Financially Free

I decided to do a quick update or another month will go by. I am alive and well in the City of Trees. Tomorrow we leave for China, where we will spend almost a month seeing much of the country. We will be on a Road Scholars tour with a small group and an English-speaking guide. We will start in Beijing and will return from Shanghai. I appreciate the educational component of this tour... we will learn much during this adventure.

The best news in a while, is that in early February our grandson was born, about two weeks early but healthy otherwise. He is adorable, but I guess I am just like any grandma when it comes to thinking ours is the cutest. We love being grandparents and spending time with him as much as we can. Fortunately he lives only a few miles away.

We recently finalized plans to have a new house built, just a few miles from our current home. The new house should be ready this summer. We felt it was the time to do it because real estate and building is starting to take off in this area. We looked at several pre-built homes but none of them had everything we wanted, so building seems the best option for us.

My sister and BIL are in the process of downsizing in CA, from their home of 30+ years to a condo in an "over 55"community near our former home. I think they will love their new, simpler and less expensive life.

Well, I need to finish packing, so I'm off. Hope all at SA have a Happy Easter in the company of friends and family.

With the New Year upon us, I've been reflecting on my life in retirement. Before retirement I worked for almost 30 years in education in positions ranging from classroom teacher to program specialist, and culminating for the final 15 years as school principal. On a daily basis there were problems to solve, challenges to face, and goals to meet. My life was fast-paced and intense but I loved my work.

On a personal level, preparing for retirement was an important goal and a challenge I undertook with enthusiasm. Although I once thought I'd retire at 55, I worked until I was 58, still ahead of many who have to work to age 66 or beyond. Planning for eventual retirement took a fair amount of time but setting goals helped keep my eyes on the prize... retirement.

Thanks to long-term planning, we retired with enough resources and income to fund a comfortable standard of living. But in some ways, I miss the challenges that made the days go by quickly and that gave me great satisfaction. So in retirement, I've had to find new challenges and create new goals.

Fast forward to January, 2013... I've been retired for 4 1/2 years. How is it going? In many ways retirement is everything I thought it would be and more. I enjoy mostly stress-free days and manage to keep busy. From spring to fall, gardening keeps me busy. I've joined a gardening club and have a membership at the Botanical Garden that gives me access to classes, events, and volunteer opportunities. We continue to volunteer with a national organization that provides disaster relief to individuals and families.

Dh and I have joined local bird-watching groups and he has taken several short trips out of state for birding festivals. Although I'm always "invited" to go, I prefer to stay home and enjoy some alone time. Bird watching has been a great hobby for dh to get into and he has given several presentations to various groups. An added bonus: it gets him out of the house and gives him a hobby he can do anywhere in the world.

And we travel a lot. Our 121 days of travel in 2012 took us to new and old places around the world: Cayman Islands, Belize, Curacao, Aruba, Mexico, Guatemala, Honduras, and Puerto Rico. We explored more of the USA with trips to Wyoming, Montana, South Dakota, Arizona, California, Florida, Oregon, Utah, and Nevada. Most of our travel was great fun, except for a 2 week cruise where hundreds of passengers contracted the norovirus. Let’s just say we are putting cruising on hold until we’re (much) older. Add visits to family and bird watching trips for dh, and we were out and about over 5 months total. Whew!

On the financial front... how did we do in 2012?
Life continues to be simpler and less complicated, especially financially. We sold our house in CA in 2011 so now we just have one home to maintain. In 2012 we sold one of our rentals to DS and his wife, so we also have one less investment property to deal with. Two rentals were refinanced, a smart money move resulting in a good cash flow.

Our income is fixed (defined benefit pensions) and direct deposited to the bank, and most bills are on auto-pay. A property manager handles the three remaining rentals. I track our expenses in four basic categories. "Living" is all expenses excluding travel, giving, or saving (i.e., medical, property taxes, food, entertainment, clothes, auto, etc.).

Our net worth grew 8%, excluding real estate. This figure represents the average growth of taxable accounts, tax-deferred accounts (to be tapped at 70 ½), and stocks/mutual funds. The 8% includes a stock portfolio that grew by 24%, mostly due to Apple's strong performance in 2012, so this skews the totals a bit.

We spent our 2012 net income as follows:
~ Living 30%
~ Giving 15%
~ Savings 32%
~ Travel 23%


And that's the recap of 2012 in the life of a very happy retiree. Although I rarely blog anymore, I continue to enjoy visiting SA and keeping up with the lives of my online friends.

The following picture is from our trip to Mt. Rushmore. As much as we travel around the world, the USA is IMHO the greatest country in the world.

Happy New Year everyone!

Well, the truth is it feels like a raise. Today I signed the papers for refinancing two rentals that are my sole and separate property. I have been thinking about it for several years but dragged my feet, mainly because I didn't want to deal with B of A (the current lender), and home values had dropped dramatically. But values are finally creeping up again.

I remembered the name of the loan broker I used when I bought the houses. He used to be with Countrywide (now B of A) but is now w/ a small mortgage company. He was able to get a rate of 3.625% locked in with no points. This is an excellent rate for investment property. I also decided to have impounds because it makes life easier for me. I will no longer have to deal with tax bills or annual insurance premiums... only HOA fees.

It will take about 15 months to recover the closing costs but after that I will have about $447 a month net, after paying for property management and reserving funds for HOA fees to be paid twice a year. Wish I'd done it sooner, especially since I've had a negative cash flow of ~$65 a month.

The cash flow will come in handy... we are expecting out first grandchild (a boy) early next year and I will want to start a college savings account. It's never too early!

Summer in the City of Trees is my favorite season. Dh and I spend time enjoying our adopted city before our serious travels begin again in the fall. This week we are having a heat wave in our neck of the woods, with six 100+ degree days predicted. Nonetheless, I love summer and the fun that comes with it. Before retiring, summer was our major down time and although we enjoyed it to the max, returning to work always loomed in the back of our minds. Now that we're retired, there is a carefree aspect that adds special enjoyment to summers. An best of all, many of our local activities are free or reasonably priced.

Dh and I are having our bikes tuned up in preparation for some riding on the greenbelt or the municipal park, two great areas for riding, with some long shaded stretches mixed in. It's fun, free, and healthy. Another low cost activity is a visit to the

Botanical Gardens, where we have gone several times in the last few weeks. Once for a food and wine tasting fundraising event and once for a lengthy walk. We are members, so we get in free but non-members pay a very reasonable fee of $5 adults/$3 seniors. And, admission is free on Tuesday and Thursday mornings between 7:30 and 9:00 a.m. in the summer. Tai Chi classes are offered for a small fee every Saturday morning in this gorgeous setting, and also summer concerts on Outlaw Field. The gardens are next door to the historic Old Penitentiary, another fun place to visit.

On Tuesday afternoons we usually go to the movies, often to the theater where admission is $1 (only on Tuesdays, but $2 all other days). The movies offered are usually 2-3 weeks from their release date, so not too old. The house cleaners come every other Tuesday, so we started going to the movies to get out of the way and like it so much we go almost every week. Sometimes, depending on the movie, we'll go to the "regular" theater where we pay $7.50 to get in, but still less than the $10 we used to pay in CA.

