Living Small

Living large has been the mantra for many over the years. However, I don’t know if you’ve noticed, but there is growing interest in living tiny. And by tiny, I mean 84 square feet of living space tiny. There are books and blogs and magazines dedicated to this burgeoning movement. In fact, Charlotte recently hosted the Tiny House Conference geared to help educate and train people interested in building their own Lilliputian domain. The conference sold out in short order.

So what’s so appealing about living in a home smaller than 500 square feet? In her book “The Big Tiny: A Built-it-Myself Memoir,” Dee Williams details her journey from a Craftsman-style bungalow to a 95-square foot home on wheels. Williams had been diagnosed with congestive heart failure in her 30’s and after suffering a heart attack at 40, she realized cleaning gutters and tending to the mundane chores that go with home ownership were no longer important. So she sold the Craftsman, built her tiny house and parked it in the yard of her good friends where she has lived happier and much longer than the doctors predicted.

Tiny House enthusiasts have multiple and varied reasons for going small. Some want to live sustainably, others want to be self-sufficient and off the grid, while others are just looking for a way to simplify their lives and focus on the things that matter to them most. That was Dee Williams’ motivation. She realized that it wasn’t stuff that made her happy, but spending time being with friends and doing the stuff she loved that mattered most.

While I don’t think my husband and I and our two cats would be very happy in 95-sqaure feet of living space, I do think we could be quite happy in 1000 square feet. When I look at these tiny houses, I think about how much less there is to clean, and to heat and air-condition. That means more time and money to do the things I like to do, and that equates to more happiness.

But, after living in the same house for more than 20 years, we have accumulated a lot of stuff. Some of that stuff has not seen the light of day in years. In order to move into a 1000 square foot home, I am going to get rid of about 1000 square feet of stuff. And I, like a lot of people, have a hard time doing just that. Never mind that I haven’t used those brown-and-white transfer ware platters in years, or that my Princess Dianna style wedding gown will never fit my much more petite daughter. And what about the drawer of fabric my mother-in-law gave me when she downsized? I don’t even own a sewing machine!

And yet, I know it is time for me to start on this goal. The kids are on the opposite side of the country (and they’re not moving back in!). I love my garden, but I am really beginning to hate maintaining a 50+ year-old house. And someday, making it up those stairs will not be as easy.

I think those platters are heading to the consignment shop this weekend.

Tracy Allen, CFP®
Financial Advisor

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I Want it All

My husband and I are planning a trip to celebrate our 30th anniversary this summer. We love to travel, and we are fortunate to have taken some wonderful trips over the years. But, when it comes to planning a new trip, I have a weakness: I want it all. You see, there are many places still on my list to visit, and yet there are others we have visited and enjoyed so much, we want to return. It can take weeks for us to pull the trigger and settle on an option. I want it all and I want it right now.

So, it was with great amusement when I read the most recent blog post by the NY Times “Sketch Guy,” Carl Richards http://www.nytimes.com/2014/01/21/your-money/the-trap-of-too-many-choices.html?ref=your-money. You see, having few options is bad, but having too many options can be debilitating.

In the world of financial planning, we most often see this debilitation when people try to time the market. When the market is up, people want to wait for a correction. When it is down, they think it hasn’t gone down enough. Just when they think it is safe to go back in the water, they have missed the biggest part of the upswing. The cycle continues.

This is why the right asset allocation and portfolio diversification play such an important role in your financial success. It may not be exciting and you may not beat the Russell 3000 year after year, or ever. But you are participating in the markets, you have the cushion that fixed income provides and sufficient cash for emergencies to ride out just about any storm. And if you stick with your plan, over the long term, you will be a winner. You definitely won’t get there by sitting on the sidelines.

We all want to make the best decision, invest at the best time, pay the perfect price, plan the perfect trip, etc. But all of the research in the world won’t guarantee success 100% of the time. In fact, waiting for the best often causes us to do nothing.

Richards’ suggestion is to accept that sometimes good enough is better than not at all. And I would have to agree. For now, we have settled on our travel plans. And with any luck, there will be another trip next year.

Tracy H. Allen, CFP®
Financial Planner

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Mise en Place: To Put in Place

Don’t hate me for this, but I am one very luck woman. My husband does 99.9% of the cooking in our house. And best of all, he enjoys it! That said, once every so often he has to work late, or he is out of town or he craves one of my few specialties and I have to put the apron on. Such was the case this past Tuesday when I decided to tackle a new recipe. Since I cook so infrequently, I can get rusty between stints, so I decided to put to practice the concept of mise en place (pronounced meez ahn plahs). Mise en place is literally translated as “to put in place.”

Mise en place is simple. Before you pre-heat the oven, you want to make sure you have all of the required ingredients and equipment needed to make the dish. Think of your kitchen as an operating room; prior to surgery, all of the surgical implements have been sterilized and the accompanying supplies (sutures, gauze, etc) are neatly lined up on a tray. Imagine if mid-procedure your surgeon cried out for gauze and the assistant had to run to the drug store to buy more. Things would not turn out so well.

