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December 2015 Goals and Financial Update

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Happy New Year! I hope everyone gets a holiday to sleep off the hangover from that huge party last night. 😀 As usual, we were tired out and went to bed early. Somehow, a short week is always harder than the regular weeks.  I know, we are a bit boring, but we’re heading to Mt. Hood to play with the snow on New Year’s Day so we need our rest. Anyway, 2015 is over so let’s see how I did with my New Year goals and December cash flow.

2015 Goals

Invest $50,000 in our tax advantaged accounts (Done!!!)

We did it! We invested $54,873 in our tax advantaged accounts. Woohoo!!! Another year with over $50,000 invested in our tax advantaged accounts. I wasn’t sure if we’d be able to save much after I quit my full time job, but we have been doing very well so far. Mrs. RB40 is still working so we have been able to continue saving a substantial amount. When she retires in 2020, we’ll drastically reduce our saving rate.

Surpass $50,000 in RB40 Junior’s 529 account (Fail – progress at 91%)

My parents footed most of my college education bill and I’m extremely grateful. I was able to start saving and investing right out of school and didn’t have to worry about debt. I want to do the same for our son so we have been contributing to his 529 account. This year we contributed $4,800 ($400 per month.) This is less than previous years because I found out about the student loan forgiveness programs. We’ll continue saving, but probably not more than $400/month.

RB40jr currently has $45,592 in his 529. The domestic and international stock markets did not do well in 2015 so we didn’t make as much progress as I’d hoped. I’m pretty sure we can beat this goal in 2016, though.

Generate $10,000 from our dividend portfolio (Done!!!)

Yea! This is another huge milestone for us. It feels great to reach 5 figures in dividend income. This year we received $10,508 in dividends. Next year, we’ll raise the bar to $11,000. Kinder Morgan already cut their dividend and others might follow so we’ll see how it goes. The plan is to build it up to $15,000 by 2020 when Mrs. RB40 retires.

Exercise 120 times (Fail…) 🙁

Going to the gym 10 times per month didn’t sound so difficult when I made this goal. After all, I used to go 15-20 times per month when I was working full time. I usually went to the gym at lunch and ate at my desk afterward. Ironically, it’s a lot more difficult now that my schedule is more flexible.

I usually go to the gym with RB40Jr because they have a childcare facility there. However, the hours are a bit weird. The childcare is closed from 1 pm to 4 pm. Also, I can’t really go in the evening because I’m spending time with the family. So the only time slot I can go is in the morning. When RB40Jr is at preschool, I use that time to work on the blog, run errands, and do a few things around the house. So we can only go on Thursday, Saturday, and Sunday morning. Inevitably, someone would be sick or we need to do something else. Anyway, the gym isn’t working out (ha ha…)

For 2016, I got a fitness tracker and will just focus on elevating my activity level instead of worrying about the gym. Let’s just put this behind us and move on to 2016…

Try 6 new restaurants in Portland (Done!)

This was a great goal for us. It forced us to try new restaurants instead of just going to our old standbys. We found some great spots (3 out of 6+) and will make it more challenging next year. My goal is to try 6 new great restaurants! We’ll need to do a bit more research and perhaps eat out a bit more. 🙂

Oh, if you happen to be in Portland and like Cuban food, I highly recommend Pambiche. The food is awesome and it’s not too expensive.

Visit a foreign country (Done!)

We visited Costa Rica in September and had a great time. This was the first time RB40Jr traveled internationally and he did pretty well. Next year, I want to take an extended trip to Thailand so we can visit my dad and my extended family. If time permits, we’ll also drop by Angkor Wat for a few days. We’ll see if I can make it work.

2016 New Year Goals

All in all, 2015 went pretty well. I’m pretty happy that I accomplished most of my goals. Updating those goals every month really helped. The two failures were tough losses, though. RB40Jr’s 529 and fitness are very important to me. We’ll try again in 2016 and work on them more consistently. By the way, I already posted my 2016 New Year goals. Check them out and let me know what you think. They are modest goals and I should be able to complete most of them.

