experience itself. At that point, it’s like you experience nothing at all.

It bears repeating again and again: Slow. it. down.

Travel: A Weekend in Telluride, CO

A weekend in Telluride, Colorado was the right prescription to combat my fast-paced California life. Nestled in a valley surrounded by snow-capped mountains (in June!), this secluded town is almost two hours away from the nearest Southwest-serving airport (Mike and I are companion pass holders and we use our Southwest card to travel around the United States for FREE!) and is a stand-alone vacation spot so that, once there, you can nix the rental car along with all other obligations and just settle into the present tense. In fact, since there is no need to leave this town (like ever!), I would actually recommend taking the shuttle (at $75 per person) from the airport to Telluride. It’s less stress, less hassle, and if you’re staying a while, less dollars.

Telluride is the perfect place if you like slow-living. There is fantastic food and coffee to be had, as well as a number of shops downtown. I would recommend swinging by the book store and purchasing a paperback to read on the patio of Ghost Town or Coffee Cowboy. If you prefer to write, my friend and I bought paperback journals and spent an afternoon writing whilst sipping smoothies. Natural juices translated into creative ones in real time. There are also many local events, such as live music on the green or a Farmer’s Market that takes place for a majority of their Fridays. On the weekend, you can join the community clean-up crew to keep the area looking pristine – and to pay back Mother Nature for all the good she provides.

The vibe of Telluride is adventure-laden. The streets are teeming with dogs and active pet-owners who have most likely checked off a 3-mile hike by the time you wake at 9am. Patagonia gear, trail runners, and Prana shorts abound in this outdoor-loving getaway of a town. Most trailheads begin in town, and the trails are well-kept and demarcated clearly, as well as avidly used by the locals. Many waterfalls can be seen due to the melting snow caps, and some you can walk right up to them and revel in their misty glory. Shall you choose, rivers for crossing are also present – so feel free to slip off those Tevas and ground yourself in ice-cold goodness. Telluride also has the only free gondola in North America, which will take you to trailheads at the top of the mountain, without the need to slave away to the halfway point. For those with kids, why not take the Gondola up and hike with them down towards town? You’ll still get the view, without the tantrum.

Here are a few highlights from our recent Telluride trip.

Ghost Town Coffee

A great spot to have breakfast or refresh in the afternoon. We went back for smoothies twice (may I recommend the coconut milk in the Purple Smoothie or the house-made cashew milk in their green smoothie?). They also make great coffee, and have an intimate gathering area outdoors for your friends and family.

Cowboy Coffee

The pitstop we made three out of three days. It’s a tiny trailer stationed next to a Greek restaurant serving great coffee and breakfast burritos. Pro tip: The day-old burritos are half-price, so take them to go and reheat in your AirBNB for an easy time. Also, they’ve got a stash of spices sitting on the counter, and my tumeric-infused coffee really got me through those rainy Telluride afternoons. The clouds roll in around 2pm from the surrounding mountain giving the town a daily shower. No wonder it’s so green!

The Butcher and the Baker

Apparently this is the busiest breakfast situation on weekends. The line went around the corner, and there are no reservations. I would recommend swinging by during the weekday if you want to avoid waiting a while. I got the cheddar croissant and coffee. An honest baker’s opinion? I would go with an actual breakfast meal rather than a pastry and bring coffee from the other two places mentioned above. What I ordered was okay, but what the waiters were bringing to other tables looked way better!!

Brown Dog Pizza

My number one recommendation when staying at Telluride. This place gets busy between the hours of 6pm and 8pm and there is limited seating outside so either plan to come early or take it to go. They have multiple Award winning pizzas and they did not disappoint. You could even request to top the two halves differently. We were able to try two of their Award winners, and it was DELICIOUS!

New Sheridan Hotel

A historical hotel remodeled into what currently stands, with a great patio area and restaurant for lunch and dinner. Eating here is a bit on the pricier side, but they serve good American fare for those who like lighter and well-prepared meals. The key lime pie is to DIE FOR. I’m biased, of course.

