Jonathan Clements's Blog, page 29
June 24, 2025
A challenge just for fun from RDQ.
You list each piece of data you want, need and obtain from a spreadsheet and I’ll see if I can match it with my all online bank multi-account, single source consolidated investments approach. 😎
And yes I realize some people just enjoy spreadsheets.
No 🔻please it’s just a fun exercise.
The post A challenge just for fun from RDQ. appeared first on HumbleDollar.
The Wedding Extravaganza: A Pre-Mortum for Future Parents of the Bride
I have a particularly vested interest in all of this because my eldest daughter got engaged a couple of months ago. It's likely she'll be heading down this same rabbit hole in the next few years. However, observing my friend's daughter's wedding from afar has firmly cemented in my mind that some of the latest "must-have" items, both during the wedding and at the reception, are plainly ridiculous in both concept and cost. A few cases in point: silent discos, roving tarot card readers, free cocktail stations, and holographic art displays. Why? And who even thought of a silent disco in the first place?
As parents to a future bride-to-be, we're contemplating our own Rubicon. It's our little darling's big day, and we want it to be special. But at what point do we draw a line in the sand and say "no more" if the wedding additions become simply silly?
I do “get it” to a degree. The bride and possibly the groom get caught up in a bubble of excitement about their shared grand adventure. I suspect aided and abetted by social media influencers etc….. but I think sometimes we need to bust their bubble and ground them to the financial reality of the big day. What do you think, readers? Am I being mean and tight, possibly a bit of a grumpy killjoy or just plain practical?
The post The Wedding Extravaganza: A Pre-Mortum for Future Parents of the Bride appeared first on HumbleDollar.
Am I missing something? What happened to taxes? asks Quinn
As a result of reading HD I have become fascinated with certified financial planner videos on YouTube, some are pretty good, others not so much.
Often one thing strikes me as ironic. Simecpresenters look more like they will be starting college in the fall, than experienced experts and none of them look anywhere near retirement age - maybe they will FIRE, but I digress.🤑
My real curiosity is when they show a spreadsheet to see if a hypothetical couple can afford to retire. They usually start by showing the couples needed monthly income- their spending. Often that is quite a modest amount (they should tell us where they live).
Then they list income sources, like SS, annuities, pension, drawing down investments or whatever.
When the math works when income equals or exceeds the spending needs, and they proudly demonstrate the couple can retire and their probable success rate is X%. They will be fine we are told.
What’s missing? Taxes! I have yet to see one of these presentations talk about net income after taxes. So when you match desired spending with gross income, the picture is rosy, but it seems to me the bloom is off when you use net income. The last I tried to pay bills with 20% or so less than I had it didn’t work.
When I compare my working income to retirement income it’s gross amount to gross amount. Taxes always reduce both. If you are looking for the income that will pay bills, shouldn’t it be net income?🤑
The post Am I missing something? What happened to taxes? asks Quinn appeared first on HumbleDollar.
June 23, 2025
The Slumping Deck: A Lesson in Time, Money and Memory
Yet, here and now, the question resurfaces: should I spend money to have someone fix it, or should I invest my time and do it myself? For me, it's an easy choice; I enjoy working with wood and find great satisfaction in completing projects like this. The satisfaction of creation, the calm of focused work, and the personal story these efforts bring into our lives often outweigh a purely financial calculation.
I'm reminded of Charlie Munger's phrase, "Invert, always invert." Interpreting this idea more loosely, I can see how others might view this equation very differently. This personal dilemma is a small microcosm in the spirit of the "time value of money" problem. Should your time be better spent elsewhere on things that appeal to you, and could your money be more wisely deployed on other investments? The crux of the matter is the realization that both time and money are finite resources, and we must use our best judgment on how to consume these valuable commodities to the betterment of our own lives.
Who would have thought that such complex financial concepts could extend to simply fixing a common garden deck? But on this occasion, I only have to know it will remind me of my brother. We had a wonderful childhood together.
The post The Slumping Deck: A Lesson in Time, Money and Memory appeared first on HumbleDollar.
June 22, 2025
The Fear of Letting Go
Retirement sounded so great to me a few years ago. Now as I face the reality of it, I find myself having panic attacks. “No more income? I will end up a homeless bag lady on Main Street….” I find myself thinking.
All irrational thoughts since I will have a COLA pension supplemented by my savings and will receive social security in 18 months. These revenues will come close to matching my current net pay when I start social security.
I had planned on working until age 70. But with the ageism I face at work it’s time to go. Also, at the age of 68 I’m just tired. But a part of me is disappointed in myself for not working until age 70.
I have many projects and activities I plan to pursue in retirement. I’m not concerned about what I’ll do, but how to pay for it.
