Author Archives: Mom

About Mom

A family of three living in the Pittsburgh area. We both work full-time and work on raising our daughter.

Detailed Financial Picture – January 2016

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December’s Numbers

I hope everyone had a nice holiday season and the financial “hangover” isn’t too bad.  We paid for anything up front, so no extra debt for us for the holidays!

As of January 6, 2016, we are $321,071.86 in debt with a mortgage.  We currently have $905,408.00 in assets.  Our investment accounts are at $488,831.28. Our Net Worth is $584,336.14, down from $592,278.09 last month (1.34% decrease)

This month was not so great on the investment front, which really impacts our net worth.  I also updated our car values, neither of which decreased significantly from about 6 months ago.  Both cars are “above water”, so we could sell them at any point really if we needed to.  We have no plans to, so it’s not that important.

Daughter Person started a new daycare on January 4.  It’s slightly more expensive now ($175/wk vs $160/wk), but the center busses to and from her half-day Kindergarten program that she’ll start in August/September, and we felt it was important for her to meet her teachers and new friends first rather than change everything at once. It’s also about 10 miles closer to us, so Dad won’t be driving as much.  I’m probably going to start driving the Camry to and from work on a daily basis because I have the longer drive now, but Dad really likes the Camry and doesn’t particularly like driving the RAV, so there’s still some debate.

I’ve put aside quite a bit of cash for our Disney vacation coming up in a few weeks, so I didn’t pay as much down on the line of credit.  I suspect I’ll be making another payment with what we didn’t spend on vacation once we get back and assess the damage.

Debt (in the order we’re paying it down):

  • Line of Credit (8.75%): $3,000 (-1,000.00)
  • Car loan – RAV4 (0%): $7831.18 (-489.44)
  • Car loan 2 – Camry (0%): $23,722.20 (-439.30)
  • Mortgage (3.875%): $289,518.48 (-488.66)

Total paid off in December:  $2,417.40

 

2015 End of Year Investment Income

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Fidelity (and most of Vanguard) have posted their end of year distributions this weekend, and after adding all of ours up, over multiple accounts: We’ve “earned” $10,850.60 in investment income this year – with most of it ($6521) in December.  We’re primarily invested in total stock market funds, and those generally dump all their goodies at the end of the year.  We do have about 18% bonds in our tax-advantaged accounts and they earn us about $100/month throughout the year.  Most of this money is in tax-advantaged accounts and  “untouchable” for us, but our taxable account generated $138 in dividends/capital gains this year (almost 100% FSTMX).

If my goal was to live completely off dividend/capital gains income, we’d need about 3.4million in the bank based on this year’s income.  But, if that was my goal, I wouldn’t be as heavily invested in equity index funds, and instead would have more money in bonds, which throw off more reliable income.

Still, $10k in almost completely passive income isn’t much to sneeze at – that’s about 2 months worth of living expenses for us.

How did your investment income do this year?  Did it increase as you wanted it to?

Detailed Financial Picture – December 2015

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November’s Numbers

As of December 8, 2015, we are $322,489.36 in debt with a mortgage.  We currently have $914,767.35 in assets.  Our investment accounts are at $493,010.04. Our Net Worth is $592,278.09, up from $587,477.65 last month (0.82% increase)

Dad got an almost $4000 bonus this year, and we used that to cover our interim property taxes (the mortgage company did an early escrow analysis and sent us some money, but about $1800 short), and pay more off the line of credit.

I’ve switched to making minimum payments on the cars in order to use some of that money elsewhere.  It’s only about $100, but it can pay off the line of credit faster, and the line of credit has interest, the car loans don’t.  The amounts this month are slightly lower than the actual minimum payment because I had “pre-paid” so much previously by rounding up the amounts.  So, next month, we’ll be paying more on the cars.

We’ll likely pay off the cars “on schedule” according to the loan agreement, but I can’t get really excited about paying off a 0% loan early when that money could be going to investments.

