There isn’t all that much to say about this summer so far. Markets did very well in June and less well in July, but at the same time the yen weakened by about 5% in July, which was enough to offset any USD gains that I had. Of course it makes the JPY numbers look great, but a persistently weak yen will eventually lead to price increases, which increases the FIRE target number. Prices have been gradually rising over the last few years, but not as much as the US in the immediate post-covid years.

Life-wise, we’ve been doing weekend trips around Japan when we can, but it’s not really possible to escape the summer heat this year. Even Hokkaido, which normally has the reputation as the go-to place for respite, is regularly over 30C and some towns measured over 40C during heat waves. Not sure what Japan is going to do long-term if summers continue to be this brutally hot, even in the northernmost areas.

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 10 years, 11 months.

I fell out of the habit of writing updates, so apologies for that.

I managed to file my taxes for last year, both for Japan and the US. I ended up going with my company’s payroll provider for preparing my Japanese taxes, and based on the results I’m fairly confident that I will be able to file on my own next year without assistance. Surprisingly, (or maybe not that surprisingly) wrangling Turbotax to correctly a credit for my taxes paid in Japan turned out to be the most time-consuming part of the whole process.

Lots of market drama since my last post, no thanks to the Great Orange Menace across the Pacific. As of this moment, the tariff situation has mostly calmed down, and the markets have crept up near where they were pre-April. The yen has strengthened a bit as a result of the market turmoil, so in yen terms my assets have fallen a bit, despite the increase in dollars. Here’s hoping for continued stability going forward, but I won’t be holding my breath.

Finally, I noticed that as of this month, I have “officially” crossed the 10-year mark on the path to FIRE. If I can find the motivation, I may do a 10 year retrospective at some point.

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 12 years, 2 months.

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 10 years, 8 months.

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 11 years, 3 months.

Finance-wise, I ended up selling off (and then re-buying) my assets that I had acquired prior to my move to Japan, since I passed my 5-year residency on the 14th. After 5 years, all income, dividends, capital gains from foreign sources become taxable in Japan even if they are not repatriated, so by selling before the 5-year deadline and realizing gains and resetting the cost basis, I will only pay tax to the US on the realized gains (15% in the US vs 20.315% in Japan), and my future capital gains will be calculated from the higher basis. Since wash sales are not a concern (no losses), I took the opportunity to shift from the mutual fund to the ETF versions of the assets when I bought them back, because ETFs are a bit easier to monitor and easier to transfer to another brokerage should that be necessary in the future. In addition, in the past there was a slight discount on the management fee for holding the mutual fund over the ETF, but that advantage has also largely disappeared.

The yen had a bit of a strengthening run over the summer, but that too appears to have reversed, going from 144 to 152 to the dollar over the course of the month. Still wondering if it will ever recover back to “normal” levels near 100 or if those days are gone forever. The US has started cutting interest rates a bit, so maybe that could help a recovery in the new future? ¯\(ツ)/¯

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 10 years, 7 months.

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 10 years, 8 months.

For the Europe trip, I’ve tentatively booked hotels for all our travel days, but I can rebook them if needed or our plans change. Looking forward to going soon.

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 11 years, 0 months.

On the travel front, the itinerary for the Europe trip is solidifying a bit. I booked flights to and from our entry point (Helsinki) to central Europe, as well as hotels stays for the surrounding the flights, but there’s still a 5 day gap that needs to be finalized. Will continue to work on it a little bit at a time until we’re happy with the itinerary.

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 10 years, 4 months.

The biggest expense this month was I booked flights to Europe for later this year for our honeymoon trip. The final itinerary is still TBD, but I’m hoping that it will be enjoyable for us. Hopefully I’ll be able to use miles for intra-Europe flights and hotel stays.

In other news, there is some kind of tax relief program that the Japanese government is starting this year, which might save me about $200 on taxes. It’s not much, but it’s better than nothing.

On the topic of taxes, I got a nasty-looking envelope from the IRS this week because appparently it’s not allowed to submit a paper return with a non-wet signature. I thought I was clever by printing and sending my return remotely from within the US via my virtual mailbox, but it backfired because now I need to physically sign my return and ship it back anyway. Lesson learned for next year, I suppose.

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 10 years, 1 month.

This month, the yen fell even further, hitting 160 to the US dollar at one point. I’m pretty sure that the Japanese government did another intervention, as the yen has dropped below 155 this week, but unless Japan raises its interest rates or the US lowers its rates, I don’t see why it won’t continue creeping up over the near term.

Now is Golden Week in Japan, which is a period of several closely-spaced holidays at the end of April through the first week of May. I’ll be relaxing over the long weekend and then it’s back to work again.

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 8 years, 11 months.

Work has been getting a bit busier as well, since there’s a big deadline approaching on my current project. Looking forward to finishing it and hopefully being able to relax once it’s over.

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 9 years, 0 months.

Weather is starting to warm up here, but with that comes cedar pollen, and with that comes my allergies. I’ve been on a sublingual immunotherapy treatment for the past 9 months, but it appears to not be completely effective at preventing my symptoms, at least so far. Until the pollination season passes in about a month or two, I try to avoid going outside too much and need to hang my laundry indoors. It’s one of the more annoying aspects of living in Japan, and I wish there was more effort to deal with the problem, but there’s not a whole lot that can be done about it at this point. The best time to cut down trees was 50 years ago.

Finance-wise, things have been going well this year. The Japanese stock market is on a tear, already up about 20% (in JPY terms) in 2024 and reaching an all-time high 30+ years after the asset bubble of the late 1980s. I don’t have too much specific exposure to the Japanese market in my own holdings, and the weak(ening) JPY certainly doesn’t help USD investors either. I suspect that a big driver of the high returns is the introduction of the new NISA investment vehicle, which is basically like an extra-large American Roth IRA. Compared to the old NISA, the new one has a larger annual contribution limit (3.6 million JPY, about 24,000 USD at current exchange rate), and no time limit on tax-free gains. The stereotypical Japanese saver keeps all their money in a bank account earning nothing, so this new, very generous account is probably enticing many people to invest for the first time. Of course, as an American I would have a very difficult time opening a NISA account due to the FATCA / PFIC rules which make investing outside of the US almost impossible. Land of the free! 🙄

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 9 years, 5 months.