Net Worth (+14% in 2015)

After a year of bouncing up and down, the S&P 500 ended up about where it started. Our stocks and bonds portfolio didn’t fair so well in 2015. A sizable portion of our portfolio is invested in developed international markets and emerging markets. Those markets performed poorly last year, particularly the emerging markets. Anyway, this portion of our investment didn’t gain much in 2015.

track your net worth Personal CapitalSo I was surprised that our net worth increased nearly 14% even with the lackluster stock market performance. It turned out that our real estate investments did quite well in 2015. Portland’s real estate market is sizzling hot and that made a huge difference. You can take a look at our Annual Net Worth Update if you’d like more details.

If you need help keeping track of your finances, try using Personal Capital to manage your portfolio. Also check out their fantastic retirement calculator. You can read my review here – The Best Free Retirement Calculator.

December 2015 cash flowCash Flow

Take Home Income (target > $5,000)

Wow, December was a crazy month for us. Our rental income was dismal because we installed hardwood flooring and made a few repairs at our duplex. My online income was also quite a bit lower than usual. However, my High-Tech Antitrust settlement check arrived just in time to save the month. Check it out.

Mrs. RB40’s Paychecks: $6,026.

Rental income: -$5,408. We paid for the hardwood flooring installation and a few other minor fixes. I think we’re done with  renovations for at least 6 months. I’m thinking about putting a clear PVC roof over the backyard deck, but that can wait until the summer. Anyway, 2016 should be much better because the rent is a little higher now.

Online income: $862. Online income was much lower than usual in December. I will break down the online income and expenses in our monthly newsletter so if you’re curious, sign up with our email list.

Dividend: $1,244. Our dividend income was quite nice in December. I will update the dividend portfolio post soon.

Interest: $2. The interest rate is quite low so this will be small in the foreseeable future.

P2P lending: $50. Our ROI is holding stable at 8%. That’s not bad at all. I don’t have to do much for this account and it is making much more than our saving accounts. The fund here is not very liquid, though.

Misc income: $7,132. Woo Hoo! My settlement check was for $7,000! That was a great windfall just when we needed one. The rest was from gifts and $12 gain from Kickfurther.

Expense (target < $4,500)

I think we did okay with our expenses in December considering it was Christmas.

Housing: $2,256. Mortgage, HOA, and property tax.

Cash Allowance: $0. We had cash left over from our Costa Rica trip so we didn’t need to make any cash withdrawals.

Groceries: $387. This is a bit lower than usual because we were gone for 6 days during Christmas.

Child/Dependent: $631. Preschool and new shoes.

Healthcare/Medical: $293.

Entertainment: $50. Gym membership fee.

Misc: $343. Christmas gifts and an annual membership fee at OMSI (science museum.) We also went to see Star Wars! That was a lot of fun.

Transportation: $170. We drove to my brother’s home in the Bay Area to spend Christmas with family.

So that’s it for 2015. Now, it’s time to look forward to 2016 and keep working on building wealth and happiness. Good luck on in 2016 everyone!

Did you have a good 2015?

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{ 18 comments… add one }

  • Ernie Zelinski January 1, 2016, 2:49 am

    Good luck to you too in 2016!

    You ask, “Did you have a good 2015?”

    Yes, in many ways. Although I had my best year ever for pretax income, and my net worth likely increased the most in any year ever, let me share one more event just as important:

    I drank some great wine for the first time in 2015. One was Mollydooker Boxer Shiraz, which I discovered with my financial advisor friend (Jim Seyers from ScotiaMcLeod) at The Keg restaurant in Toronto in September: It is available in the US too:

    http://www.wine.com/v6/Mollydooker-The-Boxer-Shiraz-2012/wine/125946/Detail.aspx

    Another favorite wine I drank more than once in 2015 was Tridente Tempranillo:

    In short, nothing adds as much to having had a great year as having had drunk some exquisite wine with great friends while dining on food fit for a kings and queens. Perhaps I am overdoing it with the wine and food — but I always keep these words of wisdom in mind:

    “To safeguard one’s health at the cost of too strict a diet is a tiresome illness indeed.”
    — François, Duc de La Rochefoucauld (1613-1680), French writer

    • retirebyforty January 3, 2016, 7:42 am

      Congratulation on a great 2015!
      I love great wine too, but rarely have the opportunity to have some.

