Contribution limits for 401k, 403b and most 457 plans are increased to $20,500.
For people over 50 - catch-up contributions are additional $6,500.
Traditional IRA and Roth IRA: $6,000.
For people over 50 - catch-up contributions are additional $1,000.
HSA: $3,650 for single and $7,300 for family.
For people over 55 - catch-up contributions are additional $1,000.
https://www.youtube.com/watch?v=AHt4ImYadCQ
It is my post number 96. Getting pretty close to 100. But I am not waiting till 100, I am already celebrating. With a funny cat post.
Last weekend my daughter and I we were playing with the animal talking app and that is what came out of it.
This cat in the video has my voice, distorted of course, to make it sound like a cat. But some people recognized me by the melody of the voice. So this post is not entirely incognito, some may recognize me...
COVID-19 visited our house and stayed for the last 3 weeks as a guest.
First my 11 years old daughter had some slight headache for 2 days, only in the evenings. No fever, cough or anything else. She complained about some muscle pain but we thought it was because of the exercise at her GYM in school. That was it. We didn't even think that it could be COVID.
3 days later my husband, 47 years old, started to have headache and fever. It was getting progressively worse, he also had muscle pain and middle of the second week there was also some cough. He was sleeping a lot and had general weakness and shortness of breath. His test was positive. His symptoms were the same as mine on the day after my vaccine, but for the length of 2 weeks. He recovered. His main disappointment is that he didn't overcome it in only two days as he expected.
All that time I had nothing. My test was negative. Maybe because of my very strong reaction to the vaccine, any COVID particle dies immediately on contact with me... My immune system now has thousands of tiny loaded guns pointed at any trying COVID particle.
If you would have a limited time to live, what would you pick? 375 days of torture or 325 days of joy?
A rather interesting article appeared on my news feed a few days ago: "Small Changes in Diet Could Help You Live Healthier, More Sustainably".
The first paragraph stated: "Eating a hot dog could cost you 36 minutes of healthy life, while choosing to eat a serving of nuts instead could help you gain 26 minutes of extra healthy life, according to a University of Michigan study."
I decided to read it because I would be the one losing 36 minutes.
The second paragraph explained: "The study, published in the journal Nature Food, evaluated more than 5,800 foods, ranking them by their nutritional disease burden to humans and their impact on the environment. It found that substituting 10% of daily caloric intake from beef and processed meats for a mix of fruits, vegetables, nuts, legumes and select seafood could reduce your dietary carbon footprint by one-third and allow people to gain 48 minutes of healthy minutes per day."
I will not talk about the environmental part of this report.
Much more interesting is the health part because it threatened to shave off a large number of years from my life.
Below are select images used in the article. If you want to read the entire article, here is the link.
Source link: Nature
I eat mostly foods from the left side on the last image. Based on that and the suggestions on minutes gained or lost I would lose about 24-25h per week. I lose that much time because I almost always eat way more than one serving of what is mentioned.
That is about 50 days per year and about 500 days (maybe 1.5 year each 10 years). Then by age 80 I will lose about 5 years of life. The authors are hedging and calling is "loss of healthy minutes", not just loss of life time.
If I make a mental exercise and calculate how much "healthy life" will I gain if I eat foods only from the right side of the image, I would gain 5 h per week, or 10 days per year. However eating those foods will make my life a torture.
I would curl on the floor with stomach pain. Those will not be "healthy minutes" for me. Most of the foods on the right side give me either stomach pain or some other kind of indigestion.
This comparison makes it crystal clear to me that I need to use all my remaining time to eat what I really like and what doesn't cause me discomfort. I don't want to waist any of my time on what I don't like to eat.
What would I prefer if there was only one year of life left but I could extend or shorten it by what I eat?
I could gain 10 days by torturing myself every day and have 375 days (of torture)?
Or I could lose 50 days and only have 325 days left to live, but that would mean enjoying every meal, feeling great and strong every day and not have any pains?
Now I really want my steak.
My friend R. is brave. He is buying real estate and rents it out. That requires capital outlay and dealing with renters.
