Credit: abovethelaw.com

[It’s Randy this time around.  Occasionally he steals the keyboard.  Enjoy.]

In seventh grade I walked about a mile and a half to school on most days.  This was way back in the mid-seventies (yes, I’m that old).  Back in those days, the school lunch tray cost forty-five cents (stop looking so shocked, okay?  I already said I’m old!)  My mom would give me a dollar each day for lunch plus a treat at the school snack bar. This snack bar also served burgers, fries, hot dogs, etc.

But this “good” food was way out of my dollar-a-day price range.  I had to get creative.

Conveniently, there was a 7-Eleven on my way to school. I would stop in each morning and spend all of my lunch money on candy.  (Before you start judging, no, I didn’t eat candy for lunch.)

I bought it to sell.

Picking the Right Products

I didn’t buy just any candy.  I needed something I could buy fairly cheap and sell at a higher price, that would sell easily.  The perfect product was Now and Laters.  Do you remember those waxy fruit-flavored chews that last a long time?  Yeah, those.

They were perfect.  First, they were cheap.  I could buy a 7-piece pack for 10 cents.   Second, they were popular.  I would usually sell out long before lunch time.

Demographics, Supply and Demand

Who were my customers?  A whole bunch of kids with lunch money.  Sure they could get candy at the snack bar, but for that they had to wait for lunch.  Most kids barely got out the door with a piece of toast for breakfast.  So they were hungry long before lunch rolled around.  And hunger makes people do irrational things.

These kids were trapped at school with no other options until the snack bar opened at lunch time.  The snack bar did have some good options for sweets.  They had all kinds of pastry products and candy bars.  Most were at least fifty cents.

Now you may be wondering if other kids tried to copy my business model.  A few did, but they were never as consistent as I was.  I had a lot of loyal, regular customers.  (Did you read that?  A 7th-grader with “regular” customers.  I still find that funny.)

Pricing Your Product for Optimum Sales

So, what did I charge?  I broke the 7-piece packs apart and sold them for ten cents a piece.  Anybody can afford to spend a dime.  You could probably go for a short walk and find that much laying on the street.  My price was affordable and at ten cents a piece, I had potential to earn a $6.00 profit from my initial dollar.

I may have been able to double my price and earn a lot more, but hey, I was a kid and wasn’t thinking about higher profits.  I just wanted a snack bar lunch and money for the arcade on the way home.

What’s Eating Away At Your Profits?

In my case, it was me.  I had a backpack full of candy, I was a kid, so of course I’m going to eat into my profits. (In most cases, once I had sold enough to get what I wanted from the snack bar, I just ate the rest.  Again, I was aiming for the short-term game. Oh well.)  My favorite at the snack bar was Hostess Suzy-Q’s.  Remember those? They used to be awesome. The filling would be so thick it would run all over as you ate them. Now the cream is so thin you barely see it in the package.

The Lost Potential

Man, if only I had been able to see the business potential instead of just being satisfied with that darned Suzy-Q.  I could have scaled it up into a serious profit beast.  I could have branched out with multiple sellers where I would take half their profits for supplying the candy.  Can you see it?  I show up in the morning with a case of Now and Laters. Distribute product to my sellers. Collect my share of the profits at lunch. I would have been able to buy my own 7-eleven at 17.

But it’s not all lost.  Looking back, I see that I naturally fell into entrepreneurship without any outside influence teaching me how.  I knew I wanted the “good” lunches the snack bar offered. Getting my parents to spring for it wasn’t going to happen. It was junk compared to the school provided lunches.

I had to figure out my own way.  (There’s a reason why they say that necessity is the mother of invention.)

My mother has told me many times that she’s not surprised at all that I’m a business owner.  I guess I had the entrepreneurial spirit in me all along.

Truth:  I frequently get requests from other bloggers to guest post on my blog.

Another Truth:  I’ve never allowed anyone to guest post on my blog, and I almost never agree to guest post on someone else’s.

But there are a few rare exceptions to those rules.  If you want to post on my blog (or vice versa), I must know more about you than just your Twitter handle, and you must be super-cool-awesome.  (Bonus points if I’ve met you in real life.)

The married duo that blogs over at 1500Days.com easily passed those tests, and while we met because of a blogger conference, the friendship transcended the online space, and we count our time spent with them (and their kids!) among some of our life highlights.

Their blog is so entertaining that laughter will often leave my brain space and actually come out of my mouth.  They bring the full-on ugly laugh out of me.  Not only are they funny, but also super-smart, especially when it comes to money and toy dinosaurs (that last part will make sense if you start reading their blog).  They’ve also reached their million-dollar investment goal, so to say they’re inspiring is an understatement.

So when Mr.1500 asks you to write a guest post, you say “heck yeah!” and start writing.   He specifically asked me to talk about the launch of our other website, Laundromats101.com. (A resource website for people looking into ownership of self-service laundries or existing owners.)

If you want to check it out, the link is here:  My Guest Post on 1500Days.com

(One Last Truth:  My guest post was over a month ago, and I’m just now getting around to mentioning it.  So shoot me.)

Meanwhile, we’ve been working on some new posts!  Here’s what we’ve got in the works…

• We have another online business on the horizon, that we’re pretty excited about…
• We’ll divulge some details on how our first online business at Laundromats101.com is doing; the income, how we built it, growth strategies…
• We finished a DIY major bathroom remodel; there will be before/after pics, construction details, you know the deal around here…

So stay tuned!

