One of my primary goals for this blog was to document our progress on our path to financial independence. Each month I update our spreadsheets to determine our net worth and how we are doing on meeting our goals. Our financial independence project is now officially one month old and while it was not a great month for the stock market (according to the general media) we did pretty well on increasing our savings and net worth while also meeting some of our other project-related goals. The lower stock market also presented some good opportunities to buy more index funds for our portfolio. I’ll admit that in the past I was one of those people who would obsessively check my account balances everyday, but today was actually the first day I checked the balances of most of our retirement accounts so I could update my spreadsheet. Focusing on increasing our savings rate and investing in index funds certainly decreases the amount of stress especially when multiple media outlets spend a significant amount of time telling you “how bad things are”.
Currently our Net Worth is: $622,645 a $19,744 increase since the start of the project. This is a nice increase, especially considering market performance, but this is primarily due to receiving a contract payment that represents about three months of work.
ASSETS Prior Month January 31st, 2016 % CHANGE
Florida Retirement Plan
College Savings (ESA & 529)
Taxable Brokerage Account
Real Estate Property 1
Real Estate Property 2
Primary Home Value
Here is how we did on our goals this month:
We set a goal this year to save at least $60,000 and we are off to a great start. We saved $14,442.06, mostly in our retirement accounts, with a significant portion ($11,000) being our yearly IRA contribution for 2016. It also helped that one of the bigger contracts my wife works on as an independent contractor paid a significant amount of their contract in January.
We set a goal to spend $5,000 or less this month and failed to meet that goal. We spent $5,008.60 this month missing our goal by a little under $9. We did however pay for six months of car insurance this month as well as a couple of unplanned but necessary expenses. I am bit more confident that we will meet our spending goal in February.
Not much progress has been made in this area so far. We did sell a fair amount of stuff on Craigslist, but we have a significant amount of work to do in this area. There actually is a bit more clutter than usual as we have been moving things around in our house in preparation for our second child in a few months. The Life-Changing Magic of Tidying Up: The Japanese Art of Decluttering and Organizing is still on my wife’s reading list and once she has finished reading that book I hope to use a few of the suggestions in that book to help us not only declutter but minimize the amount of needless items we have in our house.
No major changes since last month in this area. I am working with my wife on a potential contract to allow a large side project that both of us can work on. I am also continuing to look for a few small opportunities on the side, but my wife is truly “at capacity” right now juggling four different clients.
I set a goal of trying to tell our story and help others think about finance in a different way by documenting our journey through our blog. I set a goal of 2-4 posts per week and barely made that goal. Of course measuring my work by frequency of posts may not be the best way to measure personal success, but it does help me try to keep a consistent writing pace. It turns out that staying on top of a blog takes a fair amount of work and I have a huge list of things I would like to do related to this website that are still in progress. So I will continue to try to meet my writing goal and hopefully spend some time actually working on the design, layout, and pages in the near future.
As I continue in this process,one other goal I have is to try and simplify our finances by reducing and combining some of the accounts we have, which is far too many. So far I have not made any significant progress on this and in fact added two new Solo 401(k)s accounts. We are still in a waiting period before we can roll some of my wife’s retirement accounts out of her old work plan as well as some other consolidation moves we would like to make..
So after one month of officially being on our path to financial independence I feel like we are doing fairly well on most of our goals. I am also learning a lot as I continue to think about our finances and read what others are doing that are on similar paths.