I am not so brave. I don't want to commit significant capital to one or two particular items and I don't want to deal with renters.
A lot of time will be spent on looking for the property, finding and screening renters, dealing with repairs and complains.
What if one of the renters turns out to be aggressive or crazy? When I was renting some time ago, the woman in the apartment above said that her cats are attacking her and decided to flood the apartment to get the cats out.
Or what if there will be an eviction moratorium like it happened at the verge of Covid-19 epidemic? The property owners still had to pay the mortgage but couldn't get any rental income.
I feel more comfortable to research the alternatives online, maybe find some real estate stocks and have them instead of the "real" real estate. Owning real estate stocks may be overall more risky and less profitable. The risks are of a different kind: stocks don't appreciate as much and the dividends don't increase like the rent does with the inflation. Taking those risks will be my "pay" for that potential difference in the appreciation and for not needing to deal with renters.
On the equity markets there are different options available. Some REITs are owning mortgage contracts and some own real life real estate. Some own malls or office buildings, some own residential real estate or medical facilities.
I am getting a mixture of several types.
Periodically (at least yearly) I will compare the two ways owning real estate of using stocks. I am curious to see how much will I "pay" for avoidance of dealing with renters.
One of B.'s houses was purchased in cash, $225,000 and it brings in $1,500 rent per month. This is before property taxes, insurance, possible fixing costs. Removing those additional costs it may be about $1,250. I am not really sure, I am trying to stay conservative.
This would be 6.7% return on the investment. That is before income taxes. If I use REITs, the dividends will be taxed at the same rate as rental income unless you have a corporation or some other entity for your rental properties which would be additional pain for me. If I can make 6.7% per year in dividends then this "rental income" will be comparable to the above example of a condo for $225,000.
I am OK with less appreciation because my preferences are on the cashflow site versus long term appreciation. I want to have the money now, a steady cash flow all the time. I don't know when I die, and if it happens suddenly and early, I will not benefit of long term appreciation.
I already have one group of REITs which I kept for several years. The total amount invested is $211,253 and this portfolio group gives me dividends calculated per month $1,184. This is 6.72%, which is pretty much the same what R. gets from his rental property.
R. just got another rental property for which he didn't pay cash but used mortgage.
I am starting another REITs group with which I will have a bit more work and will use leverage too (since mortgage is leverage).
I selected a few REITs and I will use a mix of holding, trading and options use.
The property is again $210,000 and after 20% down there is a mortgage on the remaining 80%. He gets $700 after all other expenses including mortgage payment. The mortgage will be paid off in 30 years but I am not interested in comparing profits after that because I might be already dead by then, and if I am not, I hope I will not need to worry about any small differences.
So after leveraging 80% there are $42,000 which he paid in cash. With $700 rental income that will be 20% on the cash outlay.
I am not sure that with my second REITs portfolio I can get 20% return. I think that will be quite difficult. It will also require more work. I am curious to see what I can reach. If I will get over 10% I will be OK with that. If I will get less than 6.7% , I will stop active work on this group and convert it into a passive one like my first group which gives me 6.7% with no work.
This post will be updated with the data.