What can I say? We’re human.  We change our minds.

This last June, we announced that this blog would be moving in a different direction.  And that’s true.  But not completely.  Well, hold on, let me just start by giving you some backstory.

The Backstory

When we started blogging about our purchase of the laundromats back in November 2014, we started seeing some significant growth in traffic.  Then in March 2015, we posted “We Bought a Laundromat and It’s All About the Numbers“, and since then that little post has been viewed 70,000+ times (yeah, we were pretty blown away when we looked it up).

In fact, that one post has actually risen to the front page on Google when someone searches for information about purchasing a laundromat. (Go ahead, try it.  Open up Google and type something like “how to buy a laundromat” or “how much money do laundromats make”, and more than likely, we’re in the Top 5 and in some cases, we’re #1.)

Without even trying, we’ve become a resource for other people wanting to do the same thing we did; buy a semi-passive business and become laundromat owners.

That’s originally why we decided to change the direction of this blog. We wanted to give our readers more of what they wanted.  More laundromats.

Deep Thoughts and Late Nights

But…after a lot of discussion and research and some more discussion, we are giving the land of laundromats it’s own site.  I mean, when you think about it, who comes to a personal finance blog looking to start up a brick and mortar business?

So…we’ve launched Laundromats101.com!

We have spent the last few months working hard to build a site we can be proud of.  Our aim is to be the go-to landing spot for entrepreuneurs and investors interested in purchasing, managing and profiting with laundromats.

Since we published our latest guide to laundromat investing, sales have taken off and our own forecasts have been exceeded.  The website felt like a natural next step, and we feel really lucky that this opportunity to add another income stream to our portfolio has basically fallen into our lap.

So, What Does This All Mean?

This blog, MyShinyNickels.com, will continue to document our journey to financial independence; including our experience in earning income online.  The laundromat-oriented content will then move to the new site once we launch.  Since the book is producing a decent income, our goal is to make Laundromats101.com the free resource we wish we had when we started out ourselves.

So, if you want to find out more about owning your own laundromat, subscribe and bookmark our new site at Laundromats101.com.  To continue watching our journey to financial independence, and a behind-the-scenes look at building a website that produces income, stay right here at MyShinyNickels.com.

A Big Thank You

Lastly, for those faithful readers who have been here through it all…from the first post about our financial independence journey, through the “laundromat phase”, and now back again…

THANK YOU.

Thank you for sticking with this sometimes schizophrenic blog that has an occasional identity crisis.

Thank you for the opportunity you’ve given us to branch out and create something new.

Thank you for supporting us and reminding us why we do this.

We’re looking forward to continuing this blog and making it everything it was intended to be, while giving our “laundromat kingdom” it’s rightful place on the interwebs at Laundromats101.com.    Until next time…

Cheers!

This is not a stock photo from the internet. This is the ACTUAL store we purchased. Fun times, right?

UPDATE – We now have a NEW website, Laundromats101.com!
This blog, MyShinyNickels.com, will remain a personal finance website, while all laundromat-related goodies, including this blog post, have been moved to Laundromats101.com.
Click HERE to read this post on the new site…

I think it’s pretty fair to say that laundromats are not the darlings of the small business world.  They don’t have the best of reputations, and truthfully, for good reason.  Far too often they really are dilapidated, run-down eyesores. Sadly, our second store was one of them.

But I’ve always enjoyed a great before/after makeover story.  I’ll take them in any form…houses, cars, animals, humans.  I love seeing the transformation from ugly duckling to swan.  And our second store certainly qualified as an ugly duckling, both inside and out.

It’s become clear over the seven or so months we’ve owned it that the elderly owner before us just hung on. Far.  Too.  Long.  Occasionally we still find that a washer was “fixed” with a paper clip and a piece of bubblegum.  Okay, I’m exaggerating with the bubble gum. (But not the paper clip.)  He was proud that he “did his own maintenance”, but I imagine that his tool kit consisted of a cardboard box full of paper clips and several varieties of duct tape.

It’s frustrating, but a very likely reality when you buy an old rundown store.

But for the right price, a store like this can be a diamond-in-the-rough.  This second store was originally listed for $50k, then lowered to $40k, and then finally sold to us for $28k.  (And even that price was a bit generous.)

We saw this store as an opportunity for a few reasons; the first was that it was, um, cheap.  It meant expanding our laundromat “empire” for very little cash.

The second reason is that it was only a few miles from our first store.   Some may argue that we’re competing with ourselves (our other store), but we see it differently.  We’d rather buy out a competitor and avoid the risk that a savvy buyer nabs it instead and makes it amazing.  Then we’d really have some competition on our hands.

Plus, we like the idea that we corner more of the market share in this area of the city.  Having two stores within 5 miles of each other means they are just close enough to make it convenient,  but just far away enough that the customer base doesn’t overlap very much.  They are located in two completely different neighborhoods.  So our radius has expanded that much farther.

We don’t have plans to pick up any more stores at this point, but I won’t deny that I daydream about it on occasion.  Randy says I have a soft spot for sad little laundromats.  I guess you could call me the “Patron Saint of Orphan Laundromats”.  (I know there’s a t-shirt opportunity somewhere in there.)

