Net worth update May 2018 – 319,887 (+$6,426)

See all Net worth update here.

A normal month in April. The job stress has taken over me. On its own, the job is easy. Code, meet people, meet more people. Write emails. Write documents. In reality, there are conflicting requests, answering phone calls, debating ideas and the constant never-endlessness of it. I am always online, reachable through emails, instant messaging or other online tools. The work never ends, the site is live 7 days a week, 24 hours a day;  with on-call pager duty rotation.

Basically, I’m starting to think this is too much. I’m willing to slow down. I’m fine taking a few more years to reach financial independence, if it means I get to keep my sanity. I’ve played with numbers. It doesn’t affect them too much. Compound interests help!

Lack of sleep doesn’t help as well. The whole family has been sick, and my youngest one refuses to sleep a complete night. Ah well, life of family parents. 🙂

Let’s go down to the emotionless numbers!

Assets: $1,035,588 (+$4,848) – Great! Almost 5k more in assets.

Investment breakdown:

  • Vanguard (401k) : $63,140 (+$1810)
  • Vanguard Brokerage: $54,530 (+$3,149)
  • Schwab Brokerage: $0 (-$1,000) <- I got my bonus. I transfered the money out. 🙂
  • Vanguard Roth: $16,470 (-$153) – Is there really a point to owning bonds?
  • Fidelity Roth: $16359 (-$139.06) – Same question!
  • Total: $150,499 (+3,667)

Cash:

  • $35,589 (+$1,381)

Lots of spare cash due to lots of CC and Bank bonuses being worked on.

Property

  • $840,000

To encourage myself, I’m going to slowly increase the home evaluation in the following months. I don’t want it to go up/down like a rollercoaster, but instead steadily increasing. This will offset the home maintenance cost and allow me to properly take care of the home.

Liabilities: $715,711 (-$1,578)

  • Mortgage: $708,975 (-$1,261)

I’m paying the mortgage at a slow speed. Same strategy. Interest is low (2.85%) and are tax-deductible, which mean a less than 2% effective rate, below the target inflation.

  • CC Debt: $6,736 (-312)

Nothing to say here. I never carry a balance, so that’s the new balance for this month. There are also business expense associated there, which will impact my monthly net worth, but it will not impact my saving rate.

Leverage Ratio: 69.11% (-0.48%)

Net worth: 1,035,588 – 715,711 = $319,877 (+$6,426)

Income: $12,023

Income is back to “normal” level.

Expenses

$7,282

I’ve splurged on expense this month. Decided to increase a lot of expense. Bought a few electronics, rented hotels, registered to a marathon, etc.

Saving Rate

In April, our saving rate is 47% – Still a good value ! Our last 12 months rolling average is now below our goal at 49.44% (down from 51.60% last month). The coming month of May, June and July should be incredible in terms of income. Stay tuned!

Net worth update April 2018 – 313,452 (+$15,572)

See all Net worth update here.

Another incredible month in March. The markets are troublesome, but I’m adding so much income against it that the overall net worth is still going up. We also received almost $10,000 in tax refund due to my planning of end of 2017.

Assets $1,030,741 (+$9,999) – Not a typo, exactly that. $1 off 10k.

Investment:

  • Vanguard (401k) : $61,330 (+$567)
  • Vanguard Brokerage: $51,384 (+$1,106)
  • Schwab Brokerage: $1,000 (+$1,000)
  • Vanguard Roth: $16,623 (+$139)
  • Fidelity Roth: $16498 (+$94.54)
  • Total: $146,832 (+2,907)

I’ve increased my double-weekly deposit on the Vanguard brokerage. I opened the Schwab Brokerage to get a $100 bonus. Everything else is boring.

Cash:

  • $34,208 (+$7,291)

Lots of spare cash due to lots of CC and Bank bonuses being worked on.

Property

  • $840,000

House valuation according to Zillow/RedFin is now around 900k, I’m still keeping it at 840k. We are thinking of adding a few house improvements, solar panels/roof and remodeled bathroom. If we do it, we expect the value of the house to increase as well, so we’ll add it to the home valuation.

Liabilities -$717,289 (-$5,573)

  • Mortgage: $710,236 (-$1,258)

I’m paying the mortgage at a slow speed. Same strategy. Interest is low (2.85%) and are tax-deductible, which mean a less than 2% effective rate, below the target inflation.

  • Car Loan: $0 (-$6,193)

Wee, I decided to pay the car loan in full this month. The interest rate was at 3.25%. The interest payments are not deductible. I had extra spare cash, and it gives me something less to track. It removes the lien from the vehicle. I can update my insurance to remove the collision protection which will lower my upkeep cost. One less thing to worry about. Yay!

