Well, we officially quit saving yesterday.

After a brief chat with Girl Ninja yesterday, we’ve made the wise decision to stop saving money for the foreseeable future. No, we haven’t hit our $100,000 savings goal yet, and if I all goes according to plan, we never will.

I first blogged about our ambitious $100,000 savings goal in June 2010. Exactly three years ago. And here we are, probably four weeks away from reaching said goal, ultimately deciding it’s time to throw in the towel and give up.

Have I gone bonkers? 



Don’t worry, I haven’t gone off the deep end yet. It’s just time I start practicing what I preach.

While it’s true we have not hit $100,000 in savings, we are pretty freaking close. About $3,500 short as of this writing. This week’s blog post about 401(k) loans got me thinking. I like the idea of using a 401(k) loan, but ultimately have decided against it for one reason.

I wont need (or want) a boat load of cash sitting in the bank once we’ve made our down payment.

As I’ve mentioned before, we will likely use between $70k and $80k for a down payment and closing costs. This will leave us with a $10,000 emergency fund and between $10,000 to $17,000 for “other things” (furniture, vacations, etc).

I have no desire to keep more cash in the bank than necessary. In other words, we’ve reached our MAXIMUM savings threshold. I feel like any additional savings would no longer be classified as “being responsible” but instead as “hoarding”.


We knocked debt freedom off the list years ago. Yesterday, we put a check mark next to savings. Now it’s time to make some new priorities. So…

  • I upped my 401(k) contributions last night from 13% to 20%, and after I see exactly how that affects my paycheck (thinking about $430/month less in take home pay), I might increase it even more.
  • We’ll probably begin living slightly more frivolously (emphasis on slightly). Maybe we go out to a nice restaurant once a month. Take a weekend trip somewhere once a quarter. Or finally update one of our six-year-old laptops. We won’t be keeping up with the Joneses by any means, but it will be fun to splurge every now and again.
  • Lastly, and what I’m most excited about, we will take the majority of our discretionary income and FINALLY start throwing it in to taxable investment accounts. If all goes well, we can make some serious progress in our goal to build up some short to mid-term investments. It’s important we get a jump-start on this now, before we have kids, a larger house payment, and only one income. 

While it would be cool to actually reach our $100,000 savings goal, I think it’s way cooler to move on to the next phase of Operation Build Wealth.

A lot can happen in 12 months.


Yesterday, I went all “Who wants to be a millionaire” on you guys and asked the audience a question. It was a simple question:

How has your financial situation changed over the last 12 months?

Of the 333 of you that responded, 240 said things have gotten better. Only 44 readers said things have gotten worse. I wasn’t surprised by the results, considering anyone who voluntarily reads personal finance blogs in their free time, probably tends to care about their finances more than the average joe.

I liked my question because it was intentionally vague. I left it up to the respondent to decide what an improvement in one’s financial situation meant. Maybe that meant getting a fat raise, maybe it meant your retirement funds have appreciated, maybe you moved out of your parent’s basement, or maybe you’ve finally started knocking out that consumer debt that’s been hanging over your head. It was awesome to see the additional insight some of you provided in the comments section, so thanks for that.

While not much has changed in the Ninja household over the last year (expenses and income are pretty much the same), we’ve seen a pretty incredible increase in our net worth.

In fact, I just ran the numbers and it looks like we’ve shot up $55,454 in the last 12 months. In-FREAKING-sane. I honestly had no idea we made that much progress. That works out to a $4,621 increase each month… for twelve straight months.

What’s more, we dropped $12,000 cash on a car upgrade and another $7,500 on MANteresting during this time.

How the heck did we swing this?

I really don’t know. I mean, obviously the markets are responsible for a big chunk, but it really just comes down to boring ol discipline. Investing in our future, saving aggressively for a down payment, not being consumer whores, blah, blah, blah.

Being intentional and proactive with our finances in our 20’s will hopefully set us up for continued success in our 30’s, 40’s, and beyond. I’m taking the words of Spock seriously and doing my best to…

Live long and prosper

Why you should buy a house in a bubble.


When I almost bought a rental property this weekend, a few readers chimed in saying “Ninja you are supposed to buy low and sell high. Right now you would be buying when the market is booming.” Comments like these are expected, especially when I’m always talking about Seattle Real Estate being in a bubble.

So why do I still check the local MLS listings every day, hoping there will be a place worth looking at? It’s simple really.

I’m not stupid shortsighted. 

If you’ve read any news about real estate over the last six months, it’s clear the market has picked up. Some cities like Phoenix and Las Vegas jumping up 20%+ in the last 12 months. What was a $300,000 house one year ago, now goes for $360,000 after getting multiple cash offers. Same story up here in the Pacific Northwest. Inventory is low, prices are high.