I know there are people out there that would actually wear this. It sounds like a rock band, doesn’t it?

Each time we drive by a decaying laundromat, I immediately want to buy it and make it nice again.  I guess nothing is safe from my intense love of good ol’ makeover stories.

So when we bought our second store, we knew we had our work cut out for us.

Below is the rendering of our exterior makeover plans.  On the left is basically what it looked like when we purchased it (except for the logo decals on the door; we had already added those when the photo was taken.)   The right “photo” is the same view, but it’s my “artist rendering” of what it will look like once the paint and other exterior signage and lighting is complete.

At this point, we’ve already installed the large sign in front, and applied the window and door decals.  We still have to get it painted white with the green trim/accents, install the additional signage on the right wall and add the accent lighting that will highlight the sign at night.

And the interior was just as bad as the outside, unfortunately.   There was (still is) a long list of remodeling items for the inside, but we’re tackling them one-by-one, and it already looks so much better than it used to.

One major item was to refurbish every single washing machine in the store.  They are over 30 years old, but our technician said they were some of the best machines made and will continue to run for a while longer.  But they looked like they were on their last leg, and that’s all customers saw.  If they look like they don’t run, customers will just go somewhere else where the machines look more reliable.

Below is a before picture of the washing machines.  This is what they all looked like before I got my grubby hands on them.  Instruction labels were peeling off, brown paint was chipping everywhere, grime-covered temperature knobs and beautiful Halloween-orange front panels.  Oh, and I can’t fail to mention the previous owner’s finishing touch…machine numbers written with black Sharpie.  Let’s hear it for machine #7!!!

I’m sure folks ooohed and aaahed when these babies first rolled off the production line in 1982, but they were in desperate need of a facelift (there’s that makeover instinct again).

So before we even closed escrow, I had already finished designing a new label that was the exact dimensions of the existing brown, peeling one, but in a medium grey color.  I even found the Wascomat logo online and applied it in the upper left corner.

I submitted the file to our sign company and ordered one for every washer in our store (27), at $12 a pop.

When the new labels arrived a week later, I was ecstatic.  They were gorgeous, and looked professional, just like we’d hoped.

After I finished drooling over my new instruction labels and had completed my happy dance in the family room, I headed to the laundromat to start my refurb work.  Over the course of many weeks, one-by-one, I scrubbed each washer down, covered the brown instruction panel with black appliance paint, applied the new instruction label, cleaned the temperature dial until it looked like new, and painted the orange panel with heavy-duty white appliance paint.  Below is an actual side-by-side of a refurbished and an, ahem, original.

We spent $60 on appliance paint and $324 for custom printed labels, for a total of $384 to make our washers go from this…

…to THIS…

Numerous customers have told us they’re excited about the “brand new washers.”  Sometimes we ‘fess up and admit they were refurbished, and other times we just say “thank you” and bask in the glow of our accomplishment.

And as you likely noticed, we also painted the walls our “Thrifty Wash Blue/Grey” color, added new signage to the walls, refinished the benches in a dark blue and replaced the ugly green bulkheads and folding tables with new white countertops from Ikea.

Because I love before/after pictures, here’s another set.

We’re currently in “capital reinvestment” mode for this store, meaning that any profits we get we’re pretty much just rolling back into improvements.  We’ve also ordered all new dryers for this location (cost = $50k), since the current ones really are on their last leg, and breaking down on a regular basis.

Once we’re done with the remodeling stage, we’ll start ramping up advertising and really get this store booming.  Because so far, we purposely haven’t done any advertising at all for this location.

Why? The truth is that you usually get just one shot with new customers.  If they walk in for the first time, and then turn right back around again in disgust, it is much harder to get them to give you a second chance, even after significant remodeling.

With this customer psychology in mind, we don’t really want much attention yet.  At least not until we’re prepared to knock their socks off.   Literally.  I want to knock their socks off right into a nearby washer.

So now you’re thinking…”that’s a nice story, why are you showing us this again?”

My point is that while purchasing a run-down store can be a gold mine, it comes with a lot of hard work and the reality that cash flow will likely be minimal or nonexistent until you can get the improvements completed.  So if you need to rely on cash flow for living expenses, this type of store is not for you.  And if you’re a first-time laundry buyer, I’d be careful as well.  It’s not impossible, but know your limitations.

On the other hand, I want to make it clear how much improvement can be made with just cosmetic changes alone.  Had any other buyers looked at those old washers and even considered refurbishing them as we did?  Probably not.  They saw ugly, peeling, old orange washing machines and rejected them at face value.  Even our service technician was blown away at what we’d done with those old washers and he’s been in the business for 30 years.

All that to say that creativity in business can serve you very well.  Think outside the box.  Don’t reject an opportunity simply because it’s seen better days. With your specific strengths in mind, look for areas where you can improve that no one else would think of.  

There are diamonds-in-the-rough out there; find them, buy them for next to nothing, and then get to work overhauling them.  Create your own ugly-duckling-to-swan success story.  The customers (and the profits) will follow.

Until next time…

WE WROTE ANOTHER BOOK!

Pulling it together felt like the birth of another child, so I guess it deserves a birth announcement:

Why did we write another book, you ask?

It was you, dear readers.

