Meeting Fulltimers Steve and Debbie

Karen and I were excited to spend a couple days with Steve and Debbie from the Down the Road Blog. In late 2014 Karen and I made the decision our future would be in an RV – someday. Doing like most I started surfing the web for ideas. Got lucky and found the class of 2014 whom had attended the RV Dreams Rally together. Debbie calls them the 14teeners or however that’s spelled. For us future-timers meeting those we have followed during their journey is like meeting a rock star.

Really appreciated Steve and Debbie diverting to Kansas City as they made their way up from southern Missouri. As is the custom in our house, we ask out of towners what their interests are. In this case, western stuff, history, breweries, hiking or outdoors and BBQ. Debbie and I communicated via email and then texting as the couple arrived near town. Karen and I came up with some ideas based on what the couple suggested were their interests and then just played it by ear, doing whatever made sense.

They camped at Fleming Park/Blue Springs Lake, south of downtown Kansas City near the sports complexes. This was our second visit to the campground having met out of towners there in the past. It’s a county park. Karen and I drove out to Steve and Debbie’s where we learned several new tricks about picking a spot in a park, towing a fifth wheel, working on-line, nice features to look for in a fifth wheel and a bunch more. As is the case most of the time with those coming to town, Steve wanted to eat at Joe’s Kansas City BBQ. I decided taking them to the original location would be a special treat and give them a chance to see a little of the Kansas side of Kansas City, Missouri. But first we made a stop at our local “famous” brewery which is Boulevard. North of Kansas City is Weston Missouri which has a history of distilling and scattered all around the area are wine vineyards. Most don’t know Missouri is also wine country, given the French influence before the area was part of the United States. Owners of a winery down the street from our home told me wine gets its flavor from the soil which is the reason they picked this area. Here are some photos. Karen says Debbie is very photogenic.

City scape from porch at top of building

We took a tour – beer served before and after!

After dinner, because it was not far away, we drove over to the Plaza Shopping Center. This is the countries first outdoor shopping center. The developer (JC Nichols) was friends with the King of Spain. Kansas City has a sister city in Spain and Nichols modeled the buildings after Spanish buildings. Missouri is called the Show Me State. We are also the Cave State and Kansas City is the City of Fountains. The Plaza is a great place to see fountains although they are spread all over town. Not far from the largest fountain near the Plaza is a Vietnam War memorial. Steve and Debbie are into locating geocaches. We walked down to one at the memorial and then Steve and Debbie bought us ice cream to (more than) replace the calories we burned.

Debbie – Here is a view of the Christmas Lights on the Plaza I told you about.

The world may be coming to an end, the 20 something year old we got to take this photo asked me how to take a picture with my cell phone. Wow

The couple spent the next day on their own touring western/history stuff in nearby Kearney Missouri which is centered around the Frank and Jessie James home. Then they came out to the house for a meal. Really hope we meet again. Karen and I can’t say enough how much we enjoyed our time with the couple. Wish we would have had time to show them around our town of Excelsior Springs Missouri.

As a lore (on my part) to visit the state, Debbie says a new Springfield Missouri museum, located by Bass Pro is now open. I recalled some time ago seeing city blocks cleared away in Springfield to make room. It’s called the Wonders of Wildlife National Museum and Aquarium.

I meant to post something about the decision to take a social security benefit at age 62 and how I rate fifth wheels. That will have to wait until next time.

 


Forest River fined
by Indiana OSHA for safety violations. Beginning in 2015 they were also in trouble with the Feds for failing to recall trailers when needed. The Cedar Creek is at the top of our list for a new fifth wheel, but violations like these is hurting my opinion of the company. Also, a sales person at another manufacturer, whom I trust, used to work at Forest River and told me a few other facts that were bad to hear such as employees racing around throwing trailers together so they could go home early.


Rollin’ On TV Series has a number of interesting and well-done videos.

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Bees and BBQ

I had trouble figuring out how to start this blog post. It’s about family and a hobby. I sat around thinking, “how the heck should I start this.” Finally decided just to jump in. No reason to make a literary work of everything. I hope you find it a little more interesting than a couple future posts I’ve been contemplating which are taking a social security benefit at age 62 and my system for evaluating fifth wheels.

We traveled to our daughter Catherine’s home for BBQ. Her husband John is one of those (us) people who researches the heck out of everything. He purchased a very heavy Green Egg grill to smoke meat. Catherine has been a vegetarian forever. We did our part in trying to eat all the meat and keep it out of her fridge. Of particular interest was a wire hanging out of John’s BBQ smoker. It’s attached to a meter that sends signals to his phone telling him important data such as temperature. It even has an alarm to wake him up at night to let him know he is about to ruin our meal by sleeping when he should be adding charcoal to the grill. Speaking (writing) of charcoal John says Missouri is the leader in production of the best chunk wood charcoal that being manufactured by Rockwood.

