Conversation, Walks, and Collaborative Projects

FraidyCat is a freelance writer who works on the blog FraidyCat Finance with her partner, Mr. Blue Sky. 

Every day since mid-March, my partner and I have taken a walk, sometimes two. Our neighborhood is pretty well-laid-out for it, and very few other people walk so we didn’t worry too much about virus spread in that way. We’ve practically worn a rut through the cracked sidewalks and backwoods trails behind the nearby park.

Before COVID-19, our conversations often revolved around work, what he was doing and what I was doing, and household management: when would groceries be bought, who was coming to visit this week, what needed to be cleaned. We also talked about other things, podcasts we enjoyed and such, but it was never enough, him being pretty concise and quiet, to fill seven-to-ten 45-minute walks a week. 

At some point, I came up with the idea for a blog. This isn’t unusual, since ideas for things pop up all the time. But this one had a kernel of utility for me: it’d be a blog about us, specifically about how my partner was willing to dive into aspects of personal finance, and how I was always dragging my feet and deeply risk-averse. 

He’s not a writer, but he does like talking about what he’s learned lately about dollar-cost averaging or donor-advised funds and anything else financially interesting. I pitched him, a freelance writer at my heart, on the idea of me writing a blog that was based on our conversations.

At first, he was unsure, but I reassured him that he wouldn’t have to do 50 percent of the writing. What he’d have to do, though, was research with me: rather than just idly scrolling through the internet feeds on our phones, we’d need to follow our curiosity on personal finance topics more deliberately. He’d report back to me about what he found.

I was not all that interested in launching the blog — I’ve always struggled with committing to projects — but we spent the first two months of the pandemic chatting about what the blog would be like. I would draft up a post and he’d read it when he had the time, and when we were walking, I’d interview him more officially about decisions like why and how we bought our house and why he invests for retirement the way he does.

It was really fun. I didn’t see it going anywhere — nothing in our experience is unique in the wide, wide world of personal finance blogging — but just pretending we were going to launch the site made me look forward to our walks more. It felt like we were getting deeper into our own decision-making process, the household management talks we’d always had, but also coming up with new ideas, feeling more invigorated. It was nice to have something new to think of amidst a lot of sad, difficult news that 2020 brought.

I sometimes wonder what holds couples and very close friends together long-term. Is it inertia, proximity, or actual shared interests? My partner and I don’t have a lot of overlapping interests other than personal finance, so when our social circles and outside-the-home activities shrank, it made sense to drum up some serious shared-project energy.

I don’t know if this is the kind of project that I would have made enough headway on in a non-2020 year to actually launch the site, but in November, I decided to go ahead and launch, since that would push me out of a slump I’d been in about the project and hopefully get me excited again. It worked. In addition to the fun of talking to my partner to brainstorm, I was now able to comment and connect to other bloggers. It was a well-timed infusion of excitement, when the weather was turning nasty and I wasn’t likely to be walking as much.

As the walking aspect faded, since we’re indoors more, I still keep an eye on the weather and try to get us out for a quick stroll somewhere any time the temperature breaks 50 degrees at the warmest part of the day. But we’re in a rhythm as well: talking about personal finance as a subject of study and consideration has become part of our lexicon as we clean the kitchen and cook meals and wrap presents. 

As a writer, I tend to find the process of creation pretty lonely; only one or two times in my life have I felt truly in sync with a collaborator in creative harmony and productivity. With this project, however, the lack of expectations for the final product and the overarching goal of mostly just entertaining ourselves on walks and in the daily spaces of conversation has really worked.

I have high hopes that, after only a few years of marriage, we have more projects left in us. I hope that creative collaboration can be a part of romantic love but also of friendship love, and family love in my life. Certainly, people who don’t live in my household might not share the same schedule as me, so they might not be as immersed as we happened to be this year, but I hold out hope for other low-stakes, creativity-focused projects in the future.

