The lead-up to this has been surprisingly calm. We painted the nursery, set up the crib, installed the car seats, and toured the birthing center. We even packed the hospital bag. Mrs. Max OOP has been working a light teaching schedule and keeping herself healthy. It’s been fun, and everything from here on out is just gravy. To top it off, I closed out a 10-week ski racing series. My last race was this past Wednesday and I put up my best time of the season.

Some people will call this period “the calm before the storm.” I don’t buy that. That’s just another one of those things you are supposed to say.

We are excited to meet the baby but also want to enjoy the final month of pregnancy. It will be a fun summer in New England, and we are looking forward to working this multi-year joint venture into our routine. And routine will likely be the hallmark of our parenting strategy from day one.

Out-of-Pocket Costs

The up-front capital costs for this baby project have also been surprisingly low.

We picked up a gently used crib (pictured above) from Mrs. Max OOP’s sister while we were in New York. We insisted on trading two bottles of wine for it (~$30). I spent about $35 on a can of paint to spruce up the nursery. We dropped approximately $50 on a new cozy bassinet and another $50 on blankets. We also purchased a new car seat for around $100. I already installed a base into each of our cars, and we may even get that inspected by the nursing staff or police department. The baby will likely come home in Mrs. Max OOP’s 2007 Honda Civic, purchased way back in 2007. The Civic will celebrate her 14th birthday this year.

I will round way up here and say we are at about $300 out-of-pocket for standard baby stuff. We are hoping nature will provide baby food for free for about 6 months or so. We ordered a breast pump today for $0.00 out-of-pocket.

Friends and family have been extremely generous as well. They have helped with several other items not on the list above. One of my favorite blogging friends gave us a gift card to Amazon! Thanks, Dragon Guy! I love how engaged you all are with our confusing healthcare system.

What About Medical Costs?

As you might expect, medical expenses related to the pregnancy make up the brunt of our baby-making costs so far. It’s an easy thing to complain about. Our max out-of-pocket for services provided from January – December 2021 is $6,600. We will easily hit that figure. Once we do, all additional medical costs in 2021 will be paid in full by my insurance. This means I can flat out ignore complicated things like family deductibles and coinsurance. My max-out-pocket trumps all of that and $6,600 is the most I will pay for medically necessary services.

Maybe I should get my bunion fixed in 2021 while we are at it? I also have a pin in my elbow I should consider removing. It was put there in 2017 after a nasty fall during a trail run. Perhaps 2021 is the year to get this hardware taken out? Yes, timing healthcare services should be a consideration, but only when it makes sense.

Total Cost to Date

Since our max out-of-pocket bucket reset in January 2021, we saved some serious money with Mrs. Max OOP in Canada during the first 3-4 months of pregnancy. Likely in the neighborhood of $2,500 or more.

Since she returned to the States, we have hit $2,853 of our $6,600 max out-of-pocket in 2021. My insurance has a nice little bar graph showing our progress to the promised land.

I will very briefly cover this below.

• 1/05/2021 – Covid test: Paid in full
• 1/15/2021 – Hospital ultrasound and interpretation: $1,252.64 (that’s paying too much)
• 1/26/2021 – Routine preganacy lab work: $117.38
• 1/26/2021 – Routine vaccines: $74.72
• 2/22/2021 – Gestational diabetes test: Paid in full, likely an error on the insurance side
• 2/26/2021 – Hospital ultrasound and interpretation: $786.96
• 3/12/2021 – Non-routine labs to check for a minor issue that came back negative: $621.30

Total Out-of-Pocket Costs so far in 2021: $2,853

I have not set up any of these bills on the payment plan yet; I will look into that this week. The reason you don’t see doctor fees here is because all of those appointments will be included in the baby delivery charge. We call that a “global fee” in healthcare finance.

Let’s make a mental note here for later.

In 2020, we paid cash in Canada for three clinic visits, one telehealth visit, two ultrasounds, lab work, and a nuchal translucency ultrasound. All that came in at only 794 USD. 

Our very first ultrasound in the hospital setting here in the States after my insurance discount came in at $1,253. Is this a sign of inefficiency, or just cost-shifting at its finest? Keep in mind, it was my decision to have these services at a hospital instead of an imaging center; no one forced my hand. It was also our decision to have a baby in the first place. Yes, I am purposely playing both sides of the argument.

Downsizing Project

The Max Out of Pocket crew has made a multi-year effort at downsizing. I have been leading this push to the point where I might actually be annoying myself. Mrs. Max OOP has been a good sport, though.

We sold our 2,200 square foot house (+large basement) down in North Carolina back in May 2017. We landed in a 900 square foot $1,000/month rental here in New England. It was a bold move and something I don’t regret for a second.

