Dealing with Costly Water Leak

By Mrs. Song Life

Plumber digging

About a month ago, our utility company notified us that we had a water leak somewhere on our property. The fun part of home ownership right? We left it in the back of our mind since nothing jumped out as “THIS IS A LEAK”, until we received our utility bill and noticed that we were charged $70 more than usual! The leak was unfortunately real. We had no prior experiences in dealing with water leaks, so we googled instructions on “how to locate a water leak”, and tried to follow along.

Locating the Water Shutoff Valve(s)

Most websites told us to first locate the main shut-off valve to determine whether the leak was inside the house or outside, but oftentimes the instructions were vague and confusing. Especially since there is a difference between warm-weather water system and cold-weather water system.

For warm-weather water system, which seems to be the system used around greater Seattle area, there will typically be two shutoff valves: one by the water meter, and another near the house. The one by the water meter shuts off water service from the city. If there was a leak before the water service reaches the meter, it would be the city’s responsibility to fix. The other shut off valve located near or in the house disconnects the water service going into the house, but does not impact the water service running through the yard.

How to Locate Your Gas Shutoff Valve and Water Shutoff Valve” by The Family Handyman actually did a very good job illustrating the systems.

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2016 Taxes, Checked!

By Mrs. Song Finance

Tax return 2016

Embarrassingly, this was the first time since moving to the states 3 years ago that Mr. and Mrs. Song have filed their taxes by themselves! We’ve always thought filing taxes would be very complicated, and we were scared of messing up.

The first year we were here we hired a cross-border accountant from Vancouver to do both our Canadian and US taxes. We had the accountant help declare us as non-residents of Canada for tax purposes. We didn’t own any properties, and had already disposed of any investment accounts and TFSA accounts we held. It really helped cut down the amount of taxes we had to pay, since in Canada we’d have to pay the B.C. provincial tax, whereas Washington has no state tax.

The second and third year we hired the same accountant again. We got married and had bought a house, so our tax situation changed. Oh boy, do I wish I had learned more about finance before getting married! I would’ve probably had a way smaller wedding to cut down wedding expenses. I might’ve not signed the papers too, if I had learned about the marriage tax penalty. Did you know that depending on whether you and your spouse’s incomes are equal or disparate, you will either be taxed more or taxed less (respectively) when filing as married and jointly?

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4% Rule: Ticket To Early Retirement?

By Mrs. Song Finance

Retirement sign post

You see people announcing their retirement in their 30s and you wonder, how is it possible they’re retired? They’re probably going to run out of money and they’ll eventually have to go back to working at some crappy part time job! And that’s a possibility; it’s a risk associated with many of the decisions you’ll make in life. But people have figured out how to lower that risk to an acceptable minimal, and they refer to it as “the four percent rule”.

What Is 4% Rule?

In a nutshell, it’s the amount you can safely withdraw from your portfolio year over year without depleting it too fast. This is achieved by maintaining a conservative portfolio that produces enough annual returns to match inflation and depletion. It has been a popular rule of thumb for retirement planning since it was first publicized in a 1944 study by William Bengen.

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From Vancouver to Seattle

By Mrs. Song Life

Moving from Vancouver to Seattle

In 2013, Mr. and Mrs. Song packed up their Vancouver belongings and drove 225 km (140 miles) across the border to start our work life in Bellevue. I was in my dad’s red minivan where we stuffed Mr. Song’s full-size bed in, the bed that we still sleep on now, along with other old household items that we pilfered from our families.

We never thought we’d move out of Vancouver, BC. Why would we? Vancouver is a beautiful city with diverse culture and much better Asian food. Although most Vancouverites complain about how bad their transit system is, I feel it’s better than Seattle’s. Some say Vancouverites are friendlier than Seattleites, but we found the opposite.

We ended up moving to Seattle for a few reasons.

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We Chose to Buy Instead of Rent in Seattle

By Mrs. Song Finance

Home ownership vs rent

In 2015, we left our renter life and entered home ownership. Back then we weren’t thinking too much about finances. We wanted a house because that seemed like what you would naturally do. Our parents always preached us that a property is similar to gold; its value will never depreciate, and you should always look to own a property. So we did.

But few days ago I came across “How I made $102K in Real Estate and AM Poorer For It” @ GoCurryCracker. In that article, GoCurryCracker shared his experience on home ownership in Seattle, broke down all the costs, compared it to renter life, and decided he was financially better off by renting instead of owning.

I thought to myself, SHOOT are we screwed? Did we make a wrong decision? Would we be financially better off and closer to retirement if we had stuck to renting? Their story was similar to ours in that we both arrived in Seattle for a new job and we both went and bought a house. However their location, size of the house, and timing was different from us.

I decided to do a similar analysis for our situation to find out whether we made a bad move or not.

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