July 2021
Cash flow:
Stocks: 0
Options: $1,453
Capital: $80,000
OHI -2Jul21 $37 put: $100
OHI -2Aug21 $36 put: $190
CTRE -8Aug21 $22.5 put: $274
MPW -10Aug21 $20 put: $443
SBRA -10Aug21 $17.5 put: $446
Total cash flow for July 2021: $1,453 - 1.8%
Cumulative for year 2021: $1,453 - 1.8%
August 2021
Stocks: 0Capital: $80,000
OHI -2Sep21 $36 put: $338
Total cash flow for August 2021: $338 - 0.4%
Cumulative for year 2021: $1,791 - 2.2%
September 2021
Stocks: $1,823
Options: $394
Capital: $80,000
DOC stock: $370
MPW stock: $1,453
CTRE -8Oct21 $22.5 call (covered): $394
Total cash flow for September 2021: $2,217 - 2.8%
Cumulative for year 2021: $4,008 - 5.0%
October 2021
Stocks: $950
Options: $0
Dividends: $441
Capital: $80,000
DOC stock: $265
DOC dividend: $230
CTRE dividend: $212
MPW stock: $685
Total cash flow for October 2021: $1391 - 1.7%
Cumulative for year 2021: $5,399 - 6.7%
November 2021
Stocks: $0
Options: $0
Dividends: $568
Capital: $80,000
SBRA dividend: $300
OHI dividend: $268
Total cash flow for November 2021: $568 - 0.7%
Cumulative for year 2021: $5,968 - 7.5%
January 2022
Stocks: $1215
Options: $0
Dividends: $0
Capital: $80,000
Total cash flow for January 2022: $1215 - 1.5%
Cumulative for year 2022: $1215 - 1.5%
February 2022
Stocks: $0
Options: $0
Dividends: $434
Capital: $80,000
Total cash flow for January 2022: $434 - 0.5%
Cumulative for year 2022: 1649 - 2%
April 2022
Stocks: $0
Options: $0
Dividends: $514
Capital: $80,000
Total cash flow for January 2022: $514 - 0.6%
Cumulative for year 2022: $2163 - 2.7%
May 2022
Stocks: $0
Options: $0
Dividends: $434
Capital: $80,000
Total cash flow for January 2022: $434 - 0.5%
Cumulative for year 2022: $2597 - 3.2%
June 2022
No trades or dividends
July 2022
Stocks: $0
Options: $0
Dividends: $514
Capital: $80,000
Total cash flow for January 2022: $514 - 0.6%
Cumulative for year 2022: $3111 - 3.9%
August 2022
Stocks: $0
Options: $0
Dividends: $434
Capital: $80,000
Total cash flow for January 2022: $434 - 0.5%
Cumulative for year 2022: $3545 - 4.4%
September 2022
No trades or dividends
October 2022
Stocks: $0
Options: $0
Dividends: $514
Capital: $80,000
Total cash flow for January 2022: $514 - 0.6%
Cumulative for year 2022: $4059 - 5.1%
November 2022
Stocks: $0
Options: $0
Dividends: $434
Capital: $80,000
Total cash flow for January 2022: $434 - 0.5%
Cumulative for year 2022: $4493 - 5.6%
Summary: 2022 was the year with markets going down. I didn't make any trades except in January.
The total cash flow for 2022 with dividends only was 5.6%, Compared to 2021 where I did some trading in addition to the dividends it was less: 5.6% in 2022 versus 7.5% in 2021 (July-December only).
Without doing any trades, getting dividends only, I get 5.6% per year. For now I will just wait till markets stabilize. If I will do any more trades, I will add below.
Today there was an email saying that at our hospital system we are all going back to universal masking regardless of vaccination status and that all in person public events will be cancelled.
The reason is that in the last 7 days the Covid-19 related admissions have tripled from 46 to 120.
Let's see how the graphs are looking on the www.worldometers.com.
Our family likes to go on cruises with Royal Caribbean.
They cruises are expensive but enjoyable.
Recently I found something new to me: Royal Caribbean will give you a statement credit if you own their stock.
At this time, after they were hit by Corona, their stock is still relatively low and I decided to look into it, to see if I can do anything with that.
Here is the link to the official site with the complete information to stockholder benefits.
The summary for RCL shareholders as of July 2021:
1. Any shareholder of a minimum of 100 RCL shares at the time of sailing can get $250 onboard credit per Stateroom of 14 or more nights, $100 credit for 6-13 nights and $50 credit for 5 night or less.
2. The credit is per room, not per person.
3. Check the eligibility when booking (applicable on any eligible Royal Caribbean or Celebrity Cruises, excluding carters and Galapagos sailings).
4. Two-three weeks prior to sail date you can mail, fax or email the proof that you own RCL shares with the current brokerage statement or a current trade confirmation along with your sailing date, name of vessel and reservation/booking number. Email to shareholderbenefit@rccl.com. You can complete your Shareholder Onboard Credit Offer Request electronically here.
5. Only one shareholder credit per stateroom on any one sailing, based on double occupancy. one shareholder credit per stateroom, and one credit per shareholder per sailing.
