by Michele | May 1, 2013 | Preparation Stage
Once Upon a Gypsy Moon is not so much a sea-tale as it is a man’s introspective journey into his own motivations, actions, and dreams. While Gypsy Moon (his 32-foot sloop) carried Michael from Annapolis to Nassau and beyond physically, the time he spent single-handing her over that distance carried him much farther emotionally and spiritually. He started his journey lost and lonely after an ugly divorce and ended it as a man with hope for the future.
Here are a few of my favorite quotes from the book:
The world has a way of working itself out, in my experience. There are things unseen. Life is not always easy or pleasant, and it is often unfair, but it seems to unfold according to some plan of which we are only peripherally aware – like a dream, the details of which are vivid only when we are sleeping. We cannot remember- much less comprehend- that dreamworld with the powers of a rational mind.
Sailing has been a love of mine for almost as long as I can remember, and that love endures…But over the years, the idea of sailing long distances over oceans, unobliged to return, became for me less about adventure than escape- a kind of trapdoor beneath the uncertain footing of a marriage and a personal and professional life that seemed at various times to teeter on the brink of collapse… With no escape hatch, we have to face life head-on, admit our weakness, rely on our relationships, and trust others to catch us when we fall.
The insight in the book was compelling, though at times it did get a little dry. The boat journey was somewhat less exciting than the cover lead me to believe as it was mostly individual legs of a trip broken up by repair stops on his old boat rather than a continuous time line. The final chapter entitled “The Loss of the Gypsy Moon” was certainly the most thrilling of the book as *Spoiler Alert* Michael did eventually have to abandon ship during bad weather after a nasty knock-down and subsequent rescue by the US Coast Guard. Maybe someday she will be found and resuscitated but it seemed a fitting end to the tale of a man who no longer needed his escape hatch.
We would like to pass the book on to one of our readers in our first giveway! If you would like the chance to read Once Upon a Gypsy Moon yourself, there are four ways you can earn entries to the giveway:
- Subscribe to this blog via email (look for “Receive updates by email” in the right sidebar)
- Leave a comment on this post
- Follow us on Twitter @sv_horizon
- Like us on Facebook https://www.facebook.com/FollowTheHorizon
Each way gets you 1 entry into the drawing, for a maximum of 4 entries. We’ll do the drawing next Tuesday evening and announce the winner on the blog next week! Hope to see your name!
(In March, we were contacted by Center Street book publishers to do a review on a new memoir that they released on April 16 called Once Upon a Gypsy Moon by Michael Hurley. We agreed, so they sent us a pre-release copy of the book that for some reason we didn’t receive until a couple of weeks ago. This is the first time that we have been contacted to do a review so we’re pretty excited that we are starting to pop up on the radar of the sailing blog world.)
by Michele | Apr 24, 2013 | Preparation Stage
A financial safety net is just as important as a physical one.
Whenever we are dealing with finances Dan and I like to plan for a pretty decent margin of error. (Dan would appreciate it if I would practice this a little more in dealing with scheduling as well; I am consistently 5 minutes late.) If you could listen in to some of our mini-planning sessions we frequently have, you would hear the phrase “worst case scenario” at the beginning of most of them. We figure that if we plan for the worst case – within reason of course, we aren’t going doomsday here- then we will be left with a much higher comfort level and safety net in times when we’re living on the other end of the spectrum.
The margin of error is especially important when we are talking about making a budget for a lifestyle that we have never lived before. Sure we think that we will be fine living on $1000-$1500 per month based on our research, but that’s all it is right now, research. It’s crucial for us to know that if that doesn’t end up being true we aren’t left high and dry (pun intended). The whole basis of this adventure is our desire for freedom but you can’t have freedom if you are constantly worried about how you are going to pay for the next time your engine needs a tune-up.
There are a couple of big ways that we are dealing with the margin. The first is in how we are planning out our rental income. Dan has created a spreadsheet that we use to evaluate any potential rental properties that we look at which takes into account all expenses (including property management costs at the highest rate we’ve seen in our area) and also vacancy rates of our tenants. We have separate columns for vacancy rates at 0%, 4%, 7%, and 11%. The current accepted vacancy rate in our area is a very low 2-3% but we use the 7% rate as the amount that we use for budgeting purposes. We hope this will give us a very safe expectation of income from our rentals even if the market worsens a bit before we leave. Hopefully we’ll continue filling vacancies within a week or two as we have done with our first 2 houses and also find a manager we like at a lower price, but if we don’t we are still fairly comfortable.
