Category: Things I Think About

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Personal Improvement – Taking Care of Yourself

#MusicTherapy

Do you ever get to a point where you are feeling overwhelmed with everything going on in your life? The constant demand from work, the building up of lots of meaningless little things that put you in a funk? Or what about a sudden realization that things in your life that you took for granted are no longer a sure thing?

Click on this link to get your own free copy of the Rental Property Tax Guide by Stessa.

Well, that has been me for the last few months. I believe it started with my health. As I talked about in a previous post, I was diagnosed with thyroid cancer. And luckily, it was the easily treatable, slow growing kind. Simple solution. Remove the thyroid gland, check for any other abnormalities near it, and carry on.

Or at least so I thought. The surgery was quick and without complications. No abnormalities observed in the surrounding tissues, most likely due to such an early diagnosis. When the pathology came back saying that there was a third tumor growing on the other side of my thyroid gland, my endocrinologist decided to ablate me with radioactive iodine. This would kill the remaining thyroid cells and virtually eliminate any chance of thyroid cancer coming back.

Because he suspected that we might have to go that route, he did not start me on replacement thyroid hormone medications, choosing to wait until a decision was made on the radioactive iodine (RAI). I felt fine right up until I did the RAI. This was approximately 6 weeks post-surgery, which is also just about the length of time that thyroid hormones live in your body. What that means is that I had little to no energy and mostly just sat around.

I was able to start the meds a couple of days after the RAI and I began to feel better. Over the next few weeks the doctor ramped up the dosages, trying to get my hormone numbers in line. And it worked/is working. BUT, I have nowhere near the endurance I used to. I normally get up around 05:00, give or take. But by 17:00 – 18:00 in the day, I had no more energy. Now I am able to last to about 20:00, then it is sit or lay around and nothing strenuous.

So that was bad enough, but on top of that, my glucose levels have begun to go a little haywire. I can have normal numbers throughout the day (120 – 150) & low levels at night (45 – 68), then wake up in the morning to levels at 245 -280.

The doctor thinks that it may stabilize once we balance my thyroid hormone levels. It also may be related to a medication change made a few months ago.

In addition to the medical issues, there has been a lot of stress at work, which probably magnifies all of my medical issues.

With all of this going on, I did not feel like doing much of anything extra-curricular. I had a realization that this was my new normal. There would be no more “go, go, go” and rest on the weekends.

I was depressed.

Now I don’t claim to have a solution for depression, I am only relating what I am observing.

We took the kids to see Weird Al Yankovic in concert in New Orleans, that seemed to help. And this week, I had to travel to Dallas to present at a workshop for a different group in the company for my job. While there, I had dinner with a buddy I hadn’t seen in twenty-plus years. IT was good to catch up with him. On top of that, I started to listen to music a little more. My aural diet has been mostly podcasts and audiobooks for the last three or four years, so music is a refreshing change, in addition to being therapy for my soul.

So, what I suggest to you, dear reader, is that if you find yourself in a similar situation, don’t wait to do some self-therapy…find what feeds your soul. Take Care of Yourself.

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And, as always, let me know what you think in the comments. Ask questions, tell your story.

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Automation – Stessa Rental Property Accounting

Today I am going to do a review of Stessa, an online rental property accounting platform.

But first, a disclaimer:

***This review may contain affiliate links that compensate me for user registrations of this product.***

As I have detailed in a previous article, I started using Stessa last year to track accounting for our rental portfolio. Previously, we used Google Sheets, tracking rental income and expenses for each property on different tabs. This would involve me going in to the first property’s income tab, entering the collected rent, then checking all of my receipts and accounts to verify I hadn’t missed any expenses and adding them to the expense tab for that property. I set up expense categories and put in a section to summarize the expenses by category and by month. While not ideal, it insured that someone at my CPA’s office was not classifying an expense in the wrong category or for the wrong property. It was not hard to do, just more a matter of remembering to do it.

Around the middle of 2018, I started seeing advertisements for a product called Stessa on Facebook. As per my SOP, I ignored them, other than taking note of the name. A few weeks after first seeing the ads, I heard an advertisement for it on The Bigger Pockets Podcast. This was more effective, as they pointed out how it was free for rental property owners and individual investors and involved some automation to keep track of your accounting. They also pointed out how the product was developed by real estate investors for real estate investors and the name was “assets” spelled backwards.

