April 2017 Atypical Life Income Report

Welcome to the fourth monthly income and expense report from the Atypical Life family. We are pleased to share this with all of you, so that you may have the inspiration to achieve financial independence and freedom from the man sooner. As an atypical family, this income and expense report will look very different to most family budgets, however, it is 100% real and is achievable under the right circumstances.

I share my finances to inspire others to reach for freedom earlier. I hope to demonstrate:

  • Income can be generated in multiple ways. The regular 9-5 job is not the only way to make money and is also the best way to be a slave to the man.
  • Lowering expenses is really the path towards financial freedom. The lower your expenses, the more you can save. Also, with lower expenses, it takes fewer savings to live on.
  • Side Income can allow you to be free from the man sooner than just saving.
  • It is possible to have low expenses.
  • Becoming an expat is a great way to financial freedom
  • To keep me accountable.

Tracking Your Money

Keeping track of your money is the number one way to reach financial independence. We track all of our income and expenses and then analyze it all at the end of the month for you.

Using Personal Capital is the best way to aggregate all of your accounts into one nice easy view. With your accounts spread across so many different platforms, it is hard to get a whole picture of your finances. Personal Capital gives you a view of where you are, if you spent too much, saved too little, or went into debt. Keeping track of your Net Worth on Personal Capital is super easy.

The best part of Personal Capital’s service is that it is free! It fits in perfectly with our frugal sense and allows us to track and reach financial independence faster. Check out their retirement planner to estimate how far away you are from retirement. It is one of the best I have seen for those of us pursuing FIRE.

If you haven’t started tracking your finances, it is not too late to start. Give Personal Capital a try and you will soon be on your way to being a personal finance guru.

Income

IncomeAmount
Company Match$570
Expat Income$1,266
Interest Income$5
Dividend Income$56
Other Income$102
Salary (Mr. Atypical)$6,467
Salary (Mrs. Atypical)$58
Total$8,524

April was just another normal month for us in the Atypical household. We had our regular salary and our wonderful, but regular expat income. This expat income is a 20% location premium or hazard pay in expat vernacular. It is additional income for us that is grossed up by the company, so we do not have to pay taxes on it.

My company has a fairly generous 401k match of 9%, as long as we contribute 6% to the 401k. This goal is very easy for us to achieve, as we contribute 50% of our income to the 401k. There is one caveat to my 401k contributions, though. They are only calculated on salary, expat income is not included, so 50% of $6,466 goes to the 401k each month to prepare us for financial independence. The 401k matching contribution is free money and we make nearly $6,000 per year from it.

Expenses

ExpensesAmount
Business$143
Entertainment$17
Fees$6
Food$220
Home$325
Insurance$74
Medical Expenses$71
Shopping$55
Taxes$1,065
Travel$743
Total$2,719

Our April expenses were expected and slightly under budget! We had our lowest monthly shopping budget to date at only $54 for the entire month.

My parents were in town for the first 2 weeks of April, which means more dining out and exploring. We tried to show them a good time and that involves traveling. We took a week long trip to Gansu province where we got to see numerous Danxia formations and got the must do in China done, visiting the Great Wall. Introducing my parents to the local food is enjoyable, but certainly more expensive than dining at home. However, this month we were able to reign in the food expenditures because we were eating local Chinese. Having my parents here for a few weeks gives us a feel for what the cost may be to live when we have kids in the future.

As part of our planned expenditures from the Chinese bonus we received in January, we treated my parents to roundtrip flights to Gansu. Both of their birthdays are in April, and we are so appreciative of them coming to visit, we felt that covering the flight was a great idea.

Our Gansu trip spread from March 28 – April 4, so is split over 2 months again. The portion spent in April was $743. This amount is lower than the March portion because it includes my parent’s reimbursement for half of travel expenses. Because my parents do not have a free way to get RMB to spend, we are covering all costs and they reimbursed us at the end of their trip via PayPal. To read more about our trip and how we did financially check out our post here.

April 2017 saw my lowest monthly shopping expenditure ever! We spent only $55 which included a new chain for my bike and a new skillet. Both of these were replacements for broken parts at home. Our low expenditures for April prove that it is possible to not buy stuff. After 5 years of buy, buy, buy, you can rid yourself of the habit and only buy the things you need.

Our insurance for the month is on an accrual basis because we paid for the year entirely in December. We dropped our company sponsored health insurance that cost us $250 per month and the company $750 per month in favor of a local insurance company that was ~5300 RMB or $890. This covers us for all medical expenses in Greater China and also qualifies us to use the supercharged investment vehicle, the HSA. My parents tried out acupuncture while they were here, but didn’t use all of their sessions, so we paid for 3 future acupuncture sessions. Acupuncture cured Mrs. Atypical’s back problems, so we are believers.

Our grocery and dining came down to normal in April. In March we spent, $427 and in April we spent $220. Our dining budget is always pretty small because we don’t eat out very often and when we do, our favorite restaurant cost $5 for the 2 of us. We get 兰州拉面 pulled noodles from a noodle shop within walking distance of our apartment.

The HSA Experiment

Our HSA, currently residing at HSA Bank, incurs a fee of $2.50 per month for a balance under $5,000. We will incur this fee and an additional $3 per month on that account, so we can keep all of our HSA money invested at TD Ameritrade and buy VTI, the best possible investment vehicle. VTI is the ETF equivalent of my favorite mutual fund VTSAX, Vanguard Total US Stock Market Admiral Shares.

After 2 months on the TD Ameritrade platform, I have figured out how to purchase my one ETF without issue. I was able to contribute an additional $1,750 into the HSA bringing our total investment to the maximum $6,750 for 2017.

The investments made into the HSA will save us a good amount of tax for 2017. At the 25% tax bracket, if assumed the HSA contributions are taken off the top, it is $1,688 in tax savings. I will be in the 15% tax bracket after all of our savings so, even there our tax savings are $1,013. These savings help to accelerate our path to financial freedom.

Taxes

Everybody hates taxes. They eat away at our income and we never even get a chance to see it. Taxes were 39% of our expenses for March totaling $1,065.

There are 2 certainties in life, death and taxes. ~Benjamin Franklin

After doing a review of my tax situation, I approached my tax preparation company about reducing my estimated taxes for 2017 and the future. I showed what I would save into pre-tax investment vehicles:

  • $18,000 to the 401k
  • $5,500 Mr. Atypical Traditional IRA
  • $5,500 Mrs. Atypical Traditional IRA
  • $6,750 to the family HSA
  • Total Value of $35,750

This is able to reduce my taxable income significantly, and when combined with personal and standard deductions on the 1040, it brings our taxable income very low. The purpose of reducing our tax withholding is because we know best how to take care of our money. The government obviously does not know what is best for me. We can put our money to work as soon as possible by investing in VTSAX and VTI, without waiting for a tax refund at the end of the year. This can gain us upwards of 12 months of growth (or decline…). It also allows us to raise our contributions throughout the year to achieve a healthy total portfolio to pursue freedom sooner.

I would never use a tax preparation company right now if it was not provided by the company. Taxes are not nearly as complicated as they are made out to be. Due to the tax equalization policy that my company implements for us, we have to have a professional tax preparation firm handle our taxes.

April saw the completion of our taxes, albeit after the normal April 15th deadline. Our theoretical tax liability for 2016 was $15,565 and we had paid $15,378 meaning we actually owed taxes on the return for the first time ever. This is a major bonus because the government did not get a free loan from us.

The way our tax return actually worked is a lot more complicated because we got over $7,000 in tax return that was then remitted with the additional $187 to the company.

Since we had the huge return in the bank account for a little while, I took the chance to max out my Traditional IRA for the year with a contribution of $5,500. With that final contribution, I have maxed out all pre-tax savings accounts by the end of April besides the 401k. Now to see how much more we can save on the year.

Blogging Update

April saw a lot of changes come to this blog and its secret sister travel blog that we also run. All of these changes were behind the scenes, so hopefully, there wasn’t much to notice on the actual site.

Blog Speed

We got feedback that our site was slow to load in the US. We always assumed that it was super slow to load because we live in China where internet service sucks and the server is in the US. Using a VPN to bypass the “Great Firewall” slows down traffic because of the encryption to get out of China.  Not using a VPN means we are a long long ways away from the server. Because of those reasons, I thought the server was probably fine.