The second part of the plan is maximizing our income earning potential while cruising. Dan is currently a certified PADI Dive Master and plans to become a PADI Open Water and Specialty Instructor as soon as possible. Because PADI is recognized worldwide we are hoping that this will give us a nice back-up option if our income falls short of expenses. We also intend to log our sailing time once we start cruising to begin the process of getting Coast Guard Captain’s licenses (6-pack at least) which would allow us to complete deliveries and also increase Dan’s marketability as a SCUBA instructor who is licensed to carry divers himself. Finally, investment income on other savings and maybe some future swing trading as described in Live on the Margin in addition to some small income from this blog (yes we have recently added ads to the site) eventually could all add to a few hundred a month for extra flexibility.
Best Case Scenario: our costs will not overextend our rental income, we will have renters who stay for years at a time and financial stress will be a thing of the past in our new life. Worst Case Scenario: we have crappy renters who tear up our houses, our boat breaks down too often and Dan has to take up part-time work doing his favorite hobby. Sounds like a pretty nice life either way.
by Michele | Apr 17, 2013 | Preparation Stage
Everything you need to know about cruising is in here!
So far in our month of finance posts, we’ve gone over our savings goals and reducing our current spending. But of course all of this is meaningless unless we have a plan for how much we will be spending while we cruise. People have asked this question on every blog and every forum available to cruisers of all levels and with something as individual as personal spending it is a fairly difficult question to answer. The most common response is “it costs whatever you have” or “that’s the same thing as asking how much it costs to live on land…its all up to you.”
While I appreciate the idea behind the answer, I also think that there is a way to generalize expenses for people. I can tell you that it is possible to live on $750/month or less for a couple in my town if you rent or own a one bedroom shack, eat peanut butter sandwiches every day and don’t own a car or have other insurance. You could spend $2000/month living in a small 3 bedroom home, eating good meals at home, driving one car rarely and being otherwise frugal. Or you spend $5000/month on a nice home in a good neighborhood, drive expensive cars that get terrible gas mileage as much as you want, and eat out for every single meal to normal restaurants. I can’t tell you how much it would cost your family, but I can give you the basis to help you figure it out on your own.
That’s exactly what Beth Leonard has done in this fantastic article entitled “How Much Will Cruising Cost You?” and also in her book The Voyager’s Handbook. She details the spending habits of three fictional cruising families: the Simplicity’s in a 33 ft cutter, the Moderation’s in a 40 ft catamaran, and the Highlife’s in a 54 ft ketch. In my opinion, this is the best document on cruising budgets that I have found in any of my research, and is what Dan and I based many of our calculations on when trying to figure out how much we would need monthly and yearly to live at the level we desired. We believe that we can budget somewhere between the Simplicity spending of 8,000/year and the Moderation level of 20,000/year leaving at somewhere in the $1000-$1500 per month range. This budget was also verified by a seminar called Three Cruising Budgets given by George Day of Blue Water Sailing magazine at Strictly Sail Chicago this year.
Obviously, we don’t know for certain yet how much we will spend once we start sailing, but it is important for us to have some sense of direction to work with while planning. No one else will have the same budget as us (and certainly not one man on a forum that told us we would need at least $50,000/year…he and his wife spent $1500/month on food alone!) but we think that using a generalized picture has given us pretty realistic expectations. We’re always open for comments or suggestions, so leave one for us below!
by Michele | Apr 12, 2013 | Preparation Stage
Sure it can eat through mud and snow…and your wallet.
Now that we’ve taken care of most of our “big-ticket” items to improve our savings, Dan and I are trying to tackle the smaller ways that we can find extra dollars in our budget. Not only is this important for increasing our savings to maximum levels but it also is helping to prepare us for living more frugally while cruising. If we want to have any kind of decent chance at living on $1000-$1500 a month than we have to get serious about knowing where each of our dollars goes and how to cut that down as much as possible.
The tracking part is made much easier by the online financial website that we use: Mint.com. We have all of our bank accounts, credit cards, loans, and investment accounts tied in so they automatically update whenever you long in. We’ve used this program for a few years and we’re pretty happy with it, though it can be a lengthy process to set everything up and figure out what budgets you want to set for yourself. Once you have been using it for a couple of months, it can really help to show you where your money is going every month. For some time now, it has been giving us a pretty clear indication that we have been spending too much in the Food and Gas departments, so we’ve finally decided to get those under control.
Food was first and it was somewhat daunting to me to be honest. Not to play the martyr working mom bit, but it is really hard to provide home cooked meals during a working week. There’s just not enough time to be able to figure out what to make every day and go pick things up from the store so I had to find a different approach. A couple of weeks ago I mentioned that we have purchased a subscription to 5meals1hour.com for five dollars a month. Well, we’ve completed the first months’ worth of recipes and I can honestly say that we are way ahead of where we were last month, but I can’t give all the credit to the menus. We only used about 1/3 of the recipes on the menus, but we have still been eating at home on average of 5 days a week, which is a huge deal for us. I think just the change in mindset about grocery shopping every two weeks for actual planned meals has been the biggest positive change that 5dinners1hour has made for us. We can still improve a lot in this area, especially because I’m not a very experienced grocery shopper yet so I think we’re paying too much for our groceries, but we’re seeing a definite change in attitude and habits.