Over the last year, I’ve received a ton of reader mail asking for help; about lease negotiations, or how much a particular laundromat is worth, or whether to make an offer or not.  Many of them were requests for consultations.

“I’ll pay you! I just need 30 minutes of your time!” they cried.

So it became very clear that a lot of people out there still need a lot more information.  Well, information and confidence.  And they need more than my blog alone can provide.

Many of you described the fear you have when it comes to investing in a laundromat, or any business for that matter. And that’s understandable.  Fear of taking the first step, fear of failure, fear of living outside your comfort zone, fear of the unknown.

And then it finally hit me.  After I found myself repeating the same strategies and stories and calculations over and over to one reader after another, I figured we should just pull everything we’ve learned directly or from veterans in the industry, and create a complete guidebook to laundromat investing.  From start to finish.  And then to really get folks set on the right path, we’d offer a discounted bundle that includes ALL of the spreadsheets and templates and checklists we used to successfully purchase and operate our own two stores.

Now that it’s all pulled together, it’s quite a package.  It’s everything we wish we had when we started our own laundromat investing journey.

But with the amount of time and effort we devoted to it, we couldn’t just give it away.  The blog costs money to run, and our time is worth something.  So we’re not ashamed to put a price on the fruits of our labor.  But for what is all included, it’s almost like we’re giving it away.

If you’re serious about investing in a laundromat, it’s a must-have.  It will save you both time and money, and help take some fear out of the process.

Click Here to Check It Out …

A New Identity and a New Direction

As I already mentioned, I get a lot of reader mail, and these days about 90% of it is about investing in laundromats. So as much as I’ve resisted it, pushed it aside, ducked it and avoided it…the fact is…I’m now known as…

…the laundromat lady.

I tried to fight it.  I didn’t set out to have this blog be about laundromat investing.  I didn’t even want it to be about laundromat investing.  But the reality is that there is only so much one can say about investing in index funds, or eliminating debt that hasn’t already been said.  There’s a million (ok, maybe not a million, but a lot) of other personal finance blogs out there that cover everything else, but there’s no one that blogs about laundromat investing specifically.

So I guess it’ll be me.  I accept the crown and I’ll wear it proud.

UPDATE – We now have a NEW website, Laundromats101.com!
This blog, MyShinyNickels.com, will remain a personal finance website, while all laundromat-related goodies, including the laundromat section of this blog post, have been moved to Laundromats101.com.
Click HERE to head to the new site…

I’ve just been, well, busy.  And, if I can be completely honest, I was a little burned out for a while.  Over the last few months, I’ve been swarmed with emails and blog comments, many saying variations of “I want to buy a laundromat.  Can you help me?”  Or worse, those that ask questions that I’ve already discussed in a blog post somewhere.  Urgh.

Some I’ve responded to, and some I haven’t.  I just don’t have the time to get to all of them.  And if I did, my kids would go unfed and I would start to look like Tom Hanks in “Castaway” from lack of consistent bathing.  (So if you wrote and I haven’t responded, I’m sorry.  Sort of.)

Don’t get me wrong, I love my readers in whatever form they come.  But after a while, I began to feel like “the laundromat lady”.  I was even starting to get quasi-hate mail that said “I wrote you a week ago, and you never answered me.  I need answers.  Are you going to respond???”  As if I owe people something.  So I stepped away for a while.

So What’s The Latest?

It’s the end of the year, so I figured it was time to give an update on life, finances, and laundromats.  I’ll start with the first one.

Life

Life is busy, but fairly normal.  I recently took a sabbatical (possibly permanently) from all social media.  It was taking up time and space that is better used elsewhere.  And two months in, I don’t miss it a bit.

Our second oldest turned 18 recently, and she now has a job, and the independence that comes with having her own car.  In fact, I’ve started calling her “Sasquatch”; I’m told she exists, but sightings are rare and undocumented.

And as you may remember from my last post, my husband Randy left his stressful, exhausting management job a few months ago, and retired at the age of 49.   It’s great having him home (and awake past 6pm), and seeing him so relaxed and rejuvenated.  He’s even started taking drum lessons, something he’s wanted to do for years.

As for me, I got a long-awaited promotion at work to Manager of Client Analytics.  Woot.

Finances

With Randy retiring, it meant going down to one income (mine), but our living expenses were already less than what I make anyway, and I make pretty good money, so it hasn’t been much of a change.  We do have less money for splurges than we used to, but I still wouldn’t change a thing.

As far as our progress towards financial independence goes, our savings have slowed down some.  When Randy was working, he was investing his entire paycheck, so the laundromat income has now had to fill some of that savings gap. But, we’re still investing some of the profits back into the business itself.  So once the laundromat remodel is completely done (we’re close!), we’ll be able to deposit more into our investment accounts.

And I still need to do a new Net Worth calculation to see where we’re at, but I’m admittedly a little nervous about the number I’m going to see.  But I’ll eventually put on my big girl pants and do it.

The Laundromat(s)

When I last checked in, we were in escrow to buy a second laundromat, located about 20 minutes away.  The seller was willing to carry the financing, and we were approved by the landlord to acquire the lease, so we thought things were fine and dandy and set to close.

But…then the landlord decided to dig into their toolbox, find a wrench, and throw it into things.  They wanted to change the way the water bills were handled for the shopping center, which would have increased the expenses for the laundromat by about $600 a month (resulting in a loss of $7,200 in net income annually).

