Welcome to the 2023 year-end edition of our net worth tracker. I’ll review our December net worth as usual and then take a look at how 2023 treated us overall. I started tracking our net worth when this blog started, which was at the beginning of September 2019.
I started by creating the Net Worth Baseline report.
You can view Previous Net Worth reports HERE.
Our December
December, as usual, was an incredibly busy month for us. We did our normal work routine during the week, aside from Christmas week.
We had a few colds and fevers, but they didn’t interfere with our weekend plans with friends and family, and everyone was healthy for Christmas.
December 2023 Net Worth
Here’s how December compares to last month:
December Account Breakdown
Let’s take a quick look at what happened in December.
Cash (-$3,014.20)
This is where our paychecks get deposited. All our income goes into this account and then gets transferred to the proper accounts as set by my budget. I typically do the net worth report before transferring money to the appropriate accounts.
We made a good amount in December, better than in November. This is what a higher-than-normal month looks like for us. We had an increase in cash largely due to emptying our Dependent Care FSA into our bank account and each of us receiving an ‘extra’ paycheck.
However, we have less cash on hand this month because I forgot to transfer cash into investments the month before.
Investment Cash (+$9,331.39)
All of our extra cash is transferred here and is considered part of our savings rate. This is where our leftover income went from November and October. See what I was talking about in the last section?
This is cash we plan on using to invest in real estate in the near future (less than 5 years).
As I said last year, it’s now at the point where we can afford some fixer uppers. We have enough to buy a house and still have enough left over to renovate it. I’m starting to look, but who knows when we’ll pull the trigger?
The housing market overall stayed too hot, although it is showing signs of cooling off.
Starting at the beginning of 2024, we will pause transferring money towards this account and instead fund our Roth IRAs until they are maxed out. We try to save as much money as we can. Our future selves will thank us.
That means all our extra money from this month is going towards Roths, and you won’t see much of an increase in investment cash.
Remaining Cash Accounts (Emergency and Sinking Funds) (+$800.00)
Nothing exciting here. Just the usual. The amount increased by about the same as last month since we’re just saving up for our property tax bill for when it is due in January. (This month! Yikes!)
Retirement Accounts
401(k)s ($18,863.59)
The markets did extremely well in December, hitting all-time highs and adding to the gains made in November.
IRA ($23,502.78)
Another reflection that the markets had a positive month. The IRAs are all invested in mutual funds, which reflect the stock market’s ascent for December.
College Fund (+$3,850.03)
The college fund is invested just like the IRAs. The 529s are fully funded, and we don’t plan on putting in any more cash.
The gain is equal to about 5%.
Net Worth (+$48,683.56)
December was a stellar month in terms of the stock market. We also brought home a decent amount of money, which helped accent the market gains.
Our increase in net worth was mostly from investments and some from our day jobs. Our net worth increased by a little less than 1%. Doesn’t feel that bad considering some of my IRA accounts were down by 8%.
Accessible Net Worth (+$6,317.19)
This is the money we were able to put away, not including the tax-advantaged retirement accounts. Our income was great, and our expenses were about average this month.
Our accessible net worth increased because of the money we brought home, and we haven’t transferred any to Roths yet.
We did pull some money from a sinking fund in order to buy a new water heater for the house. We decided to replace both water heaters with a new tankless for the whole house.
Liabilities
Status: None, as usual. They’re a burden, so I avoid them. The cars, the house, they’re all paid for. Student loans… I never used them. Credit Card debt? I only use one, and it gets paid off every month, and often I’ll pay it off multiple times per month. Just depends on how many times I think about it.
Passive Income
Stocks and mutual funds did not pay out as much in capital gains and dividends as they did last year, but December was pretty much on par with last year.
We didn’t set any records this year, like we did in 2020 and then again in 2021.
However, it was still a good year, putting us at 20% of our passive income goal. Everyone says that it grows exponentially, so we’ll see how the next few years look for us. The last few have been pretty flat.
For now, we begin the dividend lull until March.
