In last week's article, we discussed accepting the circumstances surrounding our current situation while
maintaining our identities as being separate from those circumstances. We explored how to recognize the feelings of "being stuck" and how to utilize inspired action to mobilize from that place. There is so much happening in our current environment lending itself to that feeling that it warrants further exploration.
In my daily life, there are practices that I maintain in order to take care of my being: exercise, meditation, reading, and reflecting. While I may not complete all four of these items each day, I find that when I do most of these things, I find myself in a state of flow more easily. Recently, I've been reading a couple of books, one of which is The Power of Now by Eckhart Tolle. I am in the final pages of the book, and he is talking about the idea of surrender. He states that "Surrender is the simple but profound wisdom of yielding to rather than opposing the flow of life." There are words in this sentence that stand out to me: surrender, yielding, and opposing. The word surrender seems a bit misunderstood at times. It seems that we perhaps misinterpret it to mean that we are simply giving up on moving forward with something, and yet when I look this word up in the dictionary, it provides a definition as being "to cease resistance." Generally, if we are in a state of resistance to some circumstance, we are giving entirely too much of our life's energy to something in which we do not want. To use a popular Abraham Hicks metaphor, that sounds a lot like "swimming upstream." Eckhart Tolle goes on to suggest that "to surrender is to accept the present moment unconditionally and without reservation." One word that stands out to me is "moment." Again, we've discussed this idea before, but it bears repeating. A moment is literally the circumstance that is happening in the now. If we guard our thoughts carefully, we can take care not to give that circumstance a past or a future, and thus we avoid wrapping our identity in something that is simply one tiny blip on the timeline of our lives. Perhaps the great question is, how can we surrender to our current financial circumstance and allow that to flow into an inspired action that fulfills our desires for the future?
Identify the Financial Condition
There is a financial condition that we've been experiencing over the past several months (the span of Covid-19). The condition is that our tenants have been unable to pay the rent roughly half of the months since March.
How to Surrender to the Condition
This isn't the most pleasant condition to be experiencing. I mean, no one gets into the rental real estate business to not receive payments. It's okay to allow yourself a moment to recognize that this condition exists in this moment, and that it's not pleasant. Watch your feelings. It's okay to notice them. Do not allow the mind to identify with the feelings that popped up in that moment. The moment you allow your mind to connect your identity to the emotion you felt temporarily, you have given power to that emotion and to the condition itself; in doing this you give it a future. If surrendering means to "accept the present moment unconditionally and without reservation," then we must accept that we experience both the situation and the emotion in that exact moment. Notice, how it doesn't say that you accept the current situation as being from now until forever. That last line was peculiar, wasn't it? But that's often the way that we operate. A situation arises at this moment and it is easy to identify with it and a negative emotion and then allow the mind to stew on it, and chew on it, and imagine it into the future. Tell your mind to stop. This is counterproductive, and there is a much better use of your brilliant mind than that! When received the first of several emails about our tenants struggling with the rent, I acknowledged it, discussed it very briefly with my partner, accepted that this circumstance was happening in this moment, and then thought very little about it.
Ask: What are the things that come along with this temporary condition?
In other words, are there more conditions that automatically flow from the first one? Remember, part of Eckhart Tolle's description of surrender is "yielding to rather than opposing the flow of life." So, what else (if anything) is flowing from this situation? When I considered this, I understood that two more things were true in this moment: I would have to pay the mortgage myself; also, my income will be lower this year.
This is where it might pay to peel back the layers of the onion. There were two things that flowed from the initial condition of my renters not being able to pay the rent: lower income this year and needing to pay the mortgage myself. If I ask the same question about each of those conditions, "What flows from that?" and add "Is there any potential opportunity buried in there?" Then I am transitioning from to the initial low feeling place into a higher one. Raising my vibration with regards to this situation seems like a better way to emerge from it, doesn't it? There is something inherently more hopeful about looking for a hidden nugget of gold among what appears to be a simple pile of trash. So, let's see...
Analysis: What flows from paying the mortgage myself?
Well, the first thing that feels really good is that I have the money to make those mortgage payments. That already lifts my overall emotional state. But what flows beyond that? These renters have lived in my property for a few years now, and prior to Covid-19, they'd only ever been late once, and never fully missed a payment. Furthermore, based on the last inspection the management company performed, they take pretty good care of the place. This all makes me think they're pretty likely to pay the back rent as per our agreement. Also, I'm current on the mortgage and everything else. So, as they increase their monthly rent payments in order to catch up, we'll start experiencing a bit of a windfall. Money will feel like it's coming through the door more rapidly with nowhere it needs to be applied. So, we'll have more cash and lots of options! How great is that? There seems to be an opportunity here!
Analysis: What flows from having a lower income this year?
My renters are unlikely to pay this rent all back before the end of this tax year. So, I can expect a lower tax bill this year as a direct result. What flows from that? Most years, I am making estimated quarterly tax payments because of that added rental income. This year's loss of income means that I don't have to do that (as per the CPA). I have also been splitting my retirement contributions in two different directions, in part because of the added rental income.
Quick Traditional Personal Finance Lesson: At my place of employment I have some retirement account options that are traditional: 401k, TDA (tax-deferred annuity), and 457. These are funded using pre-tax dollars. If I fund one of these accounts it lowers my taxable income this year, which in turn lowers my tax bill this year. So, a lot of people like to use this in order to help minimize their tax bills in the current year. I also have Roth options: Roth 401k and Roth 457. These are funded with money that I have already paid taxes on. This means that they will grow tax-free. Since the taxes were already paid, I won't be taxed when I pull the money out in retirement. It's kind of like I prepaid the taxes for 70-something-year-old me. I get super excited about my Roth accounts because they're such an incredible deal!
Currently, 20% of my income goes to retirement accounts at work: 13% into my Roth 401k and 7% into my TDA. I greatly prefer the Roth 401k, but typically always have a tax bill as a result of the rental property. So, one of the things I do to minimize it is to put use a traditional retirement account (my TDA) to make my taxable income lower, thus also lowering my tax bill a little. This year, my tax bill will already be lower because of this situation with my renters.
Side Note: I often refer to the mind as a drama queen, and suggest pushing it off to the side so as not to allow it to stew on things that you don't want to call into your experience. I want to take a time out to point out to you that THIS is exactly the place to invite the mind back into the conversation. This traditional personal finance information is exactly what the mind is designed for. Your mind can learn it, organize it, sort it, and finally put it to really good use by helping you to apply the applicable parts to your current situation.
Ask: Do any of these things breed an internal desire?
This is where you get to the inspired action part! Your mind did its part, and now you return to your intuition. What do you feel inspired to do?
Paying the mortgage payment myself has greatly increased my desire to pay it off very quickly. The urge is becoming tremendous! I feel as though this is something that we will do within the next few years. Furthermore, when this financial windfall comes (from the renters making larger payments to reconcile their balance), I have options: throw it at the mortgage, further pad our savings account, max out our Roth IRAs, or possibly some bridge investing. I will sit with these options until my intuition kicks in and I feel a sense of peace or inspiration hit me. With regards to my income being lower this year, I feel really inspired to dial down the contributions on my traditional account (TDA) and ramp up the contributions on my Roth 401k while there's still time this tax year.
So, it seems that I have moved from a place of surrendering to a financial condition in my life to a place where I've found two inspired actions to take and am sitting with a few other options. What financial conditions are you experiencing in this moment? Can you peel back the layers to find an inspired action that will propel you forward?