January Net Worth Update

2018 is finally here.  We’re approaching my favorite time of year from a financial standpoint.  In February my wife and I both get our annual bonuses and in March we get our raises for the year.  Along with those, we usually get some amount of money back from our taxes (although I try to minimize that) and we also get our credit card reward certificate from our Costco Citi Visa.  It turns out I’m a fan of easy money.

Our net worth continues to increase on a monthly basis and I continue to be absolutely amazed at how much it’s going up month over month.  I keep saying that this can’t go on forever and I truly believe that, but we’ll take it in the meantime.

Our new net worth figure is $1,645,008.  I really love using two commas!  That’s an increase of $55,887 in a little over a month.  (I think the Nov figure on the sidebar was late November).  I still can’t believe we’ve gotten our net worth to this level.  Not bad for a lower middle income kid who has paid his way through life with very little assistance. (Acknowledging I had a happy, safe childhood where we always had food on the table, even if it was hot dog casserole now and then.)  Looking back at January 2017, we had a one year overall increase of about $330,000. WOW That’s just crazy!  That’s far more than we made in the year at our jobs, that’s for sure.  Money really does make money.  No wonder the truly wealthy have it so easy!

Obviously the next milestone I’m looking for is the $2M in net worth.  That’s a ways off but it’s the next big one for us.  I’ll be 47 this year and so I’m thinking more and more about when I can pull the trigger on early retirement.  There are a few driving factors for this.  I want to have at least $2M in cash/investments before we pull the trigger.  I also want to have my daughter through at least her 4 year college degree (We’ve been saving in a 529 plan all along), and I want to make sure I’ll be eligible to take a small pension (About $1300 a month at 55) before I retire.  It makes the most financial sense for me to work until I’m 55 so that I can start drawing the $1300 a month in pension and also withdraw funds from my 401k account.  Our company’s plan is a qualified plan so if I separate from the company at 55 or older, I can immediately draw funds from it without a penalty.

I really don’t want to wait until I’m 55 to retire though.  The one other potential path to leaving before I’m 55 and still getting to draw the pension at 55 is if I’m laid off between the age of 49 and 55.  Since I work in Information Technology that isn’t really a far fetched scenario but I’ve been a high performer up to this point so I don’t think they’ll likely want to lay me off any time soon.  I suppose I could really start acting incompetent at about age 49 but I really don’t want to do that.

Anyway, lots to sort out over the next few years.  Until then we’ll just keep pushing along the path.  So far I can’t complain about the results.  Here’s to a happy prosperous year to all of you!

Crazy Co-workers and Their Spending Habits

There I was, sitting at my desk in my company’s office building at 5:50 in the morning, two weeks before Christmas, slowly trying to wake up while reading and responding to emails that had come in overnight.  I usually get in to the office at 5:30 in the morning to miss the ridiculous traffic that starts to really build by 6:00 am.  The office is pretty much a ghost town at that hour, although there are about 5 other people spread across the 3rd floor of the building at that hour as well.  Two of those people actually sit on the other side of the cubicle wall from me and I can’t help but hear their daily conversations.

That morning their discussion was centered around Christmas gifts and what they wanted to receive.  Bob, who is about 40 years old and married with one child, was telling Jason that he really didn’t need anything for Christmas because he usually bought everything he wanted during the year.  “I’ve got to think of something”, Bob said.  “My wife keeps asking me what she should buy me for Christmas and I don’t know what to tell her.  I was thinking I’d tell her to buy me an Ipad Pro with the large screen, even though I already have two other regular Ipads.”

I couldn’t believe what I was hearing.  Bob was considering telling his wife to spend $800 on an electronic tablet that he didn’t need, just to get her off his back.  Previously I’d heard Bob mention that they were tight on their bills and were having trouble putting any money away for their retirement.  It’s not hard to see why, when hearing things like that.

Fast forward 3 weeks to another early morning sitting in cubicle land.  I heard Bob tell Jason that indeed his wife had bought him the Ipad.  I just shook my head and went back to focusing on my emails.  I won’t miss sitting there early in the morning listening to them when I retire long before they do.