John's Smoker_LI (800x448)

John’s Big Green Egg smoker with wire for temperature monitoring

Regarding BBQ, Karen has been perfecting her recipe for BBQ wings and pulled pork using her Instant Pot. It’s wonderful!

Switching topics now to honeybees, not that honey is a great ingredient for BBQ sauce. The start of fall weather marks the time we extract honey from our beehives. This year was special as my sister Mary and friend Russ were visiting and gave a helping hand.  They really seemed to enjoy the process while I thought I was glad they liked it because it’s one of the more labor-intensive parts of the process. Briefly the process is; nectar is gathered by the bees and in this case stored within separate boxes known as supers which are above their living quarters known as brood boxes. After the bees reduce the moisture content of the nectar, which has been mixed with enzymes they produce, it becomes honey. The bees secrete wax which they cap over the honey.  Each of these boxes contain nine or ten frames on which there is comb the bees stored and caped the honey on. We remove frames and cut off the wax with a hot knife. We place the frames containing now exposed honey in an extractor. The extractor spins thereby using centrifugal force, throwing the honey to the sides of the extractor. Then we open a gate at the bottom of the extractor. The honey gushes out into a series of filters on top of buckets. Later, the honey is bottled from the buckets and enjoyed by all.

Here are photos for those more inclined to learn that way:

P1000155 (598x416)

Run – There are Bees!

Honey in frames in super (314x800)

Frames in super (honey) boxes

Honey on frame (385x800)

Mark gorged with honey holding frame to place in extractor

Frame in extractor (425x800)

Frames are placed in extractor which has a handle to spin the contents

Honey from extractor 2 (440x800)

Open gate at bottom of extractor and honey strains through filters – And dog wonders if he will get some!

Regarding bees:  They seem to be one of natures several varmints folks can be afraid of. A number of people have come out to our beehives to get over that fear. Personally, 70,000 bees in a managed beehive or even a large swarm don’t even get my heart beat up. Now, throw in a snake and I’m running for cover.

For those afraid of bees there is not much I can write to get you over that. But… here are a few points to keep in mind when you run into them. Foraging honey bees have no interest in stinging you. Stinging occurs when they get swatted by you trying to brush them away such as when they get stuck in your hair.  Certain times of year, when nectar flow from flowers is low, they also tend to be more protective of their hives so stay away. Bees flying well above your head from a hive are no issue. Our bees tend to gain altitude about 20 feet from the hive at which time they are overhead. When I mow the grass in front of their hives I drive the mower slow. That way the bees have a chance to maneuver around me as they want to avoid contact.  When bees swarm, in that big black cloud so many are worried about, they are at their most docile state. Before leaving the hive to swarm they gorge on honey which has a side benefit of them not wanting to sting anyone..

In some southern states Africanized bees have made homes. They are a different creature and tend to be more protective of their hives. Wish I could tell you more about Africanized bees but I have no experience with them. I can tell you this, when a bee stings they sometimes put out a pheromone that smells like a banana. Beekeepers use smoke to mask the pheromone. If you do get stung and smell bananas the bees have marked you as a threat. On another note, it takes about 20 seconds for a bee to inject all of their venom into you. More precisely, they sting and their stinger, attached to the venom sack, is left behind which kills the bee. Don’t grab the “stinger” with your fingers because by doing so you are squeezing venom into your -whatever got stung place. Use something with an edge similar to a credit card to brush the stinger off.  If you are in Kansas City within the next two years I’d be happy to let you play with my bees to get over that fear!

Honey bear (800x448).jpg

Final Product

Debbie and Steve of the Down the Road Blog are heading to Kansas City tomorrow on their path through Missouri. According to their blog she is afraid of bees. This jar of honey is for you guys!

These Things Break – Do You Really Want to Buy One?

This blog post may turn out to be just another summary of the bad side of RV repairs as reported by so many other writers.  I’ve thought about the topic for the past several months and had started research well before that.  I found myself asking why post it at all? I thought surely everyone has read about the potential for catastrophic RV repairs blamed on poor manufacturing. I suppose the best reason to write this is to make sure my wife has an idea of what can go wrong with our future RV and maybe readers would appreciate sharing this information with their spouse.

It is no secret that RV sales are at a historic high and the forecast for next year is even more units will be built. Record production has the potential (that’s a safe way to describe it) of putting an increased demand on repair shops and manufacturers/dealerships completing warranty service.  Unfortunately, my research has been focused on fifth wheels so you will have to bear with me if you own another class of RV.