Bear Trail Hike

This trail is a great beginner 5-mile out-and-back hike (2.5 miles each way). The trail is well demarcated and you’ll encounter fields of wildflowers, fallen trees, a few waterfalls in the distance, and a waterfall that you can walk right up to. Trees line the way on either side as the snowy mountains guide you straight ahead. We saw many families and dogs on this hike. It’s very doable, but make sure to embark early and return to town around lunch time to avoid the afternoon rain.

Gondola to Mountain Village

You can take the Gondola to the Mountain Village which is the ski resort at the top of the mountain. The gondola is the only free one of its kind in all of North America. We took it all the way up and then hiked back down into town.

Telluride Trail

You can go up and down this intermediate ski run but we used the Gondola to go up and hiked it back down. As you get closer to town, you see a bird’s eye view of Telluride as well as hear the live music playing on the green. The hill is steep and rocky, so you definitely want to wear footwear with traction – unless you’re okay with slipping and sliding occasionally. The trail is straight-forward and bare since it is a ski run, but the view is hard to beat. Please note in the photo the afternoon clouds rolling in, right on schedule.

Telluride is a well-kept secret, but the travelers we met pay recurring visits. I plan to return, as well. This tiny pocket of slow is really what many of us need right now.

Play Pretend: J. Hannah Stylist

This post may contain affiliate links. Please see my disclosure to learn more.

It’s been a while since we’ve played pretend in this space. In honor of J. Hannah’s biannual sale (going on now until June 16, 2021), I decided to dress-up imaginary personnel with jewelry from the brand – jewelry that happens to be 20% OFF! It goes without saying that I’m a fan, considering the number of posts I’ve published in this space touting this line. I truly believe it’s a brand founded on good ideals (that is, reduce, reuse, recycle) and worthy of the generation that ascribes to the mantra “less-is-more”. Her collection is inclusive of different groups, and is comparatively affordable considering you’d only need one set of high-quality jewelry. Timeless in its lack of glitz and glam, this is the one set I invest in- and wear every day. Below, I imagine how it could function similarly for others.

For the tomboy.

1. Identity Necklace II 2. Classic Cigar Band 3. Signet Ear Cuff 4. Identity Bracelet II 5. Carob Nailpolish

For the bride.

1. Diamond Form Pendant 2. Duo Form Ring with Pave 3. Duet Earrings 4. Agnes Polish

For the proper one.

1. Akoya Polish 2. Glace Stud Earrings 3. Oval Mabe Pearl Pendant 4. Clara Bracelet 5. Demi Signet Pearl Ring

For the rebel.

1. Identity Bracelet II 2. Ghost Ranch Polish 3. Chess Inlay Signet 4. Inlay Signet Pendant 5. Tetra Hoops II

For the vintage type.

1. Miso Polish 2. Era Locket 3. Glace Hoop Earrings 4. Demi Signet Diamond

For the modern minimalist.

1. Form Ring I 2. Form Ring II 3. Initial Signet Pendant 4. Form Hoops I 5. Chanterelle Polish

Gift Guide: Father’s Day

This post may contain affiliate links. Please see my disclosure to learn more.

Last year, the blog’s most popular gift guide was the one for Father’s Day. Y’allll I can relate!! My old man himself has been notoriously difficult to shop for, because he always says he doesn’t need anything. Dads are like that, I guess. Truth of the matter is, it’s not that my pa doesn’t need anything. It’s more so that he doesn’t feel deserving of luxurious gifts and frivolous items. Practical to the tee.

But fathers are equally deserving of a day of rest, an afternoon of enjoyment, a bit of luxury and celebration. I feel like I’ve exhausted all my good ideas in last year’s list, but I will try again this year for the sake of all humble fathers around the world. This is for you. Happy Father’s Day!