The conversations themselves, it turns out, are the most useful output of our efforts; the blog itself is fine but I can’t spend a whole ton of time writing, promoting, or optimizing it, given my other work. What’s most engaging is the habit we built that takes things we already did (write and read) and turned it into prompts for connection (the chats, on walks and at home). I think creativity at its best often works this way: the more questions we ask, the more questions we generate. It’s a beautiful cycle to be in with someone you spend so much time with. 

In Which My Career Is Profiled in a Book About Art and Artists

In 2017, award-winning essayist and critic William Deresiewicz emailed me and asked if he could interview me about my life, work, art, and finances. (Those are four of my favorite topics to discuss, so of course I said yes.) Deresiewicz explained that he was writing a book about “arts careers in the new economy” — and this summer, The Death of the Artist: How Creators Are Struggling to Survive in the Age of Billionaires and Big Tech was published.

A lot has changed, in terms of my life, work, art, and finances, since 2017. Even back then, I wouldn’t have said I was “struggling to survive” — I think my last official “struggle” year was 2012, and I spent half of it living off the $10K I’d saved up (and the other half going into $14K of credit card debt that I finally paid off in 2016) so it doesn’t even really count.

That said, the way I am profiled in The Death of the Artist is lovely, honest, and insightful. Here’s how it begins:

Nicole Dieker is pretty much the ideal person to have tried to self-publish a work of literary fiction. Dieker grew up in small-town Missouri, the older of two daughters of a piano teacher and a music professor. Her upbringing taught her to value the arts, but above all, she told me, it taught her to practice. “The idea that every day you’re going to sit down at your instrument and you’re going to try to get better at it—that taught me as much about how to be an artist as the actual art itself.”

If you want to read Deresiewicz’s thoughts on why my freelance career has gone so well — and his analysis of The Biographies of Ordinary People both as a text and as a marketing project — you’ll have to read The Death of the Artist for yourself.

The other artist profiles are pretty good, too. ❤️

On Investment Portfolios and Financial Privilege

So I’ve been paying attention to my investment portfolio, even though that is the one thing personal finance experts are telling everyone not to do right now — if you don’t look at it, you can’t worry about it, right?

Well, let’s look at it:

It's a bar graph. A very very downward curving bar graph.

My current net worth, which includes not only my investments but also the $15,450.84 I’ve got saved in various bank accounts, is now $138,011.15.

That’s down $29,020.70 from the beginning of 2020.

And yes, that’s all investment-related. (I didn’t, like, go buy a car or anything.)

I’ll be the first to note that I am still in a very very financially privileged situation right now; I’m still freelancing, I don’t have to worry about where next month’s rent is coming from, and I have a cash emergency fund that will cover me for six months if I’m judicious with it.

The financial independence calculators now estimate it will take me 7 years and 9 months to FIRE (and yes, I ran those calculators with just the past month’s market data, so they wouldn’t be tricked into thinking we were still in a bull market). I’ll remind you once again that I’m not looking at these calculators as an actual predictive tool; they’re just fun to play with — and now it’s interesting to think about how much of that theoretical FIRE money might come from actual earnings and not investing gains.

Because that’s what the calculators told me this morning: that I could FIRE in a bear market if I continued earning at my current level for the next eight-odd years.

That said, I am well aware that employment of any kind is always tenuous (you might remember me writing the “treat your salary like it’s temporary” post for Lifehacker last summer), especially right now.

So I’d love to hear your thoughts on where I should be donating my money at present — is it better to do, like, a Red Cross thing, or to find a few GoFundMes and help fund them?

Because I do very much want to do something. ❤️

UPDATE: There was something that was still bugging me about the FIRE calculator’s numbers, and it turns out it was that the calculator wasn’t pulling current stock returns; it was autopopulated with an automatic 7% percent return.

I adjusted the calculator to run the 3.8% return that my portfolio has actually gotten since I opened it in 2018 (at the end of 2019 it was getting a 9% return; currently it’s getting something like a negative 30% return, although Vanguard won’t calculate negative returns because maybe that doesn’t work mathematically), and the calculator adjusted my theoretical FIRE timeline to 9 years and 1 month.