On the plus side, the line of credit is scheduled to be paid off February 2016, so I’m looking forward to that.  December is a three paycheck month for Dad and so I can spend that extra paycheck on the line of credit in January.

Next month, I’m going to be re-valuing the cars as well through KBB, so I expect to see a drop in net worth from that.  Hopefully, the surge of HSA money we get in January from Dad’s company will make up for some of that.

Debt (in the order we’re paying it down):

  • Line of Credit (8.75%): $4,000 (-1,600.00)
  • Car loan – RAV4 (0%): $8,320.62 (-429.38)
  • Car loan 2 – Camry (0%): $24,161.50 (-388.50)
  • Mortgage (3.875%): $290,007.14 (-487.09)

Total paid off in November:  $2,904.97

 

November 2015 Early Retirement Progress

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We contributed $4,848.32 this month to our retirement accounts, and we gained a whole $806.40 in investment value this month. At least it wasn’t a loss.

We’re probably not going to make it to our goal of 70k for 2015, but we’ll be pretty close, and if we had spent more carefully while moving, we might have made it.  We’ll be contributing just over 66k into our accounts (not including the 529 we have for Daughter Person) for the year, which I think is pretty impressive, but only about 30% of our gross income.  I’m hoping that next year, we’ll be able to contribute more because we’ll finally be done with the moving and settling – and once the deck and patio are put on the house, there won’t be any (planned) major expenditures in the near future).

2015 Totals

In 2015, so far, we’ve contributed $60,364.88 (86.24% of our goal of 70k), and we’ve gained $7,569.76 in investment value (31.70% of our planned total).

Property Tax Fun

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Our house is new construction, and we were warned by the sales guy for the builder about interim taxes.  We were also expecting to get billed for the interim taxes *after* we got the money back from our escrow analysis for this year (expected April/May).  It didn’t quite go down like that.

Mortgage companies don’t pay for interim taxes.  Since we have new construction, and the property hadn’t been assessed at the time the tax bills went out, we paid taxes on the unimproved land amount (about $200).  But, we own improved land with a house on it, and the county comes by to re-assess the property once the deeds are filed and they get off their asses to do so.  We had gotten the 2016 assessment back in September, and know what we’ll be expected to pay (more or less) next year.

On Thursday, I got a letter letting me know that the county assessed our house in 2015 for interim tax purposes (at more than our 2016 estimate?).  On Friday, I got three bills from the local tax collector: one for 2014 school taxes (2 months worth since they’re on a fiscal year of July-June), one for 2015 school taxes, and one for 2015 borough taxes, totaling about $8.5k. Not having that money easily accessible and deciding to borrow from our line of credit (again) to cover us until we got the expected escrow analysis in April, I moved money into our checking account and wrote the checks (yes, they had to be three separate checks).  I had until January 19, 2016, but I figured I’d rather take the tax deduction this year rather than next.  So, I put the checks together, put them in an envelope to mail off this morning (Monday).

Monday mail arrives, with the escrow analysis and a check for $6.1k.  Now, we only have to cover just over 2k in taxes, which we expect with Dad’s annual bonus in a few weeks.  It’s not that I *like* coming up with 2k out of the blue, but we were kind of expecting this to occur, just not as quickly as it has.  That $6.1k will be deposited tomorrow once we both sign it, and then it will be transferred back to the line of credit so we’re not borrowing quite as much.

There’s still quite a large escrow balance with our mortgage company, and we’re probably going to “owe” them next year for escrow (about $300-$400), but it was nice getting that check now instead of in April/May when it would have been a year since we got our mortgage.  I wonder if the analysis will continue to occur in November or the very large balance in the escrow account triggered the analysis, or if it’ll begin occurring April/May like I was expecting.

 

October 2015 Early Retirement Progress

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We contributed $5,062.46 this month to our retirement accounts, and we gained $26,776.07 in investment value this month.