So with concrete feedback that our site was slow, I delved into Google and did my research on how to speed up a site. I came back with a huge list of things to go, not the least of which was to switch to a VPS, virtual private server.

We were hosted at Bluehost on their shared hosting plan. I attributed a good amount of the slowness to the way shared hosting works, so we decided to upgrade. I enjoy being able to tinker with settings and optimize everything myself, so it made sense to build our own server. With Bluehost, the VPS was still pretty well managed for you, so I went with Digital Ocean, where I created a new Droplet, installed Ubuntu 16.04 and used EasyEngine to install WordPress.

EasyEngine made the installation very easy and straightforward. To go along with the standard WordPress install, behind the scenes there is:

  • Nginx webserver
  • MariaDB (a better updated version of MySQL)
  • php7 (the current latest and greatest)
  • Redis Server (an object cache)
  • fast-cgi caching (Nginx functionality)
  • Let’s Encrypt (free open-source software that issues free SSL certificates)

You will notice 2 server side caching programs in the list. These work together to cache and speed up our websites significantly. When I started the load time for our homepages were on the order of 10s and now they are down to 1-2 seconds depending on location. The next step in the coming month is to setup a CDN to deliver the content locally. The biggest benefit of the CDN hopefully will be a faster experience for our China users and ourselves during editing.

The hardest part of the migration effort was moving the media/uploads folder over to the new site. Because I am in China I could not get rsync to work between them without timing out. Due to this issue, I bought WP Offload S3 by Delicious Brains and now have all of our media hosted by Amazon Web Services. The WP Offload S3 plugin allows us to push all of our media to Amazon and then bring it back locally once installed on the new server. This service will also integrate very well with the CDN from Amazon, Cloudfront. Both of these services are free for the first 12 months, so we are certainly starting here!

As part of the migration, I also broke our multisite up and made individual installs of our 2 websites. This makes individual management of them easier because they have different target uses.

Traffic Growth

Our next major goal is to actually get people to read our content. It is kind of demoralizing starting out when you write a bunch of content, but nobody actually reads it. This month saw several concrete steps towards increasing our traffic.

First, I signed up for the Billionaire Blog Club. Paul has tons of free content to share with all of us about how to start a blog and the steps it takes to create a successful one. What drew me to his courses was their similarity to Elite Blog Academy while still being reasonably priced. We paid only $128 for a lifetime membership. His claim to fame is being able to start successful blog after successful blog instead of just teaching how he did it once.

Second, I started our Pinterest account and got it rolling with BoardBooster. BoardBooster allows me to auto-pin various pins on my boards and really get it working automatically for $0.01 per pin. I paid $10 to get 1,000 pins/month. Following Paul’s tutorials on Pinterest, I was able to optimize my SEO on my boards and start getting them full of awesome content. I currently have gotten on 4 group boards and feel like I am going to start experiencing growth on Atypical Life soon.

Check out and follow the Atypical Life Pinterest account here.

Traffic growth hasn’t really started too much yet, but after having prepared, I am confident it will begin soon.

Homepage

The homepage got a redesign in April. The new design, I think, looks much more professional than just the plain-Jane blog post list originally. Thanks to Thrive Themes and their email course on building a better homepage for the inspiration. I hope you all like it. I have plans to play with the design more in the future, but for now, all changes will be done on my development server at home.

Savings

In total, we made $5,803 in April and were able to save the majority of that into investment funds. It was a very successful month financially, but that doesn’t matter if we did not enjoy ourselves. We should not kill ourselves to reach financial independence. You should enjoy life all the time, knowing in the future it can be even better.

“Love the life you have, while you create the life of your dreams.” ~Hal Elrod

My parents came to China to visit and we enjoyed a wonderful trip to Gansu province to experience China. It is nice to know you are loved and that people will travel half way around the world to come and visit.

Soon we hope to have side income from our blogs to add to our monthly income report. 2 years from now, the plan is to transition from side-income to only income and be free.

How was your April? Are you heading towards financial independence as well? Let me know in the comments below.

If you enjoyed this post or found it useful, share the love and pin it to Pinterest!

Atypical Life April 2017 income report. We made $5,803 in profit this month. Blogging is coming along as we continue to invest in it to bring our dreams of freedom to fruition.

Cost Review of a Gansu Province China Family Vacation

After 2 long years in China, we had the pleasure of hosting our first family visitors, my parents. Since they traveled halfway around the world to come and see us, I took a week off of work, so we could travel slowly and experience China.

Originally, my parents wanted to visit places all over China. They just didn’t realize that China is nearly the same size as the US and places are not at all close to each other. After much discussion about slow travel, we settled on traveling to Gansu, since Mrs. Atypical and I had not been there yet.

Gansu offered another out of this world experience that only China can. Gansu is located in the Northwest of China, not really close to anything, and that was the whole point. We wanted to escape the crowds, escape the smog, escape the dreary weather, and enjoy China for what it can really offer.

Gansu on a Budget

Our trip started out in Jiayuguan after arriving by plane. Because my parents traveled around the world to come and see us, Mrs. Atypical and I decided to treat them to the plane tickets. The rest of the cost of the trip was split 50/50, so let’s see how we did.

Flights

Plane tickets to and from Jiayuguan went for $985 for 4, which is not too bad of a deal. We even traveled over a holiday weekend in China and the ticket price didn’t reflect a holiday price. For less than $250 each, we were able to get round-trip, one-stop tickets.

To purchase tickets in China is a slightly different process than in the US. The general advice to buy early to get good deals does not apply to China. If you buy more than 6 weeks out, the prices are higher. The prices start to come down at 6 weeks out and stay about the same price all the way up to one week out from the date of departure.

We use Ctrip to book our flights in China because it is a Chinese company and gets the best prices available for China. Their site is even in English, so it is easily usable for those of us that cannot speak Chinese. Because the on time departure and cancellation rate is pretty high in China, Ctrip also will call or message you about flight cancellations or delays. One time they called me over 4 hours in advance to tell me that the flight had been cancelled.

Our trip to and from Gansu went off without a hitch. All of our flights were on time and the flights were smooth. We did not have much for a view, and we were spread out throughout the cabin, but it got us there and back on a reasonable budget.

Transportation

On our trip in Gansu, we traveled by van with a private driver, by taxi, and by train. The private driver really is just a taxi driver that charges you a fixed rate for the day based upon how far away you plan to go. We found our private drivers when we took a taxi from the airport.

Drivers

Every driver was very excited to get to drive the foreigners!

This was both good and bad. The drivers obviously thought they could rip us off because we were foreign. The first driver of the trip, took us to see the Jiayuguan fort of the great wall, the first pier of the great wall, and a restored section of the wall that goes up into the mountains. It was a beautiful day of exploring and he charged us a measly 120 RMB for the privilege.

Not all of the drivers were so kind and genuinely happy to see us though. The next driver, in Zhangye, took us an hour away to see Mati Si, a Buddhist temple carved into a cliff face. He charged 300 RMB for the trip, but when we said we wanted to hang out longer and hike some in the beautiful park, he told us, that the 300 RMB was only for a half day and we would need to fork over 200 RMB more for him to sit there and do nothing. So we did not get to hike. We headed back to town because our driver was ripping us off and we were not going to deal with him anymore. He wanted to drive for us the following day, but we found a different driver through networking with the driver from Jiayuguan.

The next driver was the most pleasant and easy going driver I have ever seen in China! They are generally super aggressive, but our new driver drove safely. He drove us out to the beautiful Danxia Rainbow Mountains of Zhangye and sat around for however long we wanted for a flat day rate of 200 RMB. He was so nice and easy going that we used him for the rest of our time in Zhangye, which would be 3 more days. He drove us to the “Grand Canyon” of China, and to another Danxia location past the rainbow mountains.

Our last driver was back in Jiayuguan where we would fly home from. He really stuck it to us in the end with pricing, but I bargained him down. He was very happy to take us around all day to see various sights, and even took us to a wonderful Buddhist temple that we hadn’t seen in our research of the area. We didn’t bargain the price ahead of time, so in the end he had the upper hand when it came to leave at the airport. Because we did not bargain up front, we ended up paying 300 RMB for him driving us around town. The other 3 locations that we paid 300 RMB for the day (~$45), were much farther away from town, so I felt it should have been 200 RMB.