Market movement: up

The first month of 2024 is over already, although it still feels like the year has just begun.

US tax season is also fast approaching. I’ve done it enough times by now that the whole process only takes me a few hours, although there are a few extra wrinkles this year. Now that I’m married, I can no longer file as Single, but I also can’t file jointly as my wife is not a US citizen or permanent resident and thus, shockingly, has no desire to start declaring and paying US taxes. As I also have no children, I’m forced to file as Married Filing Separately, which is objectively the worst filing status. One of my deductions is unfortunately now halved, and I didn’t realize this would happen until after 2023 had ended, and as a result my Roth conversion was a little bit too much and now I will owe a few hundred dollars of US tax. Not a huge deal in the big picture, but still annoying. In addition, I can no longer file electronically as the IRS’s system can’t handle MFS with a non-resident alien spouse (if you are married, it requires the spouse’s SSN, with no exception for case if the spouse doesn’t have a SSN). So, for the first time ever, I will have to file my taxes on paper. In 2024. It seems that updating the software to handle my (not that uncommon) case is too hard for the homeland of Silicon Valley and multi-trillion dollar tech conglomerates.

No, I’m not bitter, why do you ask?

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 9 years, 5 months.

Market movement: up

2023: over

Been quite busy the last few months, and forgot to do my regular posts. Now that the year is winding down, I have some time to catch up.

The US trip in September-October was a success: got to see all the family we were going to see, the travel logistics worked out, and jet lag wasn’t too debilitating.

Following that, my partner and I officially got married in October, but didn’t take formal wedding photos until this month. We will get the final photos next month. Also, need to plan a honeymoon trip sometime for 2024…

The Yen has, amazingly, begun to strengthen over the last month or so. Hope the trend continues so that I can exchange my JPY holdings for USD and start investing again.

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 9 years, 5 months.

Market movement: down

US travel: planned!

I finally pulled the trigger on this year’s US trip. I wasn’t able to get the absolute lowest flight prices I saw (at one point I saw tickets for under $1,000 RT per person, but I hesitated and prices went up again), but they were good enough to be worth getting. Since my family has mostly dispersed away from California over the last few years, it’s more complicated to plan a visit to see everyone. As a result, on this trip there will be 3 domestic flights involved in addition to the main flights to and from Japan. For the domestic flights, I was able to use miles for one of them and got pretty good cash prices for the other two. In addition, I will need to drive for the first time in almost 4 years, and I’m not looking forward to it. Japan has spoiled me with its excellent and ubiquitous mass transit and I’m sure I’ll have even more appreciation for it after coming back from my US trip in October.

Investment-wise, the market dropped slightly in August and so did the Yen. Both of these effects knocked my numbers down quite a bit back down to the $430k - $435k range. It seems I’ve been “stuck” here for quite some time, but it’s difficult to move past it when your home currency (and therefore your primary income) devalues against USD so quickly. If the Yen ever gets its strength back (at this point, I would consider anything below about 120 Yen / USD to be “strong”), I stand to gain quite a bit from my Yen savings in dollar terms. But if it continues its downward slide, I should still be ok as my USD holdings appreciate in value and hopefully prices here won’t rise too quickly in response.

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 8 years, 3 months.

Market movement: up

US travel plans: still undecided

Another mostly uneventful month. One event coming up is that I will finally start selling off my I bonds that I purchased in 2021 (already sold a week before I’m writing this) and 2022 (will sell in early January 2024). Because US interest rates have settled down compared to previous years, the interest payments on I bonds has dropped as well. However, market interest rates are at about 5%, so it doesn’t make sense to continue holding I bonds anymore. The reason for the strange sell timing is a quirk of how I bonds work: there is a penalty of 3 months’ interest if you sell them if you haven’t held them for 5 years. Since you forfeit the most recent 3 months of interest, it makes sense to time the sale for 3 months after the interest rate drops so that you aren’t giving up any months of the higher rate. For when I bought mine, that timing works out to be August 2023 and January 2024 for the optimal selling time. There’s a very handy site with charts that show the growth of I bonds over time, which is useful for anyone holding I bonds. A consequence of selling the bonds is the interest accrued is realized at the time of sale for tax purposes. So the interest I accumulated from my 2021 purchase will be taxable in 2023. This will slightly reduce my capacity for Roth conversions, but in the long run it probably won’t matter much.

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 7 years, 5 months.

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 8 years, 1 month.

Finance-wise, the Yen has fallen a little bit more so it’s down to 140 per dollar. With the new BoJ governor I was hoping that he would take steps to strengthen the Yen (maybe by raising interest rates to combat the inflation we’re seeing?) but that doesn’t seem to be in the cards so far. I would like to get back to contributing to my investments again, but the poor exchange rate makes it very unpalatable. I can’t seem to give up hope that the exchange rate won’t eventually go back to the 100-110 -ish “normal” range at some point, even though that’s seeming increasingly unlikely.

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 7 years, 8 months.

Workwise, my current assignment is wrapping up so I’m browsing for my next project. It’s holiday season in Japan (Golden Week) so the work pace likely won’t pick up much until the 2nd week of May, which is totally fine by me! 😎🍹 Looking forward to relaxing a bit before my next engagement.

Here’s a summary of my financial position this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 7 years, 3 months.

Also, finished filing my US taxes. I owed a couple hundred dollars because I went over my deductions for my Roth conversion last year.

Here’s a summary of my financial position at this point:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 6 years, 6 months.

Finance-wise, it looks like the market dropped a bit, and on top of that the yen also lost quite a bit of value against the dollar, so that explains the ~5% drop in assets compared to last month. It makes me feel a little bit powerless when short-term market fluctuations have a much larger impact than my savings behavior, but at the same time it’s freeing knowing that it’s largely outside of my control and that I can focus my attention on other things and the growth will take care of itself (or if it doesn’t, there are much larger problems than early retirement to worry about!).