The interest rate in my savings account in that “high-yield” account is now earning 4.35%. That’s 1% more than it was this time last year. I can’t complain too much about that.
Saving’s Rate
I track my savings rate in order to help keep my feet to the fire, so later, I can be Gone on FIRE. As a bonus, you get a glimpse into my cash flow by looking at the income and expense rows.
In 2021 I adjusted my savings rate goal to 50%, down from 60%. It seemed like 50% was a more attainable goal.
Last year was terrible; Only a 35% savings rate. That was mainly due to us buying a house, and all the expenses related to that, and the costs of having two houses at the same time.
Without buying a house, we would have been right around 50%, so I kept the same goal for 2023.
Good News! We met this goal with 54% (Rounded Up).
In December, our net expenses were actually less than zero because of the DCSA reimbursement, which, along with our income, brought us from below 50% to a good amount above.
Here’s how we did this month and for the year.
Income ($13,257.76)
Right now, our only source of active income is through our full-time jobs.
This is what a high-income month looks like for us. That was a nice little boost.
Expenses (-$1.45)
Our expenses were well below average this month. In fact, we made more than we spent because of the dependant care FSA cash out and some things we returned.
Here is a quick breakdown:
1) Home Escrow ($807.17)
The normal amount we put aside every month. We also hired someone to come inspect our chimney. I’m sure that’s something you’ll be hearing about when it’s time to get it repaired.
2) Giving ($1,458.35)
The usual 10% we give every month. We started giving a little bit more, so it’s now 11%.
3) Cost of living (-$2,266.97)
This includes all our bills (Gas, Electric, Water, Internet, Phone), transportation, food, shopping, and daycare. Home insurance is paid for out of our Home Escrow savings account.
As planned, we drained our dependent care account at the end of the year in one lump sum. It is much less paperwork for us and a really nice way to end the year. It feels like getting a big bonus.
We have started to enter the cold part of the year (finally), so our water bills have decreased, and electric/gas bills have started to increase. The next few months are when our gas bill starts to go up as we heat the house.
Overall, December was still a relaxing month, and we managed not to spend a ton of money. I thoroughly enjoyed December and spending time with the family.
I’m not sure how well we’ll do on expenses in 2024, as we have a lot of home updates we want to get done. It would be great if we could keep our saving rate above 50%, though. I’m hoping that becomes routine for us.
December 2023 Vs November 2023 Expenses
November and December were quite different months. The DCFSA wiped out a lot of our expenses for December. November, we just coasted along without much of anything happening.
As a side note, I’m really not looking forward to returning to the office in January. I’m already counting the years to retirement, and I’m about ready to start counting the days till I retire from the office job.
Too bad that number is still in the thousands.
Goals Progress
Financial Goals
Aside from the Roth IRA contribution, most of the financial goals were year-long goals.
The Roth IRA contribution is done, and the money has been transferred to the proper accounts.
We missed our goal to save over $75,000 for real estate investing. We made it 92% of the way. We would have made it all the way if our take-home pay was as high as it was last year.
Let’s see if we can make this goal in 2024.
December was mediocre in terms of dividends, right on par with last year.
That said, 60% of the dividends did come in the last month of the year! With that end-of-the-year push, we were able to reach the passive income goal.
We were able to reach four out of five of our financial goals.
Blog Goal
For 2023, I wanted to create more content. And I did! My goal was at least two articles a month for a total of 24. I fell one short of that goal and produced 23 articles.
I’d appreciate any feedback y’all have for me so that I can produce more content and better content that you want.
Personal Goals
I did a reading goal again this year. I failed pretty badly on this one.
My goal was to read 2 books.
I read one book and a third of the next one.
And then there is my physical health. I didn’t get to where I wanted in 2020, or in 2021, or in 2022.
Now we can add 2023 to that list. I’m really getting sick of not being healthy. Not literally sick, but I need to whip it into shape before I do end up getting sick.
I’ve been going to the gym and running pretty routinely. That’s been helping. I just need to be more consistent, start lifting weights, and I need to eat healthier.
I’m confident that I will achieve this goal in 2024.
