Welcome to another monthly Net Worth update! This time its Net Worth May 2018 edition:
For those that are new, I will be posting these on a monthly basis to show my progress towards Financial Independence. The purpose of these is not to brag, or show off what I have, merely to show that little by little, even over the course of just 28-31 days, much progress can be made.
In addition, by tracking and posting this on the blog where everyone can see, I’m hoping this helps to hold me accountable to my goals. Where slip ups and unchecked spending can easily be passed off by keeping it to myself, with other people watching it should help to keep me in line! (Nothing like trying to avoid public humiliation to keep you motivated!)
If you haven’t already, check out last month’s report from April.
May
This month was a lot of fun. With the weather finally becoming nice again, it was time for adventures!
It was also my roommates last month in the city before he left for a full time MBA, so there were many activities revolving around what he wanted to experience.
It all started off with a trip to the Nationals game! I enjoy baseball, and will try to make to a game or two each year. I love watching, but the drink prices are outrageous!
The next weekend we went and got in some community services work through an event called Plogging (Plastic/Jogging combined). It’s basically where you start at one area, jog with trash/recyclable bags to a destination some distance away, and pick up all garbage you see along the way.
It’s a great way to clean up your city while getting exercise! My team of 4 people picked up 92 pounds of trash/recyclables while running about 5 miles! Find out if your city has an event like this!
The last weekend we sent my roommate off with a nice free outdoor concert on the riverfront which was a great time.
In between all this I found some time to explore around the area and get some adventure in! I made stops at Great Falls Park, the National Arboretum as well as my typical frequents to the National Mall.
Both had really cool sights and were my first visits!
Now for the real reason you’re here!
Net Worth
May breaks down as follows:
So close to 6 figures! At one point during the month I nearly crossed it, but then normal market movement and credit card spending brought it down to where it’s at. Looks like I’ll have to be patient and wait a bit longer 🙂
Cash: $12,547 – $702
After being slightly understated last month due to withdrawing cash for my April Europe trip and not depositing it in time, this is a more accurate picture of where it should be at.
I finally also switched bank accounts last month! I’m excited to have higher interest rates on my savings accounts that will give me more money each month.
With my Roth IRA already maxed out for the year, I’m now turning all excess cash into a rental property fund. I’ve been reading up on many blogs and listening to podcasts on how it all works, and I’m ready to get more serious about it. With any luck I could potentially own a property by the end of the year!
401K: $58,305 – $2,573
Contributions this month totaled $1,626 (Employer Matching included). The market finally had a decent month after being pretty flat for most of the year.
It’s crazy seeing this balance get bigger and bigger with all the contributions I’m funneling in. This is easily the biggest driver of my Net Worth!
My balance is 100% in stocks right now, split roughly 70/30 – Domestic/International.
Roth IRA: $11,550 – $202
I maxed out my Roth IRA back in March, so this will flow with the market for the rest of the year.
This account is all invested in a Vanguard mutual fund for Mid-Cap stocks.
Brokerage: $13,189 – $413
No contributions here, so just normal ebbs and flows of the market.
I originally invested $12K into the account, $10K in the low fee VTI (Vanguard Total Stock Market ETF) and $2K in a high yield dividend paying stock.
HSA: $1,976 – $221
I opened my HSA account at the end of November last year after turning 26. This gain was straight from monthly contributions.
Unfortunately, this is all held in a Cash position right now as I need a minimum of $2,500 to invest in a NTF (no transaction fee) mutual fund.
As I’m on track to max this out this year, I’ll hit this mark in a couple months and will immediately invest it.
Auto Value: $9,898 – ($290)
I have my Auto Value pegged at $2,500 above what the remaining value on my Auto Loan is. The negative value is simply monthly depreciation. The reason for this? Simply put, that was the value of the down payment I placed on my car (2014 Ford Fusion).
I verify through Kelly Blue Book each month so that if I desperately needed to, I could sell my car for around that value, which has always been the case. However, I plan on having this car for a long time so ideally the need to sell before the loan is paid off never actually comes up.
It’s sad to see my $100,000 car now worth less than 5 figures.. a hard lesson learned!
Credit Cards: $(1,056) – $39
I pay off my credit cards in full every month so this is just the monthly balance. By doing this I build credit and get free travel rewards and cash back while paying the credit card companies nothing in interest!
This number is what I pull from my credit card statements which ends on the 4th and 5th of every month. Now that I’ll be travel hacking more, I may just start pulling the balances at exactly month end since the newer cards aren’t guaranteed to have the same end statement date. I haven’t decided yet so I’ll report back.
Credit Card expenditures were about the same this month. See below for the full breakout of spending to see how I did against my budget.
Auto Loan: $(7,398) – $290
The value on this increases as the amount of principle on the loan decreases with my monthly payment. Just chipping away at it at this point.
