Progress to Freedom 35: 2016 Q1 Update
Been too busy having fun to keep up with financial housekeeping (ok we got lazy), but catching up now with a belated post outlining where we stood financially at the end of March and how we were doing relative to our goals. We’re working on changes that might greatly affect these numbers, so it’s nice to capture this snapshot for posterity.
We averaged ~$5,300/month in spending during the third quarter of the year. Broken down by category, that money went to:
- Home – 59%
- Travel – 1.5%
- Food & Dining – 5%
- Kids – 25%
- Auto & Transport – 4%
- Bills & Utilities – 3%
- Health & Fitness – 1.5%
- Other – 1%
We’ve been tracking our monthly expenses separately and won’t go into more detail here. The increased expenses are mainly due to our semi annual property taxes coming due. Taxes, you win some, you lose some…
Q3 2015 Average Monthly Income: ~$23,900
We’ve been front loading our 401k and thus having minimal taxes withheld this quarter, making our after tax income look artificially high, we’ll take it. We also got a large tax return from last year due to a couple of optimizations; we tacked that onto income this year for simplicity of accounting. Taxes, you win some, you lose some…
We were doing some serious house cleaning, de-cluttering, and minimizing, and ended up selling some stuff we no longer wanted nor needed and made ~$750 in the process. Yay for Spring Cleaning!
At the end of the first quarter:
- Total Net Worth: ~$917,000
- Net Investable Assets (excluding home equity): ~$788,000
Our net worth increased ~$42,000 since our last quarterly update. Based on the numbers above, this means we saved ~$55,000 during the past quarter and suffered $13,000 in investment losses. Markets took a beating and then closed positive for the quarter, however currency fluctuation took a toll on some investments we still have lying around in the old country; on the plus side, that had us entertaining the idea of spending time up north and taking advantage of said currency exchanges, this led to “fun” research still to be completed.
Progress To Freedom 35
YTD Savings Rate: 78%
We aim to maintain a >75% savings rate. We have had a stretch goal to achieve >80% but it seems like this is very much a stretch goal and are having a hard time finding areas to cut our spending – if you have any suggestions based on our monthly expense report, we would love to hear them!
Financial Independence Target: Q1 2018
The DJ is conservative and considers a 3% withdrawal rate safe, which means we’d have to wait over five years before retiring. The MC is ok with as aggressive a withdrawal rate as 5%, which would put us ahead of target to retire by 35! If we split the difference and go with the popular 4% rule, we are less than three years away.
Projected retirement date at 3%: May 2022
Projected retirement date at 4%: Sep. 2019
Projected retirement date at 5%: Jan. 2018
We were behind (at the end of last quarter)!