We belong to the local Audubon club and have gone on several field trips they organize. These field trips are free, and although sponsored by our club, you don't have to be a member to participate. Last week 14 of us participated in a daylong trip on the "Bluebird Trail" to check many bluebird nest boxes and watch the banding of the baby birds. On that trip we counted 42 species of birds, including a golden eagle. We took two other birdwatchers in our car, and each chipped in $10 each for gas. Paying one's fair share for gas is the only "requirement" and the group leader determines the contribution amount.

On Saturday mornings the downtown farmer's market offers fresh, locally grown produce at reasonable prices, and much of it is organic. In addition to fruits and vegetables, this is a good place to get flowers, plants, bread, pastries, cheese, wine, and interesting arts and crafts. Before or after visiting the farmer’s market, you can treat yourself to breakfast or brunch at one of the excellent downtown restaurants like Goldie's, one of our favorites.

If you enjoy a good wine like me, a good day trip is to some of ID's wineries. A 30-minute drive will take you to the heart of the Snake River Valley AVA (American Viticulture Area). The SW region has 24 wineries and the SE region has 5. Too far for a day trip, the northern region has 5 wineries but is worth visiting if you are going that way. I'm happy the wine industry is booming in ID because in my younger days I lived 30 minutes from CA's Napa Valley, renown for its wines, and I love sight of beautiful vineyards, especially in the fall. There are endless events and concerts offered throughout the year at many of the wineries.

For an extra-special activity, there is the Idaho Shakespeare Festival featuring a variety of performances throughout the summer. We have tickets to see The Mousetrap in about a week when my DS and BIL are here. We'll pack a picnic dinner, a nice bottle of wine, and some dessert to enjoy before the performance begins in the beautiful open-air amphitheater at 8:00 p.m. Not too far from the Shakespeare Festival is Barber Park, the beginning point for floating or rafting the Boise River in the summer months. We haven’t tried this very popular activity that takes you six miles down the river, but it sure looks like fun. Alcoholic beverages and glass bottles are prohibited on the Boise River and PDFs are recommended.

To get out of the heat, we can always go to one of the many museums (e.g., World Center for Birds of Prey, Boise Art Museum, Black History Museum, Basque Museum, Discovery Center, Idaho Anne Frank Human Rights Memorial, etc.) or, if its not too hot, it's fun to rent a paddle boat at the park, go to the zoo, or walk the trails at one of the amazing parks. And, I can't say enough about the simple enjoyment of a BBQ on one's own patio, with family and friends, or just the two of us and lots of good food.

Another activity that keeps us busy in the summer is our volunteer work with the Red Cross. While it certainly is not "fun" to go to the site of a disaster, it is very rewarding to be able help families that have experienced a disaster. In our area, this almost always involves house fires and sometimes floods. This summer has been busy so far during the weeks dh and I have been on-call, especially during the hot, dry and windy days. Considering how popular fireworks are in this state, I'm surprised we did not have too many fires around July 4th.

Although we love to travel to explore our beautiful world and learn more about other cultures, some of the most interesting and enjoyable activities are right at our doorstep. Although I don't blog often these days, I still like to read the SA blogs. One reason I don't blog often is that I don't have a lot of financial insights to offer on a day-to-day basis. But I can say this: if you plan and prepare adequately in your working years, retirement will be all you dream of and more. However, don't forego enjoying life before retirement. Balance is important... spend some $$ now but save some for later. Hope everyone at SA has a safe and relaxing summer!

I was going to post some pictures but there seems to be a problem with the SA server... maybe later.

Yikes! Has it really been 3 months since I last posted? I am alive and well living happily ever after in retirement. 2012 is the first year we've had only one house to deal with, so our life has gotten simpler (and cheaper). It was a good financial move to sell the CA condo last fall. A question that sometimes comes up from family and friends who work: What do you do all day? Well, we manage to keep busy, and at times busier than when we worked.

My volunteer time with the American Red Cross has been a rewarding experience so far. In between travel, I am on-call as a member of the Disaster Assessment Team. Dh is also a volunteer and sometimes goes with me on calls. In the last month I've had 7 calls, all of them in response to house fires in my city and some neighboring cities. I'm getting to know other volunteers and making new friends, another benefit of belonging to this group.

More and more, we're adapting to the colder climate and enjoying spending more time in this beautiful part of the country. But now when the weather gets TOO cold, since we can no longer escape to CA, we plan getaway trips to warmer areas. We're still not ready to be snowbirds in one particular place so we've been migrating all over the globe. January and February took us to Florida and Caribbean for about a month, an experience that was mostly good.

Our trip included a two-week cruise on the Crown Princess, the ship that made the news because over 500 passengers and crew got sick with norovirus. We thought we'd escaped the epidemic but dh and I both got sick the day we disembarked. We were sick enough to visit the ER and we spent the good part of a week recuperating at our timeshare condo. So the last week was not so good, but the other weeks were wonderful. We've taken many cruises and this was the first bad experience, so we're taking a break from cruising for a while but not for good.

The weather at home has been nice enough that I've worked in the garden a few days. I won't plant my annuals until mid-May, but the perennials are starting to sprout and in need of thinning and pruning. We're having the exterior of our house painted and it will happen this week if the weather cooperates. It's been a fairly mild winter but with some strange weather. One day it's in the 70s... the next day it may snow. If the painting doesn't happen this week, it will have to wait until mid-May when we return from our next trip.

Next week we'll leave for Guatemala, where we'll spend about a month. We'll start with a ten-day

Caravan.com tour that begins in Guatemala City but we are going a few days in advance. We think Caravan's prices are reasonable and we enjoyed the Costa Rica tour we took with them last year. After the tour we'll be in Antigua with friends and end with a week at a hotel/resort, also in Antigua. We will visit the schools where we used to train our SJSU student teachers and spend time with students we are sponsoring. We have planned a side trip to the Mayan ruins in Copan, Honduras, during the latter part of the trip.

The only thing I can share related to saving money is I got a very good deal on our tickets to Guatemala. We are flying first class for about $100 less than the price of an economy class ticket. I did it by using award miles combined with purchased miles to complete the transaction. Also, we are staying at a lovely resort in Antigua for only $159 a week by booking it through our timeshare exchange program.

I do have one financial goal for 2012 that supports my philosophy of giving. This year I would like to make my contributions through a donor-advised charitable fund. So far, I am leaning toward the Schwab Charitable Fund. My plan is to use appreciated stock to establish the fund and use future contributions to support my non-profits of choice. I want to proceed in the most-cost effective and tax-friendly manner. A charitable fund seems simpler than establishing a foundation that involves lots of paperwork and requires management.

Well, I haven't been blogging much because our financial life is really pretty boring these days. I guess it's better than having drama related to money (or lack of). The years of focused planning and saving have paid off in terms of providing a comfortable and secure retirement, and for that I am grateful. We planned for the future and now we are living it. Life is good.

Happy Easter to all! I took this picture of lilies at our hotel last time we were in Guatemala.

Yesterday dh and I were discussing how quickly 2011 flew by. After all, we are retired... shouldn't life seem a little slower? So where did the year go? And how are we doing financially... where did our money go?

January - Our "National Geographic Experience"
We started the year on an Amazon River cruise where we spent 4 weeks visiting everything from remote villages to the industrial city of Manaus. Our trip back to the USA took us to Devil's Island and several Caribbean countries. It was amazing and we learned so much about the flora, fauna, people and cultures of the Amazon Basin!