December 2023 Roundup
The month of December was another good one. It was nice staying home with just the immediate family on Christmas day.
Our cash flow maintains a positive direction, and all the bills are paid.
The effects of the pandemic are pretty well dissipated now. Life is pretty much normal and getting better each day as the kids get older.
2023 Annual Results
This is the fourth full year of tracking all this data, and now it’s time to share it! The exciting stats that I added last year are even more exciting this year. At least to me.
That’s because our change in net worth for the year is positive. In fact, it’s very positive. Last year, we had a decrease in our net worth thanks to buying a house.
It wasn’t exactly negative, though, because I didn’t include the income from the sale of our old house.
2023 Net Worth Increase: $213,732.21
We ended 2023 with a net worth of approximately $1,078,691.33
We ended 2022 with a net worth of approximately $598,826.13.
We ended 2021 with a net worth of approximately $687,860.35.
We ended 2020 with a net worth of approximately $512,968.66.
We ended 2019 with a net worth of approximately $365,787.79.
Last year, I didn’t include the money we brought in from the sale of our old house, so that is why the net worth between 2022 and 2023 doesn’t match up with our 2023 net worth increase.
I’m adding that value into our net worth now but not counting it as part of our net worth increase for the year.
In 2022, the markets were down about 20% for the year. This year, 2023, the market made up for those losses and then some. The S&P was up about 25%.
Let’s break down that net worth increase.
We saved about $69,000 of our take-home pay. That means from the money we brought home from paychecks, we put almost $56,000 towards investment savings and about $13,000 in our Roth IRAs.
I maxed out my 401(k) for a total of $22,500.
Thanks to market performance, we made more from stock market growth than we did from our own contributions. It feels much better than last year, where we finally got to see a strong bear market and how that feels emotionally.
“As anyone who pays attention to the news, all the experts are predicting 2023 will be a rough year financially. “
Beginning of 2023
They were wrong.
This year, I’m seeing mostly positive predictions for 2024, with a few predicting a negative year.
2023 Passive Income: $25,476.23
My goal was to have a passive income of over $25,000. In 2022, we didn’t even meet our goal of $15,000. Fortunately, we met the goal of $25,000 this year, just barely.
I’m going to set the passive income goal to $30,000. I don’t know what to expect in 2024, but I hope it’s better than 2023.
2023 Savings Rate: 53.7%
2022 Savings Rate: 34.5%
2021 Savings Rate: 52.0%
2020 Savings Rate: 48.5%
2019 Savings Rate: 57%
This is the one goal I wasn’t sure we would achieve this year right up until December. The good news is that we topped 50%!
Last year, I said if we meet the goal in 2023, I’ll bump it up to 55% for 2024. That’s what I’m doing.
I think we can sustain 50% as long as we don’t have any major expenses, so 55% is a stretch goal. Especially since our wages aren’t keeping up with inflation.
2023 Expenses: $59,481.19
2022 Expenses: $88,261.70
2021 Expenses: $66,285.45
2020 Expenses: $58,433.45
2019 Expenses: $47,676.12
YoY decrease ($): $29,140.51
YoY decrease (%): 32.2%
We didn’t have to cashflow a baby, the second child is out of daycare, and we didn’t buy a house. That saved us quite a bit compared to last year.
Here are some charts to help visualize our 2023 expenses, with a comparison to 2022 as well. Notice the dip in home escrow compared to 2022.
In case you’re wondering why miscellaneous was negative in 2021, it’s because we put the income from the monthly IRS Child Tax Credit in that category. We’ll be paying it back come tax season, so we didn’t count it as income.
The government didn’t pay that in the years after since it was a pandemic relief measure.
2023:
2022:
2021:
2020:
2023 Roundup
2023 was another great year for us all around, especially from a financial aspect. We can call ourselves millionaires for the time being!
Our income wasn’t quite as high, but both of us are still in jobs and workplaces that we both enjoy, AND we were employed full-time throughout the year. There are no foreseeable job cuts coming up this year either.