For whatever that’s worth.

More Info About My Budget

Last week, after I wrote about how I do money, reader Darlingpants asked me to clarify one aspect of my budget:

I’m curious how you manage budgeting many months far in advance in YNAB. From that post it sounded like you budget as far out as your emergency fund lets you? I tried that and I found it really frustrating to have to page months into the future to move money around for the current month, and I didn’t have the same “aha” moment you did, because spending more this month led to red numbers in a month I couldn’t see unless I deliberately looked far into the future. Maybe I’m misunderstanding, or maybe you’re much better than me about not spending more than you planned to (very likely!), but I was enchanted by your post about it and disappointed to not find the same emotions when I tried it out.

I do not just budget “as far out as my emergency fund lets me.” My YNAB budget is currently built out for the entirety of 2020, even though I haven’t yet earned enough dollars to cover all of the costs of the year. (Technically I could cover the cost of the next four years from my investments, but YNAB only lets you budget cash in checking and savings accounts — which is fine by me.)

What do I mean by “built out for the entirety of 2020?” Well, at the end of 2019 I took a look at my average expenses by category (which YNAB happily provides), asked myself where I wanted to spend more and where I wanted to spend less, and came up with some numbers that would allow me to support those financial values while still remaining within my $2,500/month personal spending goal.

And then I put those numbers into the budget.

There is, of course, some wiggle room. Currently I have $443.07 in discretionary income every month; this money lives in YNAB under a category labeled “discretionary” and gets moved to “clothing” or “dining out” or “books” as the month progresses. These budget line items, along with the majority of my “quality of life” expenses, begin every month at $0. If I want a new book or a new outfit, I’ll pull from discretionary. (I used to budget a certain amount of money for “quality of life” stuff every month, but it made me feel like I was locked in to spending $100 on clothes and $20 on books, and sometimes you need more books and not as many clothes.)

Likewise, if I decide to spend more on rideshares than the $60 I budget every month, I’ll either pull money out of “discretionary” or pull from a different area of my personal budget (like “tea,” and yes I drink enough tea that I have a $15/month budget line item just for Celestial Seasonings purchases).

But if I wanted to buy something that cost more than $443.07, I’d either have to pull from next month’s discretionary income or wait a month or two until there was enough in the discretionary category to cover it.

I do borrow from future months’ spending, on occasion. I’m planning some summer travel, for example, so I pulled some of the cash that I’d budgeted for the fall and front-loaded it into the first few months of the year. That way, I could book tickets in advance and still keep my budget balanced.

On that note, I actually considered setting up my January YNAB budget with the full total of everything I hoped to spend in every category for the rest of the year — if I wanted to spend $3,000 total on vacation, for example, January’s “vacation” budget line item would begin at $3,000, whatever didn’t get spent in January would carry over to February (and so on), and the budgeted amount would gradually get smaller as I made purchases against the budget.

But I knew that it would be a lot easier to pace myself throughout the year if I divided every total budget line item by 12. Knowing that I get $443.07 in discretionary spending every month is a lot different than knowing that I have to make $5,316.84 of discretionary cash last through December. It’s a lot easier for me to stick to my budget if I take it in monthly installments — and I think that’s the case for a lot of people.

And yes, I am very good at not spending more than I planned to, in part because my financial-independence-based motivation for saving and investing money is very, very strong.

Also because I spent so many years living on much less money than I am currently earning, and I’ve only allowed myself a very small amount of lifestyle creep.

So I hope that answers your question, Darlingpants. Does anyone else budget this way, and are you able to stick to your budgets? ❤️

How I Do Money

I’m writing this up by request, though I don’t think there’s anything particularly new about the way I do money; on the other hand, there are probably a lot of you reading this who haven’t yet caught up on the (subtracts from 2012) eight years of How Nicole Does Money internet content out there.