We’re back in positive investment gains territory (by like 6k), and we contributed a lot this month.  Mostly from an extra $250 I put in my Roth to keep it above the 10k minimum for FSTVX.  I’m almost positive we’ll be within the MAGI limits this year, but that decision could be expensive if Dad gets a significant bonus pushing us over the limits (and rumors are going around that his company did well, so we might get a large bonus 🙁 ).  I’m hoping our HSA, 529 and 403(b) contributions bring us down at least into the phase-out range.

Dad’s retirement plan is changing next year, and we’ll be able to put even more money aside.  Right now, it’s three tiered, 2% mandatory with 5% “match”, up to 10% with a 3.33% match, then up to IRS limits with no match.  The new plan is two tiered: 3% mandatory with 3% “match”, up to IRS limits, with a 1 to 1 match up to 6%.  So, instead of 2% +18k + 8.33% match, we’ll be contributing 3%+18k+9% match.  I estimate we’ll be putting about 2k extra per year into his 403(b)/401(a) plans because of the changes  (mandatory contributions don’t count against the IRS limit of 18k).

With HSA contribution changes, we’ll also be putting more in there next year.  I suspect we’ll be able to hit our 2016 70k goal easily and perhaps a 75k goal – since we’re (hopefully) not moving again, our expenses will stabilize.  We want to put a deck and patio on the house next summer, then we’ll be more aggressively saving towards retirement again.  The HSA is one of the few ways we can avoid PA state taxes on some of our income, so I’m aggressively taking advantage of it.

Not sure I want to contribute to a Roth or the taxable account with extra funds.  With the Roth, we have to keep the funds basically in cash (or invested in our taxable account via dollar cost averaging) until we do taxes and know if we’ll be able to contribute or not.  There are no restrictions on the taxable account vs the Roth, it’s our money to do with as we please.

2015 Totals

In 2015, so far, we’ve contributed $55,516.56 (79.31% of our goal of 70k), and we’ve gained 6763.36 in investment value (28.33% of our planned total).

Detailed Financial Picture – November 2015

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October’s Numbers

As of November 5, 2015, we are $323,794.23 in debt with a mortgage.  We currently have $911,271.88 in assets.  Our investment accounts are at $492,498.51. Our Net Worth is $587,477.65, up from $576,110.21 last month (1.97% increase)

 

We’re almost at half a million dollars in our retirement accounts – as long as there is no major decline in the markets, we’ll get there just with our contributions before the end of the year.

I added another $250 to my Roth as I’m reasonably sure we’ll be under the MAGI this year because we’re contributing so much to our 403(b)s.  That brought me well into the > 10k range for the advantage class fund.  Next goal is to add $2500 to Dad’s Roth to get him up to being able to invest in a mutual fund rather than an ETF.  He never had a Roth before last year (aka this February), and I’m not sure that it really makes sense for us to contribute that much to Roths right now because of our tax levels.  I had one from when I didn’t make much, but that’s been sitting around growing for a while.

We’re steadily paying off the line of credit and once we do, we’ll be saving to put a deck on the new house next summer.  We’re going to be building it ourselves with the assistance of a friend who has built them before, so that’ll save us a lot – and be quite the adventure!

Debt (in the order we’re paying it down):

  • Line of Credit (8.75%): $5,600 (-1,200.00)
  • Car loan – RAV4 (0%): $8,750 (-500.00)
  • Car loan 2 – Camry (0%): $24,550 (-450.00)
  • Mortgage (3.875%): $290,494.23 (-485.52)

Total paid off in September:  $2,635.52

 

Detailed Financial Picture – October 2015

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September’s Numbers

As of October 13, 2015, we are $325,229.75 in debt with a mortgage.  We currently have $901339.96 in assets.  Our investment accounts are at $477,938.09. Our Net Worth is $576,110.21, up from$546,437.20 last month (5.43% increase)

 

The markets have been nicer to us this month: I’m almost back at the minimum 10k needed for FSTVX in my Roth account (without adding anything).

We’re squirreling away some money for medical procedures that we know are happening this year, and maybe above our deductible(?).  So, we’re relatively slow at paying down the line of credit.  But, I’m much happier having our full buffer back.