I went to the web site and registered for it. I was able to set up our properties and import bank & credit card histories to the transactions section, allowing me to categorize each expenditure. It took maybe 10 minutes to set up two properties. And, once numbers had been entered, the dashboard populated with portfolio metrics. Way nicer than my spreadsheets!

Features

Individual tracking for each property:

Property Profile Header – Address, Acquisition Date, and Cost.

Property Details – (Year built, neighborhood, parish [county, for those of you outside Louisiana], number of units, bedrooms, bathrooms, square footage, and lot size, all pulled from Zillow, based on the address.)

Valuation – Provides for multiple options: Custom Valuation, Zillow Zestimate (automatically polled, user choice to update property valuation), Gross Rent Multiplier, or Capitalization Rate.

Rent Roll – Allows entry of Bed/Baths, Square Feet, Tenant names, Rent, Market Rent, Deposit, Move-in Date, Lease Expiration Date, and notes.

Property Notes section – Freeform note space for property.

Monthly Expenses – Allows for Pro-Forma expense entry and pulls in categorized expenses from the Transactions section to show actuals compared to Pro-Forma.

Neighborhood – Shows location on a Google map, with a Walk Score and a Bike Score for the property.

Assessments – Pulls in assessed value and property tax amount (I’m assuming from Zillow), and allows you to add missing assessment/tax details.

Capital Expenses – Allows for entry of Date, Description, & Amount of Capital Expenditure.

Loan-to-Value – Shows a chart with LTV percent, Property Value, Debt (principal balance), and number of loans.

Mortgage – Details the Lender, Principal Balance, Payment Amount, and Interest Rate.

Insurance – Displays the Carrier, Premium, Policy Number, and Renewal Date.

Transactions:

As I mentioned above, Stessa allows you to link bank accounts and credit cards to the Transactions ledger. It lets you initially import all transactions and gives you the option to review them to either categorize each one correctly or, in my case, the credit card I use also has personal charges, so it it allows me to delete those transactions.

Stessa does not store your credentials on their servers and use bank-level encryption to secure the transfer of information. It also does not allow changes to your bank or credit card accounts. It only pulls a copy of your transaction information.

The Transaction Ledger Menu allows you to review new transactions, view ALL PROPERTIES transactions, view individual property transactions, or add a new property.

The main Transaction Ledger display shows all transactions, filtered, based on the menu selection. It additionally allows you to search by keyword and/or filter by Date, Category, Amount, or Account.

There is also an export function, allowing you to export filtered transactions to a *.csv file.

You can manually import *csv and *.qif files from accounting software, in addition to adding individual transactions by hand, such as mileage.

Reporting – Reporting is one of the reasons I was interested in trying out Stessa in the first place. It provides you with standard reports such as Income Statements, Cash Flow, and Capital Expenditures, with options to select a date range, property/portfolio, monthly breakout, and whether or not to show Category Details. The report is downloaded as an Excel file, allowing you to customize the report title and report formatting, if needed.

The other reporting option I have mentioned before is the Tax Package. This contains everything needed to hand off to your CPA at tax time. And it sure makes it easier on me!

Click on this link to get your own free copy of the Rental Property Tax Guide by Stessa.

Dashboard

The dashboard is the main page you see when logging in on a computer. It allows you to show the total portfolio or to select individual properties.

It contains the following sections:

Portfolio Value – Options to see Market or Purchase Value.

Asset Return – Either Appreciation or Levered returns.

Occupancy – Detailed in percent.

Income

Cash Flow

Unit Count

Property Count

Debt – Total

Net Cash Flow – A chart detailed by month & Category

Location – Google map showing all properties in Portfolio View or a single property in Property View

Compare Properties – Rental Income, Market Value, and Square Feet. Available in Portfolio View only

Property Highlights – Property picture from Google Street View, Income, Expenses, LTV, and Occupancy. Available in Property View Only

Summary

I think that Stessa is a great automation tool for rental property accounting. It’s free, cuts down on time spent doing bookkeeping, and makes tax time easier. On top of that, their user support is outstanding! Early on, I identified a couple of bugs and they were fixed within a couple of days. Amazing!

