Tiny House, Tiny Living, The Tiny Life.

7 Ways to Prepare for Retirement

Financial independence doesn’t just happen once you turn 65. It takes planning and living on less than you make so that you can save and invest. Regardless of your age though, it’s good to know that it’s never too late to prepare for your retirement.

Retirement on beach

1. Pay off Your Debt and have an Emergency Fund

If you have not finished paying off your consumer debt or do not have a fully funded emergency fund in place, you want to focus on these things first before you start setting money aside for retirement. You want to set up a debt payment plan that would see you free from your consumer debt within 2-3 years and then very quickly move your focus to getting that emergency fund filled.

When you’re dealing with a reduced retirement income, the last thing that you want to be doing is still devoting income to your debt repayment or emergency savings. The goal here is to make sure you’re on a solid financial footing and are in a place where you can enjoy your retirement income that you’ve worked so hard for.

2. Start Saving and Stick To Your Goals

The sooner you’re able to start saving for retirement and able to stick to your monthly savings goal, the better off you’ll be. Ideally you’ve put yourself in a place where you can begin setting aside 10-15% of your monthly income into your retirement account. If you’re debt free including your home feel free to put in more than this.

In your monthly budget, make sure that you have a line for retirement savings and that you are sticking to your savings goal each and every month.

3. Know Your Retirement Needs

What you’ll need to save is dependent on the type of lifestyle that you would like to have when you retire. Most financial experts suggest that in order to retire comfortably you should aim to cash flow 70-80% of your peak pre-retirement income.

This amount is not written in stone. Many couples can retire on 60-70% of their pre-retirement income providing that they are debt free and their children are financially independent. There are many retirement calculators that you can use to help you determine how much is enough when saving for your retirement.

4. Contribute to Your Employers Retirement Savings Plan

If your employer offers a 401(k) plan, you want to make sure that you take advantage of it. Not only will you be able to take advantage of compounding interest, but your taxes will be lower, your employer may offer a match to kick in extra money, and automatic deductions make saving easy.

If your employer offers a traditional pension plan, you want to make sure that you ask for an individual benefit statement (if one isn’t sent to you automatically every year) to see what your benefit is worth. If you are planning on a career change or changing employers, you also want to find out what will happen to your pension benefit.

5. Put Money into an Individual Retirement Account

Don’t just stop your retirement planning with your company’s 401(k) option or pension. You also want to make sure that you take advantage of the tax benefits that an Individual Retirement Account (IRA) offers.You can put up to $5,500 a year into an IRA and you can contribute even more if you are over the age of 50.

There are two different types of IRAs to choose from. If you go with a Traditional IRA, the yearly contributions you make are tax deductible on both your state and federal income tax while any withdrawals are taxed at your income tax rate. The Roth IRA provides no tax break on the contributions, but earnings and withdrawals are generally tax-free.

6. Find Out About Your Social Security Benefits

Social Security pays benefits that are on average 40 percent of what you earned before retirement. You can use a retirement estimator to see what your expected benefit may be as you get closer to your retirement age.

7. Ask Questions

When preparing for retirement, the most important thing you can do is ask questions. Not only ask, but make sure that you understand the answers that you are given.

Be sure to ask your employer and union about retirement planning that is available through work. You also want to talk to a financial advisor when setting up your investments to make sure that your investments are diversified and you are taking the appropriate risk level for your age, goals, financial circumstances, and your personal comfort level.

Your Turn!

  • What are your retirement goals?
  • What steps have you taken to help reach them?

 

2 Second Lean – Eliminating Waste And Making Life Easier

I recently came across this book (which is free) and was blown away.  Lean is a philosophy of eliminating waste in our daily lives, at work or at home, to improve how we get things done.  There was a lot of overlap with a lot of what we hold dear as tiny housers.  It’s primarily oriented to manufacturing, but has a lot of practical applications in any workplace and even in our homes.

get rid of waste in life

What struck me was that 2 second lean was approachable. I’ve read a lot on Six Sigma, Agile, Scrum, and other systems, but this just clicked better.  The method had a lot of very simple lessons and application was super easy.  A lot of the techniques employed are things that we already do as tiny housers, but some new ones as well.  There some practices that really stuck out for me.