We’ve spent about $600 on landscaping for the front yard, all of which will come back to us from the builder, but I have no clue how long that will take.  Some simple plants, a lot of mulch and a lot of bricks for lining the flowerbeds.  Only 5 trips to Lowe’s – it was more of a factor of how much we could fit in the RAV at one time than that we forgot things.  But, it’s done and we have an extra bag of mulch for when the plants die and we need to cover them with mulch for the winter.

We’re chugging along otherwise.  I’ve been working on a class that’s taken all of my spare cycles, and it will be over soon.  Then, we’re going to tackle the basement and get it all set up.

We had an HVAC company over a few weeks ago to install our whole house humidifier, and an electrician will be coming tomorrow to install some more circuits in the basement, which will allow us to plug more things in without worrying about tripping the circuit.  Our goal is to spend 30 minutes each in the basement every day/evening until we get things cleared out and put away. It might take a while, but it’ll be completed!

Debt (in the order we’re paying it down):

  • Line of Credit (8.75%): $6,800 (-200.00)
  • Car loan – RAV4 (0%): $9,250 (-500.00)
  • Car loan 2 – Camry (0%): $25,000 (-450.00)
  • Mortgage (3.875%): $290,979.75 (-483.96)

Total paid off in September:  $1,633.96

 

September 2015 Early Retirement Progress

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We contributed $4,804.06 this month to our retirement accounts, and we lost $10,529.49 in investment value this month.

I think this year is going to be negative on interest, but net positive because of our contributions.  We’ve contributed about 30k more than we’ve lost, so we’re still ahead of the game.  So far, October is looking up, but I’m not going to count my money until I sell my investments and take it out of those accounts.

We’re only contributing any cash back to our taxable account for now (and probably until next summer), but it’s been significant – over 1k this year so far.  That will change now that we’re done “moving”, and only pick up again once I start buying things for the deck next summer.   The only reason we’ll be contributing in October is a 2k whole house humidifier that we installed and put on the visa card (because cash back…).

2015 Totals

In 2015, so far, we’ve contributed $50,454.10 (72.08% of our goal of 70k), and we’ve lost $20,012.71 in investment value (-83.82% of our planned total).

Detailed Financial Picture – September 2015

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August’s Numbers

As of September 10, 2015, we are $333,633.71 in debt with a mortgage.  We currently have $880,100.91 in assets.  Our investment accounts are at $458,255.91. Our Net Worth is $546,437.20, down from $579,248.78 last month (5.66% decrease)

This month, our line of credit is making a reappearance.  I got tired and stressed about not having a full month’s buffer in our accounts, so I pulled from our LoC to make one – we expect it’ll be paid in full in December.  I could have continued to float on our credit cards and timed payments to paychecks, but that was getting too stressful, so I stopped it – it’s worth the peace of mind and extra sleep at night to pay a little bit in interest.

The markets have been mean to us this month (along with everyone else), and we’re down 4.95% this month, despite contributing about $4500 to our accounts.  We’re still up 7.61% from the beginning of the year, but that’s all contributions.  We’re just continuing to contribute and hanging on for the ride!  I have one Roth account which has only FSTVX in it (advantage class), and it’s dropped below the 10k minimum, and I can’t add to it until I’ve done my taxes and are sure that I’ll be able to contribute this year 🙁  I’ll probably get a letter from Fidelity soon about kicking me back to FSTMX which has a slightly higher expense ratio unless the markets take a turn for the better.

We’re plugging along on the car payments, focusing now on the Line of Credit, and letting normal payments on the cars continue – at 0%, we still make a pretty good dent every month.

If you’re continuing to pay down debt, how is it going?

Debt (in the order we’re paying it down):

  • Line of Credit (8.75%): 7000 (+7000)
  • Car loan – RAV4 (0%): $9,750 (-500.00)
  • Car loan 2 – Camry (0%): $25,450 (-458.00)
  • Mortgage (3.875%): $291,463.71 (-482.40)

Total paid off in August:  -$5,559.60