May has arrived so it is time to figure out how we did in April and to make sure we are still meeting most of our goals. I have to remind myself that my goals are more than simply the Net Worth number and hoping that I show an increase each month, but rather staying focused and thinking about the process and all elements of the project. One of the best outcomes this month was finally staying below our spending goal even while buying more items than usual in preparation for the arrival of our new child.
Currently our Net Worth is: $644,620 adding $96 to our total this month and a $41,666 increase since the start of the project. This month our income was lower, as I predicted in my last update, due to the current pay structure of my wife’s business. This is OK because we plan for these cycles and even with the lower income still managed a 28% monthly savings rate and a yearly average of 50%. So here is where we currently stand:
ASSETS Prior Month April 30th, 2016 % CHANGE
Florida Retirement Plan
Solo 401k Accounts $5,517.76 $5,567.85 .9%
College Savings (ESA & 529)
Taxable Brokerage Account
Real Estate Assets $359,500 $359,500 0%
Primary Home Value
Here is how we did on our goals for April 2016:
Our goal is to save $60,000 (or more) this year and we are still on track to meet this goal. We saved $1,942.06 this month bring our yearly total to $26,579.02. All of the amount saved this month went into my 403b and because of our monthly income were unable to contribute to any of our other tax-advantaged accounts other than automatic HSA contributions.
Our spending goal for the year is to spend $5,000 or less each month and for the first time since starting this project we actually met that goal spending $4,984.04. It seems like we are barely under that goal, but for us this is significant. Even more impressive (at least to us) is that we spent a lot of money this month to buy items we needed for the arrival of the new child in a few weeks. This was countered by a significant decrease in the amount we spent for child care this month. To maintain transparency we did do more spending than is indicated in that number, but these were medical and health costs that came out of our FSA account that I did not include in this number.
I wrote a post about our progress in this area and how we finally addressed the excessive amount of clothes we have accumulated over the years. I thought this would be the hardest part of our decluttering process, but now that we have moved on to books we are having issues with what we actually will be able to part with. Some of the fiction and similar books are easy, but both of us have academic books that I use for my job and my wife uses for her Ph.D. that are quite extensive. This may have to be an area where we are unable to let go of a lot of items, at least at this stage in our life. The file cabinets full of documents and papers however might be another story. So far I have spent a lot of time scanning and shredding, but still have several drawers to go through that are mostly related to my past businesses.
I mentioned that I only plan to stay in my current position for one more year at most, but that might be changing soon depending on how the next few weeks go. I hope to be able to provide additional details about my plans, especially if everything works out, but don’t want to get ahead of myself just yet. I will say that what I am considering is primarily being driven by my desire to become financial independent not only on schedule but perhaps a bit sooner. It is amazing the perspective that thinking about things like FI provides concerning your job and career.
For me blogging and keeping track of our FI project is still quite enjoyable. I like that it continues to provide an outlet for me to write and share information in a non-academic context. In fact I like the diversity of writing with the primary purpose of sharing stories on this blog instead of a formulaic format and style primarily required with my current academic writing and research. It reminds me that there are a lot of things that I enjoy about writing when I am not thinking about it as part of my job.
The fourth month of our financial independence project is now complete. The spreadsheet I use to determine our FI date continues to fluctuate each month since income and savings tends to be uneven, but I suspect after a year of doing this I will be able to more accurately model the actual date with greater precision. Business income simply varies too much at this time to get an accurate projection, but I am at least able to get a general idea based on several different scenarios. So that is our update for the month and for me it is time to see how everyone else is doing on the Rockstar Finance Net Worth Tracker.