Here are a few key terms before we get into it all, most are from the Japanese who developed a lot of this stuff:

Kaizen: is a Japanese term continuous improvement.  Though slow and steady improvements we attain a better way of life.  Example: when we notice something bothers us constantly, we fix it.

Poka Yoke: this term is designing things so we can’t make mistakes or minimize them drastically.  It also is design that when a mistake is made, it jumps out at us so we can identify it.  Example: a front load washer will not start until the door is fully closed, preventing spills.

Kanban: is a technique we provide cues to remind us to refill something, buy another of an item etc so we don’t run out.  Example: I take a bright colored piece of paper, cut it to the size of a toilet paper roll and place it on top of my last one.  When I use the TP, I suddenly see the bright paper, I know I need to order more.

Visual Controls: This is employing marking and other visual cues to help people understand what’s going on at a glance.  The ideal situation is to be so clear a person could walk in and find anything or understand the flow without external direction.  Example: label bins so people know what is in them without having to look inside.

Lean is all about seeing and eliminating waste.  In our own lives we want to remove waste to make our lives easier, to give us more time to do things we’d rather do, to improve the work we do, and enjoy things more when we are relaxing.

There are 7 types of waste

At Work
At Home

  • Defects: we make a mistakes
  • Overproduction: we do extra work to fix know problems over and over again
  • Waiting: When we sit around waiting for someone to do something
  • Missed Potential: We don’t use the best person for the job
  • Excess Inventory: We have to much stuff, which leads to clutter and stress
  • Wasted Motion: we don’t have what we need close by or at hand
  • Defects: Time consuming mistakes
  • Overproduction: We don’t fix something that bothers us
  • Waiting: Wasting time on things
  • Missed potential: We don’t empower others to help
  • Excess inventory: We have clutter
  • Wasted Motion: We are constantly walking to get something

Kaizen at home:

how to declutter

When you are decluttering an areas have three boxes handy: one for trash, one box for things you want to keep, and a third box for things to donate.  When you declutter an area pull everything out.  While you’re in your downsizing process, consider having a set of general boxes so when you find something that needs to be dealt with it has a place to go right away.

Poka Yoke at home:

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Think about how you can make sure things get back to where they’re supposed to be, to make sure people have the tools at hand to do the job and error proof things as much as you can.

Kanban at home:

kanban boxes in life and at home

These are bins that are mostly blue, but one end is red, an adjustable divider lets you set your threshold.  Let’s say you have 6 cans of soup, you’d put four in the blue half and then two in the red half.  Start with the blue side out, but when you run out of soup in the blue half, you’ll be forced to flip the bin to the red side.  You’ll have two more soups to go, but your bin now signals that you need to get more soup because you look for the red.

Visual controls at home:

Organizing things with visual controls will let you know exactly what goes where and identify quickly what is missing or out of place.

Taping spots for things will show people where things go.

Kanban Board in real life:

kanban board to do list

So for those of you who want to check the book out, it’s called 2 Second Lean and it’s free in a pdf and audio.  You can check it out here:  read 2 second lean here

 

Your Turn!

  • How do you eliminate waste in your life?
  • How do you make small improvements in your life?

Minimalism and Internet: How To Minimize Your Internet Use

Minimalism can apply to so many aspects of your life, but minimizing your internet use can have one of the biggest impacts of all. When I applied minimalism to my internet use, I discovered so much more free time to work on what is really important to me.

It can be difficult to get off the internet sometimes, especially if you use it for work, or have an addiction to social media ( it’s estimated that 75% of millennials feel addicted to social media).  So, how do you quit using the internet so much? Here are five tips to cut down your internet usage:

minimalism internet

1. Install a Blocker

There are apps that you can install into Safari or Chrome to block sites of your choosing when you turn the app on. When I started to cut down on my internet use, I installed an app called Strict Workflow. Sites such as Facebook, Youtube, Pinterest, Tumblr and Reddit are all blocked. This is really helpful if you work online and need some time to focus.