Lesson learned. Always negotiate flat-rate driver/taxis up front where you have the bargaining power and can choose someone else. If they do not want to negotiate and will not run the meter, someone else will. Just choose someone else.

Trains 

We took the train from Jiayuguan to Zhangye and back. The train was pretty nice and ran on a very regular schedule, so we could just show up to the train station and book our train for an hour later. Trains in China are very regular between towns and are on a set schedule. Unlike China’s airline system which always runs late, China’s train network is always prompt.

Our train ride to Zhangye cost a total of 150 RMB (~$22). We got 4 seats all together. Seats together don’t really matter. Everyone just gets on the correct car and then shuffles around. It is a little cramped in regular class seats, definitely not how we would travel cross-country like many of the Chinese do. The trip was pretty nice and took about 2.5 hours. During that time, the train staff took the opportunity on a captured audience to try and sell a bunch of garbage to us.

I don’t know about you, but I am extremely opposed to marketing like that. Whatever they sell is always priced high and I simply do not want to listen to their incessant jabbering. The problem truly lies with the consumers, though. If no one would buy any of the garbage they sell on the train, then they would not try to sell anything, knowing it is a waste of time. Capitalism has taken over, even in a communist country!

The return train ride from Zhangye was a bit more eventful. Because we traveled over Qing Ming, China’s Tomb Sweeping Holiday, the train was full and the only tickets they had left were standing tickets. I really didn’t want to stand on a train for 2.5 hours. Seeing no other options, we purchased 4 standing tickets for the same price as coming to Zhangye. Upon boarding, several young Chinese guys got up from their seats and offered them to us. They had been on the train since Beijing and were headed all the way to Urumqi. That is a 3-day train ride! Suffice it to say, they were tired of sitting and took the chance to walk around and go smoke in the smoking area of the train.

All in all, the trains worked out very well for us and were very cheap. If you can travel by train reasonably, it is the way to go in China. They run on time and are cheap. Two of my favorite things.

Touring Destinations

Gansu Province is off the beaten path of most people touring around China, but it has tons to offer. We saw 6 distinctly different beautiful locations while staying in only 2 cities.

The Great Wall

The first destination was the Great Wall. No trip to China is complete without seeing the great wall. Seeing as Mrs. Atypical and I have been here for 2+ years and have not seen it, it was a good opportunity with my parents’ arrival to go and see it. The Great Wall is a very impressive work, though the parts that you see in pictures nowadays that look beautiful are all restored. The actual wall looks like a mounded pile of dirt running off into the distance after centuries of erosion.

We toured the Jiayuguan Fort of the Great Wall on the first day in town, which set us back 400 RMB. I thought the price was kind of high for just seeing the fort, but on the drive back to the hotel, we were informed by the driver that the ticket is also to see the first pier of the great wall and the restored section that runs up into the mountains, and it is good for 2 days! All of these locations were spectacular and very unique.

Jiayuguan Fort
Entrance to the Great Wall fort in Jiayuguan.
great wall
A restored section of the great wall heading up into the mountains.
great wall
Beautiful wall up in the mountains of Gansu

Mati Si, Horse Hoof Buddhist Temple

After seeing the Great Wall, it was time to head to Zhangye to see the more natural scenery. The first stop on that leg of the trip was to see Mati Si, a very cool Buddhist temple carved into the side of the mountain. It is unbelievable the amount of excavation it took to build such an intricate network of tunnels. The craziest part was the statues that were inside and trying to figure out how they got there without cranes and modern construction techniques. I guess the ancients were smarter than we realize.

Mati Si set us back another 300 RMB for the 4 of us.

Mati Si temple
The Mati Si Buddhist temple outside of Zhangye.
Mati Si
The temple is carved into the side of the mountain.
snowy mountains
Beautiful view of the mountains from outside of Mati Si

The Rainbow Mountains

The highlight of the trip and the primary driver of going to Gansu was the rainbow mountains. The full name of the park is Zhangye Danxia Landform Geological Park. Mrs. Atypical found pictures of the out-of-this-world scenery while in the US and knew that we needed to see it before finishing our time in China. The park lived up to the hype with beautiful hues of red, yellow, grayish, and white that look like they are painted on the rocks.

It is not unreasonable to think that while in China, this is faked and actually painted on the rocks to make it a larger tourist attraction. However, we also saw the same coloring, albeit, less pronounced outside the park in untouched areas so we know the rock formations are real.

The rainbow mountains park cost 300 RMB for the 4 of us as well, and was worth every penny for the experience. To make the most of it, we stayed there for as long as possible, since the park is not too big.

rainbow mountains

rainbow mountains

rainbow mountains
Erie sky above the rainbow mountains.

Pingshanhu Grand Canyon

We found the Pingshanhu Grand Canyon gem while riding in a cab. I saw a picture of it in a brochure and figured it would be a cool place to go and visit. The rocks have formed pillars and a canyon snakes between them, even though there is no water in it now. Maybe the area was left behind by glaciers receding from the past ice age. Nevertheless, the canyon is there and we were able to hike down into the bottom and experience the natural maze of passageways through the canyon.

Again, we tried to spend as much time there as possible by bringing lunch with us and following all of the paths around. The drive to get here was 1.5 hours, so I wanted to stay at least 3 hours to make it worth the drive time. We ended up touring the park for 5 hours before heading home.

This was the most expensive location of the trip at 520 RMB for 4 people. This price, I thought, was too expensive. The park is new, so price should be low to attract visitors. It is not easy to get to either, so they are not going to get too many tourists just passing by. Part of the ticket entrance was a mandatory 30 RMB bus fee charged per person. I tend to disagree with “mandatory add-ons” because I could walk in if I wanted to. This park the bus fee was probably needed because it was 10 km from the entrance to the actual grand canyon location.

Nevertheless, the Pingshanhu Grand Canyon was a cool destination and I would recommend it if you have extra time.

Pingshanhu Grand Canyon

Pingshanhu Grand Canyon

Camel
Saw this camel on the way to Pingshanhu Grand Canyon. Looks like they farm camels out in this area.

Danxia Binggou

The 2nd danxia location we went to was Binggou Danxia Scenic Area. This was another very cool location just 10 km farther down the road from the rainbow mountains area. The topography here looks like sandstone pillars. We headed there in the morning of our last day in Zhangye and it did not disappoint. The scenery was out-of-this-world again! The only downside to the park was that several of the paths were closed to traffic for now.

Binggou Danxia Scenic Area was a good deal with the entrance fee only 240 RMB for the 4 of us. It again included a mandatory bus fee despite being able to walk, but it was cheaper than everything previously, so I can’t complain. Most people combine the rainbow mountains danxia and the Binggou Danxia in a single day, which would be 540 RMB for 4 people, but you would save the transportation cost to the rainbow mountains. Since we had the time, we just went to one location per day and enjoyed it.

Slow travel allows you to actually get to experience the places you go to. Too many people rush from place to place trying to “see it all” and end up missing the real experience.

Binggou Danxia
Cool columns at Binggou Danxia.
Binggou Danxia
Dried up river bed at Binggou.
Binggou Danxia
Amazing views like this were everywhere at Binggou. The paths were built to the tops of some pillars to give a 360-degree view of the surrounding park.

Jiayuguan Temples

The last day of our trip was spent touring around Jiayuguan. We headed to the Weijin Tombs early in the morning, only to be disappointed by how small the place was. There are ~1000 tombs scattered around the area of ancient warriors and noblemen, but there was only one tomb that was open to the public. We paid 124 RMB for the 4 of us to spend less than 30 minutes looking around.

After the tombs, we really didn’t have an idea of where to go, but our driver for the day ended up taking us to Wenshu Grottoes which was another Buddhist temple complex built on the side and into the side of a mountain. The place was extremely ornate and we had it mostly to ourselves for exploring.

The coolest thing here was getting to walk through an area where they were building new statues and seeing how they are constructed. The statues start off as a scarecrow of hay and then are molded with mud/clay to the correct shape before painting.

The Wenshu Temple cost 168 RMB to tour which was steep considering Buddhist temples are generally free to tour. However, the price was worth it for the beauty of the area and the kindness of the monks that lived there.

