Whew, managed to get this out before the middle of the next month!
Markets are trending downwards and is reflected in our investments.
Spending for November is right about the “average”. It seems that $3.5k to $4k is our sweet spot.
We had triple whammy expenses for vehicles last month: yearly car tab, semi-yearly regular maintenance, and a battery replacement.
Winter activities, though not as time and resource consuming but fun nevertheless, are in full swing. So are the festivities centered around this time of the year. Thanksgiving gave us an opportunity to spend quality time with extended family after a gap of one year. The end of the year will possibly yield more such days.
We are all doing well. Adults have had booster shots and child is fully vaxxed. We wish well upon others.
Last month, we had our second largest MoM increase ever: $65k (the highest being $91k in Nov ’20). Things are humming along nicely. Oh, and we hit another milestone: our combined retirement fund is north of a million dollars! We were close in August, got derailed a bit in September, but the markets came roaring back in October.
October closed off with some mild weather. 50-60 degrees F days and low 40s nights and early mornings. We’ll gladly take this abundance of sunshine and heat! Fall sports have started but they are nowhere close to the level of summer sports.
Life is, mostly, good. One of our parents have had some potentially serious medical issues diagnosed. We’re waiting for some test results – fingers crossed.
Markets were down about 4.8% in September, and the trend is continuing the first few days of October. A correction is way overdue but we are still not within that territory – we’ll need to get down about 10% from the most recent highs. This gives us a chance to invest some of that extra cash we have just lying around.
We had a very busy September, with school opening and then chugging along full speed. Sporting and other extra curricular activities had taken over our entire lives in September (in a good way, not complaining!) and it’s cooling off now that we are in October. The rest of this month should be relaxing.
Months such as September really makes us think how M retiring from the humdrum of corporate life has been such a blessing for us. We are able to fit in all kinds of practices and games schedule without W having to feel rushed to get office work done and then worrying about running about or dinner. We are grateful to be in the position that we are.
For for our expenses for the month ….
Had quite an unexpected major expense last month. We suddenly found the a small portion of the basement carpet damp. Upon investigation it turned out that the water heater was leaking and some water had seeped in under the carpet. Got the plumber/heating guys immediately the next day, and the verdict was: we need a new water heater. They were able to get it replaced the same day. Sticker price: $5,345.
If we take that out, expenses this month was about average. Though our spending on eating out/takeout is creeping up.
Weather here has been fabulous. We’re still experiencing 70 degrees days. We’ll take it as long as we get it!
Here’s hoping your fall is shaping up nicely. Cheers!
We’re so far into September that I’m not even going to pretend I remember updates from August! School started. Extra-curricular activities started in full swing even before school started. Some days it feels like there aren’t enough hours in the day to get all the stuff that is happening crammed into a 24-hour period. In a good way. We’ve been spending a LOT of time outside in the sun.
Here is a challenge wish: that September’s update will be within the 5th of the month with some updates!
Two thirds of summer is now gone! That should be enough to light a fire (pun intended) under anyone who values …you know, life.
A very busy July for us. Sporting activities continued in full swing for the first three weeks of July and then started to wrap up for the early summer (Spring/Summer) season and the pace will pick up back again after the second week of August. We took a long – over 2,000 miles – road trip for a week and then chilled out the last week in July. Temperatures have somewhat returned to their averages and we’re enjoying probably the perfect time right now.
Oh, and the valuation of our assets crossed $1.5M and Net Worth rose by almost $23k.
Here is our spending for July. This is on the higher end of variable/discretionary spending for any given month.
The biggest category of expense was our vehicles, where the mid-year insurance premium was due. We also had to renew the tabs on one of the cars. Because of the road trip, gas expenses was almost double the monthly average; as was eating out. When compared to our May expenses, which was one of the lowest, July was almost $2k more. August should be somewhere in between.
But all’s well. Most of these expenses were anticipated. And we do have close to a $100k just laying around 🙂
Here’s wishing all of you have a splendid August to close out the summer. Live life. Cheers!
Earlier this month, Vanguard published this report on FIRE and set some anti-FIRE cats amongst the proverbial pigeons. You know, pigeons like us who have bought into the “idealogy” that you really can’t afford to be chained to a job for a paycheck for decades and decades. You need to get out of the rat race as soon as you can, as if your life depended on it.