Most have surely read how RV manufacturers can be terrible at handling after-sales service. Even if we have not owned a unit for years, it does not take long to drift through the forums and read even owners who have few problems will write “they all have issues.”  If you look back in the recent history of RV manufacturing you will discover many of the existing companies are not that old. Many have closed their doors and many have had their brand names bought out by another. All this causes management change and perhaps a step back in customer service.  A short list of what I’ve seen in the past three years include; NuWa stopped building the Hitchhiker then Peterson (builders of the Excel) produced the Hitchhiker only to shut down operations a short time later. NuWa invented the fifth wheel so what a shame they could not stay in business. Lifestyles Luxury RV was said by many to be a dependable brand but suddenly closed their doors.  Some say because of losing financial backing and others said they were so intent on fixing every warranty problem they could not stay in business. Management came from another defunct company to run Lifestyles. What about the Carriage brands which were also popular by full-timers as late as 2010. Gone – sold the brand names to Crossroads who has stopped building the Carriage and the Cameo is just another among average fifth wheels (in my opinion). I could go on. The point is even todays companies who care about the customer may be gone when RV sales eventually decline. And especially if management does not think long-term, guiding a company in a better position for the future.

Now for the meat of this blog post. I want my wife and others to know there is a chance so many things will be defective in an RV that you might decide to leave the road, be injured or take a financial hit.  Personally, I believe the chances are relatively rare as a percentage of RVs that are on the road today. But then again, they are not all used as full time living quarters.

I have been following full-timer’s RV blogs since October of 2014. So far, I have read or talked personally with four of the 23 RV owners I follow who had significant issues with their unit. The brands include DRV, the original Carriage Carri-lite, Lifestyles and Forrest River Cedar Creek. In one case, the person left the road disgusted after trying other brands.  Another had their RVs frame welded and eventually continued on their journey. Another sat in a motel room for months, even working a part-time job, until the manufacturer built them a new trailer. And finally, another has sent their trailer back to the factory for 70 or more issues to be addressed.  Yes, they “all may have problems.” Yes, these may be just a few unique examples. And yes, they may have eventually been repaired. But, these four examples represent 17% of this small sampling. Each was built by what are considered good companies. But most of all – what if we become one of the percentage with major issues? And is it ever satisfactory that any single purchaser, much less these 17%, should have to worry about it. Especially when manufacturers can get banks to finance these things for 20 years which to me implies they will last that long. Of course, if you buy a vacation travel trailer for a lot less than a $60,000 – $120,000 fifth wheel which is built as a “full time or extended stay” unit, most would not expect to get the same longevity.

Okay you can stop reading if you agree or feel warned there could be major issues with an RV that could cause major inconvenience when you are on the road – Or dare read on-

Please don’t get this blog post confused as only a rant, because it’s not. The chance our RV will breakdown in a major way is really a concern of mine. I’m personally willing to risk it and buy a trailer for the likely chance we will not be hindered with a catastrophic repair. If you want to read about the true nature of these issues then click here. This is the only place you will need to go to learn about what is truly behind the problem with RV manufacturers.  Greg Gerber is the past Editor of RV Daily Report and wrote this series of articles titled “RV Industry Death Spiral.” To me, he is a whistle-blower and I appreciated his candor.  Mr. Gerber may have correctly forecasted 2017 would be the year of lawsuits for the RV industry. If his research is correct, there are more than 2,500 active lawsuits by customers after the time he wrote the articles. He predicts 2019 will be the legal turning point for the RV industry as state and federal officials look to pass consumer-friendly legislation. I’ll leave out the politics of his prediction relative to if or if not government is willing to push forward with legislation.

I first became aware of government influence when reading in 2015 Forest River got themselves into a little trouble with the National Highway Traffic Safety Administration for not sending out prompt recall notices for safety issues.  Later Forest River announced positive changes potentially effecting the timeliness of RV repairs and certainly response to recall notices. Now their dealerships are taking issue with the new warranty policy per an RV Daily Report article written May of 2017. Why is this example so important? Because Forest River is among the top producers of RVs and is one of only a few competing against fifth wheel brands, and others, owned by Thor. And just think, Forest River gained that market share during their short 11-year history.  Personally, I view Forest River’s initiative as a good thing in that they are trying to introduce a system to better supply parts to customers in immediate need. RV Business published an article by June of 2017. Called a Parts Initiative in which they wrote; “An all-industry working group led by members of the Recreation Vehicle Industry Association (RVIA), the Recreation Vehicle Dealers Association (RVDA) and RVDA of Canada continues to quietly work on a series of parts delivery issues that could ultimately help improve dealers’ abilities to expedite warranty and other consumer repairs in the field.” Is this the start of RV manufacturers finally taking responsibility for producing sometimes inferior products?

Yet other manufacturers are taking a slightly different approach to better avoid major repair issues in their new units. During my research, I’m finding Grand Design, founded in 2011, is a company where potential customers are looking to provide exceptional customer service. Grand Design recently sold the brand to Winnebago. The founders came from Keystone which is a company claiming to be the #1 builders of recreational vehicles in North America. Keystone is another relatively new company founded in 1996. By 2001 they were owned by Thor. Talk about management changes!  Now back to the Grand Design’s business model, designed to catch flaws before they leave the factory. They built a huge facility where all their products pass through an inspection – after construction.  In their own words;

“Following construction, every Grand Design product goes through an initial quality inspection process. This is usually the final step other manufacturers take before shipping their units. We at Grand Design RV believe that this “industry standard” process falls far short of producing what we would regard as a quality unit. So, at this point in the manufacturing process, we send each unit to our dedicated pre-delivery inspection center where it is meticulously taken through a rigid point-by-point inspection process and final finished.”