As I consider retirement I can’t help but remember that both my mother and my maternal grandmother died at age 84. My father died at age 86 and his mother at age 92. How long will I live?
Money was a charged issue in my family. Basically, my father expressed his love for his family by supporting us financially. As a child of the Great Depression, it was his way of keeping us safe and secure. Even now, I find myself feeling that buying an expensive gift for someone is a way of expressing my affection.
But I remember back when my closest friend got me a birthday present. It was a teal highlighter. We were both college students with little money. Although the highlighter did not cost much, it touched me that she had noticed that my favorite color was teal.
But teal highlighters will not pay the rest of my mortgage, which is $150,000. And I still have to get the landscaping done which I hope to pay for with my current liquid accounts.
I find myself unprepared for this transition. I plan to go to the Enrolled Agent who does my taxes for a retirement check-up. But there is still that emotional component.
How have you dealt with the emotional aspect of cutting off the paycheck and the work identity?
The post The Fear of Letting Go appeared first on HumbleDollar.
A Humble Question From Across The Pond
When I heard about Jonathan's diagnosis, it really got me thinking about how I could contribute. The thing is, I'm based in the UK, and I was a bit hesitant at first because I know Humble Dollar primarily focuses on US personal finance – especially with all the ins and outs of US pension planning.
But I decided to post a few essays on some more general financial topics, just to see how they'd be received. And honestly, I've been really encouraged by your responses!
So, I wanted to politely ask: would you be happy for a UK-based writer like me to keep contributing? I'm obviously a bit needy and need some reassurance 😂
The post A Humble Question From Across The Pond appeared first on HumbleDollar.
Beyond the Balance Sheet: Investing in Yourself
With my wife Suzie away visiting her dad in Spain, I've been keeping myself busy, and I must say I've had a pretty active few days! On Wednesday, I played two hours of pickleball in the morning and then did a 5k fun run with my grandson in the evening. Thursday saw me walking the shoreline of Belfast Lough from Bangor to Holywood – about 12k. Then on Friday, after driving to my holiday home on the North Coast, I enjoyed a roughly 10k walk along the beach and the headlands above the Giant's Causeway. Saturday I lowered the pace with a little nine-hole links course overlooking the Atlantic Ocean.
What really struck me was the reaction I got from two friends, both my age and with no particular medical conditions, when I told them about these plans. Their responses were surprisingly negative, along the lines of "that's too much activity," "I wouldn't be able to do that," and "I'd be too tired to enjoy any of it."
Their comments got me thinking… again! We live in a world that constantly encourages us to invest in our financial future – saving for retirement, building wealth, ensuring security for our later years. And rightly so; financial planning is crucial. But why do we so often overlook, or even neglect, the equally vital investment in our physical and mental health?
Your body is, arguably, your most valuable asset. Just like a financial portfolio, it requires consistent attention, diverse 'investments' (exercise, healthy eating, rest), and protection from 'risks' (sedentary lifestyles, poor diet, chronic stress). Neglecting your health today is like choosing not to contribute to your pension – you might not feel the pinch immediately, but the long-term consequences can be severe.
My friends' reactions highlight a common mindset: that physical activity is a chore, something to be endured rather than enjoyed, or even something impossible. This often stems from a perceived lack of time, feeling unmotivated or overwhelmed. However, my experience demonstrates the opposite. I find enjoyment and vitality in these activities. It's not about being an elite athlete; it's about building capacity and resilience in your body so you can continue to enjoy life's adventures, big and small, well into your later years.
The good news is that getting started with exercise doesn't have to be daunting. The easiest steps involve simply starting small and finding something you enjoy. Even a 10-minute walk a few times a week is a significant beginning. The goal is to build momentum and see exercise as a way to boost your energy and improve your mood, rather than a burden.
Just as financial discipline allows for future freedom, investing in your health ensures you have the energy, mobility, and cognitive function to truly experience that freedom. It means being able to keep up with your grandchildren, explore new places, pursue hobbies, and maintain your independence. Ultimately, investing in yourself and maintaining your health to the best of your ability is just as important, if not more so, than the time you invest in your financial life. One without the other risks leaving you rich in funds but poor in quality of life.
The post Beyond the Balance Sheet: Investing in Yourself appeared first on HumbleDollar.
June 21, 2025
Saving and Giving
I'm in my early 40s. I have a wife (like me, a public employee) and two young children, and I have the opportunity to take a higher-paying job within my organization in the coming months. I don't anticipate increasing my spending with increasing income, at least not to any substantial degree. Rather, I'd either increase my savings, increase my charitable giving, or both. Whether or not I take the job, this opportunity has got me thinking (as I continually do) about my savings and giving rates.