February - Family Time
Spring in Idaho was quiet and restful. We took a road trip to our condo in Silicon Valley, stopping to see family in Oregon along the way.

March - Time for Family and Friends
Went to Newport and Gleneden on the Oregon Coast for a week with dh to enjoy bird watching and the ocean. Later I took a "girls only" trip to Las Vegas to celebrate a friend's 70th birthday. Dh and I ended the month with a week in Cabo San Lucas for our niece's renewal of vows.

April - From NYC to the Rain Forest
The first week was spent with my sister from CA in NYC visiting my grandnephew (her grandson). Later that month, we were in El Salvador to see family for a week, followed by 10 days in Costa Rica on a

Caravan.com tour, one of the best travel bargains around.

May - R & R
Had thyroid surgery... prognosis is good despite some unexpected news. Appreciated being home to rest and recuperate, and my daughters and dh were wonderful during this time. Prepared my garden for planting.

June - Home Sweet Home in ID
The garden is starting to bloom, I volunteered for the Red Cross, and took a four-day trip with dh to beautiful Yellowstone. We decided to sell CA condo... we just don't use it enough to justify expense of keeping it.

July - Cutting Ties to CA
The best part was that my sister and BIL from CA came to visit us in ID for a week of fun. We got an offer on the condo... drove back to CA. It was wonderful to spend time with CA family, including dh's family reunion in Soledad. Cleared out CA condo in expectation of closing escrow in August. Rented a storage locker in ID and hired movers to help us with items we are keeping.

August - Summer in the City of Trees
So happy with our beautiful flower garden in ID... annuals and perennials galore! Volunteered some more and enjoyed a relaxing summer in this beautiful city of trees (that is the meaning of Boise), biking on the greenbelt, and going to the fair, museums, parks and the zoo.

September - European Adventure Begins
We FINALLY closed escrow on our CA condo! Left on September 25 to celebrate with newly retired friends in for Barcelona, Spain, the gateway for our next adventure.

October - Wow... what a month!
We were in Europe most of October, exploring 8 different countries... an amazing experience. The best part: four days with my favorite cousin and his delightful family in Switzerland. Did some volunteer work for the Red Cross when we returned to ID.

November - So Much to be Thankful For
My DSS came home from Iraq, safe and sound after one year working as a medic with his National Guard unit in a particularly dangerous area. Thanksgiving in Idaho was lovely, hosted by DD1. After Thanksgiving, dh and I left for Cabo San Lucas, one of our favorite SUNNY and WARM places.

December - Escaping the Cold
Went to Cabo San Lucas for three weeks. Came home in time to celebrate happy holidays with 3 of our 4 adult children. DSS want to relocate to ID. We decorated the house and put up our tree. It was wonderful! I especially love the ornaments we've collected from our world travels.

On the Financial Front... where did our money go?
I spend less time on things financial now that we're retired. It's not that I care any less about personal finance... it's more that we are on autopilot. We have a property manager handling the rentals, so I do not get involved much. The financial planner I've used for 25+ years does a good job with the tax-deferred investments, so I don't worry about those. Our income is fixed and direct deposited to the bank, and most bills are on auto-pay. Life is simpler now.

I track our retirement income in four basic categories. "Living" is everything we spend that is not travel, giving, or saving: medical, property taxes, food, entertainment, clothes, auto, etc. I was surprised our net worth grew 4.87%, excluding real estate (I expected less). This represents the growth (averaged) of taxable accounts, tax-deferred accounts (to be tapped at 70 1/2), and stocks/mutual funds. I adjusted figures to exclude cash generated from the sale of the CA condo.

Distribution of our 2011 net income is as follows:
~ Living 32%
~ Giving 12%
~ Savings 31%
~ Travel 25%

We spend a lot on travel, made possible by diligent pre-retirement planning and saving. Our expenses are low, our income is fixed (~30% goes to taxes), we save almost one-third of our net income, and we are in relatively good health. This is the "go-go" stage of our retirement. The "slow-go" and the "no-go" stages will follow, but for now we are actively crossing items off our bucket list. 2011 was a good year!

Happy New Year to All at SA!

...and even for those who do not, a donation to a non-profit organization may be the perfect gift. This year I gave my grandniece and two grandnephews a symbolic adoption of an endangered animal.

World Wildlife Fund offers adoptions of 100 different species. The recipient gets an adoption certificate and a 12" plush animal in a gift box. I like this idea because the kids are young enough to still enjoy a tangible gift to open but old enough to understand that they are helping a cause.

For the grownups in the family, I will make donations in their name as we have done for the past few years. Favorite charities are American Red Cross, Kiva, Heifer International, Habitat for Humanity, the Idaho Humane Society, Second Harvest Food Bank, and Idaho Horse Rescue. Family members are on board with this plan, it makes Christmas shopping easier, plus I get a tax deduction... so it's win-win.

Wishing everyone at SA a very Merry Christmas! May you make memories with those you love.

Now that we permanently live in a colder-in-the-winter part of the country, the snowbird lifestyle is gaining appeal. On Saturday dh and I will leave for three weeks in warm and sunny Cabo San Lucas. We'll stay in a one-bedroom condo at the

Hacienda Encantada, a resort that sits on a point with great views of the arch and the Sea of Cortez.

Some snowbirds we know flee the cold for 3-6 months. Our relatively short trip to Cabo is an experiment of sorts... I guess you could call us "semi-snowbirds"... but the point is we're getting away from the Idaho cold to see how we like this area for extended winter getaways. We'll explore future options such as renting an apartment or a house. Cabo is home to large numbers of retired Americans and Canadians, so it must be a good place to spend the winter.

I reserved a "studio suite" with timeshare points from last year, trading a week in Lake Tahoe for three in Cabo. The unit has a full kitchen so we can eat meals in whenever we want and shopping will be easy with a Walmart and a Costco within a 10-minute drive. Resort amenities include laundry facilities, free parking, and free wifi. And although the resort offers an “all inclusive” option for meals/drinks, it is not worth it to us. We tend to eat healthier by cooking our own meals and dining out occasionally. My budget for these 3 weeks is $3,000+-.

So far, the costs are:
RT airfare for two: $1084
$154 per week Exchange Fee: $462
Car rental @$183 a week: $549
Food and gas: ~$500 (est.)
Excursions/misc.: ~$500 (est.)

We've never been to this resort, so I hope it lives up to our expectations based on the website and Trip Advisor. If we like it, we may decide to go back every winter for 3-4 weeks or longer.

...are some of my favorite memories. It's been a week since we returned from our European trip, and our life has fallen back into a comfortable routine. We had an amazing trip visiting 8 countries in 30 days, but it is good to be home. We stayed within our budget, but I did spend on an item I couldn't resist: a carved Black Forest musical cuckoo clock. It hasn't arrived yet but I have the perfect spot for it when it does, and it can be turned off if it drives us crazy.

Life in Europe is very expensive, especially in Switzerland. For example, in most countries, gasoline ranged from a low of ~$6 a gallon to ~$8. Understandably, many Europeans walk extensively, use public transportation, or ride bikes. We certainly can't complain about paying under $3.50 a gallon in Idaho. Food was expensive, both in markets and at restaurants. Of course, if we lived in Europe we wouldn't dine out as often. A meal that is ~$40 in the USA ran ~$70-$75 in Barcelona and even more in Geneva. Two coffees and two pastries at the Starbucks in Basel was $29. (Yeah... dh had to get a Starbuck's fix.)

