Healthcare and FIRE with a chronic (expensive) health condition

My biggest FI/FIRE fear is affording the cost of healthcare.

You see, I have Rheumatoid Arthritis (RA).

With RA, sometime regular day seems like a hike up the Grand Teton.

My FIRE journey ultimately began approximately 2014.  I was diagnosed with RA 2 years earlier at the age of 40.  RA is an autoimmune condition where the body’s immune system mistakenly attacks the joints and other body systems.  As an occupational therapist, I recognized the importance of receiving an early diagnosis, and establishing a cocktail of pharmaceuticals to hopefully stave off the progressive deformity and disability that often accompanies this condition.   Without proper treatment, the average timespan to total disability for someone with moderate to severe RA is 10 years.  Yikes.

Progression of RA in the hands

Even as an occupational therapist specializing in hand therapy, I initially dismissed my gradually progressing symptoms until they became impossible to ignore.  I describe my Diagnosis Journey here .

The first year post diagnosis, I worked with my Rheumatologist on finding a treatment regime that worked for me.  This included a cocktail of several different medications, including a biologic medication.  You know, the ones that you see on TV.  Big Pharma Cash Cow.  And cue in $$$$ of life long health care and medication costs.

Well, ok, at least I know what I am dealing with, right?

With the RA diagnosis come extreme fatigue.  Sometimes crippling fatigue.  I suffer from this.  The fatigue is mightily helped with my cocktail of pharmaceuticals, but still ever present.  Add the underlying joint pain, with various joints taking turns competing for my attention.  I knew that I would need to pivot, and explore finding income solutions, as working full time in the healthcare grind for the next 25 years was not realistic for me.  Upon researching low cost of living areas and optimal retirement locales, I stumbled upon Mr. Money Mustache and the Shockingly Simple Math article.  Mind Blown.  That began our journey for us.

It was time to get the financial house in order.  And so our journey to FI began.

As a healthcare provider and someone with a chronic health condition, I believe there is a certain naivete in the FI space when it comes to planning for long term health needs.  I see it every day in my clinical practice – shock and awe at the costshare expense, not to mention personal care costs when someone is incapacitated.   The allure of health-sharing ministries: Quite the savings, plus the illusion of “eat right and exercises, can get generic medications at Costco;  we are all set.”   Well, I am here to tell you….  You can’t always count on that.  I also ate right and exercised.  You just never know when life is going to throw you a health curve ball.

I urge you all to hope for the best, but plan for the rainy (healthcare) day too.

In good times, happiness, and health.

Jen

Hiking in the Columbia River Gorge

 

FI Journey updates July 2019

Continuing to make progress

We have made some solid progress over the past year with our FI journey. There was the slight dip in the markets at the end of 2018, which demonstrates as a blip on our FI Journey Chart. But other than that, some solid gains have been made!

One exciting change that we have implemented this year was beginning a Mega Backdoor Roth account.  After listening to a Choose FI Podcast, I learned what this was, and then found out that I had access to one at work.

What is a Mega Backdoor Roth?….
My organization allow for post-tax contributions to be deposited into a employee’s retirement account of up to 10% of the employee’s gross income.   The employee can then take an “in-service distribution” and immediately roll that money into a Roth IRA.  Where it can then grow tax free for eternity!  The only hitch is that this is a manual, paper process, and I need to have a notarized signature from Mr. HG in order to complete the rollover.  Therefore, I will execute the roll 2-3x/year, and just pay any tax on the gains in the brief time that it has been growing in the account.

We continue to max our contributions in our regular 403B accounts and Roth IRAs as previous.

I previously updated that we have reduced our living expenses by selling our primary residence and have downsized into a 2 bedroom apartment.  The additional monthly savings from this will be invested.  I am also hoping that a part time position will become available at work so that I may downshift to less of a full time grind.  Having reduced living expenses will make this transition easy-peasy, and should also allow us to continue to save the maximum in our tax advantaged accounts.

In good times, happiness, and health,

Jen

 

 

We Sold The Clown House!

We have re-entered the world of apartment renting.

