Birthdays, Rocks, Cooking School, Retirement Plans, and Late Night Work Sessions

Your "can soup relatives" like the stuff perhaps because it triggers memories of their youth, maybe a cold winter day where they all joined together eating soup after a day of sledding, with relatives that are not around anymore, don't dismiss them so easily.

(I have those relatives too, they will eat what I give them, but it's like I am poisoning them.)

That makes sense. Thinking about it, I suspect you're right.

I only figured it out when it happened to me, my mom used to always cook those Liptons soup mix packets on Sunday during winter when I was a kid, when visting home on Sunday that smell triggered all those wonderful memories. I would of been really disappointed if she served me five star restaurant quality food.

That ravioli looks amazing. Sadly every time I make ravioli it takes quite a while...

When you say that you switched a relative to a custom index you designed "so they will capture 99.99%+ of the underlying performance of the assets they own, crushing even the cost advantage of an S&P 500 index fund.", how do you accomplish that? Is it the same process as you described in this post?

It's the same basic concept as that post, only in this case, they wanted 30-50 stocks. The structure is as simple as you can imagine. I'm setting up Rollover IRAs into which they will transfer the assets. At that point, they'll each pay between about $270 or $450 in one-time commissions to buy the ownership stake in the companies. (I'm giving them each a shopping list of stocks that I currently think are decent bargains or fairly priced, and letting them choose among them in a way that they will sort of paint-by-numbers come up with a very well structured, diversified, economically-rounded portfolio; e.g., "here are three banks, you can pick two; here are six packaged food companies, you can pick three", etc.) I'm building it in a way that it can reflect their personality but I've stripped out as much correlation as possible, and it should be able to survive a 1929-1933 meltdown just fine.

Depending on their individual choices, they'll end up with a cash dividend yield of 3.0% to 3.4%, an aggregate p/e ratio of right around the historical 14-15x earnings at which the market has reverted as a mean over the past century, aggregate payout ratios of 50% or less, and shares of firms that will require virtually zero turnover. I'd expect, over long periods of time, the dividend payouts to increase at least a percentage point or two in excess of the inflation rate based on the current numbers. This is not a get-rich-young portfolio, it's a stay-rich-and-grow-what-you-have-over-the-next-twenty-five-years-or-more-until-death portfolio.

While they are still working, the dividend income will pile up throughout the year in the FDIC-insured cash sweep account, where it is matched with the new contributions they make. Once every twelve months, I will give them a new sheet of paper and tell them to pick one company on it to add to their collection. They'll pay another $10 or less commission, representing the entire expense for the year.

When they go to retire, we'll fill out a single form that results in the dividends getting swept automatically each month into their personal checking account as if it were a paycheck.

In the event something gets radically out of whack (valuation levels where the blue chips are trading at 1/3rd the Treasury bond yield or something obscene), I reserve the right to intervene but that sort of thing only happens once every generation or two; the 1920's, the 1960's, and 1990's where the last examples.

It's like my own version of the Dow Jones Industrial Average, only the standards are much more draconian, the after-first-year costs limited to $10 per annum, and the positions start out equally-weighted.

I'm also trying to push them into building up a decent amount of debt-free, cash-generating real estate over the next 10 to 15 years to serve as a counterbalance to the other assets in their portfolio. We'll see how that goes.

Joshua,

What do you think is a good ideal Savings Rate for someone about your age to consistently add to investments? What % of income to retirement accounts and % of income to investments like stocks or real estate. Just wanted to get your input on it and what you strive for.

Vital question from those of us volunteering to bake for the workplace Halloween party: Was the pumpkin spice roll any good and if so can you link to the recipe? Many thanks.

ps. Related to your Dinty Moore relatives: Have you ever watched Semi-Homemade with Sandra Lee? You might find it amusing.

I've had some people recommend it to me but they do it with this almost imperceptibly wicked uptick on their face so I have the feeling I'm being setup. I've never really been into cooking shows (we got rid of cable years ago at the house). One of these days my curiosity will get the best of me.

I'm not sure how to answer this because here's the process we use: When we try a new recipe (one we aren't developing ourselves), we make it exactly as prescribed, and rate it. At this point, we reject 90 to 95% of dishes. The top 1%-2% immediately get added to our menu planning software for what we call the "permanent" recipe collection - things we memorize and will remake for the rest of our lives. The other 3%-4% or so get tweaked, sometimes for months of experimentation, until we can improve them. We go for certain flavor profiles; like hitting the tongue in a certain spot.

This pumpkin roll was highly recommended, receiving 275 ratings averaging 5 stars (actually, 5 mittens, since that is Nestle's homespun rating system). People are crazy about it.

Us? It failed to make the cut. We'll never make it again. I can see how people would like it. I can see it being successful at a party or get together. But if we make something for public consumption - unless it's something we're having our family test or rate - we want it to be so good people remember it years later. This doesn't pass that test.

In my case, the sweetness was about 1/2" too far forward on the tongue, and left a certain numbness in the center of my mouth after a few bites. The cream wasn't nearly complex enough; it was very one note. If I were going to tweak it (I have no plans to at the moment), I'd be tempted to first try adding lemon juice or lemon peel zest to the filling, along with a touch of cinnamon, and perhaps some caramelized brown sugar, folding it all together before creating the center.

But it's okay as is. Again, people seem to love it based on the reviews. I get the appeal. It's just not something I would recommend. If I say, "this is great", I want it to mean something. That's why I very rarely recommend things on this blog or in real life and ignore the messages of people writing me offering to pay me to recommend a product. My philosophy is that life is relatively short and it doesn't take that much more work or effort to create something truly exceptional, so why not do it?

Sorry for the long response, I just want to be absolutely clear so there is no misunderstanding. Yes, it's probably good. No, I wouldn't recommend it, but I won't recommend 98% to 99% of things that I try, even if they are above average.

The recipe can be found here.

You have posted a series of posts about food that stuck in my head. I remembered your outrage at the microwave cooking book. I read this article and it somehow captured my thoughts about cooking at home (pertaining to habit #1). http://www.cracked.com/blog/the-5-stupidest-habits-you-develop-growing-up-poor/

I grew up to canned goods and frozen food and I was once proud of making pesto using a rice cooker (stove was busted) and it is hard to make the transition to thinking of food in the way you do. Even now, when we are comfortable and I want to serve something better to our kid, that has not come naturally. The best move I have accomplished so far is to stay away from the supermarket and buy our stock from farmers market.

At least we are eating fresh and staying away from processed. But beyond frying and grilling, I don't know how else to prepare most of the food we buy.

I remember having dinner at a friend's house and I wondered how her mom was able to plate the food so nicely and the food was almost an artwork. And eating was not a hurried experience where I had to eat as fast as I can while there is still food on the table.

At least with clothes shopping, there were rules I easily copied like invest in a good pair of matching shoes and bag or spend on neutrals but scrimp on fads. I haven't found a similar guide yet for food. I would need help on all steps of the process from buying ingredients, right tools and equipment, preparation, serving, and storage. Cookbooks only cover one part of it.

Like when people say that it is important to have a good set of knives, what are they talking about? How many are needed? If I am only working with X budget, which do I start with? Do I really need a set? I have been living with one this whole time.

Sounds stupid? But that's how my mind processes things regarding preparing food.

I enjoyed reading that article, and it certainly makes a lot of sense. Thank you for sharing it.