Wenshu Grottoes

Wenshu Grottoes
Built along and inside the mountain, the Wenshu Grottoes sit with a view of the beautiful glaciers in the background.

Housing

We stayed in hotels for this trip with a budget of $20 per room per night. We stayed within this with no problem. The only problem we had was booking with Qunar. Qunar is another Chinese booking site like Ctrip, however, they recently removed their English version making it much less useful. Our issue with Qunar was that we booked a hotel that told us upon arrival that they do not take foreigners. All foreigners in China have to register with the local police wherever they stay and many hotels do not understand the process, so they just say the don’t take foreigners. After calling the manager and having them come in, we were shown up to our rooms, in the hotel that “did not take foreigners.” Our rooms were massive suites for ~$20 per night.

After our room confusion in Jiayuguan, we booked using Agoda, which specifically states whether the hotel takes foreigners or not. We stayed for 4 nights in a hotel in Zhangye for ~$11.50 per night per room. This hotel was certainly not a high standard hotel, but it did the job since we weren’t spending much time in it anyways.

The last hotel in Jiayuguan was again $20 per night and was the worst of the trip. Our room did not have a window, nor did it have AC or fan mode. The room was roasting hot and Mrs. Atypical and I slept poorly. At least it was the last night.

Overall, we learned that booking with Agoda is the way to go in China. They have a wonderful selection of hotels in China and the pricing is about the same as on Chinese booking sites while being much easier to use for English speakers.

Food

Last, but certainly not least, we ate very well in Gansu. If for no other reason, everyone should travel to China to experience the food culture. The food in China is amazing and is as diverse as the country is big. The selection is so much more than we see at Chinese restaurants in the US.

We ate wonderful noodles and fresh bread one day, and lamb stew and lamb ribs the next. The variety was endless! My only word of caution: most food in China is spicy. Be ready for intense flavors that are nothing like you have tried before.

Total Cost Breakdown

We spent a total of $1,956 on a week long trip for 4 to Gansu including flights. After subtracting my parent’s half of the cost, the Atypical family’s travel cost was $1,471 because we paid for all of the flights as a gift for them coming to see us.

GansuExpensePercent
Activities$297.4815%
Housing$212.1211%
Food$177.519%
Transportation$1,268.7665%
Total$1,955.87

GansuPie

Gansu2017BarChartIn Conclusion

We had a spectacular trip to Gansu province with my parents in tow. We got to see lots of cool places and traveled slow enough to get to experience Gansu. If we had more time, we would have loved to bring the bikes and ride from place to place, which would have saved more money, but travel has to be designed around everyone.

Have you ever traveled in China? Let us know, we may be able to help.

If you enjoyed this post, please share it on Pinterest!

Travel cost review of Gansu China. Budget travel and slow travel through a beautiful unknown region of China.

What is Freedom?

According to Webster’s dictionary, freedom is:

Freedom: noun free·dom \ˈfrē-dəm\ the quality or state of being free: such as

a : the absence of necessity, coercion, or constraint in choice or action : liberation from slavery or restraint or from the power of another : independence: the quality or state of being exempt or released usually from something onerous freedom from care: ease, facility spoke the language with freedom: the quality of being frank, open, or outspoken answered with freedom: improper familiarity : boldness of conception or execution : unrestricted use gave him the freedom of their home

As we can see, freedom has many meanings. Independence is probably the most accurate definition of freedom from my point of view. To be free from all cares and from everything is to be independent.

Thesaurus.com ranked the following as the highest rated synonyms to freedom:

  • independence
  • ability
  • exemption
  • flexibility
  • immunity
  • opportunity
  • power
  • privilege
  • right

So what is freedom really?

Here at Atypical Life, we strive for freedom. We strive for personal freedom, to decide where we want to be and do what we want to do when we want to do it. We are pursuing financial freedom, where we will be able to live out our days without having to worry about working anymore.

Merriam-Webster got it right saying, liberation from slavery or restraint or from the power of another. As a society, we have become slaves to our money. Because of this, we are also slaves to jobs we do not like and do not want. Thesaurus.com concurs with its highest ranking synonym, independence. That is what we are truly seeking.

Freedom Defined by the US Constitution

In society today, we are told that we are free. The US education system does a good job of educating us about the freedoms that we have in the United States. We have freedom of speech, freedom of religion, freedom of the press, freedom to assemble, right to own guns, right to be represented in court, right to own property, among others. All of these freedoms make it seem like the US is the pinnacle of freedom and that we all should feel free our whole lives.

The US has many rights and freedoms. However, these rights and freedoms seem only to free the fringe of society. Why are the rest of us left to be slaves to work?

Why do we not feel free? Society strangles freedom.

The freedoms afforded by the US Constitution and its amendments are a good start, but corporate and societal culture need to transform to produce a culture more centered around personal freedom.

Too many people spend their lives with their head to the grindstone to earn a living just to get by. They buy things day in and day out that society says you mush have to be happy. They get married to a spouse that they love, but after months and years of continuing to push through work, their marriage falls apart. Oh well, that is what happens in such a cutthroat society. One day they wake up and they are 70 years old and wonder where their life went. What happened to all those years I was going to have to enjoy retirement and the American dream?

I watched a good Youtube video last night about a couple that was chiropractors in the US and they were miserable. They both worked 12 hour days non-stop and when they returned home from work, they were too tired to enjoy each other anymore. They had become slaves to work and to money. They sold everything they had in the US and moved to Costa Rica where they reignited their love for each other and began to love life again. She wrote a book Happier than a Billionaire detailing their journey to a happier life. The best quote from the video was this:

We are all miserable. It’s okay to be fat and hate your wife. Join the club. In society today, it’s what it takes to get by.

They decided that was not true and pursued an alternative.

Today, the typical middle-class American is brought up in society knowing their path in life consists of:

  • 1-2 years of preschool
  • K-12 = 13 years of primary schooling
  • 4+ years of college (5 or more is okay because you are figuring out your life, right?)
  • Now at age 22-23 start work for 40-50 years
  • Buy a house
  • Get married ($$$$$)
  • Have children (done right costs >$250,000 per child)
  • At 62 if you’re lucky probably closer to 70 RETIRE!
  • Live out the rest of your days tired because you worked your life away during your most vibrant years

For the first 15 years of schooling, we are probably going to school for free. Our parent’s taxes pay for public schooling. School teaches us the fundamentals of all kinds of academic pursuits and gives us a good basis to figure out what we enjoy. During these years, the government has decided for us what we need to know and what we do not need to know. Is that freedom? During our formative years, we probably do not have enough knowledge base to decide what we do and do not need to know. Still, it is not freedom for others to choose for us.

During our years in middle and high school, we are told that college is the way of the future. If you do not have a degree, then you will just be an unemployed bozo on the side of the street begging for money. They neglect to show us the other ways to make money to achieve freedom, so the majority of us from the middle class and above head on into college to pursue higher learning.

I was lucky enough to have chosen a highly employable bachelor’s degree in engineering, so I was able to get out of college after “only” 5 years. 1 year consisted of co-oping work, so I only really attended school for 4 years.

After graduation, we are now expected to get a job. But wait. Most people got a degree in an unemployable field, so what is the answer to that? Let’s go to grad school and get further in debt. We should not worry about student loan debt since it is in pursuit of education which will gain us a salary for life. Many people pursue grad school because the employment opportunities were not there when they graduated, or they didn’t play the employment game correctly to land the big job. So now they are stuck in school gaining more debt and lengthening their time to freedom.

When we finally do graduate, we are expected to get that big time “real world” job. Our wonderful government in the US decides for us what retirement age is. This age is not actually the age that you are allowed to retire, but it is the age that we can start collecting on social security. Since many people are still a slave to their money at 60 they cannot retire until they can collect on full social security which now comes around 67 or higher for my generation. Myself, I do not factor social security into retirement savings projections because of the uncertainty in it. We will provide for ourselves. If social security is around for us, all the better.

By the time we have reached retirement age, we are finally free. We are no longer beholden to the man and can pursue what we want when we want. However, since we spent 40-50 years grinding our most vibrant years away we are too tired to really enjoy what the world has to offer.