  • CC Debt: $7,053 (-$1,877)

Nothing to say here. I never carry a balance, so that’s the new balance for this month. There are also business expense associated there, which will impact my monthly net worth, but it will not impact my saving rate.

Leverage Ratio: 69.59% (-1.23%)

Income $21,372

My highest monthly income ever, but exactly as expected. There was a strong tax refund of almost $10,000. The rest is normal salary. As usual, I ignore all dividends, cash back or other investment variation.

Net worth: 1,030,740 – 717,289 = $313,452 (+$15,572)

Expenses

$5,639

Expenses are mostly kept in check. They are slightly up due to more expenses for our kids and education, which is something I feel happy to splurge on. We got them new bicycles, new bed for our younger daughter, etc.

Saving Rate

In March, our saving rate is 75.6% – Completely incredible. According to Mr. Money Mustache, such a sustained saving rate would mean we can retire in 7 years if starting from 0. Of course, it’s exceptional due to the tax refund. Without the tax refund, the saving rate would still be 71.45%! (retire in 8.5 years). Our last 12 months rolling average saving rate is now at 51.60% (up from 47.15% last month).

 

Net worth Update March 2018 $297,880 (+$4,233)

Markets troubles in March coupled with significant income and low expense leads to an increase in net worth to 297,880.04 (+4,232.94).

Let’s see how each account made.

Vanguard (401k): $60,762 (-$461)

Whoa, what’s going on. There was panics on my news feed in early February. “Market Crash”, “Did you sell ?!?”, “OMG”. Uh, I’m not sure what people are talking about. The markets reverted to the values they were 2 months ago. Hardly something to notice. I had ~$3,500 spare cash in a money market account; I bought more VTSAX with it. I wish I had more and I wish the markets crashed further to have a better prices.

Vanguard Brokerage: $50,274 (-$485)

Same as above. Markets were bouncy in February!

Vanguard Roth: $16,483 (-$171)

Bonds are actually going down since interest rates are rising. I’m not sure if bonds are that useful in a low-interest world. Warren Buffett is skeptical about them, saying they have negative rate of return.

“It is a terrible mistake for investors with long-term horizons – among them, pension funds, college endowments and savings-minded individuals – to measure their investment ‘risk’ by their portfolio’s ratio of bonds to stocks, […] Often, high-grade bonds in an investment portfolio increase its risk.”

While I agree with Buffett, I don’t understand what diversification I should use instead. 100% stocks? Munis? Bitcoins? 😛

Fidelity Roth (Spouse): $16,403 (-123.80)

More bonds in another ROTH since their interest are tax-free.

Cash: $26,917 (+$2,390)

I started Churning Bank Account bonuses. The first account I’m testing is the CitiBank. I’m using my Churning tips from DoctorOfCredit. It requires a $15,000 deposit for 60 days. There are no fees if a minimum balance is kept. Once the requirements are met, the bank will deposit a $300 bonus. Then I can close the account and start again with a different bonus. There is also a $700 bonus, but this requires a $50,000 deposit, I don’t feel it’s worth it.

Debt

Mortgage is going down to 711,493.59 (-$1,255). Car loan is down to $6,193(-$163). And credit card debt are at $5,175, down from the high of $7,000 in December. The low CC balance reflects the minimal expenses of this month.

Leverage Ratio: 70.82% (-0.39%)

Nice to see this ratio in the lower 70% .Will I be able to make it reach 60% before the end of the year? We’ll see! Total liabilities $722,862.12 are while assets are $1,020,742.16.

Income

Total income on February was $12,091.92, not including income from investment, CC bonuses, etc.

Expenses are minimal at $4,874.81, this includes more than $1,500 for mortgage interest. So less than $3,000 for a family of 5 living in one of the costliest place on Earth.

The main source of expenses are: Home, Food, Children, Utilities and Cars (!). I could reduce car expense further (~$400/year) by getting rid of one car. This would also help with the depreciation. Furthermore, I used the ‘Trim’ service which slashed $10 of my Comcast (Internet) bill.

This gives our family another great saving rate of 64.83% for the month of February. The 12 month saving rate is now at 46.43%, up from 41.34% from last month. We are getting closer to the 50% objective.

See you next month!

Net worth Update February 2018 $293,647 (+$16,897)

See all other net worth update here.

Net worth is up significantly (+$16,897) in February with standard income and low expense. This gives our family its highest saving rate ever.

We are giving up on % differential and will now use absolute values for net worth update. When we would say my account gained 2%, did it gain 2% of $100 (2$) or 2% of $100,000 ($2,000). Real values put numbers into perspective.