This month, I did another weekend trip to Kyushu. Used 30k BA miles (transferred from CapitalOne Venture card) for roundtrip flights for 2 people, plus two IHG free night certificates + 55k points for two nights. Cash price for the flights and hotels would have been about $1,380, so pretty good savings by using points.

That’s pretty much all there is to report for this month. Here’s a summary of my financial position at this point:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 5 years, 11 months.

I hit a new net worth high point, although I suspect it’s temporary due to a good month in the market. I’m still waiting for the yen to hopefully recover somewhawt against USD so that I can convert my yen holdings in order to invest again. I wish I were able to invest locally, but because of FATCA regulations and PFIC rules it’s all but impossible for US persons to invest outside of the US. Unfortunately, this probably will not change anytime soon.

Here’s a summary of my financial position at this point:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 5 years, 4 months.

Financially, I performed a Roth conversion before the end of the year deadline. I also was able to get a discounted copy of TurboTax during their annual post-Christmas sale, so I’ve got my US tax preparations to look forward to in the next few months.

Here’s a summary of my financial position at this point:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 6 years, 0 months.

Since it’s getting towards the end of the year, it means it’s time once again to start thinking about tax optimization. I estimate how much of my traditional IRA balance I can convert to Roth IRA without paying too much in tax. In addition, I need to look over my Japanese bank balance history to prepare for FBAR reporting as well. I will most likely use Turbotax once again this year for my US tax prep, but I’ll probably buy it just after Christmas since they usually have a one-day sale with a pretty good discount.

I’ll be traveling back to the US again this month to visit family, so looking forward to that. I’m thankful that I was able to book my travel a few months ago using miles (89,100 United + $56.57 in taxes) before Japan’s announcement that they were re-opening for international tourism and all the price increases and lack of flight availability that come along with that. At the time I booked, the cash price for my itinerary was about $2,000, but today it is about $2,600. Using miles for travel saves the day once again.

Here’s a summary of my financial position at this point:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 5 years, 7 months.

The markets have also continued to decline as well, which is kind of disheartening but at the same time the lower valuations means higher expected returns going forward. Since it’s approaching the end of the calendar year, I will soon need to look into how much I am able to Roth-convert this year without US tax consequences. Hopefully the inflation adjustments to the US tax brackets will give me more room to convert!

Here’s a summary of my financial position at this point:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 7 years, 3 months.

On the other hand, the yen continues to drop in value, reaching 140 per USD which hasn’t been seen since the Asian financial crisis of 1997-1998. Since the value decline began in early 2021, I haven’t remitted any of my Japanese earnings back to the US to invest because I have been waiting for exchange rates to go back to a “normal” range (below 110 per USD). In the meantime, it forces me to accumulate cash in my bank account here (no interest!) because the US’s tax and compliance policy it imposes on other countries and US persons living abroad all but prohibit me from invesing outside of the US. I’m fortunate to have a large amount of USD-denominated assets so that the yen’s (and my salary’s) fall in value is partly balanced by an increase of my purchasing power, but if prices in Japan start to rise without an increase in salary, it will be a bad situation in the long term. So far things haven’t been too bad, but who knows what the future will bring?

Here’s a summary of my financial position at this point:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 10 years, 6 months.

I did do an emergency trip back to the US in mid-July because my grandmother unexpectedly passed away. I was fortunate enough to find out about it with enough lead time to book a last-minute award flight (net 66,863 United miles + $160.77) in time for the funeral. It’s times like these when having a large miles/points balance really comes in handy, so I’m thankful to past me for putting in the effort to learn how these systems work and how to efficiently accumulate these miles and points. I was also fortunate in that in June the US lifted its requirement of a negative COVID test to enter the country, as well as Japan lifting its requirements for mandatory on-arrival COVID testing, multi-day enforced hotel and home quarantines, ban on use of public transport and invasive monitoring policies. If I had to deal with all of that on top of last-minute international travel, it would have been an even larger burden. Here’s hoping that travel continues to make at least small progress towards normalization!

Here’s a summary of my financial position at this point:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 11 years, 1 months.

Japan is slowly preparing to re-open to tourism, probably targeting a full “reopening” for later this summer, but no official announcement yet. As of mid-June they have resumed “tourism” with North Korean-style chaperoned fixed-itinerary tours with handlers and strict supervision. But for the privilege of participating on one of these tours, you need to book through a pre-approved tour company, need to be fully vaccinated, and need to apply for a travel visa through the Japanese embassy, as visa waivers continue to be suspended. I can’t imagine many people would want to participate like this, which I suspect is the intent of the policy. Japanese politicians can claim to be making progress towards re-opening to the tourisim industry, while at the same time not actually changing much to appease voters who have been enjoying life without crowds of unruly tourists everywhere. There is an election coming up in late July, and I would be truly shocked if things go back to normal before then. After the election, I think policymakers will feel more comfortable loosening tourism restrictions without risking getting voted out. If the yen remains weak until then, that would be an excellent opportunity to come visit.

US inflation doesn’t seem to be abating anytime soon, despite the Fed gradually raising interest rates. As I understand it, there are still lots of supply shocks due to continued Chinese lockdowns (who could have known that a zero-covid policy would be so hard to maintain?!) as well as the Russian invasion of Ukraine disrupting basic food staple supplies. I recently checked and saw that gas prices are averaging over 5-6 USD / gallon where I used to live. I think that’s actually higher than gas prices even in Japan (in Tokyo gas price is about 4.50 USD / gallon), although that might partially be due to the weak Yen at the moment. I’m really glad that I don’t need to drive in Japan and even the train prices are stable and have not changed in years. And even if train prices do increase (doubtful), all companies reimburse employees for commuting costs so it makes almost no difference to my bottom line. Yet another reason why living in Japan is superior to living in the US!

Here’s a summary of my financial status at this point:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 11 years, 4 months.

Looking back at my previous post, the same concerns are even more relevant now: inflation and exchange rate.