If you are interested in trying out Stessa for your rental properties, please click on the link below:

Stessa Rental Property Accounting

And, as always, let me know what you think in the comments. Ask questions, tell your story.

If you like my posts, please share them with others and subscribe to this blog.

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Personal Finance – Cutting the Cord Edition

Do you have cable and/or cable services like phone, tv plus premium channels, and internet? Does it seem like the cost keeps going up? ME TOO! LOL

Read on to see what we did to reduce our costs for these services.

Initial Setup

Our entertainment setup consisted of two Tivos, (1-Premiere model capable of cable & OTA Reception, 1-Roamio model-cable reception only), four TVs, (1-LR, 3-BR), two digital signal adapters for the Kids’ bedrooms, two Firesticks (LR & MBR), VoIP phone from the cable provider, mid-tier cable TV package with no premium channels, (up to) 150 MB/s internet connection, a family Netflix subscription (allowing simultaneous logins), Prime Video (complimentary with Prime account), and a promotional Hulu account for $0.99/month for a year. Our cable, phone, and internet were all with Comcast.

Our bill has gone up & down depending on what promotional package we would renegotiate for, but that involved going to the cable company office, in person, and asking for it, usually after waiting in line for a while. That was aggravating enough, but the bill would continuously increase, outside of the changes to promotional status.

We don’t watch a lot of TV. Just a few shows. And we never watch them live. We have too much other stuff going on. I started to evaluate our habits after our total bill came off of promotional status, raising the cost from approximately $137/month to $165/month. Then, for no reason, it went up to $174/month.

It turns out that most of the shows we watch are either only on a streaming service or show up on Hulu. It should be acceptable to only use streaming services. We decided to get an antenna to pick up local stations. We figured it would be hit-or-miss, because we live between 40-50 miles from the regular broadcast network towers. BUT, if we could get some channels, we could still get news during a storm if the internet goes down.

Click on this link to get your own free copy of the Rental Property Tax Guide by Stessa.

What We Changed

I discussed the idea with my wife and we decided to get an antenna and try it out. I researched antennas and almost bought a couple of different expensive ones, (amplified, slick advertising, etc.), but decided to start at a lower price point, always having the option to escalate, if needed. I settled on the GE Pro Outdoor/Attic Mount Antenna. It claimed to have a range that would allow us to receive the stations we wanted.

When it arrived, I connected it to the TV in the living room, (with the antenna sitting on my couch) and scanned for channels. It was able to pick up around 33 channels!

I then mounted it up in the attic and connected the living room TV to it, resulting in 38 – 42 stations coming in, depending on the weather.

I added a signal booster / splitter that would allow me to connect the other three TVs to the antenna. I was able to hook them up and get the same channels, so all was well.

The Tivo Premiere is able to receive Over The Air (OTA) signals to the tuner, so we set it up to record all of our broadcast network shows and we can use the  Tivo Roamio in our bedroom to watch the recordings via network transfer between the Tivos.

We additionally got Firesticks for each of the kids’ TVs, allowing them to access Netflix & Hulu on their TVs.

Because we were still using the “Triple-Play Gateway” modem-router-access point, it would continue to cost us an additional $13/month in device rental fees. I didn’t like that. Time for more research!

I found a cable modem, (MOTOROLA 24×8 Cable Modem, Model MB7621) that would continue to provide us with the same speeds we were getting with the Comcast gateway, but it was only a one-time cost of approximate $70, as opposed to the monthly charge for the device rental. I got it, hooked it up and was able to configure it online in less than 10 minutes.

Our plan was to keep the internet. During my research, I called Comcast and asked about the internet charges, because their website said normal charges for internet were $71-$80/month, and was told that the price would indeed be $80/month.

Now that all of the hardware was replaced, I went to the Comcast office to return all of the equipment. The guy behind the counter said “OK, we can set you up with a promotional rate of $54.95/month for internet only, at the current speed you have.” Bingo! This is the same promotional rate they are offering to new subscribers for twelve months! I was ecstatic!

Cost Reductions

Before

Monthly recurring costs were $174 for TV, phone & internet = $2,088/year

After

Monthly recurring costs are $55 = $660/year

One-time costs were approximately $240 for the antenna, splitter/booster, 2 Firesticks, and a cable modem.

Net Savings of $1,188 in the first year (495% ROI) and continuing savings of $1,428 per year going forward.