2. Put Your Phone Away

It’s polite to put your phone away when you’re spending time with a friend. If I’m out with a friend, I’ll leave my phone in my bag, or my pocket. To cut down on your internet use, do the same when you’re focused on a task on your own. If I’m reading a book, I’ll move my phone to somewhere I can’t see it. Out of sight, out of mind.

3. Disable Notifications

minimalism internetMy life changed when I turned off all notifications on my phone. I no longer get any notifications – no Facebook notifications, no Instagram notifications, not even notifications of my incoming text messages. Because I’m no longer getting that distracting noise coming from my phone, I am more able to focus fully on what I’m doing at the moment. My friends know that if they really need to get ahold of me, they can call; otherwise, they know that I may not respond to messages for hours.

4. Try an Internet Fast

An internet fast is where you don’t go online for a certain amount of time. You can simply do a 15 minute internet fast at the same time every day, where you go for a walk or get a coffee with a coworker, or you can check out for longer periods of time. I try to schedule at least two weeks a year where I am not online. I’ll go camping in a remote area for a week (without my laptop) for some quality family time, then later in the year I’ll go to a yoga retreat (preferably in a remote area without wifi). This helps me rejuvenate my mind, and when I come back to the internet, I come back focused, determined, and ready to work.

minimalism internet

5. Cut Your Wifi

If you work in an office and would really like to cut down on internet use at home, consider going without wifi. This will save you money and make it a lot harder to spend your free time scrolling. When you aren’t capable of getting online, you’ll be able to find much more productive and fun things to do.

I hope these five steps to cutting down on your internet use help you to spend your precious free time more wisely. Minimizing my internet use has led to so much more happiness in my own life – I have more time to read, write, and do the things I love.

Your Turn!

  • Which tip will you try to cut down your internet use?

How to Build Your Emergency Fund

Everyone needs an emergency fund. Life is going to happen, and those unexpected expenses can sometimes come with some serious sticker shock.The emergency fund provides that buffer between you and life, and prevents you from incurring debt when a true emergency arises.

emergency fund

When life throws you a financial curve ball, the emergency fund will turn what would otherwise be a crisis that has you running for your credit card, into an inconvenience that has you writing a check. Let’s look at the four steps you can take to help you start to build your fully funded emergency fund.

1. Open an account that’s accessible, but not too accessible:

When an emergency occurs you want to make sure that you can easily access the funds, but not have them so accessible that you accidentally spend the money on items that are not emergencies. Consider opening up a separate savings account that is not attached to your debit card. We have ours in a higher interest rate savings account where the money can be transferred into our checking account within 24 hours.

emergency fund

Remember though, your emergency fund is insurance rather than an investment. We’re not looking to make big returns on the money that is sitting in this account. If you make some interest (I think we earn $5 a month), that’s fine, but earning money is not the intention. The intention of this money is to protect the rest of your finances – including any investments.

2. Determine what 3 to 6 months of living expenses are:

Most financial experts agree that a fully funded emergency fund should contain 3 to 6 months of living expenses. In order to determine this amount, go back to your budget and look at the essential expenses that you would need to calculating living expensescover in order to get through each month. Add up your housing costs, transportation costs, monthly grocery budget, and any other monthly fixed expenses that you would still be obligated to make (insurance premiums, etc).

In order to determine whether you should be closer to the three or six month savings mark, you also have to factor your risks. If your job is stable and you are in good health or if you have disability coverage through work if you were to become ill, you could consider keeping your savings closer to the three month mark. If you are self-employed or have a variable income, you would want to set your savings goal closer to the 6 month mark.

3. Set aside a savings goal in your monthly budget:

When you add up the amount to save, it might seem overwhelming at first, but don’t let that stop you from working towards this goal. Start small with a starter emergency fund and once you get all of your debts paid off (minus your mortgage), then you can focus on building that emergency fund by taking what you were putting towards debt and now putting it into savings.

spare change

Each month when you make your budget, look at the money you have left over and commit a certain amount of it to your emergency fund until it is fully funded. The more you are able to set aside for your emergency fund, the faster you will hit your goal amount.