6. you may request this benefit multiple times-as often as you sail on Royal Caribbean International or Celebrity Cruises.
7. Onboard credit may not be used for onboard service charges or pre-purchased activities. Any unused credit after the final night of the sailing shall be forfeited and is not redeemable for cash.
With questions you can call the Shareholder Benefit Team: (954) 628-9325, option #3.
What can I do to get more than that?
My thoughts were:
Option 1:
I can buy RCL shares (current price $85.51 at the time of writing/thinking) and hold them. I will get the statement credit when I book and I will get the dividends for holding the stock.
Option 2:
I can use options and not own the stock outright. In case the options will be executed, I am OK with owning the stock. I might get more that way.
I decided to go with Option 2.
The stock price is still low. The dividends are $0.78 per stock per quarter, that will be $312 per year if you own 100 shares (before taxes).
If I buy and hold 10 RCL I will have $312 in dividends (before tax) and get statement credit if I go on the cruise (probably $100 since we usually go for 7 days).
If I have luck and the options play goes well, I could pay the entire trip with the option play proceeds.
We are not planning the trip for 2021 or 2022, I will wait till all Corona related rules and restrictions settle.
So I have about 2 years for the play.
Our trip is about $6,000-7,000 when we book. That should be at least $10,000 in option proceeds before taxes.
So with all that my goal is at least $10,000 in the timeframe of 2 years.
I am allocating approximately $24,000 to that play. The return in 2 years should be about 40% or 20% each year of play. This is quite a bit, it will probably be difficult to reach.
RCL OPTIONS PLAY
Start: June 2021
Finish: still ongoing
Updates: monthly
UPDATES
June 2021
I sold 3 puts on June 22nd for the credit of $411 after fees (-3Jul21 $80 put).
I made $411 for this trade and it will be about $250-300 after taxes. This is already more than the stateroom credit for owning $100 shares. But I sold 3 puts which was equivalent of 300 shares.
-3Jul21 $80 put - this trade:$411 - total:$411 - percent this trade 1.7% - percent total- 1.7%
July 2021
The puts were executed on July 19. I own 300 RCLs.
August 2021
I sold 3 calls against the 300 RCL shares on August 4 (-3Sep21 $80 call). It is a covered call and if the share price will be $80 or above, the options will be executed. I will make nothing on the shares, since I got them for $80, but for the selling 3 call options I got credit of $709.
Total so far: $1,120 (4.6% return on $24,000)
-3Jul21 $80put - this trade:$411 - total:$411 - percent this trade 1.7% - percent total 1.7%
-3Sep21 $80call (covered) - this trade:$709 - total:$1,120 - percent this trade 3.0% - percent total 4.6%
September 2021
The September covered calls were executed and the 300 of RCL were sold at $80. Currently the stock is at $82. I sold 3 October $83 puts for $990. Capital in play now is $24,900.
-3Jul21 $80put - this trade:$411 - total:$411 - percent this trade 1.7% - percent total 1.7%
-3Sep21 $80call (covered) - this trade:$709 - total:$1,120 - percent this trade 3.0% - percent total 4.6%
-3Oct21 $83put - this trade: $990 - total so far $2,110 - percent this trade 4% - percent total so far 8.8%
October 2021
Sold naked puts for 35 days till expiration: 3 November $82 puts for $730. Capital in play is $24,600.
-3Jul21 $80put - this trade:$411 - total:$411 - percent this trade 1.7% - percent total 1.7%
-3Sep21 $80call (covered) - this trade:$709 - total:$1,120 - percent this trade 3.0% - percent total 4.6%
-3Oct21 $83put - this trade: $990 - total so far $2,110 - percent this trade 4% - percent total so far 8.8%
-3Nov21 $82put - this trade: $730 - total so far $2,840 - percent this trade 3% - percent total so far 11.5%
November 2021
Puts got executed, now I own 300 shares at $82.
Capital in play is $24,600.
