Welcome to the October 2020 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.
I heard a joke this month that Texas weather is like drawing lottery balls….. 89, 34, 72. And the weather really can change that much from day to day. We had a cold from move in one day this month, and the temperature dropped from a morning high in the 70’s to a low in the 40’s. It was near freezing for a couple days and now it’s back up to the near perfect weather in the 70’s again.
I’ve been able to take walks frequently with my daughter and it’s been nice. She’s learning how to climb the ladder at the park, which is nerve racking since she doesn’t really grasp the concept of falling that far and how much it would hurt. Add on top of that, she wants to do everything herself. Financially, if you recall, September was a tough month. October was better, even though we started paying medical bills. We were able to save at least some money.
And just like the rest of the summer months, I’m not going to talk much about what I did this month because we continued to not do much. I almost went to a World Series game, but that didn’t happen. It was an overall calm and relaxing month and we got to watch our baby grown and learn more each day. She loves standing (with our help), and loves to talk and watch what everybody is doing. Also, she smiles constantly and has the biggest, cutest smile!
Monthly Roundup
The mask mandate continues and no one knowns when it will end. My wife returned to work in September, and October was her first full month back. It’s nice having that part get back to normal. Last month I found out that I’d have to return to the office in October, but that ended up not happening. Hopefully I can continue working from home and just go to the office when needed. The kids are doing good, growing, and, overall, life continues to be good.
If you recently had a child, don’t forget to fund their college education. I use the Vanguard 529 plan. Yes, I keep saying this as a reminder to myself. Haha. I need to transfer money into the plan before the end of the year, but after the hospital bills are paid. We are still working on getting those paid.
October 2020 Net Worth
Here’s how October compares to last month:
October Account Breakdown
Let’s take a quick look at what happened in October.
Cash (3,889.04)
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.
My wife worked the whole month and we both received an “extra” paycheck. We get paid every other week, and this just happened to be a month where we both get paid 3 times in the month. This means that we brought home the most money since the baby was born. The extra money helped because we are still paying off the medical bills.
Investment Cash ($29.79)
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.
We have to pay for the delivery of baby #2, and more bills are coming in. We didn’t have any extra cash to transfer towards investments from September because it all went towards paying bills. The increase is solely from interest. We have some extra left at the end of October, that you will see transferred into here next month.
After we receive all the bills and insurance gets their part figured out, we have to pay all the bills. I hoped that we could get that done in October, and start investing again in November, but insurance is still working out their stuff. We were able to pay a good chunk, but there are more bills on the way.
I’m still hopeful that some opportunities will come up this winter for investing. The foreclosure moratorium lasts until the end of the year. I don’t know if it will be extended again, but I expect the market will be flooded with properties a few months later. That excess in supply should result in low prices.
Remaining Cash Accounts (Emergency and Sinking Funds) ($1069.69)
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.
We cancelled the cruise that we were planning for early next year. I may or may not transfer that money back into our travel fund. I’m debating moving it into our investment fund.
Retirement Accounts
401(k)s ($589.02)
Our 401(k) increased just slightly thanks to us contributing throughout the month. The rest of our investment accounts dipped slightly for the month.
I’m still concerned about the affect of the upcoming election. Luckily, the wait is over. I should know what happened by the next net worth report.
IRA (-$3,792.35)
This decrease is all due to market performance. The drop was relatively insignificant, so I can’t complain too much. The drop was a little less that 1%.
College Fund (-$352.52)
Just like the other investments, the college savings fell as well. About the same as the retirement accounts at around 1%.
Net Worth ($721.88)
Not that much of an increase, but still positive none the less. The drop in the market wasn’t enough to offset our income this month. My curiosity remains about what is going to happen around election time. Also, I’m still hopeful all the world’s problems will disappear after the election.
In total, our net worth increased by a hair: .16%.
Accessible Net Worth ($3,925.21)
Monthly Blurb: This is the money we are able to put away, not including the tax-advantaged retirement accounts.
Our income was a above average, but our expenses were above average as well this month thanks to the medical bills. Our accessible net worth increased because my wife is bringing home a paycheck for all of October. We have enough to cover our bills again! Yay!
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
September was a record month for dividend income. However, the excitement is over and we begin a lull until December. Fortunately, it’s a short wait.
We’re still about $1,200 away from passing what we made last year in dividends ($9,242.21). I should easily pass that this year, but you never know! For the last five years, my December dividends have been grater than $1,200.
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 earning 0.4%, down from last month’s 0.5%, and the previous month’s 0.8%.
Saving’s Rate
Monthly Blurb: 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.