4. Only use the money for emergencies:

The best way to make sure that you are building your emergency fund is to only use the money in that account for actual emergencies. So what constitutes an emergency? Any major expense that you couldn’t have anticipated, such as:

  • An unexpected job loss
  • A medical emergency
  • A sudden, major car repair
  • A leaking roof during a storm

What doesn’t count as an emergency are those expenses that we should have anticipated and been planning for already. Christmas, annual insurance premiums, and regular car maintenance are not emergencies so be sure to plan for these somewhere else in your budget.

Our emergency fund has saved us in a couple of occasions over the last three years and turned those “emergencies” into much less stressful inconveniences. When it was not only raining outside during a particularly heavy storm, but also raining inside, we had the money to be able to put on a new roof. More recently when our minivan, and main form of transportation, decided to pack it in, we were able to use some of the funds from our emergency fund to purchase a new to us car with cash.

If you’re lucky, you’ll be able to leave your emergency fund sitting untouched, but if the time arises, you’ll be glad that it is there.

Your Turn!

  • What has life thrown your way that either made you glad you had, or wished you had, the extra funds available?

3 Year Review On The Luggable Loo

When I was growing up I could never imagine that I’d be sitting here writing an in depth review on a toilet, but here we are!  This is a review of my experience with a 5 gallon bucket composting toilet with the Luggable Loo toilet seat.

I want to qualify this review before we get started.  I’m a very particular person, my house is kept very clean and tidy, I have germaphobe tendencies and I work in a white collar work environment where good hygiene is a must.  I say this only to give people an understanding of where I’m coming from because when I was reading reviews I couldn’t find others with similar lifestyles or standards.  When I first started, I was concerned how making the shift to living tiny might impact my corporate job at the time.

With that out of the way, when I first sat down to plan my tiny house a flush toilet was a very important thing for me to have.  I was dead set on having a traditional toilet.  Then the real world happened.  The city I live in prohibits septic systems unless you have an extenuating circumstance (read: it ain’t happening).  For me to get a sewer line ran to my tiny house, permits, connection fees and labor it was close to $50,000!  I was shocked.

So I started looking into options: Nature’s Head, Envirolet Systems, Sun-Mar, Incinolet and many others.  The one thing that stood out to me is that they were all big, complicated and expensive.  I hadn’t made a decision because whenever I’d talk to friends who actually used them in real life, they all weren’t super happy with them and many didn’t like it.

While I was trying to decide what I was going to do, I had to move into my tiny house and just needed something.  So I swung by my local big box and grabbed a 5 gallon bucket ($5) and a Luggable Loo ($13) and some hamster pine wood chips ($3.50) and a roll of 13 gallon trash bags ($4).  A Complete kit for $25.50, much cheaper than a $600 composting toilet or $50k for a sewer line.

The setup was simple.  Take a five gallon bucket, place a trash bag in the unit with the edges hanging over the edge, put on toilet seat (which firmly clips onto the lip of the bucket) and then toss in some wood chips.  The lid will keep the bag in place so you don’t have to worry about an edge falling in.

how to setup composting toilet

Like I said, at the time I viewed this as a stop gap, something that I was begrudgingly going to use until I could make a decision.  Then something interesting happened… I really liked it!

I will be the first to admit that there was an initial ick factor to get over, but that goes with all composting toilets.  But after a few weeks I realized it’s seriously no big deal.  If you’ve ever had a kid and changed diapers, that’s way worse.  With this setup I pop the seat off, pull the trash bag draw strings, tie it off, and drop it in the trash bin at the street.  You only have to touch the draw strings.

pee diverterOne caveat that I do want to make here is that, as a male, since I keep my toilet outside, I just pee straight forward on the ground, I keep the liquids out of the bucket for the most part.  I don’t have a diverter of any kind and if a female needs to use it, I just toss in a bit more of the wood chips for a little extra absorption and not worry about it.  If I had a live in girlfriend I may look into more complicated setups.