Monthly Goals: June 2021

An Overview of May

May was the longest month of the year yet it still managed to escape me. I don’t know where the time goes but if I could somehow pocket just a little extra bit of it, then let my pockets rip at the seams with carrying the stuff. Luckily, I do practice bit of daily journaling with my Unbound planner so that I may look back at the forgotten memories buried within my fickle mind and recall what it was that I did with my precious time. It’s good practice, too, as it forces me to set aside a few hours at the end and beginning of each month to review not only progress, but the good and important stuff that we sometimes miss – that which is the essence of life.

It turns out, there were many accomplishments in May that, when taken separately, seem random, but when read in the context of our big picture plans, actually move us closer to our dream life.

  • We refinanced our home a second time, making it a cash flow positive rental option in the future. This sets us up nicely since our dream was to travel the world. It allows us to gain equity plus enough extra income to cover maintenance costs without having us live here anymore.
  • We drafted a living trust on our own after we were quoted $2.5K to have one written up by a lawyer. We wanted to put all our assets in a trust but did not want to pay the lawyer fees so with the help of Legal Zoom (the same company that I built an SCORP with, and no I do not get a commission for this, I just really want to talk about them), we were able to draft our own living trust for less than $400.
  • Mike’s job officially offered him the option of fully remote work in the future which sets us up nicely for our dream to travel the world and live in different places. I am actually most excited about this fact in congruence with the refinance since it allows us to try our nomad life sooner than we thought! Our housemate is leaving at the end of summer, and our plan is to rent our home out for a year and nix the permanent address. Also falling in line with all of this is our HOA’s recent approval to allow year-long rentals in our community (starting tomorrow!). And the world is slowly opening up to leisure travel. The timing couldn’t be any better!

Aside from the accomplishments, May was also spent with friends and family. We stayed with friends in NorCal, visiting Healdsburg for a weekend and working remote in their dining room. My brother was home from Arizona for three out of the five weeks in May, celebrating Mother’s Day as well as Memorial Day with the fam. We stayed with friends in their newly purchased San Diego home for an entire weekend, then hosted friends in our space over Memorial Day weekend. I may not have worked as much, but my lack of productivity at work was offset by being with people I haven’t seen in months (or for some, over a year!), which is fine by me. In fact, I was so busy with life that my blog earned $0 this month.

Looking Forward to June

June is my birthday month, as well as the halfway point of the year. I tend to approach June with gusto and an intent to live life to the fullest, as it serves a reminder of both the passing of time and the gift of being placed on Planet Blue with a beating heart and a working mind. Also scribbled on our calendars are Father’s Day, plus a wedding we’ve been waiting over a year for – so celebrations abound!

Then we jetset off to Iceland in early July, where we will meet my sister and begin our traveling life. With the liberties Mike’s new way of work-life gifts us, I tell myself I will start approaching the rest of 2021 with the same exuberance I felt when I tackled the challenge of adding baking to my career repertoire – that is, with reckless abandon, shutting my eyes tight and taking leaps of faith that could land us somewhere far away from here, or alternatively, right on our arses. Cheers to mid-life crises or whatever you call it, that which I experience every other year or so it seems. 🙂

June Goals Include:

  • Notarize the living trust, because we must continue to do practical things.
  • Plan our nomad life, because I shan’t forget to dream.
  • Declutter garage, email, and phone, as a symbol of starting anew at thirty-two.
  • Organize digital photos, especially if travel will start to accelerate the collection.
  • Finish 2 books, including the current read.
  • Increase Rye Goods wholesale by 10%, growing my version of remote work-life.
  • Pursue blog income stream steadily, in an effort to replace dental income shall I leave this place.
  • Master 3 new piano songs, and continue the daily practice.
  • Resume my boxing routine, as they re-open next month at a new location.
  • Get two interviews on the calendar, to spread the word to new-grads entering the industry post pandemic.
  • Apply to 20 affiliates to help the blog revenue along.
  • Take 5 SEO courses, to continue adding to my skill set.
  • Finish 5 dental CE courses online, to revive my love for the art.
  • Bake 2 new recipes – I’m looking at Chiffon cakes at the moment…
  • Consider starting a weekly baking IG LIVE tutorial, because those Lunch-And-Learns were so fun!
  • Learn geography of all 195 countries – a bit of R&D never hurt anyone.
  • Run 4 miles in 40 minutes, as if boxing wasn’t enough.
  • Yoga and meditate each day, for the mental aspect as well as the physical.
  • Finish 1 coloring page from A Secret Garden – something I’ve been saying for months but have yet to accomplish.