Gas spending is our other cash hog. Like a lot of people we know, it’s just something that we haven’t taken seriously before. But looking at our accounts, we have spent almost $1300 in gas alone since February 1! That’s averaging $18.50 per day, yikes! Here are a few strategies we are implementing to help us cut down this silent killer.
- Drive less…obviously. Eating meals at home isn’t just saving us money in the food department, it means less driving too.
- Walk and Ride Bikes, and not just for leisure riding. Dan has started riding his bike to work most days and we are planning to use our bikes for trips to the grocery store, library, and other close to home errands.
- Get rid of the gas guzzler in the driveway. We’re still working on this one, but the goal is to eliminate one of our 15 mpg SUV’s for a 30+ mpg compact car. Even if we have to spend some money over the sale of our Jeep, we should get most of it back in the end when we sell it in a year. This one has the potential to save us in the realm of $250/month!
Hopefully, we’ll find some good success using these strategies and find others to help us keep our everyday spending in check. If you have any suggestions, let us know in the comments!
by Michele | Apr 4, 2013 | Preparation Stage
To start off a month of posts about finances, Dan and I need to make sure that everyone knows our baseline. We come from average middle-class families who have good jobs and provided well for their children in the sense that most middle class parents do: clothes, food, housing, low budget car in high school, etc. Dan’s parents paid for his college education, mine did not, but we still left school with only around $4,000 in student debt and no real savings to speak of. We got jobs after college that made cumulatively $70,000 and bought our first house (a foreclosure in Dan’s parents’ neighborhood) on the $8,000 new home-buyer credit in 2009 for $110,000 (for those of you who don’t live in Central Illinois, money goes a long way in our house market compared to other areas). Then we proceeded to buy a couple of new and almost-new cars with car loans for somewhere in the vicinity of $40,000 total. In 2011, we both got raises and now make a total of around $95,000. (You may note a conspicuous lack of credit card debt. That’s because we’ve never had any. Thanks mom and dad for teaching us that credit cards are good for only one thing…free rewards!)
So, we when started our retirement planning in 2011, it looked something like this:
Income: $95,000/year or ~$5,500/mth after taxes, 401k, and health insurance deductions
House: $150,000 value, $50,000 equity, $1200/mth mortgage, property taxes, and house insurance
Cars: $40,000 value, $0 equity, $900/mth car loans and insurance
Other Debt: $5,000 student loan debt, $50/mth payment
Other Spending (food, clothing, entertainment, etc.): $2000/mth
Savings: Income ($5,500) – Spending ($4,150) = $1,350/mth Savings (though in reality it was usually closer to $1,000/mth that would make it into the savings account)
As you can see, $1,000 a month into a savings account was pretty nice savings compared to most people, but $12,000/year was going to take a long time to turn into enough money to live on the interest and buy a boat, especially because we were starting with around $5,000 in the bank and whatever assumed equity we had in our house. So we needed to save more money and find some better investments that we could use to live on. As you can see above, we were spending a whopping 40% of our after-tax income on our house and cars. In America, banks will tell you that is perfectly affordable and it was…if we wanted to “afford” a 9-5 job for the next 30 years.
Here is what we have done in the last year and a half to improve on our savings rate and investment income:
- Sell our over-priced luxury vehicles and buy two dependable used cars with cash. This saves us money on payments and insurance, since now we only carry liability insurance. Cost: $5,000. Savings: $800/mth
- Eliminate student debt. The payment wasn’t high, but we didn’t want to have that liability while cruising. Savings: $50/mth
- Sell our house and buy a smaller one which will become a rental or get sold when we leave. Savings: $800/mth and $25,000 in cash (after down-payment and repairs on new house)
- Purchase 2 rental homes using cash from house sale. Cost: $18,000. Net Income: $700/mth.
- Moved $6,000 from savings account into Vanguard 80/20 investment account. Anticipated income: ~$30/mth
- Adjusting spending habits (still in progress). Savings: $500/mth
Current Cash on Hand: ~$22,000 New Rate of Savings: $3,000-$3,500/mth
Saving money is always a work in progress, which we will go into a little more later this month. Our goal is to purchase 2 more rental houses by the end of this year to solidify approximately $1,000/mth in net profit after expenses and vacancies. Then, we are off to the races to save somewhere in the $50,000-$75,000 range with which to purchase our new floating home. It will be a challenge, but I think we’re up for it!
We are normal (well ok, not so normal) people that have a dream to see the world and live life as it was meant to be. We both have successful careers in the healthcare industry, even in this terrible economy. We want to break free of the current cycle of trading time for dollars and dollars for more and more things we don't need. So, we have decided to forego the fruits of our economic success and "retire" well before we are 30 and set out to see what is over the Horizon.