Not that I would recommend looking it up, either—even though the Tumblr on which I used to share weekly financial updates was kind of essential in launching my freelance career. (Or at least the personal finance side of it.)

But how do I deal with money these days, especially now that I’m earning well over what I need to cover the basic costs of living?

For starters, I’m still trying to keep myself at an average of $2,500 in personal expenses every month, or $30,000 for the year. (Those would be post-tax dollars, which essentially means I need to earn $1.30 in freelancing income for every $1.00 I spend on, like, rent.)

I’ve been capping my personal expenses at $2,500/month ever since I started using YNAB, which did in fact completely change the way I viewed my finances. It didn’t change the way I did money, per se; it just changed the time horizon through which I viewed my income and expenses. With YNAB, I could see exactly how far my net worth might take me if I never earned another dollar in my life—which made me want to see how much of my future I could get my savings and investments to cover.

And of course I was always going to aim myself towards FIRE at some point; I’d been interested in the idea ever since I graduated from college and found a copy of Your Money or Your Life at the library. I know I’ve told this story before, but that was the book that made me start tracking every penny I earned, spent, and saved—a habit that has stuck for (subtracts from 2004) sixteen years.

I didn’t realize when I began tracking my money that I would not be able to turn my telemarketer earnings into a stable income that derived primarily from U.S. Treasury Bonds; by the time I figured out how much interest rates had changed since YMOYL was initially published, I decided I’d continue to track my income and expenses just in case. This took me through the year I was on food stamps, the year I saved my first $10K, the year I got myself into $14K of credit card debt, the year I became debt-free, and the year I earned six figures as a freelance writer.

The ledger moved from a physical notebook to a customized spreadsheet to Mint, then to a different spreadsheet, then back to Mint, and now to YNAB—but it still exists, and I take a look at it every morning.

So… basically I track my income and expenses, and I try to keep my personal expenses at $2,500/month.

I also maintain a $10,000 emergency fund in cash, tucked into a high-interest savings account—which, these days, is 1.70% APY.

Then I invest any money that doesn’t go towards personal expenses or my freelance business (or taxes, a lot of it goes towards taxes).

It sounds so simple when you put it that way—and I have been putting it at some variation of “that way” for a while.

Billfold readers might remember, for example, that I committed to living on 50% of my income until I paid back my parents the $14K they loaned me to cover my credit card debt (this was, I always feel like I have to mention, an unsolicited loan—though it’s also a reminder of how family and privilege and everything else fits into financial decision-making). The idea that the majority of my money won’t be spent on my day-to-day life was a mindset I signed up for during my telemarketing days, when I told myself that if I got $500 together I could rent a black-box theater for one night and put on a play that I would cast and rehearse in a public park (yes, I was very young and very foolish and had no idea what was involved in artistic production of any kind). Even the $14K of credit card debt wasn’t spent on, like, me; I got into financial trouble trying to make it as an independent musician, and I didn’t even have the good sense to put that debt on a business credit card where the interest would have been tax-deductible.

Now that we’ve covered that aspect, I also have to remind you all that I got darned lucky with my current career (and, as noted above, some of that luck was absolutely due to privilege). I also took some financial risks, like choosing to make the minimum payments on my credit card debt while I worked as hard as I could to pick up freelance articles and crank out 5,000 words a day. I could have gotten another office job (I’ve had plenty of office jobs) and made more money than I earned during my first two years of freelancing and content writing. But I saw that I was earning more money as a freelancer month over month, and that I was rapidly building and expanding my client base, and I wanted to see how far I could take that.

And then I just combined my freelance earnings with my inherent frugality and love of, like, tracking stuff.

And it helps that I live alone, in a beautiful-but-small apartment in Cedar Rapids, and do not have any children.

Is this what you wanted to know? Is there more stuff you want to know? Do we want to get into the way I choose my investments or how I meal plan or how I live in Iowa without a car?

Keep asking questions, and I’ll keep answering them. ❤️

March 2020 Financial Update

Let’s start with the good news: I received $9,630.23 in freelancing income last month and $3.25 in publishing royalties.

