Yesterday, October 6, 2017, we closed on 21 acres of vacant land on the Big Island of Hawaii.

Pretty much everything else remains the same from a year ago:

  • we live in the duplex
  • we are both still working our primary jobs (lawyer & IT)
  • our big house hasn’t sold and it is being rented on Airbnb
  • we have the Townhouse and the 6-unit building, 100% occupied currently

But, everything feels different, too. I can smell freedom. While it would be ideal to have the big house sold, we have agreed to look for a long-term tenant if/when it makes more sense than Airbnb. While Mr. PFL is still working, I believe his anxieties about “needing” the job have lessened; he intends (I think) to quit around his birthday in early spring. While we still have plenty of debt, we have plenty of assets that could pay it off if/when it makes sense to do so. The 6-unit building is completely paid off and we confirmed that we have made enough rental income in the last four years that all improvements, repairs and expenses have been paid for as well. We received an offer for $200,000 to sell the building over the summer, which would be pure profit. And now we have a foothold on our dream: Hawaii!

The last six months have been a blur – I can’t believe we already had Halloween! As soon as we were in-contract on the new duplex, we were going non-stop. In addition to listing the house, moving and managing the Airbnb, the only month we didn’t travel this year was in August; instead, we spent a lot of August updating our duplex.

At least I can see all of our hard work paying off financially. Mr. PFL is still working his full-time IT job, so his income should remain the same this year. I am on-track to gross more than last year as a lawyer. I also made $8,100 as my commission as the real estate agent on our purchase of the duplex and we’ve grossed $17,000 on the Airbnb rental of our house from mid-July to date. This is in addition to rent increases for about half of our units due to tenant turn-over and the extra $1,950 per month in income from the new duplex (we pay $1,000/month and the neighbors pay $950/month).

We’ve also had some big expenses, including about $10,000 for the Condo roof (again) and about $20,000 to shore up and dry-out the basement at the new duplex.

Our house is still for sale, and there have been several showings, but no offers yet. The listing expires December 9th (six months from posting), so if we aren’t in contract by then, we will probably wait to list again in the spring.

Thanksgiving is less than three weeks away?! I’ve got to line up some turkey…

In the “learn something new every day” category, I hadn’t realized that the acronym for financial independence/retire early is FIRE. But, it just reminds me why I continue to learn and continue to read. There is always something new.

I’ve been helping a friend sort out her parents’ finances the last few months. Her father is in need of assisted living and her mother passed away. Unfortunately, her mother was in control of the finances and was incredibly guarded about them, even claiming that they had “no money,” which wasn’t true. It has been difficult for my friend to get access to accounts to pay for her father’s care (he no longer has the ability to do it himself) and she has been forced to learn about different types of investment accounts. Thankfully, she has found a financial adviser that she trusts to help her navigate. But, my friend has never independently learned about retirement accounts and taxable investment accounts, so she is incredibly overwhelmed.

Unfortunately, her situation is not unique. So many people are financially illiterate. But there is so much information available! It isn’t magic, but I understand that it can feel that way. Dealing with money isn’t just math, it is emotional. For example, I still get surprised, and a little offended, when we occasionally get called “cheap.” But, I don’t feel deprived. I take more trips in a year than almost everyone else I know. And while I drive a junker, I’m totally fine with it. I have to remember that our FIRE quest is still abnormal. But I also know that is doesn’t have to be. Almost anyone can do it if they put their mind to it.

Life had been one gigantic whirlwind since April 17th when our offer was accepted on the new duplex. Everything has more or less gone according to “the plan,” except that we haven’t had any offers on our big house yet. As the local paper points out, this is common for homes in our price range. Having two homes when you only need one smaller one isn’t the best feeling, though.

As we were downsizing, I had enough duplicates of items to pack up two plastic totes for a hypothetical “second home,” including dishes, towels, and cooking equipment. I assumed I’d use the items for a camper or a cabin, or maybe to ship to Hawaii, but I’ve been using them for the last couple of weeks.