I still remember getting a quote from the moving company my new employer recommended. The move from North Carolina to New England happened to be the exact amount of my new company’s moving allowance. I found that suspicious.

Instead of hiring an overpriced moving company to move all the possessions that come with an oversized house, we moved everything ourselves. This decision left us with almost $7,500 cash, which will cover our entire out-of-pocket costs for the baby delivery. It could also cover 15% of our annual expenses. I flew a friend down from Michigan to help with the move and we turned it into an awesome road trip. We got a presidential suite at one of the Marriotts along the way.

Since self-storage units are for suckers, we initially crammed everything into the rental and put our overflow items into the crawl space under the house. It was ugly, but we made it work.

Since then, we have completely emptied the crawl space. We went through boxes and boxes of stuff, getting rid of things we did not use. What’s left is slowly getting as organized as it can be in our tiny attic.

I can finally say I feel nimble now, and it’s a good feeling. We still have some work to do here, though.

Future Plans

All of this downsizing has led Mrs. Max OOP and I to talk about “what’s next”. Having our first baby almost completely financially independent is likely a unique situation that must be carefully respected.

We will definitely be staying put for at least the next 6 months. My wife will take the summer off teaching and concentrate on the baby and routine. I will take my four-week parental to focus on the Baby, Bonding, and Benjamins. I have plenty of PTO, which is my favorite benefit. After that, the sky is the limit.

We have toyed with the idea of moving to Canada or Australia. My wife’s triple (US/Canadian/Australian) citizenship makes those moves easy, and she could start generating income quickly. She is anxious to get started with her new skill, butchery, and even went as far as applying for a position in Ontario a few months back, but nothing came of it. We have a $100,000 opportunity fund dedicated to this concept. I moved that money into corporate bonds, which remains questionable, but I am holding steady for now.

If we did move, I would consider taking some time off work since my skillset likely does not transfer quickly to those countries. In contrast, I am also considering another stint in a new hospital system here in the States, a sure sign of ‘one more year syndrome‘. We would then pad our growing retirement balances for another year or two. Since I still enjoy the work, that wouldn’t be the worst plan in the world.

Time will tell here, but I sometimes feel like I am in the last semester of college.

Personal Finance

I am making a ton of progress in implementing my 2021 investor policy statement. I have not written about this yet, but I completely fumbled a $38,000 health savings account consolidation in late 2020. The custodian transfer took way longer than I expected after selling my position in the total stock market. Meanwhile, the total stock market continued to rise. Lesson learned, I suppose. I have been dollar-cost averaging the funds back into the market to correct everything. Yes, I know lump-sum investing normally wins.

I put a little rant up about it over on David’s blog.

It is also natural for humans to complicate things that don’t need to be complicated. I have been touting my tilt by making some small purchases into small-cap funds. Dr. Medimetary shared a great podcast in the comments of that post that made me think about the strategy some more. I listened to it on my way to Michigan.

Although I am looking to simplify the medical office building portfolio, I am having difficulty selling off the positions in my retirement accounts. It’s in my head, and I am unsure what my deal is, but it needs to happen soon. It is one of the last things on my list to simplify. It is not the worst thing in the world, though. We cleared another $1,066 in passive rental income in the first quarter of 2021 bringing the total to just over $6,000, not including capital gains.

I do need to be careful here. My state will start taxing me 5% at $4,800 in dividend income, and we were not too far off that in 2020. The tax would be immaterial initially, but it’s the tax return paperwork I don’t want to deal with.

Speaking of taxes, I am close to finalizing our 2020 taxes. It’s weird seeing so much ROTH contribution this year. I maxed out my traditional 403(b) and IRA for over 8 years.

Final Thoughts

Things have been surprisingly calm ahead of having this baby. At the risk of sounding naïve, we plan to keep it that way. I know our routine will change dramatically, but there will be a routine from day one. We are already building it.

Out-of-pocket medical costs will come in at $6,600 for 2021. That’s a lot. But it will be heavily subsidized through a tax shelter when I pay it out of my health savings account. I will also get a $3,000 tax credit for this child in 2021 to help with the cost. That’s on top of the $2,800 we already got from the government this year. Perhaps we are seeing a round-about way of subsidizing our healthcare expenses? As I said, Max loves playing both sides of the argument to get people fired up.

My investor policy statement is close to being implemented, and Mrs. Max OOP and I are carefully considering future plans while staying grounded and focused on what’s right in front of us.  

It’s been a fun few months, and we are really looking forward to meeting our baby.

The post A Month Out from Baby – A Random Update appeared first on Max Out of Pocket.