I loved Amsterdam with its beautiful canals and was fascinated by the Dutch custom of bike-riding everywhere. It seemed there were

more bikes than pedestrians. Not surprisingly, the Dutch, in general, seem very fit... I didn't see many overweight bike riders. People of all ages and professions cycle everywhere, often with kids, pets, and packages in tow as you can see in the above link.

What would I do differently? We had to pack for two climate zones (the warm Mediterranean and cool fall weather in Switzerland, Germany and Holland), so next time I would try to avoid this to pack lighter. Instead of taking as much cash in USD, I would just get more Euros from an ATM. Businesses give a lower exchange rate than banks when you pay with USD. It worked well to use my Chase Sapphire card when I could, and the Schwab savings debit card was used at ATMs... neither charge foreign exchange fees.

All in all, it was a great trip. We enjoyed traveling with friends during the first half, then spending time with my Switzerland family, and finally ending with a romantic week-long cruise on the Rhine. People tell us we're "lucky" to travel as much as we do, but in reality it's due more to years of focused planning and saving for retirement rather than luck.

Here are some pictures of the trip:


The view from Erice, a medieval town in Sicily, Italy.


The Parthenon at the Acropolis of Athens, Greece.


The Blue Mosque in Istanbul, Turkey.


Montserrat... a monastery near Barcelona, Spain.


The United Nations compound in Geneva, Switzerland.


Old homes in Strasbourg, France.


Marksburg Castle in Braubach, Germany.


One of the many windmills in Kinderdjik, Netherlands, used to pump water to reclaim land from the sea.

Tomorrow dh and I leave on our next adventure, a month-long trip that will take us to eight European countries. The first leg of the trip will be two days in Barcelona followed by a 12-day Mediterranean cruise to celebrate a friend's retirement. Then we are back in Barcelona for a few days before flying to Geneva to spend time with my cousin. After a few days in Geneva, we'll take a train to Basel to begin a one-week cruise on the Rhine. Our trip will end with three days in Amsterdam before returning to the USA.

While planning the trip I discovered it's sometimes cheaper to buy a round-trip ticket, even though you just need a one-way fare. For example, a one-way flight on Swiss Air from Barcelona to Geneva was $592 (Economy Class). By booking a round trip ticket, I paid $177 (and it is Business Class to Geneva and Economy Class for the "return" trip). Baggage weight limits are lower in Europe and we each have a 50 lb. bag. Business class allows more weight, otherwise I could have spent ~$35 per RT ticket.

Other savings: I booked the first cruise through Costco Travel, and even though the price was exactly the same as through Royal Caribbean, Costco gave us a $500 on-board credit. The river cruise was a 2-for-1 special on Viking. I will use my Chase Sapphire card to pay for hotels in Barcelona, as well as meals and extras, because there is no foreign transaction fee with this card. And at home, I saved ~$150 by putting the garbage, paper, and TV satellite on hold, and by skipping one of our bimonthly house-cleanings.

Today my dh got a check in the mail for $63 from the State of California. This came about after I read an article a few months back that said there are millions of dollars in unclaimed funds in the CA treasury. I checked and, sure enough, found dh on the list of people with unclaimed property. Dh's money was from an escrow he closed about 20 years ago. Apparently the title company never thought to mail the excess to the address of the home he bought. Dh completed the application for a refund, following the instructions on the website and the check followed in a few weeks. Follow this

link to find out more.

on our California condo... three weeks late, but at least it's done. We had to be patient due to buyer's loan issues that necessitated signing FIVE extensions to the contract. It's a good thing we knew and liked the buyer otherwise we would have gone with the backup offer and would have had a speedier close.

It's been over a month since we moved our belongings from the condo. Although we really loved our home, we decided to sell because we just didn't use it enough to justify the expense of keeping it. It will be nice to save the money we've been shelling out each month for expenses plus the substantial equity from the sale. Moving and consolidating two homes into one was a project I do not want to repeat anytime soon.

We hired a nationally known company because we thought they would be more reliable. Wrong. The movers showed up 12 hours late. We had to stay in a hotel an extra night because they started the job at 9:30 p.m. and worked until 12:30 a.m. Then they started at 8:00 a.m. the next day and finished at 1:30 p.m. We spent the next night in Nevada because we left CA too late in the day to make it all the way home. Of course, the final cost was MUCH more than the estimate, and even though the movers were respectful and friendly, they were not as careful with our furniture as some of the local movers we've used.

All in all, we survived the move and the furniture survived, although with a few more scratches than before. The task of blending two households into one involved sorting items for donation, giving away loads of extra furniture, household items, and clothes, putting some furniture into storage for my stepson, and shredding old financial records and personal papers. Whew! Glad that is behind us but it has given me renewed motivation to streamline financial record keeping and to think twice before buying anything new for the house.

When dh and I moved to ID in May 2010 we applied and were accepted as Red Cross volunteers. We completed the required training and are now members of the Disaster Action Team (DAT). We are on call several weeks during year, with the dates aligned to fit our travel schedule. This week, even though we are not on call, we were asked to assist with emergency services in two local communities after house fires. It seems the people "on call" were not available but fortunately we were able to step in.

After an emergency, such as a fire or flood, the Red Cross typically provides 3 nights in a hotel for the displaced family, plus money for clothes/shoes and food allowance for a week. It's not a huge sum, but for families that have lost everything, it makes a difference and is much appreciated. The Red Cross also helps procure medication lost in the fire and puts families in touch with community-based resources to help them rebuild their lives (e.g., counseling, housing, etc.). The Red Cross aid must be requested within three days of the incident.

The cause of one fire was electrical and the other was accidentally started while filling a gas generator in the garage. In both cases, the homes were destroyed and 11 people were left homeless. Fortunately, no one was seriously injured but the experience made me think about the importance of having:

~ an emergency evacuation plan for the family;
~ a plan for temporary/emergency shelter for family pets (one family had two 100 lb. dogs and no hotel was willing to take them);
~ a list of medications for everyone in the household;
~ a list of important phone numbers such as insurance, credit cards, etc. (I periodically email my list to myself so I can access it from anywhere).

Tomorrow dh and I leave for CA to finalize the sale of the condo... escrow papers will be signed on August 2. We are selling it for 95% of what I paid in 2003. That is how bad the real estate market is in Silicon Valley. Still, I'm grateful it sold, although I won't celebrate until escrow actually closes on August 15. I've seen too many sales unravel at the last minute.

The woman who is buying the condo is a neighbor and a lovely person. She lives with her sister who owns the unit attached to mine and she even has a key to our condo. I gave it to her a few years back because she keeps an eye on things while we travel. So now the sisters will have adjoining homes. How wonderful! I really like our complex and it is rare for a unit to come on the market, so I'm happy our house ended up with someone who already loves living there.

While we're in CA we'll be busy attending dh's family reunion, spending time with friends and my sister, and packing and preparing for the move. The movers will arrive August 3 and there's much to do. I'm giving away a lot of furniture and household items to avoid bringing them back to ID but we will still have plenty that is being moved.