Have you or are you thinking about cutting the cord? Let me know in the comments.

And, as always, let me know what you think in the comments. Ask questions, tell your story.

If you like my posts, please share them with others and subscribe to this blog.

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Business Finance – Small Business Tax Myths

This week we are going to go over some myths regarding taxes for small businesses. I get a newsletter from our CPA each month that covers tax-related topics. The articles are written by other people and I am assuming his website subscribes to these articles from a service.

I found the topic of this one interesting, so I searched for the title on the web and found the original author. Here is the original article, by Juanita Farmer, CPA, of Germantown, Maryland.

There are a lot of myths & misconceptions around what you can and can’t benefit from with regards to taxes in the US. Below we are going to cover seven of the most common ones.

***DISCLAIMER – I am not a CPA and DO NOT Offer tax advice over the internet or otherwise. Please consult with your CPA for tax advice. This article is for informational purposes only***

Click on this link to get your own free copy of the Rental Property Tax Guide by Stessa.

Start-Up Costs are Deductible Immediately

Business start-up costs are the costs incurred prior to the business actually beginning operation. They range from advertising and travel to surveys and training. Organizational costs such as these fall under capital expenditures.

Just like you can amortize depreciation of equipment, when you start a business, you can amortize some business start-up costs.

You can deduct up to $5000 of business start-up costs and up to $5000 of organizational costs. For start-up or organizational costs that exceed $50,000, the $5000 deduction is reduced. The remaining balance must be amortized.

Overpaying Taxes Makes You Audit-Proof

From a business perspective, the IRS is only worried about if your documentation matches your deductions and that your deductions are legal and legitimate. Properly document expenses and follow the advice of a good tax accountant to “Audit-Proof” your business.

You Can Take More Deductions for an Incorporated Business

You don’t need an Incorporated Business to deduct business expenses. Plus, depending on the corporate entity, you may have more tax and tax filing burden.

Home Offices are an Audit Flag

Home offices used to be a common audit flag, but with so many people now utilizing home offices, the IRS issued a a simplified home office deduction that is easy to claim, with proper recordkeeping.

No Business Expenses are Deductible If You Don’t Take a Home Office Deduction

All business expenses such as travel, business supplies, equipment depreciation, etc. Are deductible, regardless of if you take a home office deduction or not.

Filing an Extension Delays Your Tax Payment Due Date By 6 Months

Regardless of whether you file for an extension or not, if you owe any taxes, payment is due on the original due date, typically around April 15. All an extension does is allow you a six  month extension to this deadline to turn in all of your paperwork/documentation.

Part-Time Business Owners Can’t Have Self-Employed Pension Plans

Even if you are working a full-time job with 401k benefits and you start a  small business, you can still set up a SEP-IRA for that small business


Source Attribution: Juanita Farmer, Managing Partner of J.D. Farmer & Associates, LLC

And, as always, let me know what you think in the comments. Ask questions, tell your story.

If you like my posts, please share them with others and subscribe to this blog.

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Personal Improvement: Podcasts – What I Listen To

I recently connected with someone on LinkedIn who is a Life Coach for High-Performing Remote Workers. As part of his getting to know me messages, he asked if I listened to any good podcasts lately. That got me thinking about the regular influence on my thinking of the podcasts I listen to. The more I thought about it, the better the idea to turn it into an article listing what I am listening to and why.

  • Doggcatcher for Android
  • Downcast for iOS

A little background on my interest in podcasts:

I have listened to podcasts for almost 12 years. Up until the start of this year, I always had a long commute. Whether a 200+ mile daily round trip to Lafayette, Louisiana or a 1,000+ mile round trip driving to Houston, Tx every other week, I had a lot of highway time on my hands. Podcasts allowed me to be entertained and informed, in addition to allowing me to utilize “dead” time for learning.