I am not qualified to tell any RV manufacture how to run their business. I’ll let my purchasing dollars influence that – to a tiny degree.  But Dr. Deming is qualified!  And I’m not sure Grand Design’s model would be part of the way Deming would suggest the business be run in terms of checking for problems after the fact. How about building quality into the process to start with! In business college, I learned where during World War II Dr. Deming worked in logistics with the US Air Force. Deming would eventually draft what he called the 14 points for management. From what I was taught, Deming took his skills to Japan after the United States drifted into an economy based upon, in rather simple terms, why build it good when you can throw it away and buy another. At the time it might have been easier to get away with poor quality when most of the worlds manufacturing overseas was bombed into oblivion, while ours went untouched. But not for long.

US business management would not listen to Dr. Deming’s ideas. Well, the Japanese listened and with Deming – trashed the US auto market. Legend has it one Japanese executive was in the audience during a day Deming presented his principles. Kaoru Ishikawa listened and later was noted for his own quality management innovations. If you have studied the topic you may have heard of an Ishikawa Diagram which some refer to as a fishbone chart. This is a process of breaking down a problem into its root cause to truly fix the problem.

Dr. Deming believed in erasing anything wasteful. I was taught his motive was not to increase profits, but to rid the world of waste. This included wasteful human effort that could be better spent building something with zero imperfections rather than checking something later to make sure it is built right and if not, build it again. But I get it and I’ll bet Grand Design management gets it better than most. Sometimes things are currently out of one’s control. Perhaps the labor shortage in Elkhart Indiana is having even more of an impact on business. Perhaps Grand Design can’t trust their employees to build it right. Or maybe they have given up during prior attempts.  Who knows for sure.  Maybe they are driven by short term profits because the next recession or major gas price increase will bring an end to them. After a few short years of research, I’ve come to my own opinion of the current RV labor market. And I don’t blame the majority of the employees. If I must blame someone, then I think I’ll blame management because that at least goes with the salary!  I suppose there might be an argument that the consumer could be blamed because they are not willing to pay more for a better built trailer. Personally, I would have to disagree with that, especially since a lot of the parts that are installed into one particular brand of trailer are the same as another brand’s.  More on that later.

Certainly, the way employees are over-worked and paid in a manner that encourages speed over quality could have a little to do with it. Here is a  Reuters article on RV construction labor in Elkhart. Sorry in advance as portions of the article discuss politics. One model is to pay employees by the “piece” where in the employee can go home after producing X number of units with the same pay as if they were there all day. Some manufacturers do not subscribe to this “incentive” and still elect to pay by the hour. Augusta RV and New Horizons come to mind.

I’ll near the conclusion by saying there has to be hope the RV industry will improve either through increased competition, their own initiatives, or hopefully not – through government regulation. Seventeen percent of the 23 full timer’s RV experiences I started off writing about is not going to cut it. Perhaps there will be an awakening in this industry just as there was in the US auto industry brought about through stiff competition by the Japanese. Can you guys remember when one could buy a foreign car at a fraction of the price that lasted a lot longer than a domestic built car? Thank goodness those days are over.

I’m not ready to say the issue is profit driven although it might be. A reader posted this link to See Dealer Profit (thank you Ryan). If what the website is reporting is accurate, RV manufacturers sell to dealerships between about 35% to 50% less than manufacturer’s suggested retail price (MSRP). That would mean an RV manufacturer producing an RV with an MSRP of $100,000 is building it, with included cost and profit, for maybe $50,000.  Some may say “these things go through an earthquake everyday” when they are pulled down the road as if to make excuse for repairs even in a new unit.  Well, is that not what they are supposed to be built for? To me $50,000 is a lot of money and is more than most earn in a year.

Why can’t we ask that at least when an RV manufacturer installs another’s part such as a slide motor, water tank or refrigerator as well as their own plumbing and electrical runs or whatever, can’t they do it right the first time. And why would you pay an employee for doing it wrong to start with? And why would you pay a vendor for furnishing defective parts? That makes no sense, especially if it might be at the root of the problem.  And if they cover themselves with short one-year warranties and only build something to last that long well then shame on them. Because that RV might be financed through a bank by an unsuspecting family. And if the management and owners of these companies don’t care beyond a year then there might be a good seat in hell for that attitude.

I’m still buying one!  I’m taking my best shot at finding a good one and crossing my fingers from there on.  Maybe that sums it up as to why they are still selling so many. Maybe my second full-time RV will be a Toyota RV. I hope not.