Yes, we can now enjoy the company of our family and our loved ones more often. We can even enjoy the freedom to travel around and see the world. But just ponder the days, when you were 25-40. The fittest and strongest days of your life. This is the time that Atypical Life aims to be free for.

This is why we feel strangled by society. We feel that the expectations set by society have to be followed. To go against the flow of society is to be a social outcast and to not be accepted. We are taught that acceptance in society is important, so we need to follow the flow and fit it with everyone. Because too many people just accept the status quo, our personal freedom is strangled.

Personal Freedom

We have the freedom to live the life that we want to. Do not let anyone tell you otherwise!

In order to live the life you want, you have to cast away society’s feelings and decide for yourself what you want most in life. We still have to live within the laws of the world, however, it is not difficult to design a life for yourself that fulfills and surpasses your wildest dreams. If your dream is to live where you are now and do what you are doing, congrats you are already free. But if you are tired and worn out from work, do not hesitate to change. We have to make personal freedom a priority because no one else will do it on our behalf.

Here at Atypical Life, personal freedom is being location independent. We want to be able to pick up and move around whenever we want. This does not mean we will not have a house/apartment wherever it is we are located at the moment. We want to be free from the obligation to be located in a certain place because of work. We want to travel and see the world. To do that, we need the freedom of location.

Financial Freedom

In the US we often hear:

Freedom comes at a price.

I cannot agree more with this statement. It usually means a human sacrifice in war, but for financial freedom, it has a more direct meaning. The price for financial freedom is your expenses for the rest of your life. There are too many investment decisions to talk about here, but the point when your investments are able to grow and become self-sustaining is when we have financial freedom.

Financial freedom seems like a dream to most of the societal drones that go along with their heads to the grindstone. However, if we save our money and invest it wisely, we can free ourselves. The more we pursue financial freedom and actually put real effort towards it, the quicker it comes.

In the pursuit of freedom, less is more.

Financial freedom does not mean buying everything you can possibly dream of and never running out of money. It refers to being able to cover your reasonable living costs forever. At this point, we have the freedom to tell people, we don’t need your money, you don’t own me. This is the truly liberating feeling that comes with financial freedom.

Freedom

Whether we know it or not, freedom is what we all want. Innately, we all want the ability to choose for ourselves what we want, when we want, where we want. Society has thrust itself upon us trying to tell us this is not possible. We need to take it upon ourselves to make freedom a priority because no one else will. Freedom means different things to different people, but we should all strive to achieve our own version of freedom.

Here at Atypical Life, freedom is paramount.

I would love to hear your thoughts on freedom.

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freedom, what is freedom,

freedom, what is freedom,

Top 8 Reasons to Buy Forever Items

In the pursuit of financial independence many of us try to save, save, save. That means forgoing almost all purchases in the hopes that one day we will have enough money to leave the workforce and enjoy the atypical life of freedom.

But I am here to tell you, it is NOT ALL ABOUT SAVING.

Every item we buy has a purpose, or at least it should have a purpose. If we buy something with no purpose, then why did we buy it in the first place?

Without further ado, here are the top 10 reasons that you should buy forever items.

1. You will only have to buy the item once.

This should be obvious from the name, forever items. However, many of us on the path towards financial freedom are extremely frugal and are trying our best to find the cheapest way there. The cheaper we can be the sooner we can leave the rat race, right?

Most of the time, this is true. But when you buy a forever item, it may be more expensive, but you will likely never have to buy it again. This far outweighs the downsides of paying more for the item upfront.

2. Resale value stays high.

When we buy our forever items, they are  items of high value, but they also allow us to resell them in the future. A good example of forever items is camera lenses. We buy them because we enjoy photography and to help us achieve financial and personal freedom sooner, despite them being expensive items. Sometimes they cost $500+ each, which seems outrageous. However, camera lenses, as long as you take care of them never wear out. You can keep one for 10 years and then resell it for nearly the cost you paid for it.

We are getting ready to sell our Nikon camera system because we switched to Olympus. Our favorite wide angle lens, a Tokina 11-16 mm f/2.8, sells for around $400 new. We bought it for $330 used, and I expect to sell it for the same amount I bought it for after having it for an additional 4 years. This is the true power of forever items. Value lasts!

3. Quality is second to none.

When we buy a forever item, we know we have done our research and have found the best item available. A forever item is expected to last forever, thus it requires the quality to be second to none. A forever tool, like a set of Snap-on wrenches for your workshop, have a lasting quality to them that can be used over and over again without ever wearing out.

4. Forever items are in the eye of the beholder.

Not every forever item needs to be the top of the line purchase. Does the hobbyist really need industrial grade tools to work on cars or are the regular Craftsman tools sufficient? Obviously, if you are not going to use your tools on a regular basis, then the cheaper ones will last a lifetime and that makes them a forever item for you.

5. Most forever items come with spectacular warranties.

Back before I started my journey towards financial independence, I just wanted to buy things. And buy things I did. I needed a blender, and after doing hours of research, I landed on the Blendtec Blender. You may have seen the youtube videos from “Will it Blend“. I decided that this was the blender that I needed, and $400 later I had my very own Blendtec blender. Now, I have had it for over 4 years, and this past week, the blade’s seal wore out and we got rubber seal in our smoothies. This was very disappointing coming from such an expensive piece of equipment. I remembered though, Blendtec has an 8 year warranty on their blenders, so I filled out the  warranty information on their website, and the next thing I know, I have a confirmation of shipment for a new jar. No haggling, no complaining, just great customer service. This is what you can expect from top-end forever items.

6. You will save money.

Because a forever item lasts forever, you will save money on the purchase. The upfront purchase price may be high, but the fact that you will not buy another one in your lifetime means that the cost is averaged over your remaining lifetime. My Blendtec blender, bought in 2013, now cost approximately $100 per year. By the time the warranty on it runs out in 4 more years, it will be at $50 per year. I was going through $30 and $40 blenders once or twice per year, so in the end, it is cheaper for me to have purchased the high quality forever item.

Another way to look at the cost of ownership is when you plan on reselling it. If you buy a forever item for $500, own it for 4 years, and then resell it for $400, then your cost was only $100, or $25 per year. Because of the high resale value, your cost of ownership of forever items comes way down. The caveat here, is that you must be willing to resell it. But because I know you are all pursuing financial independence and minimalism is a value held by us, I know all of us are willing to let go of items.

7. You can buy forever items used and still have a long life expectancy from it.

Because the quality of forever items is so good, you are able to buy them off the used market. Ebay and Craigslist are 2 of my favorite places to buy items in the US. If you are patient, you can score great deals on these sites for forever items. If the original MSRP cost is $1,000, like our new camera the Olympus E-M1, but you get it used a couple years later for $500, then you can enjoy the item for a lifetime well without the cost of it new.

One of my favorite methods to save money on the journey to financial independence is to let someone else take the initial value out an item before we buy it used. The first 30% or more of an items cost is markup, so we might as well let someone with money to burn take that cost out for us, especially on forever items that last a lifetime.

camera

8. You can pass on your forever items.

Everybody likes to get things for free. Your kids and later your grand kids will appreciate acquiring quality forever items. One of the most common forever items to pass on is quality cookware, currently from the 1930s and 40s, however the idea continues to apply. A forever item can be passed on and appreciated for generations to come. No one wants to receive garbage hoarded for years, but will genuinely appreciate a lower number of quality items.

Conclusion

As you can see, buying forever items does make sense even for a frugal family pursuing financial independence and freedom. By spending more upfront, you save money in the long run and cost over a lifetime is what really matters. Spending money to save money is a concept that is normally passed over, but there are times, when it can make sense. Buying forever items is one of those times, and I encourage all of us to consider purchasing forever items when the option is available. Not everything we buy needs to last forever, just always keep in mind lifetime cost.

By keeping an eye towards the end goal, financial independence, and we can guide ourselves to the right decisions. Let me know in the comments if you agree or disagree.

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 buy forever items, top reasons

How to Slash Your Taxes: Tax Liability Estimation

With tax day fast approaching, most of us are in crunch mode to get our taxes submitted by the deadline. It is now crunch time to finish before time runs out and penalties are assessed. Despite the desire to just finish our taxes, we should all take a step back and think about tax estimation.