Since I last wrote, the yen has sharply weakened to its lowest level in 20 years. Currently it is sitting at about 130 JPY / USD, and it is now a regular topic of conversation on the evening news. As someone who earns money in JPY, it is disheartening to see my salary worth less and less compared to my “home” currency of dollars. As I mentioned before, because I am all but forced to invest in the US, it makes it difficult for me to make new investments as my salary buys fewer and fewer dollars. However, my existing USD investments become more and more valuable in terms of JPY, which helps with paying my living expenses. However, if/when I visit the US it will be even more important to pay using my points and miles and avoid spending JPY.

US inflation also continues to remain high, 8.5% most recently. Inflation is starting to pick up in Japan; I recently noticed that onions had nearly doubled in price compared to the previous week. But so far most price increases have been fairly modest, as Japanese consumers haven’t experienced any inflation in over a generation and as a result can be very price-sensitive. On the US side, I once again made an annual $10k purchase of I-bonds, which pay out interest equal to the inflation rate, as determined every 6 months. For bonds issued in the May-October 2022 period, I-bonds will pay 9.62% interest for 6 months, and then it will readjust depending on what the CPI is in October 2022. I decided to purchase in April in order to lock in the previous rate of 7.12% for the first 6 months and then receive 9.62% interest for the following 6 months. As you are prevented from redeeming the bonds within 1 year, I have guaranteed a rate of 8.37% for my first year and will decide whether to sell them after 1 year depending on what inflation is doing at that time. Last year I did the same and purchased in May 2021 when the rate was 3.54%, and that set of bonds is now redeemable since it has been a year. I will let them continue earning their high interest rate and will only sell once inflation starts to go back to normal, which could be a while!

Finally, the US market continues to be volatile and on a generally downward trajectory. Additional uncertainties due to the ongoing war in Ukraine hasn’t helped supply chain issues, and rising costs of energy affect everything. Expect more of the same for the near future.

Here’s a summary of my status at this point:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 11 years, 5 months.

In my progress chart, I have added another line representing my net worth in JPY, as that is the currency most relevant to me now. I have retroactively extended it back to when I moved to Japan in October 2019 in order to show my progress during that period. Note that due to the rapid depreciation against the dollar, my net worth in JPY has increased this month, even though in USD terms it has fallen almost $20k due to market declines!

Investment-wise, the US market seems to be close to entering a correction (10% decrease) for the year, which isn’t too suprising given the almost unabated rapid growth we’ve had in the last several years. By contrast, my own investments have declined by less than half that in the same period, due to my more conservative and diversified investment strategy. As a result, I’m not really worried about the markets at this point. However, I am a bit concerned about the dollar-yen exchange rate. Since the beginning of last year, the yen has been gradually falling against the dollar, and it is now at a five-year low and still declining. This impacts me because I am paid in yen, but am forced to invest in dollars (thanks to FATCA). To make matters worse, we are starting to see the beginnings of inflation in Japan, with many companies announcing price increases going into effect in the coming months. Japan has gone the last 30 years or so with negligible inflation, so it will be interesting to see how price increases play out for the macro economy. My gut feeling is that most companies will make relatively small price increases (“if we raise our prices too much, our customers can’t afford our products!”) but won’t increase salaries (“we can’t afford to with all this inflation!”). As a result, consumers will cut spending, and Japan will likely enter a recession (again). But who knows? ¯\_(ツ)_/¯

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 12 years, 5 months.

I haven’t posted in a few months due to a recent change in my living situation: I moved into a new apartment with my girlfriend! It was an expensive move (as is the norm in Japan) with a lot of unavoidable fees, and the rent is about double what each of us were paying living separately, but in return we are getting almost 3 times the space. Each of us has enough space to work from home without disturbing each other, and we are able to spend even more time together without having to plan ahead or compensate for work schedules. However, since we are now sharing household expenses, I no longer have a complete picture of our household spending, so for the time being I will discontinue my monthly detailed spending reports.

In investment news, the US market seems to have become even more sensitive to the high inflation and subsequent hints of rising interest rates from the Fed. Hoping that this finally kills off the speculative bubbles in real estate, cryptocurrencies and related products, tech stocks, Tesla, etc., but I doubt it will be enough on its own. Nevertheless, my investment balances still managed to increase since my last post, although most of it was offset by the previously-mentioned moving expenses so pretty much zero net gain in net worth.

Once again this year, I executed a Roth conversion to take advantage of my otherwise-unused standard deduction space. However, I was a little bit too aggressive with my estimates and ended up converting a little bit more than my tax-free allowance, so I will end up owing about $400 on this year’s conversion. I’ll have to remember to be more careful next year.

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 6 years, 4 months.

This month I also made some large tax-related payments. The first one is a little over $500 worth in residence tax payments for 2020. The way that tax works in Japan is there is income tax at the national level, plus a local income tax, which I will call residence tax from now on. I haven’t familiarized myself with all the details, but the gist is that the amount of tax that you pay in a given year is based on your previous year’s income, the tax bracket you fall into, your marital status, and some other factors. If you are a company employee, tax is withheld from your paychecks according to your salary and there is an adjustment done towards the end of the calendar year in order to true-up discrepencies that may have occurred throughout the year (unpaid absences, overtime, etc.). For whatever reason, my employers in 2020 did not withhold residence taxes from my paychecks, so as a result I received a letter from my local government informing me of how much I owed and 4 bills to be paid quarterly. I had been expecting this, so I have been setting aside savings in preparation to pay the bills. I paid the first one this month and will make 3 more payments over the next several months at regular intervals. Nothing much more to say about that.

The second payment was a voluntary tax “payment” to the US government. As I’ve written about [previously]({% post_url /2019/2019-02-13-five-stages-tax-refund-enlightenment %}), this is actually more of a loan than a tax payment. I applied for the United Quest card back in May and it required $5,000 in spend over the first 3 months in order to earn its 80,000 mile sign up bonus. Since I don’t usually spend anywhere near $1,666 / month on credit cards, I had to make up the difference using tax payments. As a result, I gave the IRS a nearly $4,000 interest-free loan this month and paid a fee of $75.73 in order to do it via my credit card. I will receive my loan back when I file my return in 2022, but in the meantime I did receive my 80,000 bonus miles to use as I please. Unfortunately COVID-19 is still going strong here in Japan so I might have to wait a while before it’s safe to get on a plane again, but when I do those 80k miles will be good for about 4 domestic roundtrip excursions with my girlfriend, courtesy of the IRS and United Airlines. Oh, and I will do the same thing again in another 3 months to earn an extra 20k miles on top of that.