There is no denying 20% year-over-year real estate appreciation is unsustainable. Eventually things will cool off. Maybe to a more normal 3 to 6% YOY growth. Maybe things will go flat for a while. Or, who knows, prices could actually drop. Thinking about the recent boom on an emotional level causes some to shy away (myself included at times). They are waiting for a correction that may never come.

Yes, Seattle prices are up 16% in the last year, but they are still 20% below their 2006/2007 peaks.

What’s more, even if real estate is in a bubble right now, it’s a completely different bubble than the last one. In 2006 banks were handing out money like candy. People with no income and no assets were qualifying for $500,000 properties. The market took a dump on it itself when these unqualified homeowners could no longer keep up with their 5-year jumbo ARM payments.

Sure the market is in a frenzy right now, but banks learned their lesson (at least temporarily) and are exponentially more picky in who they lend to. If you don’t have great credit, a significant down payment, and a solid income history, you aren’t getting a loan. Unlike 2006, most of the people buying houses now can actually afford their monthly payments. (random fact: 1 in 4 houses in Seattle receives a full cash offer)

All this is great, but there is really only one reason why Girl Ninja and I are still open to the idea of buying a house in a boom.

We don’t give a crap about price. 

If we find a place we love, I don’t really care if it costs $350,000 or $400,000. All I care about is being able to comfortably afford the monthly payments. Sure, I could buy a house for $400k today, and three years from now it might be worth $375,000. But I’ve ALWAYS said, one shouldn’t buy real estate if they aren’t comfortable with the idea of owning the property for at least 10 years. I look at property values over the long haul, not the short-term. A $10,000 price difference today matters little when the house could be worth double 15 years from now. As long as rates are at all time lows, and prices are below their all-time highs, I say it’s still a good time to buy a house.

What say you?

Did we buy a rental property?

If you saw my post on Friday, you know that Girl Ninja and I were seriously considering going 50/50 on a rental property with my best friend from high school who married one of Girl Ninja’s best friends from high school. Today, I tell if we wrote up an offer, but not until I drag things out a little more 🙂

We viewed the property yesterday morning. It is due to list on Tuesday, so getting to see it pre-market was crucial. We completely expect it to go pending on the first day it lists for full (or above) asking price. Having the opportunity to write an offer, without having to compete with other interested parties, was a pivotal part of making the deal work.

The house appears to be in tip-top shape. It’s only a year old and the appliances, finishes, etc all still shine like they’re brand new. It was clear the owners took pride in their home. There were linoleum floors in the bathrooms and tile on the kitchen counter-tops. This bothered me because I would have preferred higher quality finishings, but at the same time, these are the perfect materials for rental wear-and-tear. The house shows really well and I could totally see a Microsoft employee (Microsoft is 20 minutes away) renting the house for his/her young family.

Okay, so now that you know we liked the place, it’s time to tell you if we wrote up an offer…

Drumroll please….

Nope. Here’s why:

If Girl Ninja and I co-bought this property, we wouldn’t be able to buy our own place for at least two years, since that is about how long banks need to verify stable rental income.

With any partnership there is risk. While I still believe that my friend and I would have been able to make this deal work, we know that everyone probably thinks the same thing. Neither of us could shake the potential issues that could arise when control is shared.

The time sensitive nature of the transaction. This was my biggest hesitation. I felt rushed. An offer had to be made last night in order to give the sellers enough time to respond before it goes to market on Tuesday. There were still a lot of questions I couldn’t yet answer, and while I believe the house is a good buy, I didn’t have enough time to really wrap my brain around all that encompasses being a landlord. Especially when that responsibility is shared with another person.

But ultimately, Girl Ninja and I did not go in on the house for one reason and one reason only. My friend decided to buy the house on his own. I’ve known this was a possibility for the last few days. He sees very little downside and a ton of upside potential. He can afford the risk and no longer has to worry about me dying divorcing, or forcing a sale. I went and viewed the house with him yesterday knowing he was probably going to be the only person writing an offer. It’s a little sad because I want our cash to be invested in something, but I know this is for the best. I’m super pumped for him and I hope his offer gets accepted.

Who knows, maybe Girl Ninja and I will rent from him once we have a kid or two 🙂

p.s. for those that care, here is the spreadsheet that lays out the numbers (click to make images larger)…

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It’s the end of the world as we know it, and I feel fine.

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I can’t go a day without reading a blog post or news article that predicts the end of the United States as we know it. Some people even stocking up on ammunition, bottled water, and canned food, convinced the zombie apocalypse economic Armageddon is coming.

I get it. It’s not uncommon for me to hear an older Christian person say something like “The world is really going to hell in a hand basket. This must be a sign that the rapture is upon us.” Assuming their generation will be the one in which Christ returns. I’ve got news for them. They’ve been wrong 2,013 years and counting.

