I started an email list this month and sent out my first monthly newsletter.

Here are some snippets from my first monthly newsletter.

Subscribe to be entered into the sponsored giveaways!

LiveFrugaLee Monthly Newsletter #1, July 2024

If you know me, you know that I’m always trying to learn new things. I find that the best way to learn new things is to learn through trial and error. I’ve failed a lot in my life, but I’ve also found success in a few of the things just because I tried.

This year, I’m trying to put together an email list and send out a monthly newsletter. In each newsletter, I’ll write about personal finance, real estate, and travel. I’ll also share about what’s going on in my life. I’d love to hear what’s going on in your life, especially if we haven’t connected in a while. Reply back to me!

One goal for this newsletter is to keep in touch with people. Another goal is to provide value to others by sharing my knowledge in certain topics and to promote my real estate business and my new travel business.

Life

In May, my daughter turned 6 and my younger son turned 1. It was a great time with family with lots of cake and birthday celebrations.

For the summer, the older two will be doing swim team at our local pool, so we’ll be spending a lot of time hanging out at the pool.

My real estate business was a little slow in the first quarter of the year, but I got busy in the second quarter. I had 6 closings in 7 weeks. I was working 6-7 days/week for most of April and May. I’m grateful for my clients, but I’m also ready to take it a little slower this summer and recuperate.

I decided to continue to stay at my government job part-time for now. I rented an office in Reston Town Center and do most of my work there. Even though I can work from home, I am able to concentrate so much better in a quiet environment with two large desks. As a bonus, Sweetgreen is downstairs, and there are many other places to eat nearby.

Personal Finance

529 Plan to Roth IRA rollover

This month, let’s do a quick overview of the 529 to Roth IRA rollover. This discussion is more relevant to those who have young children and are saving in a 529 Plan for their education.

The Secure Act 2.0, signed into law in December 2022, had a provision allowing tax-free rollovers from Section 529 plans to Roth IRAs starting in 2024.

Here are a few things to note:

• The rollover can only be made to the Roth IRA of the 529 beneficiary (typically the child), not the owner (typically the parent) of the 529
• The 529 had to have existed for 15 years before doing the rollover to a Roth
• The maximum lifetime amount that can be rolled over is $35,000
• The maximum annual rollover is still subject to IRA limits (for example, $7,000 in 2024, $8,000 for ages 50+)

We have 529 plans for all of our kids. In Virginia, you can take a state tax deduction up to $4,000 per year, per child for 529 contributions. For example, if we contributed $4,000 to each of our 3 kids’ 529s in 2024, we can deduct $12,000 from our taxable income on our state income tax return. If you contribute more than $4,000/child in a year, you can take the deduction in following years. You’ll just have to keep track of it.

Real Estate

Assumable Loans and Mortgages

As interest rates hover around 7%, assumable loans are making a comeback. Even in this interest rate environment, you may be able to purchase a property and get a 2, 3, or 4% rate on your loan. Assuming a loan means you are taking over someone else’s loan. Generally, you can only do this on government-backed loans, such as VA, FHA, and USDA loans.

In practice, the majority of assumable loans I’ve seen are VA loans. Here are a few things to consider when assuming a VA loan:

• You’ll need to have enough cash on hand to cover the difference between the loan amount remaining and the sales price (plus closing costs). For example, if the sales price is $700,000 and the loan amount remaining is $600,000, you’ll need to have $100,000 (plus ~$12k-$15k for closing costs) to close the deal.
• If the Seller needs to use their VA benefit again, the Buyer must be a veteran buying a primary residence and do a Substitution of Entitlement.
• If the Seller does not need their VA benefit, the Buyer can be a non-veteran and there is no requirement to live in the property. These are rare, but I am seeing these more often.
• Loan assumptions generally take 45-90 days, so plan accordingly.
• Sellers usually prefer to close quickly, so you’ll most likely only be able to assume a loan on a listing that does not have multiple offers.
• Assuming a loan can make a HUGE difference in monthly payment. See the example below where a $500,000 loan at 2.5% saves about $1,350/mo compared to a $500,000 loan at 7%. P+I is principal and interest.

$500,000 loan @ 7%: P+I = $3,327
$500,000 loan @ 2.5%: P+I = $1,976
​Savings of ~$1,351/mo. ($3,327-$1,976)

If you’re interested in listings with assumable loans in the DMV area,
reach out to me at RealtorDannyLee@gmail.com ​
Follow me on Instagram @RealtorDannyLee

Travel

I joined Fairy Godmother Travel

In case you haven’t heard, I am now a travel agent/advisor. I joined an agency called Fairy Godmother Travel earlier this year. After booking a few trips with a travel agent and having a positive experience, I decided it would be fun to learn the business and give it a try. I think traveling is one way to create cherished memories and valuable experiences. It doesn’t cost anything extra for the client, as the suppliers (e.g. Disney) pays a small commission out of the sales.

I’m still in the early stages, so I’m learning a lot. I plan to specialize in Disney (resorts and theme parks), Disney Cruise Line (DCL), and other cruise lines, including Royal Caribbean and Princess. I’ve also done the Universal Studios training and can book the resorts and theme park tickets.

In order to be a better travel agent, I need to travel more myself. We are planning to do an Alaskan cruise with Disney in September and a cruise in the Caribbean with Disney in November, partly to check out Disney’s new private island. We went on the Disney Wish last year and had a great time.

If you’re interested in booking travel with me,
reach out to me at DannyL@fairygodmothertravel.com​
Follow me on Instagram @Danny_FairyGodmotherTravel

For cruises, I am usually able to provide onboard credit to make it worth your while (vs. booking with Costco).

Sponsored Giveaway

Sponsored by Sylvia Bae, First Heritage Mortgage

I’m going to try to do a giveaway every month for my email subscribers. Instead of spending money on ads, I prefer to spend my marketing dollars this way. Plus, it’s more fun.

This month, we’re giving away four $25 Starbucks Gift Cards.

So far, I only have 92 subscribers. If you subscribed, you had a 4.34% chance of winning this month! I use a random number generator to pick the winners.

This month’s winners are: Sameed K, Alex B., John Y., and Daniel L. (not me).

If you’re one of this month’s winners, you’ll be receiving a gift card in your email. Thanks for subscribing!

Please share with your friends and family if you think they’d be interested in my content.