So I skipped posting in February, though I did a table for it and never got around to posting. Sorry about that.
Back in January, I wondered if a $335,000 Net Worth at the end of the year doable? Well, as of March, I’ve crossed the $300,000 threshold, so I think it’s possible if I play my cards right the rest of the year, and the stock market can at least end up about where it is right now.
My total net worth grew by almost $24,000 in the month of March alone, to $304,447. That was by all accounts, a fantastic financial month for me!
March 2020 Financial Statement
| Account Name | Previous Balance | Balance | Change |
|---|---|---|---|
| Cash | 0.00 | $275.00 | $275.00 |
| Savings - Personal | $3,002.17 | $3,002.23 | $0.06 |
| Savings - Personal (CU) | $799.92 | $799.95 | $0.03 |
| Checking - Personal | $1,822.93 | $4,851.90 | $3,028.97 |
| Checking - Business | $7,225.00 | $12,648.30 | $5,423.30 |
| Credit Card - Business | $0.00 | $0.00 | $0.00 |
| Credit Cards | -$7,278.73 | -$17.17 | $7,261.56 |
| Retirement - 401k | $207,312.84 | $216,504.72 | $9,191.88 |
| Retirement - 401k Loan | -$8,888.64 | -$8,063.65 | $824.99 |
| IRA | $7.62 | $7.62 | $0.00 |
| Retirement - Pension | $32,595.08 | $32,996.00 | $400.92 |
| Retirement - HSA (Investements) | $0.00 | $9,336.86 | $9,336.86 |
| Retirement - HSA (Cash) | $12,697.49 | $2,867.03 | -$9,830.46 |
| Asset - Vehicle 1 | $36,440.00 | $35,300 | -$1,110.00 |
| Loan - Vehicle 1 | -$38,663.43 | -$35,252.17 | $3,411.26 |
| Asset - Vehicle 2 | $6,000.00 | $6,000.00 | -$0.00 |
| Asset - Precious Metals | $2590.71 | $2,418.38 | -$172.33 |
| Asset - Home | $155,288.00 | $156,021.00 | $733.00 |
| Mortgage - Home | -$130,397.04 | -$130,397.04 | $0.00 |
| Mortgage - Home | -$131,015.56 | -$130,397.04 | $618.52 |
| Net Worth | $280,553.92 | $304,447.06 | $23,893.14 |
A few things to note this update:
- The table is ran against February’s numbers, but I did not make a February post!
- I paid my credit cards off!
- I received a nice bonus from work.
- I bought a brand new car after wrecking my previous one.
Side Business Income
The side business is doing okay. February was a bit of a slow month compared to December and January, though March is now our 2nd best month, surpassing January. I continue to pay myself $1,000.00 a month (after taxes). Advertising expenses are up, and starting in April I’ve hired a firm to help manage the Adwords campaigns – perhaps they will be more effective than I am at doing it myself.
Retirement
Significant update! After being in cash since DDecember 24, 2018 (Yes, I stupidly had taken my money out at the bottom!), with the recent crash due to COVID-19, I’ve found an entry point to start getting back in. I starting scaling in once there was about a 25% drop in the market, and am now about 63% invested. As of yesterday, I’ve already started seeing gains again in my 401k! We will see what kind of uncertainty April brings however, and if it drops some more, I will put additional cash back into the market.
I increased my pre-tax contribution to my 401k from the 6% my company matches, to 12% to also take advantage of the market prices today.
My 401k loan is slowly being paid off – about $8000 left to go (January 2021 unless I pay it off early).
With retirement accounts totaling $249,500.72 and using a 3.5% safe withdrawal rate (SWR), that would allow me to take $727.71 as income each month. Add on to that my $1,000.00 a month draw from my website, and I’m at $1727.71. That’s still far below where I want to comfortably retire, however if I lost my job – I could relocate to somewhere cheap and focus on growing the business if I had to.
Back to the grindstone for now though.
Safe Withdrawal Rate (3.5%) monthly income: $727.71 + Website income = $1,727.71
Spendaholic Ways
COVID-19 has one benefit to my family financially… it’s preventing me (us) from eating out as much as we used to, and going places to spend money. It’s really helping to form better spending habits, so if there is something to be grateful for in this – that’s it for me.
I got a yearly performance bonus from Work in March, and used that to clear out my credit cards!!! I plan to keep them paid off this year!
I got into an accident and totaled my previous daily driver. The spendaholic part, however, is I talked myself into buying a brand new car – the most expensive car I’ve ever owner, $40,000 before some extras such as extended warranty. Eek! I probably could have made some better choices here. I rationalized it as being a Hybrid and better on gas (I drive 25,000 miles a year), and promising to keep the car for 10 years (It’s a Toyota which should last). Still… financially I might have been better off purchasing a used vehicle. I lost over $3,000 in value the moment I drove it off the lot, basically. I did receive $5,000 from my insurance company after paying off my previous car, so that was a decent down payment.
Additionally, I spent a lot of money this first quarter on some luxuries I could have done without, and probably $3,000 on gambling. I really could have done without that. To be honest, this was purely due to not being happy at home and attempting to buy happiness on things I like and enjoy. For the most part it works for me, but I think there are more economical options available.
On another good note, I’ve taken to driving to parks and taking walks, instead of eating out when I’m stressed. I hope to continue that habit.
Emergency Fund
My personal and credit union savings is now at around $3,800. I was really hoping to put most of my performance bonus into this savings, except I had to pay off my credit cards since I ran them up over the previous year. That is effectively only about 1 month of expenses, and that’s just not enough. Worst comes to worst, I can take money from my business checking account – but I’d really like to avoid that.
Looking Ahead
I’m working on making better habits that will continue to help my financial net worth, and will be focusing on those closely. I know that’s the entire point of this blog; but let’s be honest – it’s really hard to do!
On the emotional side that also affects finances – I’ thought things might improve at home, but I’m still not happy, and divorce is still on the table for later this year.