Welcome back!
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 (finally?) halfway to our target net worth of $1,250,000!
This post is the first in what I anticipate will become 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.
With that, here’s where we are at through July 2020:
| BALANCE | ||
| ASSETS | ||
| Cash, Checking, Savings | $15,293 | |
| Investments | $535,269 | |
| Home Equity | $98,083 | |
| LIABILITIES | ||
| Credit Cards | ($2,005) | |
| Misc. Other Debts | ($22) | |
| NET WORTH | $646,618 | 51.7% to FI |
Cash, Checking, Savings
Consists mostly of our $9,000 emergency fund held in a high-yield online savings account at Ally Bank. The rest is held in a “big bank” for depositing our paychecks and paying bills.
Investments
Several different accounts here, most of which are true “retirement” accounts. Also includes our taxable brokerage account at Schwab. This category is likely the source of a future post.
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.
Credit Cards
Just the balance on our various cards (future post on our travel hacking exploits to come) as of the end of the month. We pay these off on time and in full each month.
Misc. Other Debts
Usually just my administrative accounting of who owes what for various fantasy sports leagues.
Here’s a look at our expenses for the month:
| EXPENSES | |
| Home (mortgage, property taxes, maintenance, etc.) | $1,645.13 |
| Utilities | $149.42 |
| Automotive | $313.21 |
| Groceries | $319.45 |
| Dining Out | $92.04 |
| Health & Beauty | $445.58 |
| Cell Phones | $0 |
| Travel & Entertainment | $77.81 |
| Pets | $20.05 |
| Work-related | $408.36 |
| Merchandise (furniture, decorations, clothes, etc.) | $967.41 |
| Other Expenses | $2,954.00 |
| Total Expenses | $7,392.46 |
Yikes.
At first glance, this was not a good spending month for us, as our monthly budget averages an even $5,000.
Notes
I won’t go into detail on every category here, but the main culprit of July’s spending extravaganza is that ominous “Other Expenses” category. We had to pay Uncle Sam for taxes owed for 2019. Remember, the tax filing deadline was extended from April 15 to July 15 this year, so we held onto our precious pennies until the last possible second. Yes, I know there are ways of reducing the amount owed at tax time – this is a calculated strategy that we revisit every year.
Work-related expenses included $305 to renew membership in a professional organization for me, which will be reimbursed by my employer in the near future.
The Merchandise category was a bit higher than normal this month due to the purchase of a new desk for the home office. Mrs. FIby35 has been working from home since the COVID lockdown began in March, so it was time to upgrade her setup now that she will continue working from home for the foreseeable future. Some other minor expenses are included here for clothes and gifts.
A note on cell phones: We love seeing that $0 for 11 months out of the year. We both own our phones outright, and pay Mint Mobile for service once a year (~$200 each for 3GB of 4G LTE data and unlimited talk/text). No need for outrageously high phone bills when we are connected to wi-fi more often than not and receive adequate service elsewhere.
Conclusion
Upon further review, spending wasn’t too bad for the month. How did you do? Any ugly surprises lurking in your Other Expenses category?
*Technically, The Almighty Spreadsheets project we could reach FI sometime during 2024 if the market cooperates, which would put me at age 34 and Mrs. at age 33. But in the interest of being conservative, we’ll stick with “by 35.” It also provides this blog with a more succinct name than “FI by 34 and a half.”
