August and September were incredibly hectic as I prepared to leave Long Beach for a two week vacation in Japan and a six month internship in Costa Rica. I was inspired to write the post below in the middle of my Japan visit because I felt so incredibly lucky to be in an island in Osaka, Japan.
Originally written October 3, 2017
At the end of August I was dreading resigning from my well paying job. The position I took on at the beginning of July was going very well; part of me felt sad to walk away from it. “What do you do?” is usually the question right after, “What’s your name?” Walking away from a job can definitely be a bit of a loss of identity. That in itself can stop many people from leaving an unsatisfying job. But to be frank for me the fear was losing the money. Leaving my job actually moved me closer to my true work identity of holistic financial planning.
I left my employer ten days shy of four years of continuous employment. Many of the managers I had worked with expressed sadness to see me go. I was surprised and moved when our CEO went out of his way to find out why I was leaving. Everyone was dumbfounded with my new direction. I was able to share the details on the nonprofit I will be volunteering for, but I had little to tell them when I was pressed on the details of what I’ll be doing once I arrive at Fundación Mujer.
My primary purpose will be to learn from the foundation and work on my remaining Certified Financial Planning courses. The worst case scenario is that I get to Costa Rica and the nonprofit’s mission does not align with anything I need to do as a financial planner. Best case scenario I get to learn about business plans, learn how to teach consumer empowerment, and spruce up my resume with a very ballsy enterprise. And of course, there are countless other outcomes.
Our next installment on the Hero’s Journey shows us how resilient we can all be. A close friend of mine has moved 16 times in her short 30 year life across three countries. As I prepare for my own journey abroad I feel dread at the upcoming changes and hope that I will be able to stick to my own values of frugality as Ai-Chan did. I also really admire her willingness to share with others and her kindness even when things were not going as well as she wished. This Hero’s journey will be a reverse one. I’ll start by bragging about her frugal super powers, the time her super powers couldn’t save her, and how all this moving may have affected her.
Ai-Chan and I met our first year of college as roommates. We hit it off really quickly and proceeded to continue to room together during our four years of undergrad in college. We often split groceries and did laundry together to keep costs low. We bonded over moving around a lot as kids and tubs of ice cream. Saving comes easy to Ai-Chan and she’s never been in consumer debt. In her own words she only has debt for the essentials: her car and student loans. Her student loans are on the ten year repayment plan so she’s due to be done with them very soon. It helps that her main hobby is free once you pay for basic utilities: Ai-Chan is a huge gamer and thinks nothing of spending an entire weekend at home.
Two weeks ago I finished the Certified Financial Planner introductory course to personal taxes and learned about a very attractive benefit of home ownership: Internal Revenue Code Section 121. Sec 121 allows the gain on the sale of a residential home to be excluded from income. The exclusion is up to $250,000 for a single person or up to $500,000 for a married couple filing jointly.
That’s a lot of money that can be excluded from taxes. However, there are some caveats if the residence was used as a rental since 2008. Yes, I know these concepts might bore some, but I was deeply intrigued. As a California native I’ve seen the housing market do amazing things. One day I may get to give someone the good news that they get $250k/$500k of income tax free. Or I may even get to benefit from it myself. The specific requirements to qualify for Sec 121 are below.
Best advice I ever got was an old friend of mine, a black friend, who said you have to go the way your blood beats. If you don’t live the only life you have, you won’t live some other life, you won’t live any life at all. That’s the only advice you can give anybody. And it’s not advice, it’s an observation.
It’s Actually Happening! Update on my Microfinance Volunteer Adventure
James Baldwin’s observation applies perfectly to the next chapter in my life. As I alluded to in my previous post on Microfinance ($2/day) and on the one announcing my career change (aligning your spending) I am making major changes in my life. Part of my inspiration for this definitely comes from Mo, a good friend who moved to Turkey to become an English teacher and who now lives in Japan. She has documented her travels over at Travels of Mo. The other part of my inspiration is listening to my inner curiosity more closely.
How I Found Costa Rica and Agreed to It
I’m planning on quitting my job and potentially being unemployed for a 12 month sabbatical. I lined up a microfinance institution (MFI) volunteer opportunity in Costa Rica through NGOAbroad and am scheduled to start in October, five months from now. When I first found this opportunity it felt too good to be true. Costa Rica is expat heaven, a tourist destination, and has a great medical system. For a moment I wondered whether I would actually have anything to contribute because the country is doing much better than others in South America. Continue reading “12 Month Sabbatical – Update on my Microfinance Adventure”
Joseph Campbell is a scholar who studied ancient myths and developed the idea of the monomyth – The Hero’s Journey. The three part act of the monomyth is a way to understand how we all can change or improve what’s not working. This arc has been used in many settings, from Harry Potter to Star Wars. It was further publicized by Hollywood screenwriter Christopher Vogler; below is his well-known adaptation. Interestingly, the Hero’s Journey is also a recurrent theme in 12 step recovery shares: What it was like, What Happened, and What It’s Like Now.