So, back to my kitchen and my rusty cooking skills; as I began to dice the onions and mince the garlic, I realized there are other applications for the use of mise en place. Packing for a trip is one such example. Preparing your taxes is another. And then I thought how well this could work in estate planning. If you have all of your documents prepared, in one place and up to date (sort of like within the sell-by date), your passing will be that much easier on your survivors.

Preparing your estate doesn’t just mean you have prepared the necessary documents. You must also sit down with your heirs and explain your plans and your wishes. Tell them why you have made certain decisions pertaining to the distribution of your assets. In addition, share with them your wishes concerning your living will and health care power of attorney. This can greatly reduce conflicts over your desired medical treatment should you become terminally ill and alleviate any stress and guilt family members may have. And finally, make sure you have your documents reviewed every 3-5 years to ensure they are current with state legislation. Remember, the only constant in life is change.

My husband does not utilize mise en place very often. He doesn’t really need to. Since he cooks daily, he doesn’t get rusty in the kitchen. But when it comes to executing an estate, he fortunately has zero experience. That is why he truly appreciated the very candid meeting we had with his parents this year. We now know where everything is and what the plans are and that gives us peace of mind.

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Medicare Open Enrollment is Upon Us

Medicare Open Enrollment began October 15 and will run through December 7. For those of you on Medicare, this is your opportunity to compare your existing plan to other options and to make any changes you may want.

Just as we recommend that you perform an annual review of your homeowner’s and auto policies, it is important for you to take the time to review your Medicare policies as well because the plan that’s best for you this year might not be the best next year. In September, you should have received an “Annual Notice of Change” letter from your provider. You should read it carefully for details of how your plan will change next year.

The Medicare Plan finder is a great tool to help you compare costs and coverage of the many plans available. Pay close attention to the prescription drug section. This allows you to enter your prescription medications and compare the policies that will cover them. https://www.medicare.gov/find-a-plan/questions/home.aspx

If all of this becomes too confusing or time consuming, you may want to consult with a counselor at the NC SHIIP (Senior Health Insurance Information Program). This free service is designed to help you better understand your options and benefits. To find a SHIIP office near you go to: http://www.ncdoi.com/SHIIP/SHIIP_County_Sites.aspx

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Senior Moments

You’ve arrived somewhere only to realize you’ve forgotten what you went there to do. Or perhaps you forgot the punch line at the end of a joke. When I was a young new mother, I got in my car to go to work when I suddenly remembered the baby was in her car seat in the living room! These are a few situations many of us will find we know too well. Incidents such as these remind me of the famous line from Mark Twain: “Of all the things I’ve lost, I miss my mind the most.”

Memory lapses such as these are caused by a variety of factors – thankfully few of them serious. If you can relate to the first scenario, you have experienced what researchers have dubbed “the doorway effect.” A paper published by Gabriel Radvansky at the University of Notre Dame explains that our brains use a file system not too dissimilar from our computers. However, rather than file folders for documents, music, pictures, etc, your brain files by physical location. This means that the information readily accessible to you in one room (or file) suddenly becomes a lot harder to access when you go to another one. The researchers suggest that saying things out loud as you pass through the doorway can help you remember your mission. You can read more about this study here: http://al.nd.edu/news/27483-walking-through-doorways-causes-forgetting-new-research-shows/

As the young harried mother, I blamed post-partum hormones and work overload on my memory lapse. But the forgotten punch line? I blame that on age. Knowing we are living longer and longer, I refuse to let my brain atrophy!

Doctors have long said that eating right, getting enough sleep and regular exercise are good for the body, including the brain. In addition, certain “brain foods” are thought to help protect brain function. There are also brain “exercises” one can do – crossword puzzles, Sudoku or Ken-Ken can help, or you can register with Lumosity, a free brain-training program developed by a group of neuroscientists. Even playing video games can provide benefit.

In addition to exercise, multiple studies have shown that community involvement, prayer and meditation help maintain healthy brain function. The reason: all three help control stress and anxiety.

And finally, never stop learning. Take up a new language, learn to play an instrument, buy a dictionary and learn a new word every day (and write a sentence using it!). Learn to play chess or poker. Do you want to know more about Higgs boson and the Large Hadrons Collider? Then sign up for the MOOC (Massive Open Online Course) being offered by the University of Edinburgh. In fact, there is a vast and growing world of free online courses covering wide range of topics offered by leading universities. You can get more information here: http://www.openculture.com/free_certificate_courses

I personally love crossword puzzles, and every time my husband and I travel to a new country, we work hard on learning key phrases and words. No matter which method you choose to exercise your brain, you will be doing yourself a favor.

Tracy Allen, CFP®
Financial Advisor

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