Life in Kansas City – Evening Airshow

I had planned to discuss a few changes in the RV industry, specifically for Forest River, that has a potential of causing an effect on the timeliness of RV repairs and certainly response to recall notices. However, Karen and I went out to test her “new eyes” and had some fun. So more on that first.

For the past two years first responders (fire, EMS and police) were invited with their families to an earlier airshow performance at one of our local county airports. Karen had been spending time indoors healing after eye surgery during which cataracts were removed AND she now has corrected vision with her new lens implants. No more eye glasses! Seemed like a good idea to go watch some airplanes as well as spend some time with coworkers and their families after hours.

A special treat was a late evening performance by Team Aeroshell. They fly the North American T-6 Texan trainer which was first built in 1935. These planes were equipped with fascinating lighting systems which added to the thrilling acrobatics taking place in the late evening sky. The planes took off as the sun was going down.

I used our Canon T3 digital DSLR camera to film much of the show. I’ve got zero experience shooting video, nor the proper lens or even a tripod. I gave it a shot anyway.

I found that WordPress allows you to insert YouTube video even if using a free account. This was my first attempt at video editing. As I prefer to use standard Microsoft products, which are bundled in Windows 10, I edited with Movie Maker.

Team Aeroshell finished the show by parking directly in front of the crowd. They spun their planes around in a circle with smoke on. Was a wonderful way to chase bugs off as the smoke covered the crowd. I don’t have a photo of this as there was no point in trying to take one.

 

After the show, I had to take Karen to Sonic for ice cream. A coworker mentioned during the show that he had feed his child ice cream for dinner. Saying Karen loves ice cream is a total understatement of fact.

 


Video by the Gadget Guru about diesel exhaust fluid (D.F.F.)

Additional Health Care Planning

This will be the last of three blog posts concerning health care. I just completed truck research and will get that posted soon.  I’ve come up with a short list of trucks I’m interested in as well as an idea of how we intend to purchase one and when. 

Snap 2017-04-10 at 19.18.44
On the home front, Karen now has an
Instant Pot and loves it.  Three people at work also bought one and we all plan to share recipes. Karen made the best spaghetti she has ever made, browning the meat, putting in the sauce and noodles without dirtying any other dishes. And the chicken wings she cooked up were as good as any restaurant. 

 

Now on to health care.  I want to mention a few notes about legislature that’s in the works as well as a seldom known way to fund a Health Savings Account if you have a high deductible health insurance plan.

In an earlier post I mentioned how a co-worker uses a doctor who does not except insurance. His doctor is following this blog. On Dr. Rigg’s website there is a link to the Primary Care Enhancement Act of 2017 as well as a host of information concerning health care reform.

Per congress.gov  “this bill will permit an individual to pay primary care service arrangement costs from a health savings account; and allow an eligible taxpayer enrolled in a high-deductible health plan to take a tax deduction for cash paid into a health savings account, even if the taxpayer is simultaneously enrolled in a primary care service arrangement. Under a primary care service arrangement, an individual is provided coverage restricted to primary care services in exchange for a fixed periodic fee or payment for such services. For the purposes of certain tax-deductible expenses for medical care, the bill expands the definition of “medical care” to include periodic provider fees, including: (1) periodic fees paid to a primary care physician for a defined set of medical services or the right to receive medical services on an as-needed basis; and (2) pre-paid primary care services designed to screen for, diagnose, cure, mitigate, treat, or prevent disease and promote wellness.”

If I understand it correctly, this would allow an individual to pay a monthly fee to their doctor who provides primary care services for basic medical needs. And one could make the payments from a tax-exempt Health Savings Account (HSA) which might be a reason it is contested. In other words, this would become a form of health insurance whereby the darn insurance company (and their profits) are taken out of the equation.

Regarding funding a Health Savings Account (HSA): Karen and I are doing this through a plan at work whereby my employer also contributes money. At retirement, I hope to have built the account up. I’ll turn 55 years of age next year and will take advantage of the catch-up rule where I can contribute an additional $1,000 on top of the maximum allowed for a family. I just found out the law allows a once in a lifetime contribution to an HSA from an IRA.  I think this one-time transfer would be rarely used but might be a way to fund an HSA if one does not have the cash during a given year to make a contribution to an HSA. Here are my notes:

One time transfer of IRA money to a HSA account. The once-in-a-lifetime transfer from an IRA to an HSA does not increase the maximum you can transfer is your normal HSA contribution limit. In other words it’s not on top of your normal contribution limit. If you do the transfer, it reduces dollar-for-dollar the amount you can contribute in other ways, either directly or through your employer. The transfer from your IRA to your HSA is not taxable, but you also lose the tax deduction you otherwise would get if you contribute normally. If you do the transfer you must also commit to staying with an HSA-eligible high deductible health plan for 12 months. If you fail the commitment, the transfer becomes taxable and you’d have to pay a 10% penalty. The benefit is that the transferred funds and all earnings thereon could eventually come out tax-free, provided they are used for medical expenses. A qualified transfer from an IRA to HSA once you are on Medicare is not allowed.

