Welcome to the January 2022 edition of our net worth tracker, where we’ll track our net worth month over month. I first started tracking our net worth at the time this blog was started, which was the beginning of September 2019. I started by creating the Net Worth Baseline report.
You can view Previous Net Worth reports HERE.
We had a fairly warm January, and then we had that one weekend that it snowed. At least we got to go play in the snow for a day or two! The kids love that. And then it was back in the 70s by next weekend. Go figure.
Financially, January was a bad month. If you thought November was bad, January was worse. The markets entered correction territory. In fact, it was the worst month we have had this year. Haha. As can be expected, our net worth went down instead of up.
I’m not going to talk much about what I did this month because we continued to not do much. It was an overall calm and relaxing month and we got to watch our babies grow and learn more each day. It’s crazy how fast they learn.
January 2022 Net Worth
Here’s how January compares to last month:
January Account Breakdown
Let’s take a quick look at what happened in January.
Cash (-$13,836.45)
Monthly Blurb: This is where our paychecks get deposited. All our income goes into this account, then gets transferred to the proper accounts as set by my budget. As usual, I do the net worth report before transferring money to the appropriate accounts.
This number is a little inflated. I forgot to transfer our savings two months ago, so it is reflected in this number because I transferred it over last month. Also, we made a lot of money in December, and not as much in January.
Our spending was a little below average this month.
Investment Cash ($6,856.05)
Monthly Blurb: All of our cash leftover at the end of the month is transferred here and is considered part of our saving’s rate.
This is where our leftover income went from December. Considering the fact that we also maxed out our Roth IRAs, the leftover was a lot!
I’m still waiting for some opportunities to come up to invest our money. The foreclosure moratorium expired, and I’m seeing foreclosures now. I expected the market will be flooded with properties a few months after the moratorium ends, but that hasn’t exactly happened yet. There are only a few, and the housing market is still crazy hot.
Remaining Cash Accounts (Emergency and Sinking Funds) (-$10,062.89)
Nothing exciting here. Just the usual. We are just saving up for our property tax bill and HOA fees for when they are due early next year. It was January, so we had to pay the HOA fees and property taxes. Next month should look more normal.
Retirement Accounts
401(k)s (-$11,406.62)
I warned you it was a bad month, didn’t I?
The markets were very turbulent in January, and the major indexes were down around 10%. I’ve been saying for about a year that I think we’re in some sort of bubble. May that bubble is starting to pop?
The markets have basically been on a bull run for 13 years. Yes, I know that there has technically been a recession or two, but they were very short-lived.
And what’s going on with cryptocurrency? I’m curious how that’s going to play out over the next few years as more companies begin to adopt it. The fun will be over once it is regulated by the fed.
IRA (-$8,979.61)
Again, all market performance. This number is after the $12,000 transfer for our 2022 ROTH IRA contributions, so in reality, the decrease was even more dramatic.
That’s a loss of about 10% between the 401k and IRA’s. I’ve never been through a real recession, but just this one-month stings.
College Fund (-$6,045.51)
The college fund is invested just like the IRAs; in mutual funds. The loss is equal to about 9%. Ouch, what a bad month
Net Worth (-$27,355.85)
Our net worth was down quite a bit this month, just like many of you I’m sure. I don’t exactly have a reason, but I’m still doubtful were going to remain in a bull market. It’s just been too long!
In total, our net worth decreased by slightly over 4%.
Accessible Net Worth (-$6,969.62)
Monthly Blurb: This is the money we are able to put away, not including the tax-advantaged retirement accounts.
Our income was okay and our expenses were a little below average this month. So, if those were both “positive”, then why the decrease? Our accessible net worth decreased as a result of transferring money into our Roth IRAs. Once the money is in the Roth, I don’t count it as accessible.
Liabilities
Status: (Other than the hospital bills.) None, as usual. They’re a burden, so I avoid them. The cars, the house, they’re all paid for. Student loans…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
December was a record month for dividend income. We’re talking 5-digits just in dividends. I’m still excited about that! 2022 was a record year, breaking last year’s record.