Podcasts I Listen To

Podcast Link Category
Bigger Pockets Podcast https://www.biggerpockets.com/podcast Real Estate Investing
Tim Ferris Show https://tim.blog/podcast/ High Performance
DH Unplugged https://www.dhunplugged.com/category/podcasts/ Stock Markets
Rich Dad Radio http://www.richdad.com/radio Current Affairs/Rich Dad Theory
James Altucher Show https://jamesaltucher.com/podcasts/ High Performance
Akimbo https://www.akimbo.me/ Personal, Professional Improvement
Private Lender Podcast http://privatelenderpodcast.com/ Education on the Subject of Private Lending for Real Estate
Bigger Pockets Money Show https://www.biggerpockets.com/moneyshow F.I.R.E.: Financial Independence, Retire Early
Freakonomics Radio http://freakonomics.com/archive/ Various Topics

Bigger Pockets Podcast

The Bigger Pockets Podcast helped me to learn a great deal about real estate investing. I have the Bigger Pockets website listed as a resource on this site, but the podcast is an additional tool to learn about REI. Each week, the podcast interviews guests, most real estate investors, sometimes famous authors who provide useful tips for investing, business, and personal improvement, and every once in a while, they will do an occasional webinar-type podcast to educate listeners on a particular topic.

I especially like the investor interviews to get tips, tricks, and strategies that may help me in our REI business.

The Tim Ferriss Show

Tim Ferriss, author of numerous books on increasing performance (4-hour Workweek, Tools of Titans, Tribe of Mentors, etc.), conducts long-form interviews with high-performers across various domains. Even when interviewing guests who have been on EVERY medium you can think of, you always learn things no one else has ever asked. Tim listens to guests’ answers and responds to the answers with deeper questions. He also does extensive research on guests and does not rely on canned press release questions.

I generally like to listen to his interviews because the people he does interview are “Doing It”. They don’t have a theory, they are not selling snake oil, they have done/do whatever they are recommending to increase performance.

DH Unplugged

DH Unplugged is an unscripted conversation about markets between investment advisor Andrew Horowitz and pundit John C. Dvorak.

I like DH Unplugged because they discuss what is going on in the markets and aren’t trying to sell you anything. In fact, they frequently point out how most “Money” shows on cable news channels are always “BUY, BUY, BUY” no matter what is going on.

Rich Dad Radio

Rich Dad Radio is an interview podcast featuring Robert Kyosaki, author of Rich Dad, Poor Dad, and his wife, Kim Kiyosaki, author of Rich Woman. The interviews are mainly related to money and economics, (in a broad way), and generally promote Rich Dad, Poor Dad Principles.

In addition to interesting information from guests, it’s fun to listen to Robert interpret the guests’ statements into Rich Dad principles.

James Altucher Show

The James Altucher Show is another long-form interview podcast, similar to the Tim Ferriss Show, that delves into what makes high performers “tick”. Where Ferriss delves into tools, self-talk, and motivation, Altucher focuses a little more on the path to peak performance, teasing out the development of “micro-skills”. Altucher’s overarching thesis on micro-skills is that high performers build up a toolbox of them that help them to succeed. Like Ferriss, Altucher goes far deeper in his interviews than you normally see in regular media.

Because of the depth of detail and wide range of topics covered in each interview, I really enjoy Altucher’s show.

Akimbo

Akimbo is a podcast put out by author and marketing guru Seth Godin. This podcast is a combination of self help and career advice for entrepreneurs. You don’t have to be an entrepreneur to benefit from the topics & advice given, either.

I enjoy the perspectives, suggestions, and tips provided by Godin in this show. I don’t necessarily subscribe to all of his philosophies, but that is OK. It is good to hear different perspectives from your own to allow a balanced understanding of the world.

The Private Lender Podcast

The Private Lender Podcast is a combination of interviews, case histories, and education with regards to the utilization of private lending in real estate investing.

I like learning about the details of the non-financial industry financing.

I actually met Keith Baker, the host, and have become friends with him. He’s a cool and funny guy. Oh, and he LOVES the band Rush!

Bigger Pockets Money Show

As the name indicates, BPMS is another podcast from the group at Bigger Pockets, focusing on F.I.R.E. (Financial Independence, Retire Early). The podcast is in an interview format, covering guests’ stories, tips, and tricks for becoming financially independent.

I like listening to the BPMS to better plan my own “retirement”. It has also led me to resources that allowed me to recognize that I could retire right now and be comfortable from a financial perspective.

I hope this provides you with some insight into resources to use for personal and financial improvement in your life!

And, as always, let me know what you think in the comments. Ask questions, tell your story.

If you like my posts, please share them with others and subscribe to this blog.