We rented a storage unit in ID for the furniture and household items we're keeping. Dh wants to give all of it to his son who would like to buy a house when he returns from his deployment in Iraq in November.

In the event escrow falls through, we may decide to rent the condo. Our realtor says she can rent it for about $2,500 a month which seems high, but I'd rather not go that route. We also have a backup offer but I don't know the details. In any event, with the furniture gone, we wont be staying there again so we will just wait and see what happens.

And, finally, after much debate, we are selling the Prius to dh's daughter for a great price. She needs a reliable car but she has very bad credit so she can't get a loan through a bank. In the past, she has always been unreliable about repaying loans from her dad but my dh bails out his kids time and time again. He and I are very different in this regard, but that's the subject of another post.

A year ago we debated whether to rent or sell our condo in CA. We eventually decided to do neither, and just held on to it to use when we visit family and friends in the Bay Area. Now a year later, we have decided to sell it, largely due to the high cost of keeping it vs. the amount of time we use it... only about 6 weeks in 2010. So far, in 2011, we have been at the condo less than 20 days.

We are not planning to move back to Silicon Valley any time soon because we are enjoying living in ID too much. A few benefits are cleaner air, reduced traffic, lower cost of living, and relaxed pace compared to San Jose. But the best part is being close to my DDs/SILs who live nearby.

Unfortunately, property values in CA continued to decline last year so our asking price is ~95% of what we paid in 2003. But since it's costing us over $25,000 a year to keep, it's a good move financially. These costs include PITI, HOA fees, utilities, housecleaner, the cost of insuring/maintaining the Prius that we keep at the condo, etc. At least we have some equity, so it's not as bad as some folks who are underwater.

The taxes and interest at the condo are write-offs, so we will possibly owe more income tax, but it will be offset by the savings in annual expenses.

Here is a picture of the cute little patio at the condo. MC, the cat, crossed the rainbow bridge in 2008:

Today we deviated from our usual breakfast of oatmeal or cold cereal and had a different but delicious breakfast using left over mashed potatoes and cabbage (very frugal):

Menu
~

Bubble & Squeak
~ Organic pork sausage patties
~ Fried Eggs

I decided to make bubble and squeak after watching a British comedy where it was mentioned. Apparently it is a common dish in the UK and it gets its name from the noise it makes while cooking. It's a good way to used leftovers. There are many variations to the recipe, including using meat in the mixture. Following is the recipe I used.

Bubble and Squeak
3 tbsp. butter
1 small onion
2 c. shredded cooked cabbage
2 c. leftover mashed potatoes
salt and pepper to taste

Saute onions in butter until tender. Combine cabbage and mashed potatoes. Add to skillet, and press with fork to form large cake, cook over moderate heat until well browned. Loosen cake with spatula, slide onto plate and flip back into skillet so uncooked side is down. Cook until browned. Slice into wedges and serve.

First of all, Happy Mother's Day to mothers everywhere. May your day be a special one. Dh and I went out for a lovely brunch and we will be having dinner tonight with my daughters. It should be a lot of fun.

April came and went in a whirlwind. Early in the month I was in NYC, spending a quiet week with my sister and grandnephew. We managed to do lots of sightseeing and shopping. I especially enjoyed the annual Macy's Flower Show. When the week was over, I headed back to Idaho and my ds, back to her teaching job in CA.

Mid-April was tax time, and unexpectedly, we got a $713 federal refund. This was due to adequately estimating our withholding, not because we had any write-offs to speak of. As expected, we owed a tidy sum to the state. One good aspect of living in ID: our CPA charged $290 compared to our California CPA who charged $925 to do our taxes last year.

On Friday, April 15, we left for a week in El Salvador. Easter week is seriously celebrated there, and it meant most of my family had the week off (government sector workers) or part of the week off (private business workers). The city, usually a crazy hub of people and cars, was calmer because many people leave the city for the quiet of the mountains or sea shore. We stayed with my cousin and dh enjoyed bird-watching without having to leave the grounds of her home. This is her garden:


Plants we know as house-plants flourish outdoors in the tropical climate of El Salvador:


These cashews grow on a tree outside her kitchen. The fruit is used for a refreshing beverage, and the nut is roasted:


On Good Friday, we left El Salvador for Costa Rica to begin a 10-day excursion. We traveled with a company called

Caravan.com and I highly recommend it. The cost is reasonable ($995 per person for 10 days) and includes three excellent meals a day, all excursion fees, baggage handling, and 9 nights at 4 and 5 star hotels. We traveled in a very comfortable bus and although there were 40 in our group, the trip was orderly and well-managed. Caravan uses a seat rotation system that is fair and eliminates competition for the "best" seats.

We loved Costa Rica, a clean and safe country. I've traveled to Honduras, Guatemala, Nicaragua, El Salvador, and Panama, but Costa Rica is the first Central American country where one can drink the tap water in most places and not get sick. Costa Rica's infrastructure is advanced compared to other Central American countries, largely attributed to the fact Costa Rica has not endured destructive civil wars as have the others.

We expected to see lots of wildlife and were not disappointed. Here our guide, Derek, holds a rhinoceros beetle that is sucking juice from sugar cane:


We traveled to Tortuguero Island, and although not the season for the annual sea turtle migration to the sea, a very worthwhile two-day visit. We saw many howler monkeys, lizards, toucans, egrets, herons, and caimen, and more. We stayed at Laguna Lodge, in the midst of the rain forest. This is the view from the nearby Tortuguero Village:


Then on to Fortuna for two days where we stayed at a comfortable hotel called Magic Mountain, located at the foot of the Arenal Volcano, seen here from the plaza in town:


Our last two-day stop was in Guanacaste on the Pacific Coast, where the weather was warmer and the terrain dryer. We stayed at the Marriott Resort and Spa and had great rooms. Here is the view from the nearby beach:

It's been a while since I posted, so I guess an update is in order. My dh and I have been busy traveling. In early March, we spent a week on the Oregon coast. The weather was cold and we had some rain, but it didn't dampen our spirits. We enjoyed whale watching right from the condo balcony, walked on the pristine beaches, bird-watched, and dined on fresh seafood. Our favorite restaurant is Mo's which has the BEST clam chowder. A timeshare exchange made this a very affordable trip.

In late March we were in Cabo for a niece's 25th wedding anniversary and their renewal of vows. We stayed at the Dreams resort that is pricey, especially if you choose the all-inclusive option. Through our timeshare exchange company (Interval International Getaway), I reserved a one-bedroom suite with a kitchenette for $759 for the week. We saved on meals, especially breakfast and lunch, by preparing our own. Cabo has a Costco, two Walmarts, a Sam's Club, and every American fast food restaurant you can think of. In fact, it is a Canadian and American vacation and retirement haven.

Currently, I am in NYC, spending a week with my ds who is on spring break from her teaching job in CA. We are having fun with her two-year-old grandson, but are doing lots of sightseeing while he is in pre-school. His parents are taking a vacation to Turks and Caicos while we babysit. I had never been to the annual Macy's Flower Show and it is beautiful. Not to mention that Macy's is the biggest department store I've ever been in.... with nine floors to shop, three Starbucks, a McDonalds, a full restaurant, and more. I love NYC!