In general, it's incredibly hard for me to know how much to save for retirement or potential future financial hardship -- with or without a salary increase. What if I lose my job and have a hard time finding comparable pay at a job I don't hate? What if one of my kids ends up needing a great deal of financial help? What if future returns are very far below historical averages? What if my Social Security benefits are considerably less than projected? What if I or my wife need considerable long-term care? And on and on. All such questions suggest that its a good idea to save more now (as do many verses of the book of Proverbs -- e.g. "A good person leaves an inheritance for their children’s children, but a sinner’s wealth is stored up for the righteous").
On the other hand, I'm certain that have more savings and opportunity than most people in the world, and various retirement calculators suggest that I'm on the right track. Moreover, and more importantly to me, the author and perfecter of my faith commands us not to worry and not to store up treasure on earth and to give to anyone who asks. He proclaims, "You cannot serve both God and money," and he ever emphasizes care for the poor.
I tend to obsess over moral issues. At the same time, it is human nature to err on the side of hoarding and self-protection. Also, for what it's worth my understanding of my faith is not that we give to others in order to earn God's favor, but rather as an act of faith in and thankfulness for God's provision and an act of care for others.
What do folks think about balancing saving and giving?
p.s. I currently have only sporadic Internet access -- please don't be offended if I don't respond to others' comments.
The post Saving and Giving appeared first on HumbleDollar.
A theoretical, simplified road to retirement income without a pension. I’ve learned it doesn’t exist.
Many discussions on HD make it clear my retirement is unique, mainly because our income consisting of a pension and SS is more than adequate to live in the way we did when I was working.
Other than monitor my pension as it grew, there was no financial plan except to ensure receiving the employer match on the 401k so that meant saving at least 8% for a total of 12%. I also invested the compensation I received above base salary, both cash and equity.
But HD posts often get me thinking, what if there wasn’t a pension, what if it was all on me, what would I have done? Of course I don’t know, but knowing how I think about money and security, I can speculate.
Let’s see, no pension. First, I would keep track of what Social Security would provide to us. Second I would use two separate ways two save and invest. First in the 401k but also outside a retirement plan.
Those brokerage savings would be thought of as two pools of money.
One part of the account to keep investing and growing in retirement and the other for the sole purpose of buying an annuity at retirement to cover basic living expenses.
I would periodically check to see the amount of annuity income those investments could buy so between that and SS I would know our retirement income stream.
Back in July 2007 Jonathan wrote in the Wall Street Journal
“If you try to pay for retirement by slowly drawing down your nest egg, there’s a risk you will outlive your savings or your finances will get derailed by rotten markets. To protect yourself, you’ll want insurance-in the form guaranteed of lifetime income.
Your Social Security benefit will provide some of this insurance, and you may have a pension as well. If you want further protection, consider buying immediate annuities that pay lifetime income.”
That is exactly what I am saying.
I would also have saved all forms of compensation above base salary as I actually did. Today the dividends on the company stock I saved and accumulated for the last twenty years generate $25,000 in annual income. Bond interest is about $1,600 a month tax free.
Fidelity says my brokerage account asset allocation “resembles a Growth with Income strategy and my retirement account investment “resembles a Growth strategy. The growth and income strategy in the brokerage account is where bond funds reside, including muni funds.
Is that good? Is it the way it should be? I don’t know.
With all this speculation I am still faced with determining the best investment strategy and also the dreaded withdrawal strategy. I like to think I have minimized the withdrawal issue by using an annuity with my withdrawals limited to the income generated by interest and dividends - at least that’s what I imagine, but then there are RMDs to deal with.
Has this theoretical retirement allowed for survivor benefits? Hopefully, but not with the certainty of a pension survivor annuity.
This world without a pension is scary and complicated. There are many decisions to be made, many unknowns to deal with.
My hat is off to the great majority of Americans who live in my theoretical world. It’s not an easy road to a secure retirement. And for sure an early start to saving and investing is very important.
The post A theoretical, simplified road to retirement income without a pension. I’ve learned it doesn’t exist. appeared first on HumbleDollar.
Morning Delight
Morning shopping, I've discovered, is a real delight. There are no crowds, just a quiet hum, and I even had time to chat with the checkout operator, who seemed far more relaxed than during busier periods. The shoppers at that hour appear to be a mix of young mothers and, shall we say, those of a more mature nature – a surprisingly peaceful crowd.
This has been a lovely, unexpected benefit of being retired. I'm hoping to uncover many more little surprises like this! In fact, I'm thinking of visiting the local museum mid-morning next week to see if it's as peaceful.
The post Morning Delight appeared first on HumbleDollar.