This was the fourth full year of having to pay for daycare. For a while, we had to pay for two kids, but now we only have to pay for one. We’ll be done with daycare starting with the next school year this August, aside from sending them during school breaks.
It’s a big chunk of our budget, but nice to know that it doesn’t eat up too much. At least not enough where it would be better for one of us to stay home.
Let’s take a look at how our expenses break down.
Housing: Home Escrow (26 %) & Utilities (7%)
Home Escrow continues to be the biggest slice of the pie. Texas has high property taxes. Texas passed a measure that lowered property tax rates, so I expect that taxes and other minor home expenses will be below a quarter or more of our annual expenses once we make the upgrades we need/want to make.
I anticipate that giving will be our top category in future years once that happens.
I already know what our property tax bill looks like for 2023 and it is a big relief compared to the property taxes we were paying at the old house. I’m still not looking forward to it, but it is close to half of what we were paying.
We had a big house and now we have a medium sized house. That said, it’s an older house, so utilities will still cost a decent amount. We try to be conservative with our usage. Turning off lights and bundling up in blankets for the winter, but there’s only so much you can do. This is one of the upgrades we plan on making.
Previously I expected that utilities would hover around the same amount for the foreseeable future, and last year I anticipated a slight increase because we have two kids we have to provide for and keep comfortable.
The actual cost did tick up ever so slightly, but it stayed the same percentage of our take-home pay.
I predict utility prices to continue to climb as the cost of natural resources goes up.
We really like our house and where we live. Also, we don’t want to move too much with the kids. We like the daycare, and we live in a great school district. That said, we are always looking for a property with some land. We would like to have some space between our neighbors and ourselves eventually.
I don’t see us moving while the kids are little, but maybe by the time they reach high school. We’ll see how it plays out over the next couple of years. It’s hard to predict one year ahead, much less 10 years.
Also, we would love to build our dream home one day. FIRE Goal!
Giving (22%)
It’s awesome to see that giving is our second-highest “expense,” and we were able to give more than last year. It reflects how blessed we are and that we are good stewards of what we have.
Hopefully, we can continue the trend and increase our giving for 2024. It really is a lot of fun to be able to give. As the kids get older, I’m looking for more ways to give than just money.
Daycare (8%)
In 2020, I said, ” This is one category that I expect to be a higher percentage by the end of 2021. I’d be happy if it was only 9% next year!”
It’s true, I am happy it was only 9% in 2022. Paying for two kids at daycare is not cheap. I’m even happier now that it was only 8%. We are nearing the finish line with daycare!
We have another 2/3’s of a year of daycare at about this cost, and then we will see a significant drop. I know this will fly by, and we’ll be reminiscing about the years they were in daycare.
Transportation (12%)
This year was somewhat expensive due to buying new tires for both of the cars. There weren’t any costly repairs that needed to be done. I better go knock on wood now…
Miscellaneous (2%)
In 2022, we put some house-buying expenses in this category. It would have been close to 1% without adding the earned money. In 2023, that is pretty much what we saw. I’m a little surprised it hit 2%.
All the other categories
The rest of our expenses combined are 25% of our total outgoing expenses, with shopping accounting for 12% of that. I think we are doing a decent job in these areas, although I need to reign in shopping a little.
We could do a little better in the shopping category, but I’m trying to balance savings with what the kids need. I’ll admit that I probably went a little overboard in 2022 and in 2023.
I’m still finding the balance, but kinda expect I’ll have to spend about the same in 2024 because of inflation. It would be nice if my paycheck went up as much as the inflation rate did.
Otherwise, sure, we could trim a little here and there, but it wouldn’t really move the needle much for us.
FIRE Away!
Reminders:
- 2 big items not included in my net worth:
- House & Cars – Their value will be added to my net worth if and when I sell them.
- 2 accounts not included in net worth total (even though they’re listed):
- 529 – This is my baby’s money. Consider it her net worth summary.
- Home Escrow – This is Uncle Sam’s money. We don’t mess around with him.
- Total income only includes our active income, which is currently our full-time jobs.