I’ve been using this setup now for over 3 years and that means I’ve had a lot of experience in different weather, temperatures, rain, snow, etc.  Here are some experiments and lessons learned:

No Wood Chips

Since I’m a guy I don’t have much liquids coming into the mix, so I thought I’d try not using wood chips at all.  That was over a year ago and now I don’t use them at all unless I have company.  Wood chips absorb liquids – some what – (I want to do a test with peat moss) so in reality it’s only to cover up what you leave behind and keep it out of sight.  If I was using it with someone I might switch back to chips or opt for a his and her throne.

Summer Vs. Winter

I like the toilet setup much better in the winter.  Since I keep my toilet outside, the weather is a factor.  With cooler weather means less bugs, which means less flies and gnats.  To mitigate the bugs in the summer I just empty it once a week and I never have to worry.  There may be a few flies inside, but I give the bucket a kick and they fly away.  If you wait a few weeks in the summer you’ll run into flies laying eggs, which leads to larvae, which are gross.  Emptying it once a week means you’ll never have that happen.  In truth you can get away with a few weeks, but why chance it.

In the winter I usually empty it once a month.  There are no bugs to speak of in the winter and the cold of Fall and Winter make everything a breeze.

The Smell

This is a very common question and here’s the truth: there is a smell.  This is really why I started using this outside.  Now that said, there is a smell, but it’s never worse than if you just went.  I have considered adding two little fans to the cover to bring in fresh air and draw smells out.  With those fans, there never would be any smell.  For those of you who are skeptical, consider that I’m a very clean person and the smell has been so little of a concern I felt adding a simple fan wasn’t worth my time.

Keeping The Toilet Outdoors

I don’t really know anyone else that does this, but I am a major proponent of this.  I have considered building a little enclosed area to keep it in, but living on 32 acres, I don’t really have to worry about privacy, plus the view is much better!  My recommendation would be build a little outhouse, throw a little solar panel on the top and have a tiny fan always running.

Many people ask me about rain and snow, but honestly it has never been an issue.  Every time it has rain I just put it under a base of a tree and the leaves shelter me pretty well.  There was one time when I got very sick and needed to use the facilities very often, it also poured for several days.  I just put it on my tiny house porch and it was totally fine.  In the snow, which it doesn’t snow a lot here in NC, it wasn’t a big deal either.  Even in wind, no big deal.  I have been surprised at how little it matters when it rains, is windy or is snowing.

Going To The Bathroom Outside Is Awesome

There is something really pleasant about taking care of business when you have a really nice view or just enjoy the peace and quite of nature.  If you’ve ever gone backpacking and use a toilet with a great view, it’s very enjoyable.

The Seat Of The Luggable Loo

I am very impressed how comfortable this seat is, for $13 it’s totally worth the money.  The lid for me broke off after about a year and I like it better because the lid kind of hugged a tad too close in the back.  The lid still works, I just set it on top and it has a pretty good fit.

The other thing I really like about the Luggable Loo is how well it snaps onto the 5 gallon bucket.  It has a very positive snap on the lip of the bucket, but still leave room for you to put a trash back and lock it in place.  It’s holding power on the bag is very important because it means the bag is kept in place and your business goes where it’s supposed to and stays here.

Worst Case Scenario

The setup has worked really well for me, but there was one thing I’ve always dreaded: if it tipped over.  One day I came out and it was apparent that some animal had come up to it, knocked the lid off, then flipped the whole thing seat down.  This mean that the “contents” literally were on the ground.

This was very unfortunate, but I figure out that I could grab my shovel, slide it under the leave on the ground, using the leaves as a barrier layer, and in one motion, flip it right side up.  In the end not one bit fell out and I just bagged it and it was all good.

So far, knock on wood, I haven’t ever had a bag leak.  Even if I did, I keep a few extra pails on hand and a few lids.  This means if I ever have a catastrophic failure I just put a lid on the bucket and seal it all in, then toss it.  Pail and a lid are super durable and at only a few bucks, you don’t care if you have to toss one.

 

So that’s my review and experience with the Luggable Loo 5 gallon bucket composting toilet.

Your Turn!

  • What are you planning on using for your toilet?
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