Aren’t taxes just wonderful?

Here’s my August expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 6 years, 1 month.

Also, the Olympics have finally gotten going here, after a year’s delay. It seems pretty subdued compared to a regular Olympics, but I’m kind of glad it isn’t getting too out of hand. Makes it easier for us residents that only a small fraction of newcomers were allowed in. It’s a shame that Japan will likely take a huge financial loss as a result, and I hope that will serve as a lesson going forward of the risks and dangers of stepping up to host an event of that scale. Sports are fun to watch every so often, but it isn’t worth shelling out billion of dollars just to host a giant sporting event once in a generation. Let someone else do it and reap the benefits by participating.

Anyway, that’s enough Olympics griping for one post. Here’s my July expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 5 years, 9 months.

All of this works ok, but I also wanted to get a better feel for the cashflow between my accounts, as well as learn about accounting / bookkeeping practices. So I downloaded gnucash which is a free and open-source accounting package which can handle multiple currencies, as well as investment tracking and report generation. I’m still learning how it works, but I’ve spent several hours so far entering in transaction data and playing with its reporting capabilities. I wouldn’t say that I’m going to retire my existing spreadsheet that I’ve been using for over 6 years just yet, but having my data in gnucash is definitely more powerful and formalized than my cobbled-together mess of a spreadsheet. I think I will try to come up with a workflow in which my spreadsheet is the gathering place for all the financial data from various sources (Mint, my google form, etc.) and it will do some processing to transform it into input data that can be imported to gnucash once per month. That would save me a lot of manual data entry going forward and allow me to keep using many of my other existing tools.

Here’s my June expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 5 years, 7 months.

I’ve also been considering modifying my overall strategy away from the Pinwheel Portfolio which I have been using since June 2019. There isn’t anything necessarily wrong with Pinwheel, but my main concerns are the heavy allocation to REITs (15%), as well as the current market conditions of ultra-low interest rates (relevant for bond performance) as well as the very high US market CAPE ratio.

REITs have actually been performing extremely well over the last few months (likely due to the US reopening), but after reading the literature there isn’t much theoretical justification for overweighting REITs beyond their natural market weight (about 3%). This presents an opportunity to simplify the portfolio by selling off my REITs and re-allocating to other funds.

As for market conditions, a high CAPE ratio is a signal for lower future long-term returns as I explained last month. In addition, the ultra-low interest rate environment doesn’t bode well for bonds, as their current interest payments remain low (possibly below inflation), while their capital value is at risk if rates increase (which they might if inflation picks up too much).

So, if I were to modify my portfolio strategy, I might consider eliminating REITs, reducing bond allocation from 15% to 10%, and increasing my stock allocation to non-US and further tilting to small cap value. I haven’t decided to change my strategy just yet, but I’ll continue to think about it over the next few weeks.

Here’s my May expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 5 years, 9 months.

The market continues to rise even further, with S&P500 reaching CAPE of 37.18 at month-end, which I will remind you is the 2nd highest in history (second only to the peak of the dot-com bubble in late 90’s / early 2000’s). Quick summary of CAPE for those who are unfamiliar: CAPE (Cyclically-Adjusted Price-to-Earnings) is a market valuation metric which augments the traditional Price-to-Earnings (PE) valuation metric by averaging the denominator (earnings) over a rolling 10 year period and adjusting it for inflation. This acts to smooth out fluctuations caused by changes in the business cycle and inflation (hence, “cyclically-adjusted”). As such, it helps to compare different market pricing periods on a more apples-to-apples basis. While it’s pretty much impossible to predict market returns in the short term (< ~5-10 years), there is a reasonably good correlation between CAPE and longer term returns (>10 years), which holds across the markets of different countries. For a good in-depth discussion of this, see this post, but the gist of it can be seen in this image:

As you can see, as the CAPE increases, real returns of the following 15 years decreases. What this means is that the rapid market growth that we have consistently seen since about 2009 (about 13.3% annually, inflation-adjusted) when the CAPE as at its minimum following the Global Financial Crisis (about 15) is extremely unlikely to persist going forward, at least for the portions of investments that have been purchased at high valuations. For investments purchased at today’s high CAPE, we would expect approximately zero real returns over the next 15 years if the historical data continues to be valid. Of course, since global markets have only rarely been this highly valued in the past, the reliability of the correlation decreases due to a decrease in data points, as well as an easily visible increase in variance of the available data away from the correlation line. It’s hard to say if this information is actionable, but nevertheless it will be interesting to see how things will shake out going forward.

Here’s my April expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 5 years, 11 months.

So right after the March state of emergency was lifted, I went back to the office to work, only to find out a couple days later that my neighboring coworker had been exposed to a virus carrier, and he later tested positive (no symptoms) a few days after that. We all promptly returned to remote work until we could all get tested. I’ll save you the suspense of waiting until next week’s report and reveal that I tested negative on April 5. I think it shows the futility of companies looking for any opportunity to get employees to return to the office before the pandemic has been solved for good. Especially as employees have demonstrated for over a year that they are able to work remotely. I’m perfectly happy to not ever have to step foot into an office again (isn’t that the whole point of this FIRE thing?), so any company that doesn’t get with the times and make full (or nearly-full) remote work the norm for all employees that are able (and willing) will have a hard time retaining talent (hint, hint).

[steps off soapbox]

Financially, the markets continued their relentless climb, with the US Schiller PE reaching 36.6 by the end of the month. The only time in history that it got this high was the dot-com bubble of the late 90s, and though I was slightly too young to have been paying attention to finance back then, I think the manic attitudes of many retail investors today are very similar to how people behaved at the time. Sure, the names might be different (E-trade -> Robinhood, Pets.com -> Tesla, etc.), but there’s a well-known saying:

History does not repeat itself, but it rhymes

I hope that investors have the self-awareness to remember (or at least recognize) this situation and prepare accordingly!