Tax liability estimation is a very useful skill to have. Put to good use, it can slash your taxes and bring your freedom date closer. It allows you to leverage your knowledge of tax liability with your employer to lower your tax withholding from your paycheck and have a higher take-home pay each month.

Because estimating your taxes allows you to lower your tax withholding and not have a tax refund at the end of the year, you are able to put your money to work sooner gaining precious days and months on your freedom date.

As I worked with my tax preparation provider (paid for by work), I prepared a tax estimation spreadsheet. There are numerous calculators out there for estimating taxes, but none are as powerful and customizable as the simple spreadsheet. I developed it using the infamous Form 1040. Taxes always have a mystique of being complicated and impossible to do without help, but through my creation of this tool, I learned that it is not nearly as complicated as we are led to believe.

I went through the 1040 line-by-line and brought all applicable items over to the spreadsheet to be able to calculate my actual tax liability. Because I have the expat package now, this was a huge tool for me. I have $15,000+ per year that is un-taxed from my perspective because of gross-up taxes paid by the company. My tax preparers are doing my taxes based on not saving any money to tax-advantaged accounts and after I was able to estimate my tax liability for the next year, I was able to get them to lower my taxes over $300 per month. That is $3,600 for the year that I can invest up to a year earlier and get compound growth on.

Free TAX ESTIMATOR

If you are interested in seeing my tax estimation spreadsheet for yourself and playing with the numbers to optimize your situation, sign up below. Be prepared for extreme savings!

The 1040

The 1040 is broken up into sections to make it easier to understand. The sections are:

  • Filing Status (single, married filing joint, married filing separate, head of household, qualifying widow)
  • Exemptions (Used for the standard exemption calculation)
  • Income (All your various income streams are accounted here)
  • Adjusted Gross Income (allowed deductions to your taxable income)
  • Tax and Credits
  • Other Taxes (additional special taxes e.g. self-employment tax)
  • Payments (how much you paid through the year)
  • Refund (if overpaid on taxes throughout the year)
  • Amount You Owe (if underpaid on tax throughout the year)

There are a total of 79 line items to fill out on the 1040, but for most people, the majority of the items will be not applicable and the form quickly becomes very easy to fill out.

There are numerous software tools to help you fill out your taxes, but the tax forms are not complicated and can be filled out personally. Doing this will give you a more intimate knowledge of taxes and help you to slash through the waste.

How to Estimate Your Taxes

Everybody should track their income and expenses. Because you track your income and expenses, it is very easy estimate your tax liability for the year.

Income

First, you need to be able to project your income. This includes not only your salary, but dividends in your taxable investment accounts, business income, taxable refunds, capital gains from investment sales, taxable retirement income, rental income, farm income, unemployment compensation, and other miscellaneous income. Basically if you make money in any way, Uncle Sam wants a part of it.

From this list of taxable income, you should take notice of the dividends, capital gains, and retirement income. These are your personal levers to reduce taxes from your income. These may not seem like income during the year, but Uncle Sam sees it that way.

Adjusted Gross Income (AGI)

Second, you will estimate your deductions for the year. Your AGI is your income after allowed adjustments to income before the personal and standard deductions. AGI gives you an overview of your income that wasn't saved into tax-advantaged accounts or spent on tax-advantaged goods. Your main adjustments are:

  • Educator expenses
  • Health Savings Account (HSA) contributions
  • One half of Self-Employment Tax
  • Pre-tax retirement plan contributions (Traditional IRA, SEP, SIMPLE, Solo 401k, 401k)
  • Self-employed health insurance deduction
  • Student loan interest deduction
  • Tuition and fees to qualifying schools

This list is not comprehensive, but represents the most common deductions taken on your taxes. Normally the 401k deduction is accounted for on your W-2 and does not show up as income, however, when estimating your taxes, you should include it as a line item under AGI.

Tax and Credits

Tax and Credits is home to your personal and standard or itemized deductions. After subtracting these from your AGI, you get your taxable income. From your taxable income, you can determine which tax bracket you fit in and determine your taxes.

The US uses a progressive income tax. In other words, being in the 25% tax bracket does not mean you pay 25% of your income to Uncle Sam, it means you pay 25% of the amount above the 15% tax bracket and 15% of the amount between 10 and 15% brackets, and 10% of the amount below the 10% bracket.

tax ~= taxable income * 25%
tax = 10% * 10% tax bracket + 15% * (15% - 10% tax brackets) + 25% * (25% - 15% tax brackets) + ...

You pay less than your tax bracket sounds like.

You have your tax liability calculated and now it is time to take your tax credits. Credits are much more powerful than deductions because they directly effect the tax liability. They are directly subtracted from the tax liability. Credits available include:

  • Foreign tax credit
  • Dependent care credit
  • Education credit
  • Retirement savings contributions credit
  • Child tax credit
  • Residential energy credits
  • Other credits


Bringing it all together

Now we have enough information to estimate our tax liability. When we know our salary, contributions to tax-advantaged accounts, deductions, and credits, we can accurately estimate our tax liability for the year. Even if you get a bonus or some other windfall, your estimation is accurate and the bonus is just added in on top of what you already predicted.

The true power of the estimation is the chance for optimization. With a plan for the year and a model you can manipulate, you can see how different scenarios can effect your bottom line. The goal here is to minimize your tax liability and the only way to do that is to know how it works. By playing with the numbers you can watch the tax liability vary and determine the best way to plan out your taxes.

Spending your time on optimizing your taxes and determining how to qualify for the various tax credits will give you a huge return on investment. Not only can you minimize your tax liability today and get your money invested sooner (no tax refund), but you can also have more money overall by minimizing and planning your tax approach.

Free TAX ESTIMATOR

If you are interested in seeing my tax estimation spreadsheet for yourself and playing with the numbers to optimize your situation, sign up below. Be prepared for extreme savings!

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tax estimation

March 2017 Atypical Life Income Report

Welcome to the third monthly income and expense report from the Atypical Life family. We are pleased to share this with all of you, so that you may have the inspiration to achieve financial independence and freedom from the man sooner. As an atypical family, this income and expense report will look very different to most family budgets, however, it is 100% real and is achievable under the right circumstances.

I share my finances to inspire others to reach for freedom earlier. I hope to show from my income and expense reports:

  • Income can be generated in multiple ways. The regular 9-5 job is not the only way to make money and is also the best way to be a slave to the man.
  • Lowering expenses is really the path towards financial freedom. The lower your expenses, the more you can save. Also, with lower expenses, it takes fewer savings to live on.
  • It is possible to have low expenses.
  • Becoming an expat is a great way to financial freedom
  • To keep me accountable.

Tracking Your Money

Keeping track of your money is the number one way to reach financial independence. We track all of our income and expenses and then analyze it all at the end of the month for you.

Using Personal Capital is the best way to aggregate all of your accounts into one nice easy view. With your accounts spread across so many different platforms, it is hard to get a whole picture of your finances. Personal Capital gives you a view of where you are, if you spent too much, saved too little, or went into debt. Keeping track of your Net Worth on Personal Capital is super easy.

The best part of Personal Capital’s service is that it is free! It fits in perfectly with our frugal sense and allows us to track and reach financial independence faster. Check out their retirement planner to estimate how far away you are from retirement. It is one of the best I have seen for those of us pursuing FIRE.

If you haven’t started tracking your finances, it is not too late to start. Give Personal Capital a try and you will soon be on your way to being a personal finance guru.

Income

IncomeAmount
Bonus$6,020
Company Match$1,112
Expat Income$1,266
Gifts Received$50
Interest$4
Investment$725
Salary (Mr. Atypical)$6,467
Salary (Mrs. Atypical)$131
Total$15,775

March was another great month for us in the Atypical household. We had our regular salary and our wonderful, but regular expat income. This expat income is a 20% location premium or hazard pay in expat vernacular. It is additional income for us that is grossed up by the company, so we do not have to pay taxes on it.

I was stoked in March when our company actually paid the Short-term Incentive Plan (STIP) at 100% funding this year. This amounted to a 7.75% bonus on my new annual salary. All of the extra funds got saved and invested with 50% going directly to the 401k, ~25% going to taxes and the final 25% paid out to me and invested in the HSA.