I probably will fail to accomplish half of these things, but half is good enough for me!

How We Made Our Home Cash Flow Positive

Most of the time, I feel that the advice I write in this space comes in the telling of my personal story. I could have titled this article, “What You Need to Have a Cash Positive Home”, but decided to take a more narrative approach, since what worked for me may not work for others. Since starting my road to financial independence in 2017, we have acquired a property that has potential to be a source of income. While I hesitate to insinuate that real estate is a good “investment”, I do have to say that this particular one worked out for us, despite living in the Golden State (Orange County, no less). If you want to know how we got here, read on to hear about the process.

Our story begins in 2017, when I decided to pay off $575k+ in student debt, and suddenly realized that the beautiful live-work loft that we were renting was absolutely and horrific-ly expensive. Even though it fell within the average cost of an OC rental ($2,800 a month for a two bedroom, two bathroom, 1,500 sq. ft. live-work loft with a 2-car tandem parking garage), it became apparent that it could not support my goals. So I went down a rabbit-hole of considering my options.

First, we looked for cheaper rentals. We almost pulled the trigger on renting out a 500-square foot apartment in Huntington Beach for $1,900, but voted against it because it had no garage, was farther from work, and would have likely caused marital issues due to cramped quarters. As much as I loved Mike, we were still growing accustomed to being around each other 24/7. Little did we know a pandemic was written in our futures. Either way, we nixed the idea of moving into a tiny box, although now, I think I could handle it.

Next, I wrote to our current landlord to ask her to reduce the rent. We had a great relationship with our landlord and she was so grateful to our on-time rent payments and our care for her home, that she did reduce the rent from $2,800 a month to $2,600 a month (a savings of $2,400 per year). Okay, so now we were getting somewhere.

Then, I thought of renting out the bottom floor (which had its own entrance, bathroom, and floor). The living space was on the second floor and the bedroom was on the third floor. I told people around me that I was thinking of renting it out and luckily, my brother’s newly graduated girlfriend happened to find a job in Orange County. At the time, my brother was living in my parent’s two bedroom home and she was living with her sister in San Diego, where her internship was located. Her new job in OC meant that she needed a new home, and apartments, like I said, would have likely cost her anywhere from $1,800-$2,400 monthly.

So, we offered her a place to live, for a mere $700 per month. Liiiiiiiiiike, a really nice place to live for any new college grad. Lucky for us, she said YES! That cut down our living expenses to $1,900 per month, the same number we would have had to pay for that tiny room by the beach. By house-hacking, we saved $900 per month, which saved us $10,800 per year. This brought down our yearly cost of rent from $33,600 to $22,800 – quite an amazing feat.

But still!

It killed me to know that $22,800 of our hard-earned, post-tax dollars was going into someone else’s pocket, without increasing our wealth. So I became obsessed with buying a live-work loft of our own. I must have searched Zillow for an entire year straight. I was so in love with our current one and our location, but when one was listed on the market, I couldn’t stomach the $650,000 price tag. It was for 1,500 sq. ft., one bedroom, one bath, and a downstairs office. It was street facing which brought up it’s property value, but after stalking Zillow for a year, I felt that the right price for that loft was about $100,000 cheaper.

The most important thing about the home searching process is this:

We knew what we wanted. A turn-key live-work loft that allowed us to keep Kirsten and that is fairly new for a fair price that will not wipe out our bank accounts. We wanted one in between Los Angeles and South OC, and we wanted a property that can become a rental, a business storefront, or our home. Essentially, I wanted options. Our lives were open-ended at the time, so we wanted our housing situation to be, too. We decided to put the smallest down payment we can (about 5% of the asking price) so that we can get in on the market sooner.