But I typically try to stay away from the bad drunk territory when I can. I can deal with the occasional hangover here and there, but anything more than that would quickly be identified as problematic.

I like the taste, buzz, and overall good times’ that can come along with a few drinks. Throw in the right mix of people and late 90s music videos on YouTube, and it’s even better. That’s probably the reason I can’t remember going without it for even a week in the last 10-15 years. Maybe longer. Yeah, that’s a stretch.

But I like a good challenge even more. So, I figured, why not take a little break from the substance? And if we are taking a break, why go a week without alcohol when you can go for a month?

I have dubbed the Max Out of Pocket blog the intersection of healthcare and personal finance. Therefore, this little experiment fits right in. Not only can alcohol really hamper your financial budget, but it can also wreak havoc on your physical and mental health. I even created a new category for this one called “healthy living”.

So what were the results of this little experiment? Here’s what happened.

Max Takes a Month Off Drinking

When I first plotted this out, the thought did cross my mind that going 30 days without alcohol might be a challenge for me. On top of being a regular weekend drinker, there are always “good” reasons to let this habit spill over into the weekdays here and there. I had certainly thought about taking a break a few times before, but just never made it happen.

Drinking every night because we drink to my accomplishments.

Drake

Keeping things dry on the weekdays is one thing, but rolling into a Friday evening without a drink in hand might be difficult. Isn’t that what Friday nights are for? And then there are Saturdays. College football and alcohol have always gone hand in hand for me. Yelling at the TV when you are sober just doesn’t seem as fun.

These are just excuses, though. So I figured, let’s go for it. With Mrs. Max OOP in another country for a few months, I probably don’t have a ton of excuses to be drinking on my own anyway. Polishing off a few beers while sitting around watching Ozark on Netflix is probably a questionable use of my time.

Who knows, maybe I could even reduce my liver fat percentage by 15%.

So on Friday, September 25th*, I threw back my last gin and juice and went to bed. The experiment had started.

Sleeping Like a Baby

If I was only to write about only one thing related to this little experiment, it would be the positive impact it had on my quality of sleep. This started almost immediately. I slept more soundly, had many more dreams in much more detail, and I did not wake up at all during the night. By Week 2, I had more excitement for my 8-hour sleep cycle than I would normally have for my Friday night drink.

I will spare you the details of my dreams, though. No one wants to hear about Max jumping through clouds, fishing reel in hand, with two tennis rackets tied to my feet (cloud shoes). No idea what the fishing reel was for. I chalked this level of detail up to me spending more time in the REM cycle.

Quite often, when I drink alcohol before going to bed, my sleep cycle is disturbed. On the weekends, in particular, I have a bad habit of not giving myself enough time between my last drink and when my head hits the pillow.

There are a few other underlying causes for my sleep disturbance.

• Alcohol occasionally causes acid reflux pain that feels like hydrochloric acid in my esophagus. Yes, that wakes me up.
• I often wake up to empty my overfilled bladder in the middle of the night.
• Sometimes, I think as the alcohol wears off, it triggers me to wake up, and my type-A thoughts start racing.

All three of these can easily lead me into a several hour insomnia episode. I did not experience one of these symptoms during my 30 35* days sober. They were completely eliminated.

Reduced Recycling

Reduced recycling? Almost sounds like a bad thing. But when you are not consuming alcohol, you are not generating the packaging that comes along with it. Therefore, a lot fewer cans, bottles, and wine boxes are going to the recycling center.

This is probably a bigger deal for me than most. My town does not offer curbside pickup of our trash and recycling. I am required to sort and drive our recycling to the dump. I suppose that is the price I pay for living in one of the seven income-tax-free states.

This process makes it hard for us to hide from how much alcohol we are actually consuming. If I blow through a 12 pack over the weekend, that’s 12 bottles or cans I have to deal with next week. Sure, purchasing canned beer or boxed wine instead of bottles can reduce the work, but it still hits the weekly dump run.

A reduction in drinking had a positive impact on the environment.

Physical Performance and Health

This one might be debatable because I have been naturally spending more time at the gym with Mrs. Max OOP in Alberta. That said, it does seem like my motivation and overall physical performance is reaching the next level.

On the weekends, I have been getting to the gym by 8 am and running at a pace I have not seen in years. I put in a 21-minute run a few weeks ago that came in at sub 7-minute miles. Not bad. I am also quickly approaching 225lbs on the bench, which has been a long term goal for me. I weigh about 170lbs. There was no significant weight loss, but I am certainly more cut in the abdomen than I was thirty days ago.