  • As a side note, government rules allow an investor to distribute IRA funds to pay for medical expenses. The 10% early distribution penalty may be avoided if proceeds are distribution prior to 59½. So you don’t need to move money from an IRA to an HSA to use it for medical expense. However there are special rules such as if you spend out of the IRA that years medical expenses must be at least 10% of your adjusted gross income.
  • For 2017 the IRS defined “high deductible” as any deductible higher than $1,300 for an individual or $2,600 for a family, so your health insurance plan has to meet that threshold for you to qualfy for an HSA.
  • My HSA has investment options so I would not be losing what the IRA savings would have earned through investment. 

Do your own homework before you decide to transfer money to an HSA from an IRA.

new flash Here is an interesting web site: Travel Tax.com – from Camper Cornicles blog.

Health Care Planning

Thought I would post a few notes about our planning for health care costs.  I also want to say thank you to all the new readers who have signed up to follow this blog lately. It’s good to have you and your ideas so feel free to comment even within the older posts.

Like so many others, I follow Nina’s blog over at Wheelingit. Nina does an amazing job of summarizing current health care options so I’ll leave that to her. We all await future attempts by the US Congress at passing new health care laws. I don’t intend to make political statement so I’ll leave that alone other than to say it does seem reasonable the actual costs associated with health care services must be addressed to get at one root of the problem.  For now, I suppose we must take matters into our own hands based on whatever is available at the time.  So, to that end, I’ll post what I’ve been planning.

Karen and my situation factor in a few “what-ifs” although I don’t like using that phrase when problem solving.

  • We plan to move to fulltime RV living when I’m 56 years old. Karen will be a year from Medicare eligibility. She spent most of her career in medical billing which included helping folks out at hospice to figure out insurance options. I’m lucky to have her around to bounce ideas off.  She also has firsthand experience regarding how health care insurance companies handle claims.
  • Without re-entering the workforce later with health care benefits, I’ll be paying for my own for a good nine years. Our budget will have to include a plan with both of us for the first year. After that there could be supplemental Medicare insurance for Karen. Regarding this, Karen says we have to look at her options in terms of do I keep her on my insurance as a secondary insurance rather than having a supplemental Medicare policy. We will look at that in 2020 when the time arrives.
  • She agrees and I’ve experienced in the past that using COBRA after I leave fulltime employment is about the most expensive option out there. I met with our Human Resources person at work and confirmed its way expensive, even if I’m the only one on the plan. I would have 90 days after leaving a job to decide to file for COBRA which is good for 18 months.
  • In related topics, I’ve done very little research regarding long-term care insurance other than knowing neither of us want the other to ever be in a nursing home. I add this only because it’s health care related and a budget consideration.  Life insurance is in the same category.  At the advice of an experienced friend, I’m to look at the cost difference between taking a reduced pension with survivor benefits verses the cost of life insurance should we decide we even need it.
  • Karen added if she ever had to go in a nursing home she would file for Medicaid and make use of spousal protection clauses to separate our income and assets. She said she would not worry much about only being left with $80 a month from her social security check because she would not live long in a nursing home.
  • All this has to fit in an annual income budgeted at $3,375 a month after taxes and including inflation in 2019 when I plan to leave my job. If you’re interested there is a good thread at the Escapees forum regarding fulltime RV budgets beginning November 2015.
  • I’m always on the hunt for new ways to tax defer income as we have very few deductions to take on our annual taxes.