They had no plans to lower the rent to compensate for the additional water expense, and implementing the billing change was taking f-o-r-e-v-e-r, delaying the purchase of the laundromat.  So after 5 months of waiting, with our cash sitting idle and uninvested, and no end in sight, we withdrew our offer.

But just a few weeks later, we found another laundromat for sale. Only 5 minutes from our house.  It’s a real fixer-upper, but we negotiated the price down to the point that we could pay cash for it.  (Details to come once we close escrow.) We’ve already been approved by the landlord to acquire the lease, and yesterday we wired the final funds from our investment account.  We take possession on January 1st.

We have plans to completely gut the place and bring in new (or new-to-us) machines, and perform a full cosmetic overhaul.  So I’m sure I’ll be sharing some dramatic before-and-after shots in the future as we remodel the place.  We’ve got our work cut out for us, and it will likely take at least 6 months to a year to get it all done, but we couldn’t pass up the opportunity.  It’s a calculated risk, and we hope that it pays off.

Well, I better wrap this up, I’ve got a holiday party to get to and I’m sure you’ve had your fill of me by now.  If I don’t pipe up again before the end of the year, have a safe, wonderful, thankful Christmas holiday and New Year.  2015 treated us very well, and I’m hoping that 2016 surpasses all of our expectations.

Until next time…

“A bad manager can take a good staff and destroy it,

causing the best employees to flee

and the remainder to lose all motivation.”

Last time, I talked about a major decision my husband had to make: Quit his job and let our savings rate take a hit, or find less toxic employment.  His job was slowly killing him, and our quality of life was suffering.  He didn’t like either of the options we discussed, so we created a third option: Buy a second laundromat.

But having him quit prematurely is a bit risky.  The whole thing could fall apart, our savings rate would tank and our early retirement plan would be in jeopardy.

But we realized it is no longer about early retirement, or savings rates or laundromats. It is much bigger than that.

He needs his life back.

But as I promised, I wanted to get his perspective on this whole quitting thing, and what finally pushed him from…‘I can last a few more years’…to…‘I can’t last another day’.

Let’s dig in.

Me: So, it seems like your job sucks.  What went wrong?

Mr. Nickels: Have you seen the movie “Horrible Bosses”? That title alone should clue you in.  Plus, working 50 to 55 hours a week is taking up too much of my life. And I have no time to have a normal life. I could deal with the hours and the shift, but combine that with the dismal working conditions and it’s no longer worth the money.

Me: If you quit your job, what are you most looking forward to?

Mr. Nickels: Regaining my life.

Me: What scares you?

Mr. Nickels: Being responsible for the destruction of our early retirement plan. I am basically retiring, but I don’t want to delay your freedom.

Me: What do you miss the most with your current job?

Mr. Nickels: Well, since I’m married to you, I have to say spending my evenings with you. I hate going to bed 4 to 5 hours before you do. I feel like I miss a lot of family time.

I also miss running. Before I took a job starting at 3am, I would run in the mornings before work. You know I love running on the American River Parkway. It’s less than a mile from our house, so many trees, and of course views of the river as I run. I can’t safely run at two in the morning and by the time I get home, I am usually exhausted.  How many times did you catch me dozing off while on my computer?  (Me: That is true.  You know those cute videos of kids falling asleep at the kitchen table, and they face-plant into their spaghetti?  Replace the spaghetti with my husband’s MacBook and you can imagine what I’d witness on a daily basis.)

Me: Why are you so worried about our early retirement plans?

Mr. Nickels: With a second store, we can pretty easily replace my income, but originally I wanted to use the extra income to build our retirement accounts that much faster. I just don’t want our plans to be in jeopardy.  I do believe we will increase our income even more when we start advertising, but as with anything financial, it’s not a sure thing.

Me: What caused the shift from ‘I can last a few more years’ to ‘I can’t last another day’?

Mr. Nickels: It was actually a few things, really.

We had just come home from our cruise to Alaska. It was Sunday night, and I was dreading going back to work. Actually, there isn’t a word I can use to really describe it. ‘Dread’ is the best I can come up with and I felt it all the way deep down in my gut.

I’d spent a week of quality time with my family; no stress, no boss, no early hours. Just knowing I had to go back to work was giving me a dull headache.

The feelings were starting to creep in…

…then within a few days of being back to work, I read the post “Yo Ho, Yo Ho an FI Life for Me” by a buddy of mine over on 1500Days.com.

He described how he was closing in on the finish line. He’d reached his million-dollar mark and was getting ready to pull the trigger and quit his job. He was looking forward to what the next chapter of his life would look like, and how he planned to spend his work-free days. He’s only 41!

And while his post made me deeply envious, it was also severely depressing. Don’t get me wrong; he’s my friend and I couldn’t be more happy for him. But it highlighted my own situation, making me think…“I can’t do this for another 5 years. It’s not fair to my wife, my health, my kids.”

I decided to comment on my friend’s post:

His reply “…and I’ll bet it arrives sooner than you think it will…” turned out to be almost prophetic. We didn’t know it at the time, but he was right.

So…with a taste of freedom, a job I hated, and a friend’s announcement of imminent retirement all occurring within a 72-hour window, I couldn’t take it anymore.

Something needed to change.

So I quit.