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REI – Observations on Finding Tenants

Hello there, trusted reader! This week I am going to discuss a few observations I have made on the subject of finding tenants for my rentals.

As discussed in a previous post, we purchased another rental in December. Before the purchase was final, we started advertising it for rent. We listed it with a couple of different syndication services, Put a “For Rent” sign in front of the property, and posted it in pretty much every local and/or rental-related group on Facebook, in addition to posting it on our Facebook business page.

Syndicated Listings

Cozy.co

The property was listed on Cozy.co because we are evaluating their service for application, rental payment, and other tools that assist property manager.

The set up was easy and they list the rental as available on their site, in addition to syndicating the listing to Doorsteps.com and Realtor.com.

Cozy also offers one of the top-rate low-cost online rental payment platforms, based on reviews & comparisons. If tenants use the ACH (Automated Clearing House) option, payments are free. They also have the option to use a credit card to pay, but add a small percentage service fee. I have not implemented it in our business yet, as our tenants are more comfortable paying with checks and money orders.

In addition to the online rental payment system, Cozy provides an online maintenance request system, tenant screening, and document sharing with tenants. The maintenance request platform is only available if you are already using their online payments. The tenant screening offers options for background checks and credit reports, at no cost to the property manager, due to the tenant paying these fees. The document sharing is the equivalent of a shared drive to upload leases and any other documents for tenants.

Cozy Syndication

From our experience, neither the Cozy listing, nor the syndication partners are popular in our area for attracting potential tenants. People looking for places to rent don’t seem to frequent these sites.

Zillow Rental Manager

Zillow offers a similar set of services, excluding the maintenance requests and document sharing. They provide tenant screening and online rental payments, similar to Cozy. Where they really shine is the listing syndication. Zillow lists rentals on Zillow.com, but since it also owns Trulia.com and Hotpads.com, it syndicates listings on those sites simultaneously.

For this recent property we had issues getting the rental listing to be accepted by Zillow due to it still being listed for sale on Zillow when we first put it up for rent, but it syndicated to Trulia and Hotpads just fine. We received quite a few inquiries from these sources.

Facebook Groups/Facebook Business Page

Facebook seems to be the hands-down winner for attracting prospective tenants. We ultimately received more inquiries from Facebook than any other advertising channel that we used. It involved a little work…there are a lot of groups! I will post a detailed methodology on that some day. It is kind of interesting.

I created a video of pictures from the home and a digital flyer that was shared on and from our Facebook business page. The flyer listed the location, rental rate, the lease length, and basic restrictions (No smoking, some pets allowed). This helped to attract interested inquiries and potentially screen out anyone not interested in what we had to offer.

Traditional Advertising Channels

If you haven’t noticed yet, the only cost of the methods we utilized was a “For Rent” sign. Ads in the local newspapers cost too much, plus we have much better circulation on the channels we do use. That is why we don’t even bother to list anything in the with the papers.

If you have rentals, what do you use to attract prospective tenants? Leave me a message in the comments or email me at clint.galliano+ObservationsFindingTenants@gmail.com.

And, as always, let me know what you think in the comments. Ask questions, tell your story.

If you like my posts, please share them with others and subscribe to this blog.

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Hello 2019!: A 2018 Review

Good Bye 2018, Hello 2019! Happy New Year!  This more or less marks the first-year anniversary of this blog. We’ve covered a lot of territory between Automation, Personal & Business Finance, Real Estate Investing, & switching blog platforms and are looking forward to covering more, in addition to revisiting some topics from the past. And by “We”, I mean you, the readers, in addition to myself.

I’ll start off with a quick recap of the past year:

Combined Blog Stats

50 blog posts

8457 page views

2468 viewers

 

Combined Post Popularity

2018Top10Posts

 

Top Traffic Sources

LinkedIn

Facebook

Search Engines

WordPress

 

Audience

US

Germany

Canada

Poland

France

UK

Ukraine

Australia

Norway

Netherlands

 

I’m looking forward to getting back into the swing of things in 2019 and welcome suggestions for topics you would like to hear about. You can comment here or email me at clint.galliano@gmail.com.

 

And, as always, let me know what you think in the comments. Ask questions, tell your story.

 

If you like my posts, please share them with others and subscribe to this blog.