So here is what I’m thinking and doing today for us. Subject to change…

  • I added a Health Savings Account (HSA) plan at work. We use this to pay for our portion of medical expenses. After reaching a certain balance, the extra can be invested. I contribute the maximum amount allowed by the current tax law which is $6,750 annually. I turn 55 during 2018 when I’ll take advantage of the catch-up clause which allows us to add another $1,000 annually. At work, I enrolled in a high deductible health care insurance plan with Blue Cross and Blue Shield. My employer also contributes an amount to our HSA account as part of the annual $6,750 limit and our account is growing quickly. For those that don’t know, an HSA is not the insurance portion, it’s a savings account with a debit card used to pay for certain health care expense. Among other things, an HSA account cannot be used to pay for our current monthly health insurance premium. The money for the HSA account is deducted from my paycheck before taxes. And I’m not taxed on the money when spent! There were several points to consider before we decided to change our health care plan at work.  You must consider your own health situation before doing this.
  • I’m planning to use the established HSA balance to pay for out of pocket health expenses once we hit the road. If Congress votes in an increase on the maximum contribution limit, I’ll take advantage of it at least until I retire. Then after I’ll most likely come up with a minimum amount I want to keep in the HSA account based on our health care insurance plans maximum out of pocket expenses.
  • More than likely, based on today’s health care insurance availability, I’ll be going with a higher deductible plan at retirement. Some refer to this as a catastrophic plan so you don’t go broke if major medical issues arrive. Again, that’s a what if which includes Karen and I not having any huge medical issues when I retire.
  • Months ago, we joined our local community fitness center which costs $50 a month for the two of us. This included three sessions with a fitness trainer. Living a healthy lifestyle is for sure a way to reduce health care costs. Our family genetics for health issues prior to age 65 are not that bad – but then again that’s a “what if.”
  • I figure we will go to Mexico for eye care and dental. I’m still thinking about how to handle prescription drug cost but will certainly follow the law with whatever option we come up with. OR – research how to cut the cost of this and other health care services. Here enters the notion of finding the best care at the least cost. I found a good article here that was written in 2011 as a starting point. I have zero experience shopping around for affordable health care services. Suppose now that payment is coming out of my HSA account that’s about to change. So far, I’ve found two resources of interest which are mdsave.com and healthcarebluebook.com.
  • Karen had a few comments regarding how insurance is billed. You are at the mercy of the doctor’s billing person. Sometimes they code procedures, treatments and facility fees incorrectly. She says to challenge the costs and file an appeal with the insurance company. You might even be able to talk the doctor’s billing person into refiling the claim if they agree the insurance company (or the billing person) made an error. If you don’t believe the insurance was billed correctly you can also go directly to the insurance company to discuss the issue. Of course this is presuming one is able to recognize the error or what appears to be an out of control price from the doctor’s office (see the above online resources). She added an example where the doctor’s office, who are in-network, can only be paid per the contract with the insurance company. It’s typical that Blue Cross will only pay 49% of the total billed to them by the doctor in our region for example. She says the key is if you are paying the cost out of pocket then negotiate a price which is equal to what the insurance company would have paid.
  • A coworker told me his doctor knows he is paying fees out of pocket through his HSA account. He has a family of four. The doctor’s billing is setup to charge him fees that are lower, presumably closer to the rate an insurance company would have paid. He does not have to negotiate the fees at all. Nor does he get a bill later from the doctor’s office because the insurance claim was denied or not paid in full by the insurance company. I’m hoping more doctors will take this approach and I can find a good one out of the group.
  • I’m also very much interested in speaking with doctors through online video services for the more basic needs. Although I’m concerned something like a chronic cough might become something worse, for example, if we don’t meet in person.  I suppose any qualified doctor or nurse online would know enough to refer us to proper medical care?
  • Briefly, regarding what state and county we intend to take up residency (domicile). We all know health care insurance cost, availability and plan coverage will factor in. And of course that will be one of the considerations as to where we officially call our home.

I know enough about the topic to be dangerous. I’m trying not to put out any bad information and really appreciate your ideas, corrections and additions. PS – I don’t qualify for veterans benefits as I did not have enough combined active service when I was in the National Guard.

Life in Kansas City – Hired a Financial Planner

140530_roadtowealth_savingIn September of 2014 I dusted off an old retirement plan where I had planned on retirement at age 55 which for me is in 2018. I had created that plan in my early 30’s. I’d guess the plan was similar to what many others considered retirement. Everything paid off, a monthly income through pensions and savings that equal what I anticipated would be our monthly expenses.

The idea of what retirement would look like had changed considerably by 2014. I was no longer content to just have everything paid off and an income that just met my monthly bills while living in a small house, in the city, until the day someone pushed dirt over my grave. Karen and I had moved to the north side of Kansas City onto four acres with woods. We loved to garden and created our own oasis with walking trails through the trees lined with garden spots. Life was good other than having now lost both my parents, one to a heart attack and the other through cancer. I’ll not go into that other than to say both taught me a final lesson which influenced my own future.

So, dusting off the old retirement plan including a new meaning of what retirement will be for me.  I’m so lucky to have a wife who is an adventurer. I’m the planner, worrier and the type that must have a plan A,B and C before I’ll make an important move. She is the one with the survival instincts that includes faith that it will all work out even without a plan. I learn from her everyday how good life could be if one just lets it happen. Fortunately, we both like to camp, be outdoors and travel. Neither of us are afraid of big change even if we have different approaches in how we get there.

By 2014 I’d planned to move my retirement date to 2023 or age 59.5. By then there would be no need to work even part-time. We could stay on our property, in our current home and garden – until someone pushed dirt over our graves!

After thinking of the final lesson my parents taught, in 2014 I came up with the idea to travel in an RV after retirement and before we set down permanent roots. Karen was on-board after the first conversation.  Although I work in law enforcement, business was my college major. My father was a cop for over 50 years. We had a talk when I was around 17 years old. He suggested I go to college and get a business degree while working part time as a police officer. Over the years, I’ve owned my own business, worked for a corporation and handled my own financial planning. I’m the type who must have a 100% understanding of what is going on financial to feel comfortable with the plan. In other words, until recently I would not have felt comfortable with someone else investing for me or planning my financial future.