I gave my two-week notice, and on Friday, August 28th, I turned off my computer, pushed in my desk chair, and left work for the very last time.

The purchase of the second laundromat continues, and we should be closing escrow in a few weeks.

We’re taking a leap, and I couldn’t be happier.

UPDATE – We now have a NEW website, Laundromats101.com!
This blog, MyShinyNickels.com, will remain a personal finance website, while all laundromat-related goodies, including this blog post, have been moved to Laundromats101.com.
Click HERE to read this post on the new site…

I’ve debated on whether I wanted to publish this post or not.  I’m an admitted cynic, er, realist, and I tend to live in the “something [will/might/could] go wrong” camp.  (Now go back and read that part again with an Eeyore voice, please. That’s how I said it in my head.  Thanks for indulging me, kind reader).

But I’ve decided to be optimistic and post it anyway, as premature as it [might/will/could] be.

——————————————————————————————————–

If you’ve been keeping up lately, five months ago we purchased our first laundromat as an investment towards our goals of early retirement. We were originally going to wait for the ink to dry on the first one before diving into a second one, but…

Back in March of 2014, I wrote about the story of Sam*. [If you haven’t read it, I’ve provided a link. You should take a moment to read it and come back so you have some context. It still gives me goosebumps.]

As those who have read the story know, when my husband was hired at his company, he took Sam’s old job. At the time of that writing, I used Sam’s story to illustrate why we should live with our priorities in check. That if you want to spend the better part of your lifetime living on your terms, and less in a cubicle, then make the financial lifestyle changes necessary to reach those goals more quickly.

I implored all of us to not be the next Sam.

Do as I Say, Not as I Do…

But in a strange twist of life imitating art, my husband is now Sam. Both literally and figuratively. After nearly three years of going in to work at 3am, for 55 hour workweeks, and dealing with toxic upper management, he is a shell of his former self.

But let me back up for a moment. At first, this job was a blessing. He tripled his prior income, and this is when we realized our early retirement plans were really possible. We danced in the family room when we found out he got the job. (Well, technically I danced, while he did more of a manly high-five type thing.)

He would come home from work and we’d talk about the victories and the frustrations of his day. Laughter came easily. There was optimism in his voice and a little pep in his step.

The Stress Fractures Begin

Less than a year in, the job began to get to him.  He called me one particularly difficult morning and told me he wanted to put a sticky note on his computer monitor with the words “My Job is the Key to My Independence”. He said he needed to remind himself why he put up with his job every day.

At the time, I thought he was kidding. I soon received this photo.

The Current Reality

How are things now? Well, the victories we once rejoiced in are few and far between, and the frustrations are consistent and ever-present. It saddens me. I’ve been putting on my supportive face, trying to remind him “just a few more years, dear”, but even I was no longer believing my false optimism. He now comes home from work, falls asleep on the couch, wakes up long enough to catch a favorite TV show and eat some dinner, and then he’s off to bed to start the cycle all over again.

This isn’t a life. For either one of us. I miss cool evenings in the hammock together, his quick sense of humor, the witty conversation, late nights watching movies, family outings during the week. Those things still occur once in a while, but not often enough.

Practicing What We Preach

Fast forward to a few weeks ago, July 14th. Randy and I are at our kitchen table. I tell him I’m worried about him. I insist that he needs to choose one of two options: Either quit his job to focus on the laundromat full-time, or find a new job. But we quickly realize that the laundromat won’t replace all of his income, and jumping through the hoops of finding a new job (which may be just as toxic) isn’t appealing to him either.

We didn’t want to jeopardize our savings efforts, but there’s a point when quality of life must take priority over all other goals. I’ve always said that if you live and spend with your priorities in order, you’ll be happier than you’ve ever been.  I agree with a little sacrifice in order to reach our goals, but it doesn’t mean either one of us should have to be miserable in the meantime.

It was time to practice what I preach.  My husband needs to quit his job.

But convincing Randy to quit without replacing his full income was not an easy task. He didn’t want his actions to impact our early retirement timeline. (He can be quite stubborn, and freely admits this fact.)

The answer? We needed a second laundromat.

The Odds Are Good, But the Goods Are Odd

That evening, Randy said goodnight and headed to bed.

I immediately made my way outside to the hammock with my laptop, and swayed back and forth as I looked at local laundromat listings. But inside I felt hopeless. What are the odds that another store would be available right now? Pretty good, actually. There are always a handful of laundromats for sale at any given time. But that wasn’t the real question.

What are the odds that another store would be available and meet our criteria? Not so good.

But as I browsed, I noticed that the broker who arranged our first laundromat purchase had a few listings for sale in our price range. I emailed him about our admittedly crazy plan to buy a second laundromat already.

He wrote me back within the hour, sent the non-disclosure agreements for a couple of listings.  By the next afternoon, we were driving out to take a look at the laundromat we’re now under contract for.

In the time since, we’ve met with the seller to go over his financial records (does this feel like déjà vu for anyone else?) and he gave us official approval for the seller financing (we submitted a credit report and financial statement to him to show our creditworthiness).

Assuming this all goes as planned, and we are owners of a second laundromat, Randy will quit his job.

Are We Crazy?

Yes.  A little.