“Why?” you might ask…

Image result for rent vs own

We spent the better part of the past few years weighing the pros and cons of continuing to live in (and maintain, and pay $$$$ for) our 3,000 sf suburban home. Mr. HG has been warming up to the idea of renting temporarily until we become closer to our solid FI goals and possible eventual relocation.

Pros of Continuing to Own:
Lovely house; we built it and choose everything
Nice neighborhood, private backyard
Avoids the pain of moving
Unsure of our long term plans, so inertia

Cons of Continuing to Own:
Waaaaaaay more house than we need
$$$$
Cleaning
Cost of maintenance
Cost of heating/cooling
Potential upcoming recession, in which we would have large amount of $ in illiquid asset (house equity)
We are considering moving to a lower cost of living area, closer to family, so renting now short term makes sense

Spring 2019 – The housing market in Portland Metro area always picks up in the spring, and all signs were pointing that it would again be a seller’s market. Other economic indicators demonstrate that there might be some future recessionary trend (inverted yield curve, trade wars). We figured that now would be a good time to sell, and that if we waited due to inertia, we might have some future difficulty with selling.

We decided to put our house as FSBO (for sale by owner) on Zillow, with courtesy to buyer’s agent. We figured we had nothing to lose by trying, (we are frugal DIY weirdos, after all) and saving the listing agent fee would be worth it.

I am a Zillow and Realtor.com troll, with a fascination about everything real estate. We knew we had that right pricing based on comps in the area. After snapping some photos, we put the home up on Zillow in early May. We stuck a sign in the front yard, and I pushed some posts thru on social media to help get the word out. Luck was in our favor, as the next day another house down the street went on the market. This encouraged some lookers to come see our house too. We had an open house on the first weekend, and a week later received 2 offers. After some back and forth, we went under contract, and with a close date end of June.

Ok, Great. So, now what???
Priority 1: Find a place to rent
Priority 2: Purge rooms of useless stuff to prep to downsize
Priority 3: Secure movers and plan a moving timeline

Rental location priorities:
Pet-friendly for our 2 little dogs
Quiet
Nicely landscaped
Close to Mr. HG’s work, and quick freeway access for me
Walkable to parks and shops
Gym and pool would be nice perks

We toured a handful of places, and decided on one that we thought would be perfect. 2 bedroom, 2 bath 950 sf apartment in a complex with a nice gym and outdoor pool. It is 2 miles to Mr. HG’s work, and very convenient to the highway for mine. The rent is reasonable for the area. The complex is 20 years old, and they are slowly updating all of their units, but we chose an apartment with the old “classic” design. Privacy is afforded from trees screening the balcony and windows, and an added bonus is the rent is cheaper since the unit has not been remodeled. It is  quite nice, and light and bright with southern exposure.

The apartment was available right away, so that we could begin moving some things over. (How in the WORLD do people accomplish this in one weekend?!?!?). I knew that we needed extra time to be able to sell and purge 2 decades of useless stuff that had been reproducing in the cabinets and cupboards, plus lots of furniture and yard equipment. I will outline how we accomplished this in a future post: Purging and Downsizing.

Our house has since closed, and the proceeds (for now) are sitting in a high(er) interest savings account. We have now resided in the apartment for exactly one month and are really enjoying it!

Apartment living pros:
The dogs are settling in nicely
I love the 1 level living (after the stairs to get in – we are on 3rd level)
So quick and easy to clean
Quiet – much quieter than I/we thought it would be
Convenient/walkable
There are miles of trails/bike paths right outside our door
Love the gym and the pool
No yardwork or maintenance – the gift of time
The cost of our rent + utilities is = just the property taxes/insurance/utilities and upkeep of our previous clown house  – cue in JL Collins Why your house is a terrible investment
Huge savings on a monthly basis – we can funnel that extra money into our post tax account.

Apartment living cons: (and I had to dig deep here)
No garage to store the cars
Carrying groceries up the stairs to third floor

All in all, we are thrilled with our new place!  And ready to funnel the cost saving to future freedom from the daily grind.

In good times, happiness, and health.