Every one of us has many iterations of this journey in our own life. Sometimes it has to do with a transformation on how we handle addiction (12 Steps), a difficult outside circumstance (Star Wars), or big money changes. In this series of blog posts I will be detailing out the experience of people who now have a flourishing relationship with money. I will treat the main three acts as follows:
Recognition of a problem
Confrontation of said problem
Resolution of problem and triumphant return of hero
I would love to hear your stories for this! If you are interested in sharing your financial hero’s journey please leave a comment below.
To find out about my own Financial Hero’s Journey check out the following posts:
According to Portfolios of the Poor written by a leading group of researchers, 40% of the world’s 7 billion people live on less than $2 a day. What makes matters worse is the irregularity of their income. If they knew they were going to earn $2 every day it would be possible to build a budget around it. But they don’t know. During harvest season they may have plenty to eat and even be able to save. At other times they may have to live on one meal a day and borrow to make ends meet. How can someone deal with those massive changes in income? To make things even more dire are expensive emergencies, such as an illness, a burial, or a whole host of other things. Continue reading “How Do You Live on $2 a Day? – How the World’s Poor Manage their Finances”
Should I change from monthly mortgage payments to biweekly mortgage payments?
Should I co-sign for a loan, and can I protect myself?
If my retirement accounts are fully funded, how should I invest the rest of my cash?
But it was difficult to find questions like the ones I ask about money and finances. I think my questions are probably more like social science research theses than blogging friendly questions. For example, I often wonder about the questions below:
How do I reconcile the fact I want more and the fact that by being a citizen of a developed country I have more than 80% of the world’s population?
Why would someone tie themselves to a job they dislike with golden handcuffs like a new car every year and a mortgage that keeps them up at night?
Is it possible to use capitalism in a way that doesn’t destroy the environment and ourselves in the process? Maybe it’s something along the lines of B Corporations, which aim to benefit the shareholder, employee, customer, and community.
Why do women earn less? Why does asking for a review feel more difficult than giving a professional presentation completely naked?
How is longstanding wage stagnation related to Trump’s election?
After my quick web search I am happy to say that the internet has space for me. I am here to discuss they many existential money questions I have. In How To Read a Book the authors state that the big questions are not really answerable. The answer lies in the discussion itself. By talking about the issues we can outline where we stand.
Although I’ve never hired a financial planner, I have had to hire an expert to help me do something I could potentially have done myself. Earlier this year I switched gyms and the new one had less exercise classes. After two years of either going to a class or doing cardio I had still not started weight lifting. I always had a reason to skip it. The truth was I didn’t know how. After some half-hearted attempts to learn I realized I was not disciplined enough to learn this skill on my own. The routines online confused me and my motivation barely lasted past five minutes.
Shortly after joining the new gym they offered me an introductory personal trainer session. At first I was an adamant no. At the time my main objections were that it’s expensive and it’s something I should be able to figure out on my on. But then I saw that I could afford it and realized that I was probably not going to learn it on my own. So I took the plunge and signed on for a one year contract. I can now happily say I am comfortable with my weight lifting routine. And a positive side effect is that my butt has never looked better!
So what does my personal trainer have to do with a financial planner? Both professions have experts who motivate you through behavioral changes. They have been trained to quickly spot possible problems. Plus the best coaches, either for fitness or finances, are just as excited about your success as you are. If it’s fear that’s holding you back, take a look at this great article by Michael F Kay from Financial Life Focus.Continue reading “Why Hire a Financial Planner?”
Next International Women’s Day we will have the second annual Women’s Symposium of Southern California, which will bring together financial experts to answer questions from women in the community. The first symposium was in March of 2016 and it was a great success. It was all put on by Marah Fineberg, CFP and she decided there is a need for an annual event like this in our community.
I am proud to say that I am part of the Partnership Committee. My main job is to let others know about the upcoming Symposium and request involvement from other organizations that share our mission.
I’d love to hear if you have any thoughts on who I should contact. Also, please spread the word to anyone you think may benefit from this event. Our next event will be on March 8, 2017 in Marina Del Rey.