February 2017 update

My February net worth was only down about $1,000, which is notable because my total net income was $1,100 and I paid a large grad school tuition bill. I anticipate my net worth going down 1.4% from December 2016 to December 2017 and so far it is up 0.2%, which is on schedule.

It’s been really fun watching my investments so far this year while I’ve been with minimal income. So far, 2017 has seen a good run in the stock markets and that has catapulted my investments over $300,000, which is notable because that means a 4% SWR would allow me to withdraw $1,000/month, which is a lovely round number! My expenses in February were low enough that the current allowable 4% SWR would cover 53% of my expenses!! That’s the highest % I’ve seen yet, so I’m quite excited! The previous high was 28.3%.

2017-february-4-expense-coverage

Action items

I set monthly goals in my planner and then check in on them at the end of the month. I started doing this in 2016 and it has been great! They’re a mix of action items and routines I want to cultivate.

We prepared our tax return, figured out how much we owe, and calculated the split. We had one final bit to double check (which I’ve fixed as I write this), so we’ll file the return in March.

In January and February, I only went to 5 barre classes each month. This is bad because I have a bunch of punch cards that expire in May. I’ve made a personal challenge for March to go to 14 barre classes – 3 classes per week. We’ll see how this goes! If I can stick to a 3 day per week schedule, I should use up my already paid for classes  before they expire. (So far, as of writing this on March 6th, I’ve been to 3 classes, so I believe in myself!)

We picked a cake vendor for the wedding reception and paid that deposit in February, so it looks like we should have a few months of no wedding expenses, which will be nice. And now I’m looking forward to delicious cake!!!

Cash flow

I’m managing my personal cash flow right now by keeping three savings accounts: one for grad school tuition, one for living expenses covering the remainder of 2017 and then one for living expenses in 2018 which will simply turn into cash reserves if when I end up with a paying full-time job again. I have an automatic transfer of $1,500 on the 1st of every month to the joint checking account to cover my half of the expenses. I then take any extra money out I need to cover expenses as needed rather than transferring out a fixed amount. The grad school savings account is on track and the 2018 living expenses account is currently empty. The 2017 living expenses account had $24,105.55 in it at the end of February, when it should have $31,115.85 in it to get through the year. I’m anticipating deferred compensation income from my former employer in Q1 and a small personal income tax refund that will cover this difference with a small bit leftover to go into the 2018 savings account. I do have another $20,548 in Series I Savings Bonds that I could cash in and another $16,000 in Vanguard taxable index funds.

My goal is to pay for my half of the wedding reception out of my $36,000 budget for the year. $18,000 of that is the joint spending plan, which leaves $18,000 for personal spending. I estimate there is $10,796.32 left for me to pay for the wedding reception, which leaves me with $3,616.55 remaining for personal spending with ten months remaining in 2017. That’s definitely going to be a bit tighter than I’m used to, so I’m going to keep an eye on things as the year goes on.

Personal spending

Totaled at $187.12! I’ve been following Cait’s Mindful Budgeting Program and the best money spent each week was:

  1. Dinner with a friend
  2. Coffee with a friend / A dress for our wedding reception (eee!) / A product I bought per the recommendation of my dermatologist that quickly made a difference!
  3. Getting my eyebrows waxed – I really love the person I’ve been seeing for years now.

Notice a pattern here? I do! I probably would have also written the tasting fee for the cake vendor we ended up picking because it was SO delicious!

I have to say, it is really lovely not having the mortgage payment each month!

Joint spending

Our spending was pretty simple this month! In reviewing this though, I realized I forgot to set up the auto bill pay for the HOA dues, so we didn’t pay those in February… We’ll just end up double paying in March to compensate. This is a huge part of why I am not a fan of monthly budgets and prefer annual ones – the months can be so variable.

  • Entertainment: $42.68 for Lightroom, Netflix, Spotify Family, and Pandora
  • Groceries: $503.70
  • Restaurants: $103.87 – this is two outings.
  • Electricity: $93.73 – this is super low because I had prepaid a bit in December.
  • Housecleaning: $220
  • Travel: $261.55 – miscellaneous costs for our weekend trip in February
  • Miscellaneous: $72.64 – a blanket and something else
  • Total without reception: $1,298.68
  • Reception: $2,127.72 – one cake tasting fee, DJ deposit, my wedding dress (under $400!), and cake deposit
  • Total with reception: $3,426.40

I prepaid Comcast in December, so we didn’t pay them in February. No gas fill-ups this month either.

Readers, how was your February? Do you track how much of your spending would be covered by your investments?

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9 thoughts on “February 2017 update

  1. One year ago I retired at age 59. You mention tracking spending… I have been tracking my spending for the past 4 years. It is cumbersome, but vital to know where the money goes. If I did not know how much I was spending I couldn’t realistically say I could retire.
    As for how to live off my investments, I forecast my spending based on my historical spending pattern. Then I subtract my pension. The remainder must come from investments.

    • Congrats on retiring last year! That’s exciting :) It is so, so key to know where your money goes. How else will you know how you’re doing and whether you can live the life you want? It sounds like you have a sound strategy.

  2. Nice! My February was not so cheap with travel expenses. However, splitting it up between January (plane tickets) and February (hotel + food) made it not so bad. I did break my clothes buying ban already (so terrible at this, LOL) as I needed some new capris for warmer weather. Oh well. Minimal personal spending on anything else.

    • Hah, yeah splitting it up does make it not so bad. We paid for the hotel and plane tickets in January and then February was just transit and food.

      I’m operating on a “clothing whitelist only” year instead of a “clothes buying ban”. It seems to be working better for me than telling me I can’t buy any clothes! This way, I’m choosing to only buy the ones off the list. I’m so thankful I built up a closet with a variety of sizes in it and didn’t purge all of my old clothes because now a variety of things fit that I might have purged! The winter sweaters from 10+ years ago are in terrible shape and I doubt they will ever fit though…

  3. I like your chart on what 4% covers over time! We are not explicitly targeting FI any time soon. I don’t chart it, but I do track how close we are to FI based on investible assets and target yearly spending w/out mortgage. We have a long way to go, but it makes the numbers more meaningful :)

    • I actually included the mortgage in the expenses part of the chart, for motivation to pay it off haha. I agree that these charts make the numbers a bit more meaningful. It’s nice to see the progress even if it’s a long ways off!

  4. Your meticulous tracking amazes me. February was pretty low for me, aside from some outrageous (imo) spends on wedding invitation stuff. For the next few months, the spending will be quite irregular with an upcoming expensive trip, and more wedding costs. I prefer to track annual spends because of so many ebbs and flows. I also like using Mint’s budget feature, and configured it so the monthly surpluses/debits roll into the following month. It really helps me understand where I’m over/underspending. For instance, we spend on restaurants wayyyyy less than I forecasted. What we overspend on? Home supplies from Amazon. Who knew?

    Also, I need to hear more about this wedding cake :)

    • Heh yep I am pretty detail oriented. I’m also being extra cautious with my spending at the moment with my lower than usual income.

      We decided to (mostly) skip the paper invitations and instead do online invitations except for people who don’t have internet. It should be a huge cost saver. All those finicky invitation pieces and the postage and the return postage just seemed unnecessary to us. Our splurges are pretty much the dinner and cake.

      I have a column in the joint budget spreadsheet that shows how far into the year we are and how much of the annual budget has been used. There are a lot of large expenses like insurance, property taxes, condo fees, etc. They’re almost regular in that there is one most months!

      My kryptonite? The fancy grocery store. Everything is just so delicious. At least it keeps our restaurant bill down!

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