I posted a few weeks ago that we were still around and trying to catch up and adapt to a parent that is terminally ill, but would get back to updating as soon as I could. While things are still a bit chaotic I at least wanted to give an update on where we are financially by providing our normal monthly project update, even though this one will be the first one posted this year. To be honest I only recently started catching up on where we are financially since a lot of things went off the rails, so up until this point I was not really sure where we were financially, at least not with the great detail that I usually track everything. We essentially pulled way back in our business (mostly my wife) to allow us to focus not only my sick family member, but a lot of other things that were happening at the same time. We spent a significant amount of money with travel, and have been operating with one income since February. The one thing that kept everything stable and mostly on track was a very large one month side contract I had in January before everything started piling on. I still need to write a blog post with details about that contract work as I indicated I would in our FI Project Goals post in February. Anyway, I did not intend to ramble or vent, but when I started this blog I was adamant that I was going to share everything related to our FI path which includes both the success and failures (regardless of the source). If nothing else this is a good example of life, but we are fortunate to be in a good position that allowed us to deal with these issues without a significant impact on our financial future and goals. So looking at where we were at the end of May 2017, our net worth is currently at $758,548 which is up from $738,788 at the end of 2016. It is amazing that we are up almost $20,000 when are spending has increased, and income decreased, but the additional January income and market returns account for most of this. So here are the details for May, as well as items from the proceeding four months…
For 2017 we kept the same savings goal that we had in 2016 and are trying to save $60,000 this year. Honestly, if it was not for the project I had in January, there is no way we would meet this goal with everything going on, but I think it might be possible depending on how the rest of the year plays out. In January we saved $9,000 split between an IRA, 403b , and 457b, and in February, March and April saved $4,171, $3,500, and $4,100. This month I was able to save $3,674 which I will need to find a way to increase if we are going to meet our goal. So far this year we have saved $24,448, most of this from automatic deductions into the 403b and 457b, which required no thought or effort since it was already set up to max both those accounts over the year.
For the prior months of the year I do not have our exact spending numbers, which is rare for us. We have always diligently tracked our spending for the last five years or so, but with all the events of the last few months it just did not happen. Honestly, I don’t think I care enough to go and enter all the transactions from the prior months because it was just not based off of normal spending patterns, and more based on life events. Take out the travel costs and we were probably below our normal discretionary spending levels. What I do know is how much we spent in May, $4,897. That is actually well under our target of $5,800 a month, but that monthly number was based on our yearly goal. Starting in August we are going to be paying for childcare for our two kids which we anticipated and adjusted our spending expectations accordingly. Fortunately, we only have one year where both will need childcare at the same time.
I know income is one of the areas few talk about on their blogs, but as long as I can keep our identities somewhat anonymous I don’t mind sharing. I think it provides a more accurate picture of what is coming in, what is going out, and how much is being saved. I estimated that we would have a family income of around $150,000 in 2017, but whether we hit that goal will depend on how my wife’s business does for the remainder of the year. My base salary plus summer pay will be around $75,000 this year, on top of $35,000 “side project” I completed in January. Between our family issues (sick parent, new child) and her working on completing her Ph.D. she has not had much time to devote to client acquisition. After business expenses, including paying the other employee it has only added about $10,000 to our income so far this year. On top of that many of the clients and contracts she has been working on has ended and little time has been spent on finding new contracts and clients until about a week ago. At this point we will see how the rest of the year goes and whether we hit our goal or not. If we miss it, it is not a big deal, because honestly we still have a high family income, it will just take us longer to reach some of our long term goals, like FI.
Other Goals we set for 2017
My wife is getting closer to completing her Ph.D. As I write this she is taking her comprehensive exams and will then only need to complete her dissertation. We estimate she can complete it in a year, or 15 months if things don’t move as fast as planned. Luckily she can write around her schedule rather than needing to focus on classwork.
This will also give her an opportunity to focus on the business and try to make the income more stable and predictable. So far this year it has done the opposite, but it is a priority now that she is finishing up her exams.
No updates on the real estate investments I share with my brother. We have both had far too much to deal with family wise to even think about what we are going to do with those properties. I expect that near the end of the year we will have a plan.
Needless to say our decluttering process has been on hold, and we actually still have unpacked boxes from our move in December. Once we actually have time to settle without so much traveling we can start working on this.
Well it feels good to actually get an update out after several months absence. If nothing else it helps me think through a lot of these issues and work on our numbers. I need to spend a bit of time modelling our trajectory to see if we are still going to hit our target date, but I am cautiously optimistic we have not been setback even with the events of the last several months.