(PS: The loan we did was a traditional loan which included a PMI for only putting 5% down. We also looked into a physicians loan which allowed 5% down without PMI. However, the physician’s loan increased the interest rate, and when we ran the numbers, one ends up paying more for the physician loan over the course of 30 years than a traditional loan. As far as putting more than 5%, we just did not have the cash at hand especially since we were making $6,500/mo payments to my loans. So we decided to put in the least we could, and this kept us from being house broke. We had extra cash to cover the fees and still keep a nice chunk for an emergency fund!)

We were sitting at Bruxie’s waiting for our chicken and waffles, disappointed at deciding to let go our “dream” loft, but also proud of not allowing emotion to make our home purchase decision for us. It was then that I saw it for the first time listed on Zillow. A loft in the heart of downtown Santa Ana, maybe about 2.5 miles from where we currently lived. It was listed at $499,900 and had the same number of bedrooms, bathrooms, square footage, and parking spaces as the loft we lived in. Also, it was street-facing. The seller was under contract previously, but for some reason, the contract fell through and he decreased the asking price by about $15k. This gave us a clue: He was motivated to sell. He listed it only a few hours before our seeing it, and the next day, we had done a walk-through and placed an offer.

Some might call this an emotional decision but that it was not. We just happened to know what we wanted and did not want. We happened to know the current market. We also happened to know a stellar agent who was a friend of a friend’s, and we happened to know the person who lived next door to the loft we bought. We have done the research, the thinking, and the networking – and everything just kind of fell into place, which is great if you’re a believer in fate.

So we bought the house with a 5% down at 4.6% interest rate (which happened to be more than 2% less than my loan interest rate!) and our monthly mortgage, (plus PMI, plus HOA, plus property tax) was about $3,300 a month. We kept our roomie on for $700 a month and gave her a garage spot for the inconvenience of moving her butt to downtown, so this made our portion of the payment $2,600 – the price we were at before we started house hacking. This was at the end of 2018.

During the pandemic in 2020, we refinanced in the summer, reducing our interest rate from 4.6% to $3.5%, and our monthly payment from $3,300 to $3,000. We even gave our roommate a $100 discount, reducing her rent to $600 a month, for being such a stellar, long-term roommate. Unfortunately, our living situation with her is coming to an end this year, so we decided in January of 2021 to refinance a second time.

This second refinance (5 months after our first) reduced our rate even further from 3.5% to 2.85%! It also reduced our monthly payment down to $2,700 (HOA, property tax, and mortgage insurance included). With our roommate still on board until July/August, we are paying $2,100 for a roof over our heads. Unfortunately, she will leave at the end of summer, and we will have to face a few rental options. However, since we treat her (and charge her) like family, the rental price of that downstairs room will likely increase to a going rate of $1k/month. At that price, our housing cost will go down to $1,700 a month – not bad for OC and more than $1k cheaper than where we originally started.

The refinance put us at a fantastic place to be since our unit has a rental value of about $2,800 – $3,000 per month back when we originally bought it. However, just recently, lofts that were built over the pandemic down the street are now being leased. These 500-800 square foot lofts go for $2,800-$3,000 / month. The proximity to our place will, we hope, drive the value of our unit above $3,000/month as a rental. Either way, it is safe to say that our place is now cash flow positive shall we decide to move on from here after “things return back to normal.”

Both our jobs are taking us south, so if remote work doesn’t remain a thing, we may rent this space out and get a second property. Shall we choose to stay, we can continue to house-hack and rent the bottom floor as either an office space for a WFH parent that needs their “work away from home”, or as a bedroom for someone we know. This will lower our living expense to under $2k/month.

In the meantime, the value of the property is estimated to be at $550k according to our appraisal, and $565k according to Redfin. We are earning equity and when we move on, will also earn rental income on top of that.