-3Jul21 $80put - this trade:$411 - total:$411 - percent this trade 1.7% - percent total 1.7%
-3Sep21 $80call (covered) - this trade:$709 - total:$1,120 - percent this trade 3.0% - percent total 4.6%
-3Oct21 $83put - this trade: $990 - total so far $2,110 - percent this trade 4% - percent total so far 8.8%
-3Nov21 $82put - this trade: $730 - total so far $2,840 - percent this trade 3% - percent total so far 11.5%
December 2021
No trades or dividends
Total for 2021 (June - December) - $2,840 (11.5%).
January 2022
Sold calls and now have 3 covered calls and 300 shares (-3 RCL Feb22 at $85) for $1140. Capital in play is $24,600.
-3Jul21 $80put - this trade:$411 - total:$411 - percent this trade 1.7% - percent total 1.7%
-3Sep21 $80call (covered) - this trade:$709 - total:$1,120 - percent this trade 3.0% - percent total 4.6%
-3Oct21 $83put - this trade: $990 - total so far $2,110 - percent this trade 4% - percent total so far 8.8%
-3Nov21 $82put - this trade: $730 - total so far $2,840 - percent this trade 3% - percent total so far 11.5%
-3Feb22 $85call (covered) - this trade: $1,140, total so far $3,980 - percent this trade 4.6%, total percent 16.2%
February 2022
Sold stocks, received $450.
Capital in play is $24,600.
Total so far: $4,430
March 2022
Sold calls and now have 3 covered calls and 300 shares for $1907.
Capital in play is $24,600.
Total so far: $6,337
March 2022 - April 2023
During this time the market was going down. I had no trades. I will wait till market stabilizes and continue my way to get $10,000 for the next trip. I already have $6,337 and still need $3,663.
May 2023
Sold 3 covered calls for $406 (-3 RCL Jun23 at $77.5).
Capital in play is $24,600.
-3Jun23 $77.5 call (covered) - this trade: $406, total so far $6,743 - percent this trade 1.65%, total cumulative percent since start 27.5%
Total so far: $6,743
June 2023
Sold stock for $204
Capital in play is $24,600.
Total so far: $6,947
Pending update
The last of our probatable assets was replaces by a non-probatable last Saturday. (I was trying to make all assets non-probatable, see here).
We still had one old truck left which was not in both of our names. Last Saturday we replaced it by a new truck which is now registered in both our names and will not be probatable if something happens to one of us.
Before we picked out the truck we were looking around the the car dealership and one of the car salesmans came to us asking if we need any help. I recognized him, he sold me my car in 2017. But he didn't recognize me.
We just finished watching the series "Mentalist" on Amazon Prime. It is about a guy who used to be a mentalist, someone who supposedly can read peoples minds. In the movie he admits that he is not a real psychic and that he just can read people very well. He worked for the FBI helping to catch criminals using his people reading skills. While watching this show my daughter and I really wished to have those skills.
When I saw the car salesman and realized that he doesn't recognize me, I decided to play the mentalist. I used what I remembered him telling me about himself when I bought my car from him.
When he asked if we need help I looked at him and just asked him if his birthday is on Halloween. He appeared very surprised and said" Yes, it is!! How did you know it?" I said that it just came to me. He called his colleague, told him about me guessing his birthday and sked me if I can guess this other guy's birthday.
I pretended to focus a bit but then said that I don't feel any connection to the other guy.
Then I said: "But about you - I can tell you that you have Italian blood." He was surprised even more.
I didn't stop there. I asked to touch his hand and then I told him that he also likes guns and that he was a police officer before. That seriously shocked him.
At this point I couldn't leave it like that, it felt very dishonest. I started laughing making the situation much less serious. I told him that I previously bought a car from him and I remember what he told me about himself. We all laughed.
But there is still some psychic element in this story: when we were buying my car in 2017, Then my 8 year old daughter asked him really out of the blue if his birthday was on Halloween. That freaked him out, and me a little bit too. Because she just sked that. It was May, not even close to Halloween. She couldn't explain it why she asked him that...
Since I moved from active trading to indexing and dividend investing, I tried to simplify the indexing first.
This is what I came up with so far.
Indexing should run an autopilot. I researched in the beginning. After that I just follow the chosen strategy. It should be minimal time investment in the long run.