Here’s my March expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 6 years, 2 months.

Financially, the markets mostly continued to climb, with some volatility during the last week of February. Hopefully investors are starting to realize that a lot of the attention-grabbing names have been bid up to ridiculous levels and that they should realize their gains before the bubble pops. Although it might be a little painful in the short term, I think it’s healthier in the long term if markets don’t get too irrationally exhuberant, especially during an economic recovery period. Reasonably-priced shares allow people to gradually enter the market and still expect reasonable future gains from their investment. If you buy shares at too high a price, it may take decades before you actually start to see gains, even if the underlying companies are solid. As Buffett once said:

“For the investor, a too-high purchase price for the stock of an excellent company can undo the effects of a subsequent decade of favorable business developments.”

Here’s my February expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 6 years, 9 months.

It’s not often that the market grabs so much of people’s attention that it becomes a main story in the press for so long. The last time I can remember this much attention focused on financial markets is the last major Bitcoin bubble in late 2017, and of course that one also didn’t end well (at least in the short term, as BTC is currently at over $37k as I write this…). Hopefully not too many people will get burned once it’s over.

Here’s my January expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 6 years, 1 months.

I ended up doing a modestly-sized Roth IRA conversion after all. Since I can claim the FEIE this year to exclude my earned income in Japan, that leaves me with some tax-free space from my standard deduction with which to do Roth conversions. I did my best to estimate my conversion amount to completely fill up the tax-free space, but I’ll find out for sure once I file my taxes in a couple months.

Here’s hoping that this year will be better than 2020!

Here’s my December expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 6 years, 0 months.

In other news, it looks like the market is getting even more jubilant now that several vaccine trials have promising results. I’m doing some minor rebalancing / profit taking at this time, but I also need to go over tax rules for IRA conversions in order to decide whether it makes sense for me to convert before the end of the calendar year. Weekend research project for me, I guess.

Here’s my November expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 6 years, 8 months.

Life goes on here in Tokyo, but there’s been a lot of attention focused on the US election, as well as the resurgence in COVID-19 cases in the US and Europe. Election coverage here treats it mostly as spectacle, and doesn’t really provide much analysis or opinion. However, since the US electoral college system is so bizarre, there’s always a lot of explanation of how it works and why they need to focus the coverage on specific states. COVID-19 cases in Japan remain pretty stable (between 500 and 1000 daily new cases) thanks to nearly-universal cautious behavior (I occasionally see someone outside without a mask or only mouth covered instead of nose and mouth) and frequent hand and surface sterilization. Compared to most of Europe (most countries at over 10k cases / day) or the US (100k+ cases / day), I feel lucky to be in Japan!

PC building update: I was able to switch to using a Raspberry Pi 4 as my main computer for the time being. It’s barely powerful enough to handle basic web browsing, but it struggles with anything more demanding than watching a 360p YouTube video. Still, it has been enough to hold me over while I finished acquiring parts for my new computer. I just finished acquiring my parts today, and hopefully will get to build this weekend! Looking forward to the experience.

Here’s my October expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 6 years, 11 months.

Unfortunately, my laptop decided to fry itself a couple of weeks ago, so I no longer have a computer at home. I’m still deciding how to go about remedying this situation. I’m leaning toward building a desktop PC since I used my laptop at home 95% of the time, but I’m also going to attempt to pursue warranty claims on my laptop since it’s been less than 2 years since I bought it and I’m eligible to pay for extended service. I’m waiting for my support contract to finish transferring to Japan before I can start the process, and in the meantime new PC hardware will be announced soon, which should be a good buying opportunity due to (hopefully!) lowered prices on last year’s hardware.

Here’s my September expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 9 years, 3 months.

I did notice that I’m spending more on food than in previous months. I’ve been eating more meals with my girlfriend recently so that’s probably a contributing factor.

The market has continued to relentlessly go up, despite the continuing deleterious economic effects of the COVID19 pandemic. As I write this, the US market is at an all-time high, despite an unemployment rate of about 10% (more than double what it was pre-pandemic), record-breaking GDP contraction (31.7% annualized), and earnings of most companies have been severely impacted. I’ve heard theories that some of the seemingly-irrational increase can be attributed to closure of sports leagues, so sports bettors have moved to stock market speculation as a substitute. Personally, I’m not so sure about this explanation as retail investors typically have much lower volume than institutional investors. I think it’s more likely that the combination of zero interest rate policy and massive financial stimulus has lead to a market bubble. As always, I’m not altering my investment strategy in response to market moves, but it’s still interesting to watch.

Here’s my August expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 6 years, 9 months.

I have also returned to working in Tokyo rather than Nagoya, just in time for the 2nd wave of the Coronavirus. My current company isn’t well-equipped for work from home, so for the time being I continue to commute into the Tokyo office. The office is fairly empty, however, so that somewhat reduces the risk of exposure.

In other news, I received a $250 bank bonus from an account that I opened in March, right before US interest rates started to fall dramatically. I managed to lock in a decent interest rate at the time, so I don’t plan on moving any money out of the account in the near future. Will keep periodically investing savings, as usual.

Here’s my July expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 6 years, 6 months.

As part of that, I’ve had to spend a little bit more than usual to accomodate my temporary relocation, but it’s not all bad. IHG had a good sale on points earlier this month, pricing them at 0.5 cpp. As I am in Nagoya away from my girlfriend, I used the points to book long weekend stays at a local hotel here so that she could come visit Nagoya without having to sleep at my company’s sharehouse in the suburbs. The stays I’ve booked would have cost about $600 for 4 nights if I paid cash, but due to stacking benefits of two of my cards (10% rebate on redeemed points + 4th reward night free), the price comes out to just under 50k points for a 4 night stay, so about 1.2 cpp redemption value overall.