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Personal Improvement – Gratitude: I am Thankful

For those of you in the USA, I would like to wish you a belated Happy Thanksgiving. We celebrated it last week with a quiet day at home, spending time with family and adding final touches to the Christmas display so we could turn it on Thanksgiving Night.

Gratitude-is-peaceIN

Gratitude

I am going to assume that a combination of it being Thanksgiving in the US and some smart marketing by  @ajjacobs for his new book “Thanks a Thousand – A Gratitude Journey” that made the topic of  gratitude continue to appear in my media consumption. From a podcast of Jacobs talking about his inspiration to write his latest book to memes on Facebook, both expressing gratitude and admonishing for expressing gratitude one day, then scrambling for doodads on Black Friday the next.

 

It got me thinking about how if you truly embrace the idea of gratitude, it helps to relieve stress and anxiety. Where @ajjacobs takes it to the extreme to thank everyone involved in his getting a single cup of coffee in the morning, you don’t have to be that exhaustive.

Be thankful for what you have. Or don’t have. But also remember to not use that as an excuse to stop pursuing your goals.

 

I would like to know more about my readers. If you could spare about 2 minutes of your time, please take a survey to tell me what you like about the blog. Just click here to take the survey.

 

What am I grateful for?

  • My Family. Without my family, I would not be who I am or where I am today. Specifically, my wife. She inspired me to strive to be greater. She inspired me.
  • My career. I have learned many things that have allowed me to grow outside of my job.
  • My health. Yes, I have medical issues, but I am luckier than a lot of people. As a benchmark, as morbid as it is, I have lived longer than my father and plan to live longer than my mother and grandparents did.
  • My friends. They make me laugh and encourage me.

 

What are you grateful for?

 

Please comment here on the blog about what you are grateful for. I would  like to know.

 

And, as always, let me know what you think in the comments. Ask questions, tell your story.

If you like my posts, please share them with others and subscribe to this blog.

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Automation – Data Frequency: How “Real Time” Is Real Time?

Happy Finter from South Louisiana! Fall started to show up, but winter was riding shotgun! We went from highs of 81 degrees F / 27.22 degrees C to 45 degrees F / 7.22 degrees C AND clouds and rain. Christmas light show can wait a few more days to get set up.

Today we are going to go over Data Frequency and how it relates to aspects of drilling automation. How often we receive a data point for a given channel or curve.

 

Variations on Real Time

 

Ask someone what their definition of real time is and depending on their particular needs, you will get different answers. Some people feel that getting mud report data as checks are made is real time enough to keep them informed.

Others feel that getting a WITSML 1.3.x, (Wellsite Information Transfer Standard Markup Language), data feed that updates every ten to thirty seconds will be just fine.

Then there are others who are used to seeing the rig default of data coming in every 5 seconds and that is great!

Finally, there are those who opine for sub-second data frequencies to ensure valid tracking of rig component movement and calculations.

Depending on your particular needs, any of these might be valid. For a comprehensive approach, the platform should take into account the needs and requirements for the types of data being captured. It should be able to accommodate sensors or inputs that generate anything from one data point per day down to many data points per second.

 

(Just as an aside, I really like the way WITSML 2.x and ETP are shaping up for real time data)

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Data Frequency

The type of data should drive the frequency of data capture, in addition to what the usage of the data will be.

Some data doesn’t change very fast, so it does not need to be updated very frequently.

Things like wellbore and drill string geometry, fluid properties, and positioning data do not need to be updated every second or few seconds. In the case of drilling fluids, Density updates every one to two minutes is a decent frequency, whereas the oil/water ratio does not need to be updated as frequently.

Other data is constantly changing and depending the particular sensor, could indeed warrant the need for sub-second frequency data.

 

A good example for that need would be block position, which is used to calculate running speed or pipe acceleration. This is, in turn, utilized to calculate tripping hydraulics in real time.

The benefit of having the ability to do this based on sub-second data allows for simulating the micro-movement of pipe in tight window scenarios…too much down hole pressure, the formation breaks down, causing fluid losses and too little down hole pressure, the formation fluids/gases come into the wellbore, thus inducing a kick.

 

Logical Assumptions & Why It Matters

 

Not all data needs to be updated at a high frequency. As indicated in the above section, data frequency depends on how often the data changes. The higher the change rate, the higher the data frequency needs to be.