Now, the less good news: I also lost a lot of investment portfolio value, like pretty much everyone else with investments. My Vanguard portfolio alone dropped by $9,371.70. (The majority of my investments are in Vanguard, but I have $5,137.87 in a HSA and $5,559.52 in a TIAA 403(b) annuity that I was told I could not roll over into Vanguard—apparently I’m locked into that investment for life, thanks TIAA.)

Which means that my current net worth looks a bit like this:

It's a sad chart. A very sad chart. The bars are going down instead of up.

The actual number, as of this morning, is $157,631.69. That’s $5,104.46 down from last month’s $162,736.15, and YNAB tells me that my total net worth has dropped by $9,400.16 since January 1.

Which is fine.

It’s FINE.

As I explained in Lifehacker this morning, investing is a long game—and I’m nowhere near the end of it.

That said, I saw that there was a request in the comment section to learn more about how I did money, so I think I’ll write a bit about that for Wednesday, since I don’t have a guest post prepped to run (though I do have two guest posts scheduled for later in the month, and the pitch inbox is open).

Though I’m not sure how I do money has changed, much, over the years. It’s just that I have more money to do with, these days.

But I’m always happy to tell you everything about my finances. ❤️

February 2020 Financial Update

It’s time for another one of these, and I know I didn’t do one last month so don’t go looking for it…

In January, I earned $4,611.63 in freelance income and $0.47 in publishing royalties. Since it’s been two months since my last financial update, I’ll also report that in December I earned $11,833.09 in freelance income and $0.22 in publishing royalties.

January is often a slow month for freelancing; everyone’s ramping back up after the holidays, budgets are getting reconfigured and reshifted, and so on. In my case, I also took some time off for the Writer’s Winter Break conference (but I ended up writing and filing two freelance pieces during the conference because THAT IS HOW I WORK).

And I’ve also got something like $3,050 in outstanding invoices, and $9,000 worth of work already on the schedule for February, so… I’m not worried, financially.

Nor am I worried about the stock-market-related dip in my net worth.

So my net worth over the past three months has gone from $164,475.44 to $167,031.85 to $162,736.15 as of this morning, and I also bought a bunch of Vanguard ETFs this morning because stocks are on sale.

That said, I’m really curious what you’d like to see in these financial updates for 2020. I’d be happy to keep writing about my income and my investments, but if there’s something else you’d like to know about How I Do Money, um… tell me?

Because this monthly roundup doesn’t have to be just about various numbers in various accounts. Maybe I should also tell you the smartest thing I did with my money in the past month and, like, the least smartest.

In January, the smartest thing I did with my money was to switch my Capital One 360 Savings account earning 0.63% APY for a Capital One 360 Performance Savings account earning 1.70% APY. (For the record, Capital One should have highlighted this opportunity in my online dashboard; I should not have had to discover it when I was researching high-yield savings accounts for Lifehacker.)

The least smartest thing was… maybe… spending $13.38 on a bunch of hair clips from Amazon. They turned out to be the wrong shade, and I didn’t like the way they looked, and I keep feeling like I’m too old to wear hair clips anyway. The only thing in my hair at this point in my life should be hair, and a very small amount of smoothing product to prevent flyaways.

What about you? ❤️

Goals (and Anxieties) for 2020

Soooooooo… I feel like I ought to share my goals for 2020, because that would be the correct thing to do on my first post of the new year, but some of my goals are so fresh and so tender that I don’t want to make them public quite yet.

Here’s what I can share:

You already know that I want to finish drafting MYSTERY BOOK, and not just “in 2020” but “as soon as possible.” I’m 39,570 words in, with maybe 15,000 words to go.

The trouble is that I’m at the part of the story where all the pieces are coming together, which means I need to think about each individual move as carefully as if I were playing a sokoban game—and this means I can only write about 500 words at a time before I have to stop and think about the next move for 24 to 48 hours. (This is also how I beat Cosmic Express, if you were curious, and how I’m currently tackling Sokobond.)