In 2021, we are about 25% of the way to being able to live solely off the dividend. In 2022, we are about 1/3, or 33%, of the way there. And it’s supposed to grow exponentially, right? So, Financial Independence here we come!
That said, January is a very boring month for dividends. At least for what I own. February will be about the same. March is where things will get more exciting (for only a month).
The interest rate in my savings account is super low, as can be expected. My money is barely making any money sitting in that “high-yield” account now earning a measly 0.4%.
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.
A couple of years ago, I had to adjust the savings goal to 50%, which we didn’t achieve. In 2021, we barely achieved that goal, only making it in the last month! I’m setting the same goal this year.
This month we failed to reach that goal! I don’t really have any one thing to blame. Maybe inflation? Maybe we just spend too much, although I don’t see many areas we can cut.
Here’s how we did this month.
Income ($10,449.22)
Right now, our only source of active income is through our full-time jobs.
This is what a slightly above-average income month looks like for us. No stimulus checks or Child Tax Credits, which is how I prefer it. Just makes taxes more painful.
Expenses ($5,935.55)
Our expenses were slightly above average this month.
Here is a quick breakdown:
1) Home Escrow ($1,480.98)
The normal amount we put aside every month.
I should really change this to just “Home” because it’s not just home escrow anymore. It includes lawn care and cleaners.
2) Giving ($1,044.92)
The usual 10% we give every month. Plus 1% that we started to give on top of that.
3) Cost of living ($3,409.65)
Previous Months: Dec: (-$4,034.08), Nov: ($3,703.00), Oct: ($3,268.10), Sep: ($3,968.22), Aug: ($3,532.91), July ($2,394.24), June: ($4,283.01), May: ($3,726.16), Apr: ($3,857.24), Mar: ($2,962.72), Feb: ($2,632.65), Jan: ($4,757.43)
Running Average: $2,958.59
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. Like last year, we are going to drain our dependent care account at the end of the year in one lump sum. Doing it that way is less paperwork for us.
Our gasoline bills continued to increase. We have a pretty good idea of what it will cost each month now with my wife going back to work, and me having to go into the office.
We made it through the cold part of the year, 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.
The annual Dog vet appointments were a big-ticket item. After March or so, I should have a pretty good idea of what a normal month looks like. And I’ll know if a savings rate of 50% is likely.
January 2022 Vs December 2021 Expenses
The DCFSA wiped out all our expenses and more for December. January was just an overall average month, nothing really exciting, incoming or outgoing. The stock market is a different story.
Goals Progress
Financial Goals
It’s time to reset the goal tracker.
The goals are nearly the same as last year, except I want to save a little more for investing. Aside from the Roth IRA contribution, most of the financial goals this year are year-long goals.
We get to start our 2022 goals on a positive note! The Roth IRA contributions are done for this year!
Aside from the 401k, which is on automatic contributions from my paycheck, I’m not sure how the other ones are going to turn out. Time will tell.
Blog Goal
For 2022, I want to create more content. My goal is at least one article a month, or 12 total in the year. I didn’t create anything for January, so I have 11 months left to write 12 articles.
Personal Goals
I’m doing a reading goal again this year, with the number of books. Last year I only read 2, but I know I can do 3.
And then there is my physical health. Well, I didn’t get to where I wanted in 2021, so we’ll try again this year. I was to lose fat, and part of that is going to be by eating healthier.
January 2022 Roundup
The month of January was a good one, even with how the stock market took a dive.
I’m excited for February, and to get back to normal. Also, I’m hopeful that we will be able to stop wearing masks Everywhere we go soon. That includes at work. Hopefully by election season? Maybe?
It’s funny all these places dropping vaccine and mask mandates when Covid cases are at all time highs, and the number of deaths are at the second highest peak. Anyways, I digress.
Stay tuned for next month’s New Worth update!
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 money for my babies. Consider it their net worth summary.
- Home Escrow – This is Uncle Sam’s money. We don’t mess around with Uncle Sam and his money.
- Total income only includes our active income, which is currently our full-time jobs.