The main reasoning behind this idea is that you may miss significant changes in the data if your sampling frequency is too slow.

Below is an exaggerated example of missing changes to pipe acceleration (or Running Speed) due to sampling frequency. The data is fabricated, for illustrative purposes.

 

RunSpd-1s

 

In the image above, the running speed is a straight thirty feet per minute, with a data frequency of one data point per second. Everything appears smooth, with no issues.

 

RunSpd-SSv1s

 

In this image, I’ve added sub-second data to show that the smooth, steady running speed was actually not very smooth, it just appears that way due to when the data points were captured.

 

Because this data is not captured, it is not thought to have occurred. But if you don’t have visibility of it, you can’t know it is there.

 

The examples above are made up & exaggerated to prove the point. I have seen this play out over different data points in the drilling arena.

When we were first attempting to develop the Applied Fluids Optimization service, our original software would calculate tripping hydraulics at a one second frequency, but would only capture the data at a thirty second frequency. Running speed spikes would lead the software to calculate and display large pressure variations. When we would try to show these excursions after the fact, we could not because the thirty second frequency did not coincide with the actual deviations.

One more fluids-related example: Fluid density on a land rig. Land rigs are an exercise in economy, from an offshore drilling perspective. The rig crews are smaller, so there are less people to do a set number of jobs. The mud pits are smaller, contributing to the total circulating system being smaller. Because of this, it allows for less significant events to impact the fluid properties. The derrick hand is busy? He can’t dust up the density. The shaker hand is up on the floor making a connection? He didn’t adjust the flow on the shakers. Small system, less attention, more chance for changes.

The mud engineer, (person responsible for keeping the drilling fluid running within specifications), should be running four mud checks a day. So, we should see, at minimum, four density measurements…one every six hours. When we were conducting field testing on the DRU, we noticed that we had lots of variation and excursions in the density reading from the DRU where the mud engineer’s data showed fairly smooth trends. When we overlaid the two data sets, the mud engineer’s data matched almost exactly with the DRU readings, just that it missed the excursions.

 

Takeaways

  • More frequent data helps you to better understand what is going on
  • Depending on the environment, a data curve may need a higher frequency
  • Some data does not need to be high frequency
  • Choose your data focus wisely

 

And, as always, let me know what you think in the comments. Ask questions, tell your story.

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Business – Optimizing A Process – Order of Operations Related to Surgery:

This week I am touching on the topic of process optimization. This is another topic that came a conversation between Kevin@deliberateconsulting.com and myself when comparing thyroidectomy procedure results and side effects. He was diagnosed with thyroid cancer and had surgery a couple of months prior to my diagnosis.

Process-Optimization

We compared notes on what was similar and what was different between the two.

(Caveat: There may be some factors that we are not aware of, specific to each of us as individuals, that could have influenced decisions made.)

 

We both had thyroidectomies. Surgery, an overnight stay. A vacuum bulb to drain the incision area. Released the next morning. Then wait to determine if further treatment is necessary to ensure the eradication of cancer. In Kevin’s case, he needed further treatment, in my case, it is too soon to tell.

The doctors started Kevin on hormone replacement therapy almost immediately after surgery, then had to wait for levels to drop to begin the secondary treatment. I am still not on any replacement hormones until they determine if I need the radioactive iodine ablation, thus shortening the cycle time to start. Since the hormones appear to last about 6 weeks, I am good for a while with no replacements and won’t have to wait for levels to deplete if I do need the RAI.

The way my surgeon planned things seems to be the more efficient way to do things. This got me thinking about how an optimized process for business is cheaper and more efficient than just randomly doing things in a haphazard manner.

 

I do this in my real estate investing. When rehabbing a property, I evaluate what needs to be done & plan the order of operations so that there won’t have to be re-work because something had to be undone to do something else.

 

You can look at your business processes and optimize them for efficiency by ensuring the order of operations for each step does not additionally delay some other step.

 

You can think of it like the sandwich-making analogy I used here…if your current process calls for you to put the peanut butter on the plate, then add the bread, then the jelly or jam, you can optimize it by changing the order of operations to bread, peanut butter, jelly, then another slice of bread.

 

What inefficient processes have you identified in your business or workplace? How did you change them?

 

And, as always, let me know what you think in the comments. Ask questions, tell your story.

 

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