This step we’re taking is bold. Randy leaving his job is a bit scary. But it could be worse. Because we adjusted our lifestyle long ago so that we’re living on less than 50% of what we make, Randy could quit tomorrow without any laundromats and we could still live on my income alone, completely comfortably. (Yet one more reason why living well below your means is a good idea. The loss of a job doesn’t mean disaster.)

So while we’re taking a leap of faith, it’s an educated, well-padded leap.

But this is only my perspective. I was interested in what my husband thinks about all of this, so I asked him, Q and A interview style.

I’ll post his answers next time (soon!), and let him tell you his side of things, as well as the single event that took him from “I can last a few more years at this job” to “I can’t last another day”…

Until then…

UPDATE – We now have a NEW website, Laundromats101.com!
This blog, MyShinyNickels.com, will remain a personal finance website, while all laundromat-related goodies, including this blog post, have been moved to Laundromats101.com.
Click HERE to read this post on the new site…

If only I had a blogging magic wand. I’d say an annoying little jingle, wave a cool-lookin’ stick and my blog post would appear. The truth is that posts like this one take a l-o-o-o-o-n-g time to pull together; numbers, calculations, reviewing records, Zzzzzzz.

So, sometimes it takes me a while.

But I realize that posts like this are where the meat is; the stuff that other finance and number geeks like me thrive on. I’ve had a few readers send me some friendly, gentle pushes to publish an update on the laundromat business and how it’s going so far. Fair enough, because if I were them, I’d want to know too.

The Beginning

You know those home decorating reality shows where they take an ugly-duckling house and make it fresh and wonderful? (Just nod and say yes.)

Well…that’s how I feel about the laundromat we purchased. It was decorationally challenged (yup, made that word up myself). Actually, that’s putting it nicely. It was a bit of an eyesore. The vinyl wall paneling was the color of used-to-be-white socks. Or dirty dishwater.

Oh, and it had forest green trim everywhere. Well, where there was trim, at least. In some places it had fallen off and never been replaced.

This is one of the only pictures I have of the inside before I got my grubby hands on it.  This is when we were spying on the laundromat before we bought it.  I know, it’s hard to see the details.

Years of grime had made its way into the crevices of the vinyl on all the walls.

I took the picture below after I’d already painted the forest green trim, and you can’t see the grime on the walls.  But trust me, it was there.

There was no personality, no theme, no logo, nothing. Even the clock on the wall looked to be from a 1960’s school classroom, and it was hanging on the wall just off kilter enough that it generated some OCD in me that I didn’t know was there.

Yes, we removed the clock before we finished painting. In fact, that clock came out and a whole new cooler chrome-and-white one was put in its place. I still need to take a picture.

The crazy thing is that it still made decent money. Even looking like that. But in the 12 months prior to the purchase, business had taken a slight downward turn. Revenues (and thus, net profits) were down from prior years. But we figured that a basic, economical facelift would increase business and we knew we would take a more ‘hands-on’ approach than the prior owner, since we live just a short distance away.

Finally…Some Meat and Potatoes…

First I compared the average monthly expenses from the most recent year of business for the prior owner with our own first few months of business to see how things have changed…or stayed the same.

The rent is higher for us, since it increases every two years, and 2015 was an ‘increase year’. We had to assume the prior owner’s lease, which wasn’t that favorable. However, we negotiated our rent down so that when we renew in 2018, the base rent will drop down to $2,000 per month, which puts $6k back in our pocket for the year.

We also are seeing an increase in water costs, which isn’t a shock, given that business/usage has increased as well as the drought status in California right now. Water rates will likely go up again, but we just increased our prices on all washers by 25 cents to account for that. (I’ll talk more about the price increase in a later post. That’s a whole other discussion.)

We also gave our janitor a raise. He was underpaid, does great work, is reliable, and is pretty much the entire reason why we can go days without ever paying a visit to the laundromat. He cleans at night, closes up, and sets the alarm, 7 days a week. He has asked for only 1 day off in the 4 months we’ve owned it.

We ditched the expensive cell phone plan that the prior owner used, and went with Republic Wireless for $10/month.  Haven’t had any problems.  Every dollar saved counts.

More Meat and More Potatoes…The Big Picture

I also pulled together a summary of what our average income, expenses and net profits have been in the four months we’ve owned it (annualized), compared to the prior owner’s most recent year, compared to the prior owner’s 3-year-average.

As I said, business had taken a downturn the 12 months before we bought it. But during the purchase process, we had reviewed the financial records of the prior years, and saw what it could make. (We verified that the downturn was not because a new competitor opened up down the street, etc. It was really due to the owner becoming involved in other business ventures, and the laundromat was no longer a priority.)

Looking at the numbers so far, we’re doing pretty well! We initially put some of the profits back into the business to purchase remodeling materials, a video surveillance system, etc, but for the most part we’re letting our business checking account build up a few months worth of expenses so we have a solid reserve account. Oh, and Randy treated himself to an Apple Watch courtesy of the business.  He earned it.  

It’s important to have a nice cushion in the business account; we don’t live paycheck-to-paycheck in our personal accounts, and it won’t be any different for our business.  Once that reserves is met (3 months of expenses), we’ll start transferring most of the profits to our investment account. (I can hardly wait.)

Now for some Before and After…

But first a disclaimer. These won’t be quite as striking as I’d like. I forgot to take clear interior ‘Before’ pictures. I got excited to get in there the first week and paint, and next thing I knew, I had painted all of the trim white before I remembered to get out my camera.