Net worth: $293,647 (+$16,897).

Incredible gain! It was expected because of the tax planning of last year. There was no mortgage payment in January, the expenses were low, past Christmas.

Let’s see how each account made.

Vanguard (401k): $61,233 (+$4,378)

We are maxing out the 401k again this year, so that’s $18,500 averaged over 26 paychecks. There’s 50% match (up to 2% of salary) match by my employer. This adds $173 to the account for each pay day. Finally, there was market gain in January leading to 4k gain.

Vanguard Brokerage: $50,729 (+$3,362)

High gain due to strong market return. We are adding $500 per pay day to my brokerage account with an automatic deposit. We need to increase this amount otherwise we end up with too much spare cash.

Vanguard Roth: $16,655 (+$5,318)

Each New Year starts with a new Backdoor ROTH contribution. In 2018, we can contribute $5,500 to an IRA. We then convert it to a ROTH. We have to do this process since our family income is too high to contribute directly to a ROTH IRA. Bonds are getting a negative return (-$200). I have an uneasy feeling about holding bonds due to the low interest rate of the global economy.

Vanguard Roth: $16,527 (+$5,309)

Similar to above. This a spousal Backdoor ROTH. The strategy is the same, we contribute $5,500 to an IRA under her name, and then a few days later, we convert it to a ROTH IRA so it get grow tax free!

Cash: $24,528 (-$3,397)

Cash Balance are too high. I was accumulating them for Bank Account and Credit Card churning which requires large deposit or large balance. We’ll see in the next few months how I’m able to achieve these and where the money will go.

Debt

Mortgage is not moving at $712,748. Car loan is down to $6,356 (-$163). And credit card debt are at $7,000, down from the high of $9,000 in December. I never carry a balance, these are just current total.

Leverage Ratio: 71.21% (-1.26%)

That one is staying as a %. 🙂 It’s close to the lowest it has ever been (70.43%). I’m looking forward to it crossing below 70% this year. Total liabilities are at $726,146 while assets are at ($1,019,749). I keep the home value at $840,000 and I’m not moving it. Home evaluation sites are saying it’s worth $900k now. That’s fine. Once we sell, we will have to some repair, home staging and commission. Let’s keep it conservative low. I’d rather be conservative and surprised, than optimistic and sorry.

Expenses are under control. There was another emergency family travel for $923 this month. Food is still incredibly expensive in high cost California ($1084), also, we got 3 hungry mouths to feed. 🙂

Total income (post-tax) was $11,835 and expense $4,287 for a saving rate of 68.45%.  This is the highest saving rate I ever had. For kicks and giggles, if the emergency travel wasn’t there, the saving rate would have been upwards 75%! We are also cheating, there was no mortgage payment on this month. The cumulative saving rate for the last 12 months is 41.31%, up 1% from 40.15%. One of my objective is to get it to 50% by end of year. We are expecting high saving rate for next month as well.

Networth – January 2018 – $276 749 (-0.83%)

We are now in 2018! A new year begins. What happened in December?

  • Many, many pre-payment of all kinds for taxes. Money that should come back in the next few months.
  • Several credit card openings for churning.
  • Some unexpected expenses due to illness in the family. 🙁
  • Christmas! Santa decided to spoil the kids this year.

The Networth is therefore slightly downward! But these are investments that will payoff in the next few months when my taxes refund will come.

Assets: 996 139 (-0.37%)

  • Liquid: $18919
  • Property: 840 000 $
  • Investment 401 (k): $57 018 (+ 4.56%)
  • Investment Brokerage: $47 395 (+ 3.33%)
  • Roth IRA Investment:
    • Myself: $11313 (-0.05%)
    • Spouse: $11193 (-0.09%)

Liabilities: $707 362 (-0.46%)

  • Car loan: $6518 (-2.44%)

I want to pay off that loan The interest rate is 3.24%, do I get 3.24% return with my cash in my emergency fund? No… but I want to accumulate $15000 in floating cash so I can churn several bank account bonuses.

  • Mortgage: $712 748 (-0.18%)

Debt/asset Ratio: 72.21% (+ 0.13%)

Total net worth: $276 749 (-0.83%) Usd
Converted to CAD: $348 192 (-1.69%) Cad

In December, we still get a savings rate of 14%, the income are $19113 (3 paychecks!) and expenses of $17530 (phew!…).

Why the loss of money then? Good question. I made my update late (we are already in mid-January!) and there seems to be an error of 3k and 1k on investments and credit card respectively. I may already be at 280k as a net worth. I will ignore it and the next month will surprise me instead !