I got the loan with a 1.9% Interest rate, so I’m keeping it for now, though as the balance gets lower, it’s going to be more tempting to pay this off and be done with it, even if the math may not make sense.
Monthly Expenses:
Happy to see I was under budget (barely) again after two straight months of being over. This would have looked a lot better if not for having to pay that huge medical expense, but you live and you learn.
Here are the details:
Monthly Rent $1,131:
Have to love living in a HCOL (High Cost of Living) area right? This is for a 2 BR apartment in which we split the cost. We could have found a place a little bit cheaper, however it would have been much further away from where we wanted to be (leading to an even longer commute), and with much less perks than what we have now.
Utilities $62 / Internet & Cable $67:
I’m beginning to think I simply under budgeted for utilities… whoops. Luckily its not by too much and I can absorb this extra cost in other areas.
Internet/Cable is pretty standard around $65 as I split the costs with my roommate every month. I’m seriously debating talking with my roommate about cutting out cable, so we’ll see if I take action on that in the coming months.
Groceries $137 / Restaurants $55:
Grocery and restaurant spending were back to their normal levels this month after being reserved in April from the Europe trip.
Car Payment $302:
Monthly car payment to pay off my loan. After next month’s payment there will be 2 years left! It’s doubtful I let it last that long, but we’ll see.
With only a 1.9% Interest rate I believe I can beat that payment towards interest with returns through the market, which is the only reason I haven’t paid it off so far.
Auto Insurance $0:
I paid in full in January for the next 6 months to get a discount on the total price. This price is much lower than what I used to pay!
Auto Fuel $92 / Auto Other $0:
I have a lengthy commute to work – 60 miles round trip – leading to high fuel costs each month.
The Other category includes any maintenance, repairs, taxes, etc that I budget for. Nothing spent on that this month, though I will for sure be getting an oil change in June as I’m nearing the mileage where another one is needed.
These YTD variances are really helping out the overall budget look good. I swear I’m not sandbagging!
With my new work position allowing me to walk bike to work for at least 3 days, I’m anticipating that my fuel costs will remain below last years level.
The Other costs were always more of a precaution, though I will have registration and car taxes coming up that will need to be paid from here.
Cell Phone $0:
I’m still under my parents plan so this is my portion of the bill. I pay my parents directly up front for 6 months at a time. I’m currently paid through June at the moment.
Medical $275:
Here’s those no fun medical expenses I went into detail about. Safe to say I’ve learned a lesson here and will be budgeting a lot more for this just in case for next year. This expense was pulled out of my emergency fund.
Luckily, my take home pay has often been higher than my budget meaning I can replenish the emergency fund pretty quickly.
Entertainment $248:
About $190 on this was bars and getting to bars related. As it was my roommates last month here we went out quite a bit, leading to the high cost.
As my old roommate was the one I went out to bars with the most, I’m expecting this cost to really drop over the summer as I pursue some more low cost weekend activities. I’ve found recently that I actually enjoy those more now anyways!
The rest was $15 for Spotify, $13 on a driving range (golf) outing with my roommate, $18 for a Washington Nationals baseball game ticket, and $12 to go see the new Avengers movie.
Travel $43:
I booked flights for my summer trip to Newport, RI with my college friends. The actual flights were a little over $200, but I used the last of my travel rewards points from regular spending on my old cards to get a statement credit to bring this cost down.
Gifts $105:
Mothers Day gift for Mom. Is anyone else’s mother also impossible to get a gift for!?
I also sent a donation over to my former high school as they had their annual day of fundraising. My high school was a private school, so this fundraising goes towards helping the school operate. I truly believe this school helped me to become the man I am today and am forever grateful of my time there.
Misc $137:
$110 of this was due to things I purchased from my roommate before he moved out. $70 for the router (who knew those were so expensive!?) and $40 for a combination of a small table, living room lamp and trash can.
The other $20 was for monthly laundry and $7 for a new Fitbit band I found on Etsy! (since the actual Fitbit bands themselves were about $40….)
Savings Rate
Here’s the overall picture:
*Note – Take Home is my after tax pay (what shows up in my bank account). 401K is only my contributions. 401K Match is my company’s 3% match. HSA is both mine and employer contributions (my employer contributed $750 in January)
Even with the much higher than expected medical costs blowing up my budget, I’m pretty happy with a 44% savings rate.
Despite it falling short of my revised savings rate goal of 50%, with my new promotion pay going into effect in June, I should have plenty of time to get that higher. I’m still on track for the year!
As an aside – I’ve recently realized that I’m not including any of my dividends or interest payments as income… should I be? And if so, would it be all dividends from retirement accounts (401K, HSA, Roth IRA) and non-retirement accounts (Brokerage, Savings Accounts)?
Just curious as to what others are doing as I at least think the Brokerage and Savings Accounts should be counted as those are both non-retirement accounts and I could technically use that as spending/further investment money if I really wanted. Let me know in the comments!