Next Friday, we are off to El Salvador (1 week with family) and then flying from there to Costa Rica (two weeks of bird-watching and trekking). I've been so busy I haven't updated my travel blog but will get to it one of these days. In the meantime, another
adventure calls.

Last Thursday we received a Costco American Express rebate check for $1,019.59. These rebate funds will go straight into our travel savings.

According to the year-end summary we spent 53% of our total expenditures on travel, a category that pays back 2%. It's a good rebate program but it pays to monitor transactions to ensure expenditures are assigned to the correct category. A few months back, I found an expense that should have been tagged as travel but wasn't. The correction resulted in an extra $67 on the rebate.

We charge everything possible on our Am Ex account and pay the balance in full each month. There are just a handful of items I can't charge (e.g., property taxes), but if they take Am Ex, it goes on the card. I especially like paying for gas because this category pays back 3% and it means ~16 cents per gallon savings at the current price of gas. Another good feature: the card has no annual fee.

One drawback is that some places still do not take Am Ex, but in that case, I use my Chase Freedom card that also has a decent rebate program.

This afternoon, while confirming upcoming travel reservations I learned that as of January 1, 2011 Expedia and American Airlines no longer have a business partnership. An Expedia agent told me the breakup is due to "incompatible computer systems." However, I'm sure there's more to the story. Too bad... I often use Expedia to make reservations, and I frequently travel on American because it's one of the partners connected to my mileage program.

Now when you search flights on Expedia, American is not included in the lineup of airlines offering flights. I tested it out with a hypothetical trip from San Francisco to NYC and found that American had the cheapest flight for my travel dates/times. If I had chosen to fly on one of the airlines from the Expedia search, I would have paid about ~$48 more for the lowest round trip fare.

American Airlines and Expedia should try to patch things up because researching flights will now take longer for consumers who want to use Expedia but who also want to check American's fares. It also complicates matters for those who sometimes schedule different legs of a trip on different carriers. Fortunately, there's Travelocity... it still offers flights on American Airlines.

One of the blogs I enjoy reading,

GRACEful Retirement, had a post about a recent Wall Street Journal article on the shortfall in baby boomer retirement accounts. The article suggests being prepared for retirement means having about 85% of your working income and boomers are failing miserably. The comments to this article are interesting, and like Grace, many readers assert you DO NOT need 85% of your working income in retirement. And while I mostly agree, in reality, it depends.

There are far too many factors to consider in retirement for any specific figure or percentage to apply to most people. Before retiring, it's critical to understand your unique financial picture, but many people put off even thinking about retirement until it is almost too late. Over the years, I've talked to many people in their 40s and 50s who have not done any retirement planning whatsoever. Even sadder are people in their 60s who are "ready" and want to retire but can't because their finances are not quite where they need to be. The recent economic downturn has been bad for many, but especially bad if you've put off retirement planning and really want/need to retire.

Not only is it important to understand how much income will be at your disposal, but also what issues might impact your income. People with defined benefit pensions (e.g., teachers, state employees, police/firemen, etc.) have reliable, guaranteed monthly incomes based on a formula (e.g., years of service X age factor X highest salary). Some people will rely solely on Social Security, while others will depend on a combination of sources such as Social Security, company pensionS, 401k/457 accounts, and/or savings and investments. If retirement income is invested in stocks or real estate, market fluctuations will have an impact on cash flow. Taxes can be an unpleasant surprise if you are not prepared and will impact your net income.

In addition to understanding projected retirement income, you need to estimate your expenses. I estimated on the high side... and factored in 4% annually for inflation. If you will have a mortgage, higher medical expenses (e.g., insurance), plan to travel, or undertake expensive hobbies, even 85% of your pre-retirement income may not be enough. In my case, I am spending 3 times as much as I used to on travel. We also eat out more and spend more on entertainment and leisure activities than before retirement. We even spend more on groceries now that my dh tags along. But we still manage to live below our means.

In 2008, I retired with ~46% of my pre-retirement gross income, but since I am no longer contributing the max to 403b and 457 plans, nor do I have work-related expenses, I can live comfortably on this. The bottom line: my retirement net income is ~99% of my net working income because I planned it this way. However, before retiring I never spent anywhere close to 85% of my gross or net income so retiring was an easy adjustment, financially. It helped that a few years before retiring, I estimated my pension benefits, practiced living within that income and saved the rest.

Before deciding to retire, I formulated a budget that included a "retirement enjoyment" category. Travel, entertainment, dining out, and basically, everything that's a want vs. a need went into this line item. I didn’t want to spend the next 25-30 years home-bound, unable to do the things I dreamed about because of an inadequate income, so I planned accordingly. It meant making choices such as downsizing, creating a realistically padded budget, and having an emergency fund to address the unexpected.

Retirement, no matter whether at 47 or 67, can be everything you want it to be if you understand your priorities, set goals, and make a plan to achieve them. The sooner you start, the better your chances of retiring when you are ready.

We're back from our month-long trip to the

Amazon Basin. We traveled 1,000 miles on the Amazon River in Brazil to the industrial city of Manaus, then turned around and sailed back to the Atlantic Ocean. Along the way, we stopped at several smaller cities and remote villages. It was a memorable National Geographic-type experience, and definitely worth the time and expense.

Money-wise, it was a pricey trip but we stayed within our budget. We plan big trips about a year in advance and save systematically to our travel account so the trip was almost completely paid for before we started. We budget extra funds for unexpected events and spontaneous activities. Nowadays, we buy very few souvenirs (except for my grandniece and nephews), but we do take lots of pictures. Thank goodness for digital photography!

Health-wise, we did fairly well. Dh caught a stomach bug that lasted about two days. I was bitten by fire ants while visiting Boca da Valeria, a remote village near Parintins... very painful but fortunately, I didn't have an allergic reaction like I do with bees. Our doctor in the USA gave us meds for all possible ailments, including malaria, so we didn't have to see the ship's doctor like some of our fellow-travelers.

A few highlights and pictures from our trip are posted on our travel blog if you are interested.

In a few days my dh and I will be taking a trip that will take us away from home for six weeks. In preparation for being gone for an extended period, I have put the following services on "vacation hold:"

~ DISH TV
~ Trash
~ Sewer
~ Newspaper
~ Netflix
~ House cleaning

I calculated we will save at least $255 by placing these services on hold. In addition, I placed our mail on vacation hold, although it can only be done for 30 days at a time.

Before leaving, we will turn off the pilot on the gas fireplace, shut off the water valves to the washer, and turn the water heater to the low setting. The forced air heater will be set to a lower temperature (60) but not so low the pipes will freeze, and the ice maker will be shut off. This will save on the gas bill and protect the house from water line mishaps. (Years ago, after a two-week trip, we came home to a flooded house due to the washer hose breaking).

We will call our credit card companies to alert them we will be traveling out of the USA and give them the names of countries where we will possibly use our cards (i.e., Devil's Island, St. Lucia, Brazil...).

While we are traveling, we will keep our cell phones on "Airplane Mode" to avoid long distance roaming fees but will keep the Wi-Fi option turned on. This will allow us to check our email whenever we are in free Wi-Fi range (e.g., many hotels, cafes, and airports). I will also contact ATT about international data plan options in case I need to use my email from my iPad when we are out of free Wi-Fi range.