We still missed our 50% goal by a long shot this month thanks to our above average spending. We didn’t really have a choice though. The majority of that spending was payingg the medical bills.
Our Year-to-date savings rate is now a significant amount below 50%. Our lowest months for our savings rate are now behind us, but November is not going to be much better. On the bright side, November should be the last month of paying medical bills.
As expected we did not hit that 50% savings rate target in October, and we’re most likely not going to it it for November either. That means our goal of 50% for the year will not be met! Bummer. I know we can do better next year when we don’t have to cash flow having a baby. In fact, I’m debating raising the goal even though we didn’t meet it this year. What do you think?
Here’s how we did this month.
Income ($11,127.26)
Hey, I told you. This is was a good two-income month looks like for us.
Right now, our only source of active income is through our full-time jobs.
This is what a good month looks like for us.
Expenses ($4,006.57)
Our expenses were well above average this month.
Here is a quick break down:
1) Home Escrow ($1060.00)
The “new” normal amount we put aside every month.
We adjusted this due to an increase in home insurance. Without the increase, we would have a shortage come January if property taxes stay the same, or increase.
2) Giving ($1,112.7)
The usual 10% we give every month.
3) Cost of living ($6,397.83)
Previous Months: September: ($2,602.07), August: ($2,835.56), July: ($4,283.01), June: ($3,031.71), May: ($2,957.92), Apr: ($2,164.31), Mar: ($3,078.52), Feb: ($2,474.38), Jan: ($4,708.98), Dec: ($2,749.98), Nov: ($1,242.44), Oct: ($3,040.36)
Running Average: $3,228.99
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. Starting in July, we are going to use the dependent care account to pay for day care, so we should see a decrease in the cost of living after the medical bills are paid. We are going to drain our dependent care account at the end of the year in one lump sum. This is less paper work for us.
Our gasoline bills continued to stay pretty low, but went up slightly since my wife is going into work now. The hottest part of the year is over, so both our water and electric bills decreased. The next few months is where our gas bill starts to go up as we heat the house.
The real biter this month was the medical bills.
Other than that, we tried not to spend too much. We STILL have some big bills to pay. We’ll continue to try not spending much. We always do, but more so than normal until those bills are paid!
October 2020 Vs September 2020 Expenses
September and October were pretty similar in terms of our expenses, aside from medical bills. October was g all about paying them bills. And it’s gonig to continue into November. Ugh….
Goals Progress
Financial Goals
We met our target to fund our Roth IRA’s by the end of March.
We met our target to fund baby #2’s 529 plan early, having finished at the end of May.
The remaining financial goals are year long goals. We’ll have to wait until the end of the year to see if we accomplish them, but as you can see, they are nearly completed. Except the savings rate goal.
As expected, I am on track to have a maxed out 401(k) by the end of the year. It’s all automated, so as long as my job status doesn’t change, we should be good.
I did not actively do anything to increase my passive income, other than contribute to retirement accounts. Hopefully this is happening passively. As expected, we saw a good portion in March, and a personal best in April. and a new personal best AGAIN in September. Hopefully this trend continues into December. I’m fairly confident that we will beat the goal of having passive income grater than $10,000!
My goal of having a savings rate greater than 50% was very close, but not after cash flowing a baby. I don’t see us meeting this goal this year. August through October have really pulled that number down. November is not going to help, so that would leave December to pull it back up. I don’t think our savings rate will be high enough in December to brings it back over 50%.
Blog Goal
I’ve made a few changes behind the scenes on where I want the direction of this blog to go. My goal was to provide more value to you, so I’ve made some changes in the way I’m going to style blog post in an effort to create post that are more relevant to you. Now I just have to start creating and publishing those posts. I didn’t do much in October.
Personal Goals
I caught up on my reading goal in August, but haven’t done much reading since then. I’ve already finished four books. Now I just need to read two more books before the end of the year. I can do it….
My weight didn’t really change this month. Since the temperature has dropped, I’ve been able to run outside a lot, which has been a lot more enjoyable for me. Running at the gym is more of a mental challenge than a physical challenge for me. I just can’t seem to go the same distance as I do outside. I’ve started mixing it up slightly where I’ll run a mile or two at the gym and then run back home.
October 2020 Roundup
The month of October was a another good one. The weather was very enjoyable, and I got to spend a bunch of time with my family. My net worth increase a little even though our investment value fell slightly We still have a jobs, and my job seems to be progressing in the right direction.
I’m excited for November, as all those election adds should be over. Our cash flow is back to being positive, and the bills are nearly paid. Aside from a world-wide pandemic, life should be normal by the end of November.
Stay tuned for next month’s New Worth update. In the meantime, comment and let me know what stats you would like to see.
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.