Investment-wise, I received quarterly dividends this month, and the market recovered even more since the big drops in February and March. Just shows the importance of staying invested even if the market appears irrationally exuberant.

Here’s my June expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 7 years, 6 months.

Despite continuing virus cases in the US (as well as probably premature statewide “re-openings” and now widespread civil unrest), the stock market continued to tick up. The market seems to be untethered from economic reality at this time, but maybe the market has determined that the effect of the endless government stimulus money outweighs 40+ million people out of work and heavy restrictions on economic activity. In any case, I rebalanced my portfolio at the end of May, but in the end there were only relatively minor tweaks required. I had been reluctant to do it due to the very high volatility we have seen recently, but I remembered the importance of periodically rebalancing your portfolio regardless of market conditions so that it matches your risk tolerance and investment plan. In hindsight had I rebalanced sooner I would have captured more gains during the recovery, but I had no way of knowing that in advance.

Here’s my May expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 7 years, 3 months.

Financial highlights of the month included receiving a $1,200 stimulus deposit from the IRS, plus finally getting my IL state refund for 2019. In addition, the market recovered nicely in April (up 12.7% from the end of March), which helped restore much of my savings. Now I am back to where I was in September of last year, although with the economic uncertainty who knows how long it will last.

In other news, it’s been confirmed that Japan will be doing its own economic stimulus program by giving 100,000 yen to every legal resident. Of course, this being Japan, you need to fill out paperwork to apply for the money, and I’m pretty sure they haven’t even gotten around to mailing out the application forms yet. Hopefully I’ll get that finished by next month.

Here’s my April expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 9 years, 9 months.

So the virus (and associated fear and panic) continues to spread. The market volatility in March was unprecedented, and there’s a pretty good chance that the craziness will continue into the near future. So far I have refrained from making any large moves in the market, although I did move my cash savings from my money market account into a no-penalty CD at 1.75%. Not only did I manage to snag a decent interest rate before they dropped (the going rate for the same product is currently 1.55%), the bank also ran a promotion where they give an additional 1% bonus for keeping your money there through June 30th. I think that will be enough time for the markets to calm down a bit more from where they are now (I’ll be waiting for VIX to get under 40 or so) and hopefully it will also be a good time to rebalance. Until then, my advice for anyone investing echoes the famous words of the late Jack Bogle: “Don’t do something, just stand there.”

In addition, new virus cases in Japan are starting to tick up, and the government has enacted travel bans covering 73 countries (including the US) in order to slow new infections coming into Japan. Personally, I think it’s too late for that strategy and Japan must focus on isolating and treating existing cases as they continue to spread domestically. I’m not too worried about the disease as I am now completely working remotely so I don’t have to deal with crowded Tokyo trains anymore. So far grocery stores haven’t been too crazy, although some food items are in short supply if you are at the store in the evening. The US Embassy in Japan has urged Americans to return to the US if they are not prepared to remain abroad indefinitely, but that doesn’t apply to me since I am prepared to remain here indefinitely. Besides, I can’t imagine things getting worse here than in the US!

Here’s my March expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 9 years, 11 months.

Last year, I switched this blog from Blogger to Wordpress, in order to experiment with wordpress hosting. As part of that, I paid for webhosting with Siteground. I had no issues with the quality of their service, but I wasn’t a fan when I received the reminder email to renew my service for the price of $143.40 per year! I had originally signed up for $47.40 per year, but I guess they do that annoying thing where they raise the price of their service after the first year and hope that people are too careless to notice or too lazy to change providers. As I am neither of these, I cancelled my service and converted my site into a statically generated site hosted (for free!) on Github Pages. If you are wondering why the site looks different, this is the reason. I’m pretty happy with its current design, but I might continue to tweak it when I have time.

In other news, there’s a virus going around (it seems the English media has settled on Coronavirus as its moniker, since I guess SARS-CoV-2 isn’t catchy enough). Here in Japan, it’s been in the public consciousness since January, with relatively little accompanying hysteria (facemasks have been in short supply, and there are occassional runs on staples such as toilet paper and rice), but the US media has only recently caught up and apparently the US is in complete pandemonium as the virus continues to spread unabated. At least, that’s my impression from the news that pops up in my feed.

And one would surmise the same based on recent stock market performance over the last couple of weeks. I haven’t changed my investing strategy in response to the market turmoil, but I am looking forward to buying more shares at discount once the dust settles. Yes, I am doing a little bit of market timing by waiting to purchase, but it is blatantly obvious that the markets are in a full-on panic (the late-February correction was the fastest ever, bond yields have dropped to all-time lows with no sign of slowing, the Fed did its first emergency rate cut since the 2008 Global Financial Crisis, etc.) and the virus’ spread will continue to accelerate. I expect things to continue to get worse in the near-to-medium future and I am heeding the warning to not catch a falling knife.

On a positive note, I got a fairly large tax refund from last year, so I’ll have that ready to invest once the time is right (hopefully).

Here’s my February expenses:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 7 years, 10 months.

I did a better job this month at cutting down on food spending by routinely preparing work lunch for myself at home. Compared to last month, my combined restaurant and grocery spending is about 33% lower, saving me about $200. I’ll see what other expenses I can cut next month in order to further pare down my spending.

I did some more traveling this month. I went to Beppu, Oita with my girlfriend one weekend for her birthday. I got our flights using a mixture of United miles and travel credit from one of my cards. The night at our resort was paid with my annual free night certificate from my IHG card ($49 annual fee). Unfortunately, this year is the last year that I can use the certificate at any IHG property, and going forward I will be restricted to properties under 40,000 points only. Seeing as this property regularly lists for over $600 / night (it was just over $1,000 per night at the time I booked!), I’d say this was a good way to close out the unrestricted night era. Finally, my girlfriend and I also visited Tokyo Disneyland one weekend. It’s a fairly short trip from where we live, but since I had an unused Hyatt free night award, I booked a night at the new Hyatt Place Tokyo Bay. Although it isn’t one of the “official” Disney hotels, it is still a great location for anyone visiting the resort area, with shuttle buses to and from the resort, as well as free buffet breakfast. I’m happy that Hyatt has priced it as a Category 4 so that I can continue to use my annual free night award at this property (hopefully they won’t upgrade it to a higher category) in the future.