Mental health has been great too. I have been more productive at work and have a general sense of “feeling great” lately. That’s a scientific observation. Most days prior to this experiment would be classified as “feeling good”. But then there are the days when I would experience the occasional hangover causing the dial to dip down to the “feeling bad” zone.

Then finally, there is my elevated lipid panel. I did not have another test during this experiment, but I have read in a few different places that a reduction in alcohol can decrease cholesterol. I will be checking back in on that reading in early 2021.

Level Setting the Habit

This is a big one. But I do need to make a note here. There is a subset of the population that shouldn’t have any alcohol. Unfortunately, their mind and body just doesn’t tell them where that line is between when the good times’ end and regular life begins. I know plenty of people who fall into this boat, and some of them don’t even know they are in it. There is no amount of time away from alcohol that would support them even having one drink. Resetting the habit is just not an option.

For Max though, I have an opportunity to come out of this experiment and reset the habit. This goes for both quantity and frequency. After a thirty-day plus break from drinking, it is much easier to limit my intake frequency to certain days. Say, Friday – Sunday fun day? I can also reduce my weekend intake to maybe a few afternoon drinks instead of a full day bender on a college football Saturday. I am too old for that anyway.

Mrs. Max OOP and I have played with dry weekdays in the past, and I do like that concept. But I also don’t feel the need to micromanage it either. If St. Patrick’s Day lands on a Monday, odds are I will be having a Guinness. That said, excuses to drink can get tricky. Is a stressful day at the office a reason to drink? Maybe, but there is a spectrum and self-awareness to think about here.

I think taking a full week or month off here and there could also promote a natural reset, and is generally good for the body.

Money Back In My Pocket

Believe it or not, I don’t have great data here. Beer and wine often get buried deep into our grocery bill and I don’t have the wherewithal to pull it out of those receipts. Additionally, I am very inconsistent when picking out higher-end liquor or settling for its cheaper little brother on the lower shelf. Finally, the pandemic all but eliminated overpriced drinks from the pub since March of 2020. Limited social events kept money in my pockets.

I guess it really is just me, myself, and all my millions.

Drake

But I will make an estimate that in a normal year we likely spend over $1,800 on alcohol. A lot of this comes from drinks from restaurants with offensive markups north of 250%.

How can I complain about our health insurance cost when we are dropping almost $2,000 on alcohol? They penalize others on their premiums for smoking; should I get hit with increased premiums for this unhealthy habit?

It’s a good question. But for a family that only spent $51,436 in 2019, I suppose this shows we have our priorities in order.

Mrs. Max OOP and I used to hit our local pub for happy hours almost every weekend before the pandemic. We got the beers half off during happy hour but after tip, we would be looking at a $20 tab. That’s almost $1,000 on its own.

$20 (happy hours) X 50 weeks = $1,000

Not to mention, Max is known to get feeling good and “accidentally” order a drink after the happy hour expires. That can cost us and get the bill closer to $30. Ouch.

Since Mrs. Max OOP has not been drinking up in Canada either, I am going to go ahead and give this experiment credit for putting over $150 back in our pocket in October.

$1,800 / 12 months = $150 October Savings

Final Thoughts

This experiment spanned five weekends and saved us at least $150. Although it really didn’t cross my mind much during the week, I would be lying if I didn’t say I felt a little inconvenienced on the first few weekends. But by weekend four and five, even that dwindled. I was also invited out for drinks once. The drinks sounded good, but the company didn’t, so I was happy to have an excuse to decline.

I think this habit can slowly creep up on people. If I think back, it does seem like my monthly intake has very slowly increased over the last 10 years.

I have always thought there are probably a lot of people out there that have a love-hate relationship with alcohol. They love it at night but hate it in the morning. A never-ending cycle of winding down with a drink at night only to wind back up with coffee in the morning.

I think this would be a great challenge for them.

I am actually pretty happy about this accomplishment. This wasn’t a life-changing experiment, but it felt great. It has been on my list of things to do. Between resetting the habit and understanding my sleep cycle better, it was well worth a month without a drink. The extra cash and fewer budgeted calories were just a bonus.

When is the last time you took 30 days away from the bottle?

Cheers.

*You might be wondering why I started on September 25th and not October 1st. Well, at the time I was planning on visiting my home state of Michigan in the last week of October. That’s just too big of an excuse to drink to overcome. So I was planning ahead. Secondly, I had a lingering sore throat towards the end of September that I was trying to nip. But my Michigan trip got delayed, and therefore the sober experiment got extended to 35 days. I really didn’t have much of a reason to drink before my birthday on Halloween.

The post Sober October: Max Gives Up Alcohol For A Month appeared first on Max Out of Pocket.