The following are the tips that worked for us when buying a property:

  • Know your market. I stalked Zillow for a year for a very particular type of home in a small area.
  • Know your numbers. Don’t accept loans at face value – actually map out the dollar amount over time.
  • Know your must-haves and cant-live-without. For Mike, that was a garage. For me, it was natural light.
  • Know an emotional decision when you feel one. This is why we did not buy the loft “of our dreams”.
  • Know your financial limits. I knew I had my student debt to worry about. I also knew I wanted an emergency fund and to not be house-broke.
  • Know your future goals. I knew this wasn’t going to be our forever home. Our lives are so open-ended, there was no pressure to buy a home that we would live in forever.
  • Don’t ascribe to the “dream home” and all that HGTV stuff.
  • Take Renovations Slowly or not at all.
  • Don’t just buy a home and forget. Continually re-evaluate and find ways to save. That’s why we thought of refinancing.
  • Be open to non-traditional ways of living. House hacking and living with a roommate is the best decision we ever made.
  • Be creative in your solutions. Not only did we house hack, but I also built a bakery out of my kitchen. I operated my own bakery for a year. My house also acts as my WFH blog space, my ROVER dog-sitting space, and now, it is my husband and roommate’s work-office. It is more than a home or a rental property – it is where we work and earn a living, too.

I know this narrative is extremely personal and number heavy, but I also hope it’s been of help.

Thanks for reading along.

Photo by Philipp Berndt on Unsplash

Gift Guide: Celebrating Frugal Minimalists

This post may contain affiliate links. Please see my disclosure to learn more. 

As a frugal minimalist, there are two things I want to normalize when it comes to receiving gifts: Gifts under $25 and consumable items. I know it sounds silly, but for many years, I have struggled with the privilege of receiving gifts from loved ones that I (in all honesty) give away or throw in the trash (if I can’t return them, of course). I have expressed multiple times that I would prefer not to receive anything during holiday celebrations because of the wasteful saga that follows each one. Alas, I have found myself born into a gift-giving family, who, after many years of reproachful, miserable, and difficult conversations, has finally started to hear my wishes. Gift giving is my love language (believe it or not) but I want to receive gifts that I love or need. My actions may come across as ungrateful but nothing pains me more than receiving a gift that does not belong in my life. That’s why I always have to get rid of them right away – because they remind me of thoughtlessness and they hurt my feelings.

For gift-givers who ascribe to the idea that affection is proportional to a price tag, please hear me, a person who LOVES gifts, but believes that this is not true. I am a frugal minimalist. I would love gifts that fit both of those categories. I think the best way to show love to a similar friend or family member that you may have is to follow two simple rules.

  1. Keep the price tag under $25. I remember the gifts I received in my childhood for my birthday. They were always under $25, and they were all perfectly generous gifts! Since when did gifts start costing $50-$100? Did we all decide to participate in a game of one-upping each other and that’s how the baseline for gifts escalated? Did our gifts increase with our age, or our salary? Do gifts increase our status? Because surely it depreciates our wealth, let alone devoid our meaningfulness at being a loving friend or family member. If your friend is a frugalist, they will likely be stressing about the amount of dollars you spent on them. If they’re like me, they would be considering all the better buys your money could have been used for. We need to normalize the idea that $25 is generous, still. We have to change our mindsets about that, or go broke trying to impress the people in our ever-growing networks.
  2. Buy consumable gifts. I like gifts that are meant to be used and will no longer be around a year later. I stress about clutter around me and constantly clear my surroundings. Don’t bother buying decor items or things that have no use for your minimal friend. Gift something that will live out the course of their life and then be gone. The world changes so fast these days, so do you really think a person will like the same thing a few years from now? I change my mind all the time, so I certainly don’t.

Chances are, your own frugal minimalist has been trying to communicate these things to you for years. They may feel frustrated, stressed, or guilty at receiving lavish gifts from their friends and family. Worse, they may feel pressured to return the favor, even though it goes against their values. I think it’s time to normalize less expensive, consumable stuffs. In order to help others celebrate their own frugal minimalist, I am publishing a gift guide that will be helpful to all others like me.