Another thing I do when we travel is send family a copy of our itinerary so they know how to contact us in case of an emergency, especially if our cell phones are turned off. I will also email myself an encrypted spreadsheet with our credit card numbers and phone numbers in case we lose the cards, and I will email myself an encrypted pdf of my scanned passport for the same reason.

And lastly, I carry my medical records on a flash drive that was given to me by our HMO. My comprehensive health records are on an encrypted pdf that requires a password to open, just like the documents I email to myself.

Our trip will take us 1,000 miles down the Amazon River to Manaus.

Most of us have made poor financial decisions at some point in our lives, and I am no exception. I was reflecting about some of my worst financial decisions over the years and thought maybe someone else can learn from my mistakes:

1975 - After the death of my mother and father within a few months of each other, my sister and I sold my parents' home in SF to a relative of our estate attorney. We were young and naive and did not know the sales price was extremely under market value. We essentially gave away a home that was worth much more, especially because of its prime location. Selling the house wasn't the issue, it was making an uninformed decision... we sold it without consulting anyone else (e.g., an appraiser) and trusting our attorney 100%. Of course, we were young, vulnerable, grieving the loss of our parents and inexperienced in real estate matters. Lesson learned: Just because you have known someone for years and they seem kind and fatherly, it doesn't mean they won't take advantage. Think twice, wait a while, talk to others.

1983 - Newly divorced, I entrusted $22,000 to a family friend, a stockbroker, who talked me into the same investments he recommended for his parents. Big mistake. Today, I have approximately $1583 to show for that investment, and a K-1 that won't go away. It was a lot of money back then (and still is!). Lesson learned: Don't let someone talk you into an investment by using an emotional or personal rationale like "I had my parents invest in this." Do your research.

But did I learn my lesson? Nooooo... keep reading and you will see why. First, some background to explain my stock market experience:

1995 – I was a late bloomer getting into the stock market and started buying stocks after researching some major companies, some of which were blue chip. Since I was a beginner, I had a fellow teacher who shared copies of Value Line to help with my research. I focused on companies whose products or services I liked or used, and bought individual stocks in lots of 100-500 shares for several years. My portfolio was doing moderately well until...

1998 – I broke away from my strategy and bought some technology stocks based solely on my dh's raving about how these were the "up and coming" companies, and how his stocks had quadrupled in value, blah, blah, blah. So I bought (VRSN, XICO, XLNX)... and, about two years later, all of these stocks tanked with the dot.com implosion. Why I listened to my dh who had even less knowledge than I did, I don't know.

Then, to make matters worse, I kept those duds for years, despite the fact they could not possibly recover in my lifetime. I eventually sold these dogs, despite my "buy and hold" strategy. Most of my original stocks have been a solid investment, despite taking a beating in the most recent meltdown. Thankfully, I did not take dh's advice to sell my AAPL stock! But the experience gave me cold feet for buying more stocks and I lost my interest in the market for quite a while.

Nowadays, I am ultra conservative when it comes to new investments in the stock market. When I allowed myself to be influenced by my dh's enthusiasm and confident attitude... any maybe even a little by greed, I paid the price. Since retiring, I'm reluctant to buy more stocks, but for the younger folks, there are some bargains to be had.

Stocks I'm glad I bought and held: AAPL, ABT, AMZN, MSFT, WMT, PG, GE, SBUX, HPQ. Slow and steady, my original stocks have grown by an average of ~9.5% a year, excluding APPL which has had phenomenal growth. But then there were duds like WAMU, which became worthless. Lesson learned: Do your homework and think for yourself, then you have no one else to blame for your decisions.

"Self-trust is the first secret of success."
Ralph Waldo Emerson

I recently read an article about bad investments and was not surprised to see timeshares on the list. Timeshares frequently get a bum rap, although there is some truth to the notion that timeshares can be a bad investment. If you buy a timeshare as an investment, you will be disappointed if and when you go to sell and see how much it's depreciated. But it’s hard for me to wrap my head around the idea that people actually buy timeshares thinking they will resell them for profit.

Most timeshare owners I know bought for a variety reasons, but investing to make money is usually not one of them. However, I want to make a distinction here between making money and saving money. We think of our timeshare as "pre-paid" vacation time, and so far we are on track to save quite a bit. Read on and I will illustrate how, using our own timeshare as an example. But first let me share the "plan" we had in mind when we bought.

We intend to use our timeshare about 20 years (hopefully more) before we hand it over to an interested family member. Or, if no one in the family is interested, I can guarantee we will find someone willing to take it over. This means we would put the title in their name and they'd be responsible for the annual fee, currently about $400 a year. We're not interested in selling... we'll be happy to give it away when we've had enough. And yes, as the years go by, the fees will go up. No doubt about that, but so will the cost of hotel rooms. So here is how I break down the actual cost of owning our timeshare:

2003: Paid $10,300 (cash... no finance charges or loan fees to include)

Divide $10,300 by 20 years = $515 a year
Add $400 maintenance fees: $515 + $400 = $915
We use our timeshare an average of 10 days* per year: $915 divided by 10 = $92 per day
This is for accommodations that would normally run ~$250 to $300 a day or more. Not bad, even if you add ~$200 a year in lost interest on our original expenditure of $10,300.

*By leveraging our time and/or points, and traveling during off-peak times, we might stretch it to 14-21 days a year, greatly reducing the cost per day. We are also able to split weeks, convert to points, borrow from next year, and carry over for further flexibility. This will be an option now that we're retired and can travel during the off-peak months.

Our timeshare accommodations are typically a modern condo that sleeps 4-6 people. The unit will have a fully stocked kitchen, linens, washer and dryer, several bathrooms, and many other amenities such as swimming pools and workout rooms. We enjoy inviting friends and family to join us, and we can do this at no additional expense.

Some of the places we've been through our timeshare exchange network include:
Wolf Creek, Utah - 7 days
Sonora, Mexico - 7 days
Sedona, Arizona - 4 days
Carmel, California - 3 days
Bear Lake, Utah - 7 days
San Antonio, Texas - 7 days
Payette Lake, Idaho - 3 days
Las Vegas - 2 days
Orlando, Florida - 7 days
Mérida, Mexico - 7 days
Honolulu, Hawaii - 7 days
Brian’s Head, Utah - 7 days
Oregon Coast - 7 days (planned for 2011)

So, the bottom line is that we pay the equivalent of ~$92 per day for accommodations that would cost ~$250 per day minimum, and this approach supports our quest to save money while we enjoy traveling to different states and countries.

Sonora, Mexico:


Sedona, Arizona:


Carmel, California:


Bear Lake, Utah:


San Antonio, Texas:


Payette Lake at McCall, Idaho:


Orlando, Florida:


Merida, Mexico:


Honolulu, Hawaii:


Brian Head, Utah:

Tomorrow morning dh and I leave for three weeks in Peru, flying out of SFO. We usually fly coach unless I can get a great deal like the one I did for this trip.

We are flying first class RT and the tickets for this itinerary would have cost $5,868. I ended up spending "only" $1,028.26 for two RT tickets to Lima by doing the following:

~ Used most of the the miles I had in my account (not enough);
~ Paid to transfer 15,000 miles from dh's account (still not enough);
~ Bought the remaining miles I needed to make the transaction.