Like many others planning to fulltime in an RV, we moved our start date ahead by a few years. I adjusted the financial plan in anticipation of leaving in 2019. I call it my save and leave early plan. Late last year I took a hard look at the earnings on our retirement investments. I talked to a few people I trusted who were already or nearing retirement. At the time, most of our investments were with Waddell and Reed. I should have done it years ago, but for the first time I compared their rate of returns against just the simple index funds. Waddell and Reed had always done a little better than the “market” when things were good and a little less poorly when the market was down. That had been changing in the last few years as their returns were not up to expectations. I know exactly what our rate of return must be before and after retirement. Over the past ten years, Waddell and Reed had just been clearing that rate of return by less than half a percent. Not good when their funds are expensive to own in terms of what they charge to get into a fund and their annual expense ratio. So, I arranged a couple meetings with our account manager at Waddell and Reed who by chance was also preparing for his own retirement.

Waddell and Reed is a large financial company. They have independently owned branch offices scattered around the country who are affiliated to Waddell and Reed where they can invest in only their mutual funds. I’ve over-simplified that a bit because it’s boring to write about. Anyway, the guy who I’d worked with for years told me he was selling out to a Waddell and Reed corporate executive as part of his retirement succession plan. He wanted me to meet with him and the new owner because I’m one of his “different customers.” By that he meant he wanted the new guy to know he would have to explain every move he made to me in detail and put up with my type A personality.

Fast forward a few months to the point where I’d evaluated my Waddell and Reed account over a 10-year period. I was not satisfied and called the new guy. He asked me to come by their new office which had been moved to a more affluent area of Kansas City (Briarcliff).  I intended to tell him I was moving away from Waddell and Reed. To my amazement, he told me he was doing the same for the exact reasons I was which included Waddell and Reed mutual funds were no longer performing to expectations. Shocking news to say the least. Because the new guy has only had one job since he got out of college more than thirty years ago, and that was with Waddell and Reed where he rose through the ranks to become a devoted executive. He was moving his office to offering financial planning services with investment options to include all forms of investment rather than just Waddell and Reed funds.

I was faced with a decision that for the first time included detailing my financial condition and all investments to someone else to manage. Or simply leave and go to just another mutual fund company. I thought a small test was in order! I handed over my current retirement plan to the new guy expected the salesman side of him to shine which would include him telling me there was no way I was going to be in financial shape to meet our goal to retire early and travel. I thought he would tell me to retire later and give him more money to manage and charge for that management. Turns out he has other clients traveling in RVs. He has learned from them and was excited for us.

The new company is part of LPL Financial.  I told the new guy Karen would be coming to our second meeting because I wanted her to know everything about where our money was kept. That was in case I was hit by a bus and she needed help. I told him if that happens he should expect a call because I only wanted Karen to have to call one person to help with financial considerations in the event of my death rather than all the other account managers where our funds had been scattered to include the bank, Waddell and Reed, credit union and Fidelity Mutual Funds. And eventually the money we keep in savings after selling our home.

I walked out of that meeting with a total sense of relief and for the first time felt comfortable with someone else holding the purse strings. For a control freak like me, that was quite an accomplishment I might add. The new guy has already given me some homework which is to look at structured notes as a place he might put some of the money from the sale of our home. In this case, he would build-in protection of the principle investment. He is also considering structured notes for part of his own retirement savings. I had told him we would like access to the house money in about six years after we retired to an RV which might be a time we would either settle down or stay on the road which is somewhat of a guess. I’ve not finished my homework assignment, nor sold the house, so have not given him the go-ahead with that type of investment. The new guy has already met with the other 12 financial planners in his group to decide which mutual fund investments they are moving clients towards. As our Waddell and Reed account was converted to cash and moved to the new company, he has also yet to invest those funds. He and others think the stock market has generally run-up and may go down in value soon. He is waiting until March to dollar-cost average into the market thinking others have invested early because of expectations in market growth based on the new president’s policy. Neither of us believe in market timing where you take a guess at when the market will be low or high and invest accordingly. It’s just that for the first time in years my account is sitting with all cash needing to be invested so it’s being done wisely and at intervals.

What does all this come down to for me?  For the first time, I’ve hired someone to manage my investments and to trust their opinion. That’s costing me 1.5% of my portfolio annually. And Karen has only one person to call if that bus hits me. And, if we need the income in retirement I’ll simply have to call one person and tell him to set it up based on how much we want each month.

 

In the meantime, we continue to down-size our stuff at home. I’ve been doing a lot of research on trucks and will post about that later. And I had a few internet links of interest I wanted to share with everyone but will do that later as well.

 

Thanks for reading and commenting.