Maybe you aren’t Christian so that example isn’t relatable. Let me make it more personal.

On numerous occasions I’ve had this feeling that I was going to die young. Not necessarily tomorrow, but in my 30’s or 40’s. After sharing this morbid feeling with a handful of friends, it turns out they too have thought the exact same thing. Apparently this feeling is pretty common. In fact, I bet most of you have also felt at some point that your days would be cut short. Am I right?

I mean, who hasn’t gotten on a plane and thought “What if this thing goes down?” Our brain tells us we might die, but statistics show us our fear is completely ridiculous. We are significantly more likely to die from drowning, electrocution, or even falling down. I don’t know about you, but I don’t think I might die when I walk down my stairs each morning, but it definitely crosses my mind when I buckle up on a plane.

I think I know why….

We get irrational when we don’t have control.

Yeah the plane could go down, but it probably wont. I could die in my 30’s, but I probably wont. The United States could cease to be an economic powerhouse during my lifetime, but it probably wont.

Who knows. Maybe I’m naive? This is my first recession as an adult after all. But my understanding is that the markets have crashed before. Politicians have acted irresponsibly before. And people have predicted America’s fall from power before.

I guess I need some of you “old folks” to chime in here and give your two cents. Is it different this time? Are we in a perfect storm? Or is it just another rainy day that has seemed to cloud our judgement?

For the record: I do think things will change over time, and tough times ate ahead, just not in a collapse-of-the-Roman-Empire-kind of way.

I’m so edgy.

I was driving home last night and, out of nowhere, had an amazing idea pop in to my brain. Crazy how things like that just happen out of the blue. Anywhoozle, You know how guys grow mustaches out in November, often calling it Movember or No Shave November? Well, what if Girl Ninja and I did a No Save November?

I mean, it’s pretty common in the PF blogosphere to see a blogger do a no-spend challenge for a week or month. Personally, I think no spend challenges are dumb, but you already knew that. If you have the wherewithal to maintain a personal finance blog, I’m going to assume you probably no longer have a spending problem. In fact, it’s probably quite the opposite, you’ve likely become a frugal fruitcake.

After a few years of very intentional saving, Girl Ninja and I are fortunate to be in a position where we have some major flexibility with our cash flow. We’ve been saving around $3,000 a month for the last 2.5 years.

It’s time we did something a little unconventional. Come November, Girl Ninja and I will implement a very strict No Saving policy for 30 days. That means every dollar we make we in November, we must spend in November. How fun will that be!?

It’s a good thing we’re not rolling this program out until November, gives me some time to make a list of things we should buy.

  • Twenty-six inch spinner rims
  • A new blender
  • A laptop
  • A miniature horse named Chad

Who knows what we’ll end up with! One thing is for sure, I’m excited for November to roll around so we can be the first PF bloggers to ever have a No Save month. Who wants to join the fun and make this a thing? You have plenty of time to prepare!

p.s. As much as we’d like to just spend the money on a big trip, we think that’s the easy way out. No travel expenses allowed is our rule. And I think we will allow X-mas gifts to be permissible expenses.

Keeping up with the Joneses like a boss.

My next paycheck will be a bit larger than the last.  I’ll be getting a slight raise, about $2,500 more per year. While I’m stoked to be getting any raise at all, let’s be real, it’s not a life changing amount. In fact, it only works out to about a $75 net gain each paycheck. Or as I look at it, a free lift ticket each pay period 😉

Since Girl Ninja and I are fortunate to have our income exceed all of our wants, we decided to do the boring/responsible thing and further increase our retirement contributions. Instead of throwing 10% of my gross income in to my 401K each month, we increased that sucker by another 3%, to 13%. My employer matches 5%, so in total 18% of my gross pay will be going in to my 401K plan each paycheck. Is that hot or what?

That's hot

So I get a $2,500 raise, and before I even have a chance to see it in my paycheck, we decide to throw all of it towards retirement. If that’s not keeping up with the Joneses, I don’t know what is!!!!

Since I’m a self-proclaimed PF nerd, I thought I’d run a quick calculation…

If we keep throwing that $2,500 in to our 401K plan for the next 40 years, do you want to know how much extra we’d have come retirement? This example assumes a 6% rate of return.


There was really no decision to make. Get $75 extra in each paycheck and blow it on things we don’t need, or have an extra $417,000 waiting for us when we’re old?

Lifestyle inflation is cool and all, but if we are already content with what we have, what else is there to inflate besides our savings account, retirement funds, and our charitable contributions? I’m not going to go run out and buy another TV or laptop just for the heck of it.

Last time you came in to a little extra money, what did you do with it? If you had to inflate your lifestyle in one aspect how would you do it? (We would probably pay for a bi-weekly cleaning service)