What a whirlwind. The May 2022 financial update includes our biggest life changes to date: we quit our jobs, sold our house, and spent the rest of the month as semi-nomads.
There was a ton of coordination (financial and otherwise), but we seemed to make it out unscathed in our first month of “Funemployment.” After packing up and moving our relatively few remaining possessions, we spent about 2 weeks with family in Northwestern Minnesota before embarking on a 1,700-miles-in-2-days blitz down to Florida. All the while keeping our eye on the stock market rollercoaster. How did it all shake out? Read on to find out!
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! Since that time, our net worth has climbed to over 90% of our goal. 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
Here’s where our net worth ended up through May 2022:
| | BALANCE | CHANGE FROM PRIOR MONTH |
| ASSETS | | |
| Cash, Checking, Savings | $109,992 | $95,046 |
| Investments | $1,116,368 | $166,260 |
| Home Equity | $0 | ($109,910) |
| LIABILITIES | | |
| Credit Cards | ($4,255) | $73 |
| Misc. Other Debts | ($20) | ($20) |
| NET WORTH | $1,222,085 | $151,449 |
Some big changes here as a result of selling our home. Let’s check out each individual category:
Cash, Checking, Savings
This consists mostly of our 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. Our emergency fund grew substantially in May, as we have decided to keep about 2 years worth of living expenses in some form of savings.
We anticipate having a baseline budget of about $50,000 for the next few years, so we stashed $80,000 in savings and purchased $10,000 each in Series I savings bonds. At a current interest rate of 9.62%, that was a no-brainer. The interest rate is tied to inflation, so as long as inflation stays high we will likely buy more of these when we are able to in 2023, building a sort of I-bond ladder.
Investments
With the rest of our sale proceeds, we topped off our IRAs with $6,000 each and plowed the rest into our taxable brokerage account at Schwab. All told, we contributed almost $159,000 to investment accounts in May. The S&P 500 was actually down about 0.2% in May, but we made $7,200. How does that work?
In short, we got lucky. While the market continued its tumble into mid-May, we closed on our home sale and invested the proceeds immediately – which just so happened to be right before the market made a slight rebound in the back half of the month. We certainly didn’t try to time the market that way, and only time will tell if that is the true market bottom. If so, we got very lucky.
Home Equity
No more home = no more home equity. With some quick math, you can see we did pretty well on the sale of our home. Great time to be a seller, especially when you don’t have to buy another home in the current economy.
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. I’ve started to collect entry fees for fantasy baseball, which will be paid out to the winners after the season.
Expenses
Here’s a look at our expenses for the month of May:
| EXPENSES | Budget | Actual | (Over)/Under |
| Home (mortgage, property taxes, maintenance, etc.) | $1,114.27 | $2,759.60 | ($1,645.33) |
| Utilities | $122.50 | $463.60 | ($341.10) |
| Automotive | $350.77 | $629.67 | ($278.90) |
| Groceries | $300.00 | $325.58 | ($25.58) |
| Dining Out | $116.67 | $660.48 | ($543.81) |
| Health & Beauty | $337.50 | $773.46 | ($435.96) |
| Cell Phones | $41.67 | $184.03 | ($142.36) |
| Travel & Entertainment | $1,386.67 | $952.27 | $434.40 |
| Pets | $110.83 | $466.07 | ($355.24) |
| Merchandise | $141.12 | ($1,042.94) | $1,184.06 |
| Other Expenses | $561.33 | $335.29 | $226.04 |
| Total Expenses | $4,583.33 | $6,507.11 | ($1,923.78) |
Over budget pretty much across the board. With our lives in complete flux, I can’t say I’m surprised. Let’s see if we can make sense of it by taking a look at individual categories:
Home Expenses & Utilities
We made our final mortgage payment for the foreseeable future, as well as paying property taxes prorated for the portion of the year we owned our home. Fortunately, we received credits for the prorated portions of HOA dues and homeowners’ insurance we paid up front.
On top of that, this year’s budget is built differently than in the past…previously, I averaged all expected costs over the course of the year so that most months we should come in under budget, while in May and October we would be over when our property tax payments were due. Since we sold our house and are spending more time traveling later in the year, we’ve significantly decreased our housing budget for the year. This spending is also obviously frontloaded towards the beginning of the year.
Utilities exceeded the budget as well, as we paid our quarterly trash/recycling bill and continue to close out our various utility accounts. Our closing costs also included $115 for our estimated final water/sewer bill to the city, which will be applied to the actual bill after they read the meter.
