April 2021 Financial Update

Holy smokes, what a month! The S&P 500 climbed over 2.5% in April alone, which sure paid off for boring index fund investors like us. As you’ll see below, our net worth skyrocketed by over $50,000 for the second month in a row, and we have now crossed the $900,000 threshold. Of course, that could all go away just as easily as it came, but it’s incredibly exciting nonetheless. So the market carried us, but how did we do with our spending? Check it out below in our April 2021 financial update!

In our inaugural blog post, I briefly introduced you to our goal of achieving financial independence (“FI”) by the age of 35 and shared that we are already over halfway to our target net worth of $1,250,000!  Here’s last month’s update in case you missed it, and here‘s how we fared last year in total.

This post is the latest in a regular series of monthly financial updates to track our progress to FI and beyond.  Bear with me – I’m a little obsessed with spreadsheets and track every penny we make and spend in excruciating detail.  I’ll do my best to summarize that activity in a way that gives enough insight into our financial maneuverings without boring you to tears.

Net Worth

With that, here’s where our net worth is at through April 2021:

	BALANCE	CHANGE FROM PRIOR MONTH
ASSETS		
Cash, Checking, Savings	$15,923	($953)
Investments	$810,862	$51,249
Home Equity	$103,063	$560
LIABILITIES		
Credit Cards	($2,101)	($399)
Misc. Other Debts	($205)	($45)
NET WORTH	$927,542	$50,412

We didn’t just cross the $900,000 threshold, we obliterated it. Our target net worth of $1,250,000 is coming dangerously closer each month and we’ve already exceeded our anticipated ending net worth for the entire year.

Cash, Checking, Savings

This consists mostly of our $9,000 emergency fund held in a high-yield online savings account at Ally Bank.  We dipped into our Ally Bank reserve a bit at the end of April to make sure we had enough on hand for some hefty tax bills due in May, but that will be replenished within a month or so. The rest is held in a “big bank” for depositing our paychecks and paying bills.

Investments

Several different accounts are included here, most of which are true “retirement” accounts.  It also includes our taxable brokerage account at Schwab. Over $12,000 of this increase was due to our own contributions, with another $38,000 coming from market gains. The power of compounding continues to astound me.

Home Equity

Purchase price of our home, less the outstanding mortgage balance.  I don’t worry about adjusting the value to whatever our Zestimate is on a particular day because it doesn’t matter until we sell. Having said that, new homes are being built and others are being sold in our neighborhood for well over what we paid for ours, so this is likely a conservative number.

Credit Cards

Just the balance on our various credit cards (we use these extensively to fund our travel hacking exploits) as of the end of the month.  We pay these off on time and in full each month, so the change in this balance will usually manifest itself in the expenses below.

Misc. Other Debts

Usually just my administrative accounting of who owes what for various fantasy sports leagues.

Expenses

Here’s a look at our expenses for the month of April:

EXPENSES	Budget	Actual	Over/Under
Home (mortgage, property taxes, maintenance, etc.)	$2,259.05	$1,934.36	$324.69
Utilities	$218.41	$201.58	$16.83
Automotive	$480.21	$2,014.70	($1,534.49)
Groceries	$375.00	$316.37	$58.63
Dining Out	$116.67	$224.18	($107.51)
Health & Beauty	$266.96	$253.98	$12.98
Cell Phones	$16.67	$130.33	(113.66)
Travel & Entertainment	$369.32	$633.12	($263.80)
Pets	$119.17	$238.08	($118.86)
Work-related	$8.50	$1,045.83	($1,037.33)
Merchandise (furniture, decorations, clothes, etc.)	$250.30	$503.44	($253.14)
Other Expenses	$269.75	$0.00	$269.75
Total Expenses	$4,750.00	$7,495.92	($2,745.92)

On the surface, it looks pretty bad…like, really bad. But there’s some context to be provided, so let’s get into that before I throw my laptop out the window.

Some analysis on individual categories:

Home Expenses & Utilities

We’re under budget here, but we actually had about $280 worth of repairs to our roof that somehow weren’t covered under warranty. The cost of home ownership, I guess.

Automotive

Here’s the first big, ugly number. We had some deferred maintenance to do on Mrs. FIby35’s vehicle (the one we are both driving for the most part), which totaled almost $1,900. That wasn’t a surprise though, as we had been planning on making these repairs since last fall. Since I am also working on achieving the spending bonus on my new Chase Ink Business Unlimited credit card, it was the perfect time to strike.

Cell Phones

As I’ve explained previously, we both have cell phone plans through Mint Mobile that only cost about $15 each per month. My annual renewal came due in April, so this is the cost of paying for 12 months of their 4GB plan in full. The total would have been $180+taxes, but I had a referral credit that knocked the price down a bit. I also received reimbursement from my employer for the previous 3 months of coverage. We love Mint Mobile and highly recommend their services for a much more affordable option than some of the big names out there. I’d be thrilled if you used this referral link and signed up with them – you won’t regret it!

Travel & Entertainment

Mrs. FIby35 will disagree with my accounting here (and you may disagree too), but I include the cost of redeeming our Chase Ultimate Rewards points here. Since I track them as assets at the value of what we could redeem them as statement credits, it also makes sense that I would need to expense them as they are redeemed (debits and credits, people). We redeemed 27,833 points (at 1.25x value) for a luau through the Chase Ultimate Rewards portal, and another 26,000 points (at a 1:1 ratio) transferring to our Hyatt accounts after some last-minute changes to our Hawaii itinerary. Have no fear, I’ll go into more detail in a future post after the trip.

We also booked a trip to Austin for later this year, redeeming some Southwest Rapids Rewards points along the way.

Pets

We loaded up on flea/tick and heartworm medicine for our dog, purchasing 12 months worth at one time. It was the best deal available to buy in bulk, and I took advantage of a Rakuten deal and received some cash back from Chase in the process. Just a little bit of strategy resulted in saving over 20% off the sticker price!

Work-Related

Another virtual conference registration for me, which I will be reimbursed for at a later date. The rest is mostly the cost of reselling items at a profit, including some items sold for a friend. So the net effect of this spending is really zero at worst.

Merchandise

Everybody and their step-brother had a baby in April, so we sent off a fair amount of gifts to the happy families. The rest includes clothes, sunglasses, water shoes, and snorkels for our upcoming Hawaii vacation.

Conclusion

Did we spend a lot in April? Hell yeah. But outside of some relatively minor roof repairs, none of it was a surprise and it certainly didn’t break us financially. That’s the power of having a solid emergency fund on hand and saving vigorously into your investment accounts. Our $7,500 in spending was tremendously outpaced by the growth in our investments, so I didn’t lose too much sleep over all the credit card swiping that took place.

How did your April spending end up? Anybody nearing their FI number sooner than expected? Feel free to comment below!