But writing the BIG SCARY SCENE with the CAR and the DANGER was fun, and no that isn’t a spoiler because what is a cozy murder mystery novel without a BIG SCARY SCENE where our amateur detective is trapped with THE PERSON WHO MIGHT BE THE MURDERER but PROBABLY ISN’T because THERE ARE STILL 15,000 WORDS TO GO?

In terms of freelancing and budgeting and all of that: I set up my 2020 budget under the assumption that I would have another six-figure year—which seems likely, based on my current workload and projections—but also gave myself plenty of room for adjustments if things change. Personal expenses are still capped at an average of $2,500/month; I put a lot more (theoretical, unearned) money in the business column this year, but those are all expenses that can be cut if necessary. Fewer conferences, less money on professional development, and so on.

The real question—the one that is occupying my brain when I’m not thinking about how murder mysteries get solved—is whether I’m going to try to hit Disneyland Paris or Tokyo Disney in 2020. I keep running the numbers on what it would take to do a business class overseas flight on points, and I don’t think that’s going to happen, and part of me isn’t even sure this summer is the best time to take an overseas trip, and I know that if I do visit Paris or Tokyo I really need to combine that with a visit to see friends and relatives who live on either the East or the West Coast (depending on which park I choose), and then of course I keep reading (and writing) all of these articles about the environmental cost of international flights.

But I still want to visit every Disney park in the world. Sooner rather than later, because I don’t believe in “someday.”

Even if I don’t add a new Disney park to my tally this year, I do want to take a for-serious, two-weeks-in-a-row vacation—even if one of those weeks is a staycation where all I do is watch movies and bang on my piano and read books. (I had a few days to myself this holiday break to do exactly that, and they were wonderful.)

Also that writing retreat that I’m attending in (*checks calendar*) SIXTEEN DAYS. I should not be worried about this, it is supposed to be a retreat in which I can spend serious time improving my writing, but I keep thinking about the part where I’m going to get to take classes with Meg Wolitzer, and how I won’t be able to think straight because all I’ll want to do is tell her how much The Interestings meant to me—I mean, my eyes literally filled with tears just typing that, and I am not the crying type.

Also I’m worried that everyone else is going to be cool and artsy and really good at wearing scarves, and I am going to wear the same utilitarian striped dress that I bought five of so I could take them on book tour (because it’s going to be Florida in February and those are the clothes I have for that weather), and I know I shouldn’t worry about it because it doesn’t matter and I look great (or at least good enough) in that dress.

But still.

Wow, I didn’t realize that retreat was sixteen days away until ten minutes ago.

Better get back to drafting MYSTERY BOOK. ❤️

From 2009 to 2019

I knew I wanted to write a post summing up the previous decade, and then I decided to let the past ten years of creative work sum things up for me.

So… here’s one link (and in one case, two links) to represent each year. Some are music, some are words, some you’ve probably seen before, and some you probably haven’t. Not every link leads to something I created during its respective year (the first link is actually a Billfold article from 2014, for example) but every selection tells a true story about something that happened during that year.

Here we go.

2009: I saved my first $10,000.

2010: I got out of debt and bought a guitar.

2011: I helped put together a They Might Be Giants tribute album.

2012: I moved to Los Angeles for love and music. (Neither worked out.)

2013: I moved to Seattle for love and money (one of them worked out) and began writing 5,000 words a day for all kinds of freelance clients, including The Billfold.

2014: I got to perform in Molly Lewis’s original musical Thanksgiving vs. Christmas.

2015: I began writing The Biographies of Ordinary People.

2016: I got out of debt again.

2017: I moved to Cedar Rapids for family, community, music, and money.

2018: I tried running The Billfold (it didn’t work out). I also bought a piano.

2019: I had my first six-figure year as a freelancer.

Here’s to the next decade. ❤️

This is technically “2010 vs. 2019” because that’s how far back my Apple Photos go. It still counts.