Around June 19th, Mr. PFL and I were looking around the house, making a mental list of what we actually needed for our move to the duplex, and we realized that a strong majority of the items in our big house weren’t needed for the new place. We planned to get a new bed and a new couch. We don’t have room for our big dining room table. I  remembered that I had packed up the “second home” totes. And this is when our new business was born: I signed up to be a host on Airbnb.com.

We had never used Airbnb before I signed up for it; it has worked better than I ever could have anticipated. The big house is still for sale and our number one goal is to sell it, but in the meantime, we are making money. I have a ton of control over the Airbnb calendar, so if we do end up in contract, we will be able to close in 45-60 days without an issue (I just block days I don’t want someone to stay, and I can always unblock them later). I made the house available on July 14th for the first time, and we had three groups stay in July (with the 4th group arriving today); we made $2,955 which is already deposited in our checking account. I have a cleaning lady I found on craigslist that comes between each group, and I take all of the used sheets and towels to the laundromat so I can get them done in less than two hours. We are expecting to make an additional $5,716 in August and early September. It is an incredible relief to know that three or four months of overhead are covered just by letting people stay at our furnished house.

Mr. PFL and I are settling in to our new digs, too. The cat seems to like it (and all the new places he can find to hide). We have been doing some projects, which I’ll share soon.

We have been working extremely hard to get our house ready to sell. Our planned list date is June 9th, with a showing start date of June 10th and an Open House on Sunday, June 12th. Both Mr. PFL and I were able to take off the three days prior to Memorial Day Weekend (mine was “unofficial,” so I put in about 2 hours of work time per day), so we had six solid days of cleaning, organizing, repairing and painting. I was able to get pictures of every single room and completed the application to be accepted into the Weichert, Realtors Luxury Collection program. I should know by tomorrow whether we qualify; this marketing program is limited to homes that are expected to sell for at least three times the average sale price and have excellent curb appeal. Our area lacks a go-to agent or firm that handles high-end homes exclusively, so I’m also hoping that I may be able to generate some new business. I’m planning to get professional photos done on June 8th, but in the meantime, here are some of my favorites:

Bed Bath Dining Room

Today we are both back to work and next weekend we need to focus on the Condo because the tenants are turning over (yes, they broke the lease, but yes, they found us new tenants, so it is okay). We will actually be making more money every month and we are getting paid for the days when we will be painting, but it is the timing that is bad.

And now, time to ABW (Always Be Working).

My parents wired $100,000 to our business account today. I just need to transfer over the money from our home equity lines and we will be ready to close on the 17th on our new duplex. I’ve already set up the automatic monthly payments to pay my parents back and have drafted a promissory note to reflect the same, even though they aren’t worried about these details. I’m 99% sure that I wouldn’t trust them to pay me back $100,000 in a timely fashion, but I’m glad they trust us. I think it is important to keep this “official,” though: money can change relationships very quickly. I know they are very proud that they could help us and we are very grateful, too. I hope this turns out to be a win/win for all of us.

Over the weekend, Mr. PFL and I dropped off a carload of electronic equipment at a recycling drive. We also toured our new property and met with one of the current tenants (someone dropped the ball on letting him know that we were coming for the inspection). The only major concern is water in the basement when it rains, but it is obvious where it is coming from, so we should be able to fix it.

After seeing our new place, we were motivated to start cleaning out closets. We are getting rid of about a third or more of our clothes. There are also about a dozen different coats that we don’t need, as well as a pile full of blankets and other assorted bedding. Many of the items that we plan to purge are things that we “inherited” when Mr. PFL’s parents downsized in 2011. Since we had a big house, it has been easy to store these miscellaneous items, but we’ve already made a big dent in parsing out things that we don’t need anymore. Our third floor (that we never really use) looks enormous with most of the clutter removed. It is very liberating to let go of so many things.

We still have a long way to go, and we will probably go through this process several more times through the years, but we are definitely taking steps in the right direction. Hopefully this will make the actual move much easier, too.