One problem with the 401k contribution this month is that it still has not posted. I received my bonus on March 10, and the $3,010 that were “contributed” to the 401k, have still not shown up in my account. I was waiting for the salary contribution posted (around April 7) before approaching HR about this lack of contribution. I am not sure of the company’s intent here, but it seems they are holding on to my money for their own gain rather than paying it out to me on time.

My company has a fairly generous 401k match of 9%, as long as we contribute 6% to the 401k. This goal is very easy for us to achieve, as we contribute 50% of our income to the 401k. There is one caveat to my 401k contributions, though. They are only calculated on salary, expat income is not included, so 50% of $6,466 goes to the 401k each month to ready us for an atypical life of freedom. The 401k matching contribution is free money and we make nearly $6,000 per year from this income source.

March is when all of my VTSAX investments pay out dividends, so we had a $725 dividend payment. The payment for this quarter was very low compared with past payments. Even though I have more investments than I did in December 2016, the dividend payout was down 25% on a per share basis.

Expenses

ExpensesAmount
Business$550
Fees$8
Food$448
Home$325
Insurance$74
Medical Expenses$70
Shopping$427
Taxes$2,730
Travel$890
Utilities$29
Total$5,551

Our March expenses were to be expected and slightly over budget! They were the highest of 2017 so far because of hosting my parents in China for a few weeks.

The bonus we received in January from the local Chinese government got put to further good use this month on a new lens for our Micro 4/3 camera. The Olympus E-M1 that we bought in February is complemented nicely now by a wide-angle Panasonic 7-14 mm f/4 lens. This lens gives us a new perspective to use and will continue to expand the possibilities of beautiful photography for our blogs. Along with that, we improved our blogs with new plugins, so keep an eye out for new formatting. Because the bonus was paid in RMB to a Chinese bank account, we were not able to invest it without the fees and hassle of a wire transfer, so we have decided to allocate it to business expansion.

Because my parents are here, our budget, in general, got overstretched. We are trying to show them a good time and that involves traveling. We took a week long trip to Gansu province where we got to see numerous Danxia formations and got the must do in China done, visited the Great Wall. We are also getting more food out at restaurants as a result of them here. Introducing them to the local food is enjoyable, but certainly more expensive. It gives us a feel for what the cost will be to live when we have kids in the future.

In addition to the business expansion from the Chinese bonus, we treated my parents to covering the flight cost to Gansu and back. Both of their birthdays are in April, and we are so appreciative of them coming to visit, we felt that covering the flight was a great idea.

Our Gansu trip spread from March 28 – April 4, so is split over 2 months again. The portion spent in March was $876, however, half of the non-flight cost will be paid back to us by my parents. because they do not have a free way to get RMB to spend, we are covering all costs and they will reimburse us at the end of the trip via PayPal. Keep an eye out for our upcoming post about our Gansu trip.

Shopping

The shopping budget was over this month at $427. The reason we were over budget again is due to my parent’s trip to China. Because we can’t buy some things in China (I wear a size 46 shoe 13US), we bought them from the US and had my parents bring them to us. This saw the purchase of a pair of Chaco sandals for me, a pair of cycling sandals to replace the ones that I broke last year, and 2 horse riding helmets for Mrs. Atypical. The last one was a mistake due to a website malfunction and we will get reimbursed for the helmet when it gets returned to the store.

Mrs. Atypical and I are very into exercise and use it to spend much of our free time. Since cycling here is not too fun and the air is not too clean (think a thick headache inducing smog 150+ PM2.5) she asked for a bike trainer so she could ride inside. There was no way I could say no to that, so we purchased one that I would ride as well, and she is well on her way to getting stronger because of this purchase. I did not buy the cheapest version of a trainer because tools should be bought to last, and good quality can make all the difference. In the pursuit of freedom, we cannot forget to live and enjoy ourselves.

Medical

Our insurance for the month is on an accrual basis because we paid for the year entirely in December. We dropped our company sponsored health insurance that cost us $250 per month and the company $750 per month in favor of a local insurance company that was ~5300 RMB or $890. This covers us for all medical expenses in Greater China and also qualifies us to use the supercharged investment vehicle, the HSA.

We had our first medical costs of 2017 this month with the purchase of 12 months worth of birth control. China has it right because birth control is over the counter. There is no way they could have maintained the one-child policy for years without easy access to birth control. In the US, the government has put up barriers to access which does not make any sense.

Home

Our home cost remained at $325 and will remain at exactly that level until we finish the contract up in China. Our internet was paid in full this month for the following year. For the service (fine during the day, slow as dirt at night), the price is reasonable at $255 for the year or $21 per month.

Food

Our grocery and dining budget ballooned this month from my parent’s visit to $427. With $335 spent on groceries for the month, it is evident that we were stockpiling ingredients for the month ahead. I purchased 10 lbs of butter in preparation of baking wonderful Western sweets. Since we get the butter delivered, I thought it was better to stockpile before it gets hot here to stop melting during delivery. I am always happy that the cost of food in China is so low beside our splurges for sanity’s sake on butter, sugar, and chocolate!

The HSA Experiment

Our HSA, currently residing at HSA Bank, incurs a fee of $2.50 per month for a balance under $5,000. We will incur this fee and an additional $3 per month on that account, so we can keep all of our HSA money invested at TD Ameritrade and buy VTI, the best possible investment vehicle. VTI is the ETF equivalent of my favorite mutual fund VTSAX, Vanguard Total US Stock Market Admiral Shares.

My second month using this platform was much more successful than the first month. I did not make the same mistake as I did in February with incorrectly moving funds from HSA Bank to/from TD Ameritrade. I was able to put an additional $3,500 into the HSA bringing my total investment to $5,000 for 2017.

The investments made into the HSA will save us a good amount of taxes for 2017. At the 25% tax bracket, if assumed the HSA contributions are taken off the top, it is $1,688 in tax savings. I will be in the 15% tax bracket after all of our savings so, even there our tax savings are $1,013. These savings help to accelerate our path to financial freedom.

Taxes

Everybody hates taxes. They eat away at our income and we never even get a chance to see it. Taxes were 49% of our expenses for March totaling $2,729.

There are 2 certainties in life, death and taxes. ~Benjamin Franklin

Our taxes for March were extraordinarily high because of the tax withheld on the bonus. I initially thought it was way too high because they withheld 25% federal income tax from it, however it ended up correct. Because it is additional income above the estimated tax that I pay on my normal salary, it is taxed at my max tax rate of 25%. The 25% income tax was levied on the entire bonus, even though 50% of it went to the 401k in pre-tax contributions. Due to the expat package, I do not pay real income tax, but estimated income tax to the company, the accounting is done differently. The tax rate should probably be 15% since my saving plan for the year will put me in the 15% tax bracket but is not worth arguing.

After doing a review of my tax situation, I approached my tax preparation company about reducing my estimated taxes for 2017 and the future. I showed that I would save into pre-tax investment vehicles:

  • $18,000 to the 401k
  • $5,500 Mr. Atypical Traditional IRA
  • $5,500 Mrs. Atypical Traditional IRA
  • $6,750 to the family HSA
  • Total Value of $35,750

This is able to reduce my taxable income significantly, and when combined with personal and standard deductions on the 1040, it brings our taxable income very low. The purpose of reducing our tax withholding is because we know best how to take care of our money. The government obviously does not know what is best for me. We can put our money to work as soon as possible by investing in VTSAX and VTI, without waiting for a tax refund at the end of the year. This can gain us upwards of 12 months of growth (or decline…). It also allows us to raise our contributions throughout the year to achieve a healthy total portfolio to pursue freedom sooner.

I would never use a tax preparation company right now if it was not provided by the company. Taxes are not nearly as complicated as they are made out to be. Due to the tax equalization policy that my company implements for us, we have to have a professional tax preparation firm handle our taxes.

Savings

In total, we made $10,239 in March and were able to save the majority of that into investment funds. It was a very successful month financially, but that doesn’t matter if we did not enjoy ourselves. We should not kill ourselves to reach freedom. You should enjoy life all the time, knowing in the future it can be even better.

“Love the life you have, while you create the life of your dreams.” ~Hal Elrod

My parents came to China to visit and we got to go on a wonderful trip to Gansu province to check out the scenery and mountains there. It is nice to know you are loved and that people will travel half way around the world to come and visit.