If we had flown coach our tickets would have cost around $1,410 for two RT fares. Our first class tickets are still ~$400 cheaper than the coach fares.

I have to admit it takes time, research, and creative thinking, but there are ways to not only save money on air fare but to end up with better seats. In case you're wondering why I didn't use my miles for coach fares, they were not available. Airlines limit the number of fares that can be purchased with miles in each of the seating categories.

Before I retired, payday was always the last weekday of the month and it was my responsibility to pick up payroll checks at the Business Office and take them to my school site for distribution. If an employee had direct deposit, they got a voucher instead of a paycheck. Paydays always put everyone in good spirits even if it was only once a month. We usually had a staff potluck that added to the upbeat mood.

Now that we're retired, our "payday" is the first day of the month and our pensions are direct deposited to our bank accounts. Deposits to savings are automatic and since most of our bills are on auto-pay, there are few, if any, checks to write. There are no more contributions to be made to our retirement accounts. Our fine-tuned budget works well to meet our needs. Payday does not seem all that special anymore.

Nonetheless, I was pleasantly surprised today when I checked my bank account and saw I received the 2% COLA, which is supposed to be issued every October 1. Due to the bleak state of the California economy, I was afraid there would be no COLA. To celebrate, I'm taking dh out for pizza... so there goes my raise.

We keep telling ourselves we're fortunate to have pensions backed by legislation that supposedly makes them secure. But the skeptic in me wonders how long California will stay solvent. So I'm wary of the worst that could happen and glad we've saved enough to at least pay our basic expenses if our pensions dry up. As bad as it would be to lose our pensions, at least we’d have a roof over our heads and be able to buy groceries. But our traveling plans would need serious modification.

My dh often comments that being retired is like having a week of Saturdays. And I'm not complaining... it's great to have the time and flexibility to do whatever we feel like doing and best of all, to have "jobs" we can't be fired from. But I still miss the celebratory atmosphere of payday.

I am a dedicated credit card user who is in it for the rewards. While some folks are adamantly opposed to using credit cards, it has never created a problem for me. I closely monitor my transactions and my credit card balance is paid in full each month. Most transactions are budgeted items that I would have had to pay for one way or another. Paying my card is done with a few clicks via the "bill-pay" option.

A few months ago I switched from a card that had a $75 annual fee (an airline card) to the no-fee Chase Freedom card. Since I'm already a Chase customer, it's easy to monitor my card online. Plus, I get extra points for each transaction, bonus points at selected merchants, and 5% back this quarter on department stores, movies, and groceries.

Today, I logged on to the Chase Freedom Ultimate rewards site and in less than a minute used 2,500 points to request $25 in cash to be transferred to my Chase savings. I like how easy it is to access my rewards and how quickly they add up. For example, in the last two months I had less than $1,900 in transactions but earned over 3,400 in rewards.

For the past week, dh and I have been staying at Brian Head, Utah. Many people have never heard of it but it is in a beautiful corner of the state, high (and I do mean high) in the mountains. With the summer crowds dwindling, we thought this would be a good time to visit nearby

Bryce Canyon National Park and Zion National Park.

Two years ago, dh purchased the lifetime senior pass to enter any national park, along with up to three adult guests. The senior pass is a bargain at $10 and is available to anyone 62 or older. The entrance fee to Zion and Bryce Canyon is $25 per car or $12 per person, so we saved quite a bit. We also used it to enter Cedar Breaks National Monument, although the entrance fees there are only $4 per person.

We opted to stay in Brian Head, an hour and a half scenic drive from the national parks because we reserved a comfortable 1-bedroom condo at a beautiful lodge for only $139 for the week. This was done through our timeshare exchange program. The elevation at Brian Head is 10,350 feet, something we were unaware of although it turned out to be a good thing. In about two weeks we will be traveling to Peru and staying at Brian Head gave us an idea of the effect of high elevation on our bodies.

It did take about a day to get acclimated to the high elevation, but we learned some important things: stay hydrated, take it easy for a day or so, eat carbs, and avoid alcohol.

Here are some pics... while they last:

Cedar Breaks National Monument is only 5 miles from Brian Head. Here they get 400 inches of snow annually and close the park in October:


Bryce Canyon visitors can drive right in. It has spectacular vistas... it's like a cross between Sedona and the Grand Canyon:


Zion National Park is open from May 28 until December 1 and is a national treasure. Visitors can go deep into the park by shuttle only, and these run every 6-8 minutes. There are many hiking trails, from moderate to challenging. We went on two hikes, to the Weeping Wall and the River Walk. Here is a shot of some of the interesting Zion hoodoos:

How much money will I need to retire comfortably? This was the burning question I pondered for several years before retiring. My retirement planning involved some specific steps to answer this question and it helped me feel confident in my decision to retire. Even though I retired two years ago when the economy was imploding, I have not regretted it for a moment.

Here is what I did to come up with my answer:

1. I determined the annual income I would need in today's dollars. This involved creating a budget that allows for unexpected expenses and also a healthy amount for travel. My basic budget categories are:

Housing (includes expenses for second home)
Utilities (includes phone)
Food/Misc.
Auto (gas, maintenance, insurance, registration)
Medical
Charitable Donations/Gifts
Personal Allowance (includes clothing)
Insurance
Entertainment
Travel Savings
Regular Savings
Taxes

2. I chose my planned retirement date: August 19, 2008.

3. With input from my accountant and financial planner, I analyzed the market value of my investments. These included both taxable (cash, stocks, real estate) and tax sheltered accounts (IRAs, 457 and 403b). Taking into account a conservative rate of return on these investments (2%), we projected values at 70 1/2, when Required Minimum Distribution (RMD) kicks in.

4. I requested a benefit estimate from my state teacher's pension plan. In my case, I knew the exact amount of my pension and that it is supposed to have a guaranteed 2% annual COLA.

5. I calculated the withholding on my pensions at approximately 25%.

6. I determined my pension WOULD NOT keep pace with inflation (using a 4% lifetime average inflation rate). In the future it would mean saving less and/or drawing from my retirement accounts to supplement my pension income (definitely will need to do so by age 70 1/2).

I put all this data on a spreadsheet and saw that I could afford to retire on my chosen date, even though waiting three more years would have provided a significantly higher income. In my case, the additional money was not worth the stress generated by my work. My job as an elementary school principal was taking a toll on my health (e.g., high BP) and I wanted to retire on a high note, rather than after I'd burned out.

These are the steps I took to "crunch the numbers." There are plenty of calculators available online, some of them very useful. However, I just used a simple Excel spreadsheet. I did this exercise at least once a year for about 4-5 years before retiring. I knew it was time to retire when I began to review my retirement spreadsheet every month!

My husband retired in 2009 so we are now both able to enjoy a completely different life. People sometimes ask what we do to keep busy now that we're retired. The reality is that we are always busy, but what we do to keep busy is our choice. It's wonderful to have so much control over our lives. We love to travel and have documented some of our adventures on our travel

blog.

In addition to retirement income planning, we downsized in 2006 to a condo in Silicon Valley. This was a good move because we sold our big house when prices were high and we were able to move to the condo that we had bought in 2003 but had rented out. We used profits from the downsize to buy our Idaho home for cash, so there is no mortgage. So now here we are in beautiful Boise where we have relocated. We still have the CA condo, but it is now our second home.