Research in the beginning included ETF performance and costs comparison.
1. I decided to mirror the most popular ETFs which mostly reflect the most popular ETFs: SPY, QQQ and RUT.
2. I picked equivalent ETFs with lesser expense ratios. The equivalents I use are: SCHB for SPY, VGT for QQQ and VTWO for RUT.
In the image below the red line is VGT, the yellow line is VTWO and the pink line is SCHB which follows the large CAP ETF SCHX (candlestick line) very close with almost no difference.
The yearly dividends as of 6/22/2021 for those are:
SCHB: 1.43%
VGT: 0.70%
VTWO: 1.66%
3. I decided to go equally with those three: SCHB, VGT and VTWO.
Below is the comparison table for the expense ratios:
I am putting a certain sum every week equally into those three ETFs. This is not the same for the dividend stocks and I will describe it in another post.
The weekly investing will have two functions:
1. It will follow the market closer than monthly.
2. By checking in with the markets weekly I can see the time for the dividend stock investment time points weekly which is better than monthly.
This year the number is 47.
Getting closer and closer to 50.
When do people start to write memoires? Probably best to do it before you start to forget all the funny things that happened in your life.
I almost didn't post anything from my Happy birthday 46 post.
It was not because I lost interest. There was a computer related change at work and the blogger function was suddenly blocked. I usually don't post anything from home, I have a lot of home related thigs to do at home. It is much nicer to do it from my office where I am alone and it is quiet. Especially proof-reading is easier with my slight dyslexia. This week I checked and found that the blogger function is not blocked anymore. And now I am back.
It was very surprising that the total blog views are now at about 20,000. A year ago when I posted last time they were at 3,000.
It took 4 years to get to 3,000 and only one year to get from 3,000 to 20,000.
The strange thing is that there are not many new comments... Maybe my writing style is not inviting to comment, I don't know... But is was actually a comment that prompted me to check if the blogger was still blogged. The commenter asked to continue to write and it was nice.
I need to update the Cash flow challenge for 2020, there were some changes. The last year was less stressful because I didn't do active trading anymore. Only after stopping I realized how tired it was making me. Now I am less tired and it feels that I only have one job instead of two.
My daughter is 11 and she wants to have a YouTube channel. I am reluctant because of my paranoia. I thought about that myself and have looked up some ways to have an anonymous channel or one where you al least don't show your face, but I think I am not ready yet.
Today I will add a photo of my cat, also no face. The cat is wearing my daughter's baby clothes and is eating his daily portion of ice cream.
google.com, pub-2401395848907192, DIRECT, f08c47fec0942fa0
It is June 2021.
Just in the last few weeks I saw the masks disappearing form people's faces on the street, in stores and is schools. My 11 year old is very happy that everything is returning back to normal. She wants to go to a swimming pool again.
At work (in the hospital) we still have to wear the masks. Doctor's offices still let us wait outside in the car and not in the waiting room.
How do the statistics look like right now?
Here are the images from the www.worldometers.com website:
It is obvious that the case numbers and the deaths are both very low now. The peak in deaths was in January 2021. The deaths now are lower then the areas between the peaks.
Will this virus stay or will it disappear?
I think it will stay on a low level, just like it's "brothers" from the same Corona virus family. The virus is not lethal enough to wipe itself out. It is contagious enough to just continue travelling trough the population.
If the immunity to this one is similar to the others in it's family, it is not complete and after it wears off you can get another infection, maybe milder and it will continue and go on in circles. It will become another reason for a common cold, with a few severe cases.
I just hope that there will not be a mandatory immunization requirement for the hospital personnel. I had a quite large hematoma after the first shot (Pfizer) and a very large hematoma after the second dose. And after the second dose I had to take a sick day. It was my first sick day ever. I might have had some platelet reaction to that shot. There were some cases described where the shots produced a drop in platelet counts.
What all this pandemic experience showed me?
- Most people play by the government rules and obey.
- Governments are easy to scare.
- The economy is robust to hits like that where there is no structural damage.
- This RNA vaccine is different, I never had such a severe reaction to a vaccine.