All in all, we were over budget in May, but housing costs should be almost $0 for the rest of the year. I’ve included the cost of accommodations on our trips in the Travel budget.
Automotive
We spent about $450 on gas alone in May, mostly a result of the 2-day drive from Minnesota to Florida. The rest of this was renewing our auto insurance for 6 months, though that policy will be cancelled and a new one will be initiated in June when we register our car in Florida. Side note: car insurance in Florida is super expensive.
Groceries & Dining Out
Since we’re not total leeches, we helped pay for some groceries while staying with family in May. We also had to stock the fridge upon our arrival in Florida.
Dining out…yikes. We did spend a little more than anticipated in our last few days in Minnesota, hitting the last few spots on our bucket list before we hit the road. We also took Mrs. FIby35’s parents out to a fancy steak dinner as a thank you for housing us and our stuff.
I’m not quite sure how to handle these categories going forward in our nomadic/homeless life. Since we have no permanent home, should these expenses all fall under Travel? For now, I think I’m going to use the Travel category for when we buy food en route to wherever it is we’re going. Once we’ve arrived at our destination, I’ll resume using these non-Travel food & drink categories.
Health & Beauty
With Mrs. FIby35 quitting her job in April, her insurance coverage through work expired at the end of that month. We added her on to my work health insurance plan in May, which was more expensive for family coverage than what we were paying individually (still cheaper than COBRA though).
Additionally, we made our first premium payment for our new ACA health insurance plan. The application for a marketplace plan through Healthcare.gov was actually pretty simple in my opinion. Since we’re fortunate to not have any significant medical needs at this time, we were able to enroll in a basic Bronze-level, HSA-eligible plan for about $415 per month starting in June.
Cell Phones
As I’ve explained previously, we both have cell phone plans through Mint Mobile that only cost about $15 each per month for unlimited talk, text, and 4GB of 4G LTE data. While working, I received reimbursement from my employer every few months as well. In May, it was Mrs. FIby35’s turn to renew her plan for the next 12 months at about $200 ($180 + taxes & fees) and I received reimbursement for April.
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’ll get $15 (basically a month free!) added to your account and I’ll get a small referral bonus as well. Mr. Rebates is also running a $10 cash back deal that you could use to stack your savings, and Rakuten is offering $5 cash back if that’s more your style.
Travel & Entertainment
The only cost of actual travel we did in May was about $32 to pay the pet fee at the Hyatt House Nashville at Vanderbilt and some food on our drive down to Florida. The pet fee was actually $75 + tax for a total of $82, but Mrs. FIby35 received a $50 statement credit by using her Chase Hyatt Business credit card to pay.
Mini Travel Hack Alert: We booked the Hyatt House Nashville at Vanderbilt using a free night certificate – the actual nightly rate at the time of booking was $256 (plus the pet fee).
We continued to pre-book some things for our Europe trip later this year, making up the rest of the travel expenses this month. We’re still doing well keeping to our budget for the trip, so this is just shifting expenses between months.
Pets
Our dog needed one last annual visit to our vet in Minnesota before we embarked on our travels. We also refilled his supply of treats and heartworm and flea/tick medicine that should last him for the next 6 months or so.
Merchandise
The negative amount here is from all the extra clothes and travel items returned in May that were purchased in a previous month. I’m hoping this category stabilizes now that we have nowhere to store any additional stuff.
Other Expenses
Other expenses included random things like postage stamps and a 2-year subscription for VPN to use in our travels. Oh, and the cost of a locksmith after we locked ourselves out of the house in Florida ($165). Won’t make that mistake again.
Conclusion
Parallel to the stock market, May was a rollercoaster for us. We had plenty of ups (home sale + big cash infusion + freedom to pursue our dreams) and a few downs (S&P 500 performance + additional/unforeseen spending + leaving the house we loved). Such is life. While it was hard to leave our home for the final time, we discovered that we really didn’t miss any of the possessions we discarded along the way. We feel lighter, more free to choose our path on our own terms. Each life decision from here on out can be made with extreme intentionality – or none at all, if spontaneity strikes us at that particular moment.
While quitting our jobs has allowed us more time to pursue our interests, we’ve noticed there still just isn’t enough time in the day to pursue all of them! Patience is needed, I suppose. For now, we’re enjoying our new-found freedom (and warmer weather) and looking forward to spending more quality time with our family, friends, and each other.
More updates to come!
How was your May? Leave a comment below!