How was your March? Are you heading towards financial independence as well? Let me know in the comments below.

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March 2017 financial review

Travel Slow, Travel Cheap, Travel Forever

Why do so many people feel they need to rest when they get back from vacation?

The problem with vacation and travel in general is we are going about it all wrong. We have a set amount of time, say one week, and we try to jam as many activities and as much sightseeing as possible into our limited time. This creates a great environment for stress and high cost.

The solution:

Travel slow, travel cheap, travel forever.


So what is slow travel?

Slow travel is going to fewer places and really experiencing them. When we traverse quickly from one place to another we miss out on all of the cool little things that make a place interesting. Slow travel is about spending the time to see the little things, to talk to the locals, and to experience life as locals.

When we travel slowly, we get to spend more time doing and experiencing and less time traveling. The travel part of traveling, the bus rides, plane flights, train rides, etc. is enjoyed by few. When we decide to travel slowly, we are consciously deciding to spend more of our vacation experiencing and less of our valuable time away getting transported from place to place.

The pace of slow travel depends on the person and the constraints on vacation time. If we had the choice, we would go to places for 1-3 months at a time to really get to know them. Currently, work constrains us to a max of about 2 weeks on a vacation, so our itinerary gets cut back a lot. If we tried to fit in everything and “see a whole country” in 2 weeks, like we did in Greece, then we get to spend half of our time traveling, and the other half recovering from that traveling.

Slow travel does not only apply to the retired

Even a one week vacation can be spent traveling slowly. If you choose to go to just one place, then a one week vacation to another country or another city is enough time to get to enjoy yourself and not feel like you are flying from one place to another.

Sure, 1-3 months per location would be preferable, but one week allows for time to get to explore the back streets, and the local cafes if you are not rushing from one place to the next. In a week, you can start to develop a routine and enjoy the relaxation.

Everybody takes week long vacations. Most of us have at least 2 weeks of vacation per year in whatever job we have. If not, maybe we should reevaluate what is important to us. We can work with our bosses to get entire weeks or 2 weeks in a row for a longer trip. Don’t let limited vacation time discourage you from enjoying the experience of slow travel.

I talked with my boss and my boss’s boss recently about vacation and needing more for traveling while we are living in China. 3 weeks is simply not enough time to travel while we are living abroad. After talking with them, they offered to allow me to take at least one additional week of vacation over the year and also to work a little extra to accrue more if needed. You will never get more time off unless you ask. The worst they can say is no.

There is time for slow travel, even if you have a job with little vacation.

Slow travel is cheap

The entire premise of slow travel is minimizing your time traveling, so you can experience a place. Travel is expensive. So by minimizing our time traveling on planes, buses, trains, taxis, etc. then we are lowering the cost of our vacation substantially.

Our recent trip to Indonesia, is a perfect example of this. We toured by bicycle, which I still consider slow travel, even though it is moving most days. Despite traveling by bicycle our biggest cost on the trip was transportation and travel. That includes travel hacking our way to cheap plane tickets (~$200) for the 2 of us. Travel hacking saved us $600 on flights alone.

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As you can see, transportation was the largest cost. If we extended the trip another 2 weeks, than our transportation cost would remain the same while becoming a smaller and smaller percentage of overall trip cost.

The longer you stay in a single place or move about by free transportation, the cheaper your trip will be. Plane flights are always a major expense, unless you travel hack your way to cheap or free flights. The only way to truly minimize your travel cost is by minimizing your travel time and to travel slowly.

Conclusion

The question you have to ask yourself is this:

Why am I traveling?

Am I traveling to get photos of all the sites to show to my friends and family? Or am I traveling to experience a new place, experience a new culture, taste new foods, experience wonderful scenery, and learn a new way of life?

Asking yourself these questions will let you know if you are ready for slow travel. If you just want to maximize your photo opportunities at all the well-known tourist attractions, then fast travel is for you. However, if you want to experience life in a new way, then slow travel is the best way to reach your goal. Slow travel will allow you to travel forever!

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slow travel, frugal travel, cheap, forever

Is College the Only Path?

Why does society push us towards pursuing college?

Is college really the only path to freedom out there?

Society pushes college as the answer to everything. Yes, I went to college and got an engineering degree. After college, I got this big fancy engineering job with an international manufacturing company before moving to China on the expat package with the same company.

As an engineer, the skills I use most from day-to-day are those skills learned in the first year of engineering courses if not in high school. Were all 4 years really necessary to get to where I am today.

A degree is really nothing, but proof to employers that you can commit to something for four years. ~Anonymous

Mrs. Atypical came across this quote yesterday, and I immediately loved it!

It seems most employers don’t really care about what you learned in college. They are just looking for a check mark on your resume to say, yes, you went to college. The job requirement says BS degree in something. You are qualified!

Since I learned all of the essentials to my degree in one class, the introductory class, did I really need 4 years? I could have started working 4 years earlier (I went to college for 5 years because of a co-op job for one year), had way less student loan debt and already been retired at 28. Because society and employers value that piece of paper so much, I had to remain in school for the 4 years of classes, not to learn about engineering, but to demonstrate my persistence.

So after 4 years or more at an influential college, you now have a pretty piece of paper that you can show prospective employers. That pretty piece of paper proves nothing other than your ability to persist through 4 years of classes. It is the same paper regardless of your grades and regardless of your knowledge.

diploma

Hiring Young

Employers are scared to hire someone young. I hear the young bias on almost a daily basis. We are bringing in a 3rd party contractor to evaluate some equipment at work. He is my age, 28. My co-workers are scared. Since he isn’t 40+, he must be an inexperienced idiot. Being young must mean that you don’t know anything! I was ecstatic that our hired help is young because he has less of a chance of bias from too much experience.

Employers are scared to hire someone out of high school because there is no proof that they can stick with something. Just finishing high school is not proof because it is nearly required these days. By spending 4 years grinding your gears away, paying a college so that you can study and work for them, “proves” that you have what it takes to make it in the real world.

When we take a job in the real world, we are making the 2nd biggest commitment of our lives. Second only to marriage. As the employee, we know that we are going to help out our employer the best that we can, but employers don’t seem to believe it without proof from that piece of paper called a diploma. It shows that we can persist, and perhaps, that we have matured from our naive high school days.

What else is out there?

Despite society’s leaning towards college, there are other options out there for moving though life without a college degree. Sure a college degree, in an employable field, makes it easy to get a “good” job and make the big bucks, but it is not the end all.

Remember,

In the pursuit of freedom, less is more.

In this spirit, how can we get by without college?

The trades offer an excellent bypass of college and also a ticket to freedom. Going into the trades takes less time from your life to get certified and the pay is excellent. It also is applicable to almost anywhere you want to go because everyone needs an electrician, a plumber, a carpenter, etc. Learning to work with your hands and build practical things is a surefire way to bypass college and start pursuing your freedom earlier.

Starting your own business is another way to bypass the HR requirement of needing college. For those of us that are pursuing freedom, there is no better way than self-employment. It allows us to set our own schedule and live our own life instead of being beholden to our employer. There are a near infinite set of possibilities for self-employment that I will not list here. Suffice it to say, if you have the passion and the patience, self-employment can be the answer to bypassing college.

Can we change corporate requirements for college?

At this point in 2017, probably not. College has been driven home for too long and promoted too well, to be able to convince corporations that we are qualified despite no college degree.

Even though the probability is low, we should still do our part to convince corporations that college is not necessary to prove our worth. We go to college for 4 years, yet our future employers still require nearly 6 months of training and possibly 2 years of working experience before they find you beneficial to the company. If it takes 2 years of training after you just completed 4 years of training (college), why do we need the initial 4 years? Bringing this kind of solid argument to the table can help to influence change.

The transition to more reasonable requirements at work and better work-life balance has already started. The millennial generation has been hard at work getting flex-time schedules, more flexible vacation, remote working, and many other amenities. If we keep pushing our employers to focus on our potential and not on our qualifications, then we will be able to move towards a society where capability is king, not education.

Conclusion

College will always have its place in society, especially for knowledge for the sake of knowledge. However, we should not believe that it is the only path in life after high school. There are other ways to progress towards freedom.

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