Lastly – check out the Net Worth Updates page to see how I’ve done in past months.
How did your May turn out?
Dude, you are so close to that $100K mark! This is exciting…. No doubt you hit it this month, with the current run in the markets…. That’s so awesome!
After you hit that point, you start to get a little impatient LOL… I’m like ok, so how quickly can i get to seven figures… i understand it’s a journey though.
You are really doing good on your savings rate as well, keeping expenses low. What age are you projected to FIRE?
Yea it’s pretty exciting! But I hear you.. I feel like I’m already impatient! 😂
I’m aiming for mid 30’s if possible, but right now my projections are conservatively saying I’ll be FIRE by 40.. will need to increase income at a faster rate and/or lower expenses to make it there sooner!
You got it brah!
This is my favorite part of your blog (everything else is great too, by the way), I find myself looking forward to these posts every month now (such a nerd). You’re almost to $100K, great job! I hit that mark in late summer last year and the comment above me is right! Now you get a little impatient. I guess that’s natural but I remind myself to just keep plugging along with the plan and everything will work out.
You had a really good month. Mine was good too, but I didn’t quite see a 4%+ gain like you did. As you said, the 401(k) is a huge asset for you. My job doesn’t have one but I funnel most of my excess cash into my brokerage account to invest. I’ll also be working on building up my emergency fund in the high yield online savings account in the months ahead.
I see you have a high yield dividend stock in your portfolio. The vast majority of my investments are ETFs and mutual funds but I did invest in a stock for the first time in May, a well known company and one that I will hold for a very long time. I also am considering investing in some “dividend king” stocks for about 8-10% of my total portfolio. These would be long term holdings as well.
I don’t include dividends and interest in my monthly income or when making my budget. Only money I earn from my job. The reason is they are automatically reinvested into those funds so I never actually see them. I may consider the interest from the high yield savings account now that I am about to transition to that, but I haven’t really thought about it yet.
My mother is also impossible to gift for. You certainly are not alone! 😂
Thank you!! I really appreciate that! That’s awesome you’ve already been at $100K for a while, I’m jealous!
Definitely a huge bummer you don’t have a 401k option, but you’re making the right move funneling that into a brokerage account. Ive also been debating adding more high yield dividend stocks as well, for the passive income!
Yea I need to see if I can get my dividends to be reinvested, when I bought them I did not choose that option for some reason, but your reasoning makes sense.
Seriously so tough to get a gift for her! Saw your other comment and love mats park as well! Always a great time
By the way, I love Nationals Park! Went there a few years back for a game. Easy to get in and out, nice sight lines, spacious concourse.
That is some mighty fine savings rate you’ve got going on here, congratulations!
Thank you very much! Appreciate you stopping by 🙂
+1 to crossing that first threshold! I feel the opposite though — since I hit that first milestone, it’s felt like things have been moving faster than ever towards the next. I’m excited for you, YFK!
Thank you!! It is very exciting, the thrill of watching it go up is pretty intoxicating… makes me want to really pull the trigger on other money making endeavors to see it go up faster!
Soooo close to that elusive 6 figure mark! And a 44% savings rate even with the medical bills and your roommate’s last weekends in town? That’s amazing! And I totally need to look into those riverfront concerts-that totally sounds fun!
I include interest in my income because it shows up in my bank accounts as transactions, hence the “paycheck and other income” category. But I don’t think I include dividends, especially because they get reinvested. I only factor them in in terms of account values when I’m adding up my net worth each month. Since you’re actually getting interest now with your new bank accounts, you should totally include it as income!
I’m not sure how often those happen but they’re at Yards Park and it was really cool! I’ll definitely start including interest and probably dividends too since for whatever reason I don’t have them being reinvested in my brokerage account
Keep up the great work. It is tough at the beginning because you don’t have money momentum. They say the first 100k (and then the first million) are the hardest to hit. But at a certain point the system becomes self feeding. When your money is contributing to it’s growth more than you have been putting in in the past, then you can sit back, watch, and enjoy the greatest phenomena: money working for you. Best of luck and it will get there young fire knight.
Thank you! Yes it all makes sense how the first $100k is the hardest which is why it’s exciting that I’m finally getting there!
Sounds to me like you need a rental property 😉
I’m looking for my next one now, too! Let me know if you ever want to commiserate haha
Yes that’s my next goal! Didn’t know you were looking for one as well! I’d love to talk strategies seeing as you’ve actually done this before 😂
Getting close to that six-figure mark! Keep the discipline, cool pics of Great Falls to!
Will do! Yea that was my first time up there, I’m sure you’ve biked there many times!
You’re the second person to mention plogging, and it sounds so up my alley. Instead of finding a race, maybe I should find one of those events instead…
And I expect you’ll hit that six figure mark for real in June!
Haha yea you should! It was all free too (unlike having to pay for a race 😂).. Thats what I’m hoping though!