Here’s a summary of my expenses for this month:

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 5 years, 11 months.

Happy New Year! 明けましておめでとうございます！

Speaking of travel, I booked my annual trip to Japan this month using miles, hotel free night certificates, and my massive hotels.com gift card balance that I bought at discount. Booked a round trip to Japan on JAL for 60k BA miles + $178.86 in taxes. In addition, I got a domestic round trip ticket to Kyushu from Tokyo for 9k BA miles + $5.14 in taxes. My Hyatt and IHG cards each got me a “free” night (quotations because the cost is really the annual fee) at hotels worth $530 (total for both nights) at the time of booking, but the annual fees only cost $124 in total so that’s a savings of $406 over the cash price! Finally, the remaining hotel nights cost about $1078, but because I paid with discounted gift cards and taking into account the 10 night hotels.com discount, it only cost me about $781 out of pocket ($297 savings). So in total, I got flights and lodging for the entire 13 night trip worth about $3,331 if paid at full cash price for about $1089 + 69k BA miles. Ignoring the value of the miles, that’s a savings of over $2,000 cash that I didn’t have to pay out! Just goes to show how being clever with miles and discounts can supercharge one’s travel abilities.

I’ll close with an observation on the incredible stock market returns to start off the year. I’m under no illusions that the market will continue to perform this well going forward, but I also don’t believe that anyone can predict how the market will behave in the short term with anything approaching precision, so it’s best to stay the course. And try not to look at your balances.

Oh, yeah. I got a small raise at work this month! Higher salary goes into effect next pay period!

On a sidenote, supposedly the Republicans are due to release their tax “overhaul” proposal very soon (as in, probably by the time you are reading this). I was thinking of maybe writing a post about what they propose and how it would affect different groups of people, but it’s hard to write posts about current events since they quickly become outdated as things seem to be changing ever more rapidly in the political sphere. If there is something especially egregious in there that has a decent shot of becoming law, I’ll try to put up a post detailing it so you will know what may be at stake. On the off-chance that they actually pass a bill, I’ll likely do an overview detailing the changes. But I’m not making any promises, so don’t hold me to it!

On with this month’s spending report:

My newest credit card reward scheme which I put into action this month was inspired by this post over at the Wealthy Accountant. This month, I made an estimated federal tax payment for 2017 of $3,000 over at Pay1040. This allowed me to meet the first tier of minimum spending on my BA card (earned me 50,000 British Airways miles, cha-ching!) a month early, as well as get me a head start on the 2nd tier of minimum spending for the card ($10,000 total spent in the first 12 months) which will earn me another 25,000 miles. And all it cost me was $56.10 in fees and an interest-free $3,000 6-month loan to the federal government, which I value at about $12.60 in lost interest (after tax). Seeing as I likely wouldn’t be able to achieve the final tier of spending goal ($20,000 total spending in first 12 months, earning another 25,000 miles) without this trick, I am essentially buying BA miles at about 0.25 cents each. Since I value them at about 1.7 cents each, this is highly profitable. Just goes to show how valuable credit card sign-up bonuses can be! I intend to do this trick again for the 4th quarter of 2017. The downside of this is it makes this month’s numbers look especially bad, since I have to front the cash for the deal and it greatly reduces my after-tax income for the month.

Anyway, here’s my spending for the month:

If that’s the case, then what explains the rest of the travel spending? The answer is that I also include all extra costs associated with earning points or cash for future travel. So, $95 of it is my annual fee on my new BA card. In addition, Chase had a promotion in August where you could receive 10 Chase points per dollar spent on walmart.com for purchases up to $250 when using Chase Pay to checkout. Naturally, I took advantage of the promotion to purchase Visa Gift Cards, which are almost as good as cash. Because of this, I only counted the activation fees for the cards, which was $10.82. I also purchased a discounted $50 Hotels.com gift card for $40, which I will definitely use on my next trip to Japan. Finally, I came across a deal with an Irish newspaper which offered 18,000 BA miles for buying a year’s digital subscription for 160 euros. At current exchange rates, that came out to 1.05 cents per mile, so of course I bought it. I value BA miles conservatively at about 1.7 cents each, so I expect to profit about $117 from that transaction once I spend those points. Unfortunately, as of yesterday that offer has been cut down to 9,000 BA miles, so it is not nearly as lucrative. Just goes to show how if you see a good deal, you need to grab it before it is gone.

Anyway, here’s my spending for the month:

In other news, I applied for yet another card this month (the Chase British Airways card) because it is the last Chase card that I want which isn’t subject to the 5/24 rule (as I discussed in my previous post about credit cards), and it currently is offering a pretty good sign-up bonus of 50k miles after spending $3k in the first 3 months, an additional 25k miles after spending a total of $10k in the first year, and an additional 25k miles after spending a total of $20k in the first year. So, assuming that I use this card for the majority of my expenses over the next year, I will earn 120k BA miles! Since I travel to Japan every year, that is enough for over 13 round-trip domestic flights in Japan at current redemption rates! Or, if I choose to redeem those miles in the US, I can get 6 round-trip tickets to visit family! It’s tough to beat BA miles in terms of pure utility. I just hope that they don’t change their award structure before I can use up all my miles!

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 7 years 4 months

20% raise is official as of today, but will effectively start on next week’s paycheck.

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 7 years 9 months

Going forward, I’m not going to correct for the large spending that my personal project demanded. It will roll off my projections by next year like all my other spending, so until then I have to live with the consequences.

On the other hand, there’s a very good chance that I will soon get a raise which will boost my gross income by about 20%! More savings (and taxes) for next year!

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 7 years 2 months

…but this is kind of misleading as it assumes I spend an extra $3k every year when this is really a one-time expense for a personal project. So, for projection purposes, I’m going to cheat a bit and pretend like I didn’t spend that extra $3k this month…

For-realsies projected time to FI (assuming 6% growth and 4% withdrawal rate): 6 years 1 month

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 6 years 3 months