So…it is what it is. But these will just have to do.

Week 1: I took off the week from work, and my momma came in and helped me paint. Thanks mom!

You can see the dirty, yucky-colored walls better in the one below.  At this point, the trim had been painted white and the walls were in progress of becoming a calming blue-grey color.  Randy installed the video surveillance system.

Next we installed a paper towel dispenser and a soap dispenser at the sink…exciting stuff, I know.

Next we installed the missing trim around the dryers and put up professional signage.

Logo signage was installed on the soap vending machine, and trim was installed around it and painted white.

The classic forehead-and-hat shot of the front of the store, with the new window and door signage. That’s my mom hiding behind the window signage. She’s so camera shy that one.

Randy starring in my after photo below (much to his dismay). The vinyl paneling and garbage cans were refinished, and we had a logo and instructional signage made to place on the walls. We also took photos of the surrounding neighborhood and Sacramento landmarks, selected four, and had them printed on canvas to hang on the walls.

So that’s the latest on our laundromat adventure.  Now do you see why this post took me so long to write?  

Thanks for tuning in.

Cheers!

Canada’s national newspaper, the Globe and Mail, picked up my post “Your Starbucks Habit Is Not Why You’re Broke”.   I received this email a few days after it posted.  Maybe it’s just me, but I think I hit a n-e-r-v-e.

“Dear Mrs. Nickels / AKA Laura,

Put this in your pipe and smoke it.  $5.09 at Starbucks PER my wifes 4 PER DAY/& 7 DAYS PER WEEK for the past FU@#ING 9 YEARS.  That’s $66,882.60 ($20.36 per day/ $142.52 per week/ $570.08 per month/$6,840 per year) over the past 9 years!!

So don’t be so biased in your article here. Our cars are paid for….. BY ME, I don’t drink alcohol, and I don’t indulge in Bull$h!t either. We have NEVER had a vacation, we don’t go out to eat.  We have 4 children and a home to pay for.

On top of it all, guess what…….. I am the only income in this family. Take you article and stick it where the sun don’t shine.”

Brad S. –  Minnesota

Oh, where do I begin with this guy? No, seriously. Not sure where to start with this one. (I’ve decided to overlook the spelling and math errors for now.)

I don’t know about you, but my BS meter started flappin off the charts about 15 words in. Maybe his wife goes to Starbucks twice a day (crazy, but somewhat believable), maybe even three times a day (now we’re stretching the bounds of reality), but…4 TIMES A DAY, EVERY SINGLE DAY OF THE YEAR?!?

Sorry, dude. That’s just plain silly.

Maybe he subscribes to the belief that if he exaggerates enough, I’ll just cave and believe him.
But let’s get back to the tall tale by Captain Exaggeration…

“We have never had a vacation, and we don’t go out to eat.”

Again, are you kidding me? Are you trying to convince me that if I took a look at your banking statement for the past 9 years, I wouldn’t see a single meal out? No burger joints, chinese food, sandwich shops…anything? Even my uber-frugal friends still manage to eat out at least a handful of times a year.

There’s my dang BS meter going off again.

I think his goal with all of the inflammatory words was to get me worked up. And it’s true that after I read his email, I cried. Tears from gut-busting laughter.

I get it; he’s frustrated at his wife’s Starbucks habit.  But Brad, if you’re going to yell at me, at least stick to the facts.  I’ll pretend that I believe you for the sake of argument. $500 a month at Starbucks is pretty hard-core, but I still don’t believe it’s why you’re broke.

You poor soul, you missed the whole point. Should anyone be spending $500 a month on Starbucks if they’re in debt or have no savings?  Of course not.  But I don’t think Starbucks is the real problem.  It’s a symptom, but not the problem.

So here is my response to Captain Exaggeration:

Dear Brad aka Captain E,

First, thanks for the kind offer to stuff my pipe, but I don’t smoke.

A $500/month Starbucks habit is pretty crazy. But frankly, it’s not my place to judge where somebody spends their money, if that’s what makes them happy. My only caveat is that all other financial priorities must come first.

• Downsize your house. We have four kids, and downsized from 2,600 square feet to 980 square feet with one bathroom. Don’t regret it for a moment. Toughen up.
• Drive reasonable vehicles. Your cars are paid for? Great! Are any of them worth more than $10,000? Sell it and buy something else. Put the cash difference towards debt or savings.
• Eat out less. Oh wait, you’ve obviously got that one down already. You already told me that you never eat out. * pause for effect *

The truth is, your wife is probably going to Starbucks to escape, not because she truly enjoys the experience. If money wasn’t such a stressful issue, she wouldn’t spend as frivolously to begin with. So reverse engineer that bad boy. Stop spending so much on housing and transportation, and start taking care of your financial priorities (paying off debt, emergency fund, saving for retirement).

Once you’re doing better financially, her need to escape to Starbucks will probably dwindle down to a more reasonable frequency. (Mr. Nickels suggests some marriage counseling as well. You and your wife need to get on the same page when it comes to spending and money.)

But even if I’m wrong, and the Starbucks habit lingers, at least your financial house will be in order.

P.S.  I’ll try sticking my post where the sun don’t shine, but here in sunny California that’s a tall order.

Sincerely,
Laura aka Mrs. Nickels