The article, bullet-wise (as all good articles should have), talks about:
the dangers of blindly following the 4% withdrawal rate (given how the market is expected to perform poorly over the next decade),
using appropriate retirement horizons,
the effect of the cost to invest,
the importance of having a diversified portfolio, and lastly,
the need to have a dynamic spending strategy
All true. And most rational people pursuing/in FIRE would say so. These factors are nothing new. The 4% SWR is not gospel, the recent returns of stocks is the outlier than the norm, investing costs are to be merciless slashes, diversifying, and having a spending strategy – and even an earning strategy in FIRE – that is flexible, are all built into the plan!
Here is the real, inflation adjusted, historical return YoY (CAGR) of the stock market since 1871. Yes, over 150 years worth of data. It stands at 7.06%, adjusting for inflation and reinvesting dividends, for over a century and half. You can select the time period you want – MoneyChimp Market CAGR.
Here are two simulator applications, that runs multiple iterations (hundreds) of how a portfolio performs over extended draw down periods. I’ve run 3 simulations on each. (there are some underlying assumptions, such as stock/bonds allocation, expected inflation, etc. I encourage you to explore and play with the tools):
Portfolio of $1.5M, expected spending of $50k/year, inflation adjusted, to last for 50 years, withdrawal rate of 3.33%
Portfolio of $1.36M, expected spending of $50k/year, inflation adjusted, to last for 50 years, withdrawal rate of 3.67%
Portfolio of $1.25M, expected spending of $50k/year, inflation adjusted, to last for 50 years, withdrawal rate of 4%
If someone told me that I’d have between 77% and 84% success rate of an endeavor that I was about to embark on, I’d take those risks. But we are almost hard wired to be extra cautious about money. Especially our own money. So I understand if the 4% rule is bent into the 3.33% rule to get into the the 90% certainty range.
And, Vanguard keep those costs low. We’re all good here.
A tepid May, in terms of the markets, the weather, and most things going on. And that is absolutely fine!
Our NW increased by over $12k. Cash balance is inching towards the red line of $100k.
One slight change we’ve incorporated into our monthly posts is to do away with anything after the decimal. A simple format change in Excel and I don’t know why we didn’t do this earlier! The tables looks way cleaner now.
Last month we also tracked ALL of our variable spending, to the last penny. We know on average how much we spend and we are both very conscious about discretionary expenses but this was the first month we tracked and consolidated the outflow. This is how it looks like. We won’t be posting this information every month but rather show some extraordinarily high or low months. May was probably lower than average.
Summer is here! Hope all of you reading this will get to enjoy the next few glorious months. Cheers!
Cash balance has increased to almost $94k, which is I N S A N E! Two major influx of funds: tax refund of about $3.2k and the third stimulus check. We will not let this go over $100k!
Major expenses for the month was $3.8k we had to fork out for some long awaited dental work for M. We also paid about $850 extra towards our mortgage this month.
We are dutifully enjoying the weather – highs of 60s and lows of 40s make for wonderful time to spend and sweat out in the sun. We will continue this trend, even when the temps rises, in May.
The pandemic, here in the US, seems to be drawing towards a close. In other parts of the world, its rearing his ugly monstrous head in painful fashion. Our hearts go out to those in the front line of the attacks.
Another month, another $45k increase in net worth. This is getting boring. Yawn … 😀
On a serious note, I’ll take this nicely purring along markets any day. Or month. We’ll make hay while the sun shines. And when the inevitable correction does come – in a week/month/year – we will take advantage of that too and throw more of the stockpiled cash at it.
Cash reserve increased further as W’s sizeable annual bonus came through. Quite soon we’ll be sitting on a pile of doing-no-good $100k. That’s ok. This would more than carry us for a year if all our sources of active income stopped suddenly one day. Some of it is earmarked for vacations (that we didn’t take in 2020, and some that we will take in ’21 and beyond), some for taxes (that we thought we’d owe; but no, for the first time since we got married, we’ll get a refund!), some for property taxes (escrow that has been decoupled from our mortgage, and we pay directly to the county twice a year).
Another milestone: FI funds for the first time crossed the million dollar mark. This is funds that we can literally live off. I’ll have to sit down and do an analysis on what is the optimal value of this metric for us, but I have a feeling that $1.5M should be sufficient.
Spring is here. Green is sprouting from the depths of the grey and brown. Just two more months till school wraps up and summer starts. Life is – to borrow a mechanical analogy already used in this post – purring along nicely. Cheers!