  • Tracy @ Financial Nirvana Mama January 1, 2016, 6:53 am

    Great job on your progress!! Happy New Year Joe. And Yes, I had a great 2015, lots of life changes including quitting my salary job, starting a blog and branching out my investments – thank you so much for your inspirational posts.

    • retirebyforty January 3, 2016, 7:45 am

      Congratulation on a great 2015! That’s a big change and good luck in 2016!

  • Sandy Wetzel January 1, 2016, 12:37 pm

    Happy New Year and thank you for your blog. It has motivated me to get going on my investments, even though we retire in 2 years — never too late!

    • retirebyforty January 3, 2016, 7:46 am

      Good luck in 2016!

  • Investment Hunting January 1, 2016, 4:42 pm

    Looks like 2015 was a fantastic year for you. Investing $50k in one year is a great goal to achieve. I actually set this same goal but missed it by a few thousand dollars. Best of luck in 2016!

    • retirebyforty January 3, 2016, 7:47 am

      Investing $50k is a big accomplishment for us. We just need to keep it up for the next 5 years and I think we’ll be in a very good financial position. Good luck in 2016!

  • Sam @ Financial Samurai January 1, 2016, 5:15 pm

    Let’s get that online income up and thriving for 1Q2016! Hope you got my payment for being an affiliate of my 2nd edition book on severance negotiations. Thanks for the support! I should look to find additional partners in 2016 as well. Things are gonna be a little dicy I suspect this year.

    HNY!

    Sam

    • retirebyforty January 3, 2016, 7:50 am

      I got the payment. Thanks! I think the next few years might be dicey, but we’ll keep working on it. Hopefully, we won’t backslide too much.

  • Smart Money MD January 1, 2016, 6:10 pm

    Happy New Year! I’m itching to see how your rental income builds in 2016. Should be good!

  • Chuck January 1, 2016, 7:32 pm

    Happy New Year and congrats on the successes in 2015. We had a really good year and it’s looking like 2016 will be even better.

  • Mr. Tako @ Mr. Tako Escapes January 2, 2016, 12:55 am

    Hi Joe, congrats on a successful month. (I consider any month successful when there is more coming in than going out)

    I’m curious about your real estate investments. What kind of cap rates do you realize after maintenance, renter turnover costs, and upgrades? West coast cities are pricey and often hard to realize reasonable cap rates. I was wondering what the reality was like.

    • retirebyforty January 3, 2016, 7:53 am

      Thanks! We had a few close month in 2016, but we did well overall. Let’s hope things are smoother in 2016. 🙂
      The cap rate is not good.The duplex is cash flow positive because we did a 1031 exchanged and that resulted in a big down payment. I think the down payment was around 60% of the price.

      • Mr. Tako @ Mr. Tako Escapes January 4, 2016, 5:48 pm

        That’s a fairly normal leverage ratio for residential real estate. Slightly higher than some of the best public apartment REIT’s. Typically they’re funded at about 50% cash 50% debt.

  • DC @ Young Adult Money January 3, 2016, 9:34 am

    Socking away $50k+ in your tax advantaged accounts is huge! Truly inspiring. This is also great -> “My parents footed most of my college education bill and I’m extremely grateful. I was able to start saving and investing right out of school and didn’t have to worry about debt.” My parents helped a bit with college but I still have loans. My wife’s parents didn’t help at all and it’s really impacting our finances and forcing us to work a lot harder than if we had help. I vow to pay for my kid’s college education, even if it means putting off having kids until our income has increased and we’ve wiped out more (all) of our debt.

    Here’s to a great 2016!

    • retirebyforty January 4, 2016, 8:20 am

      Good luck in 2016! Having no student loan debt was huge. We could start saving right away and it paid off 20 years later.

  • Murali January 13, 2016, 10:00 pm

    How do you make online income of $750/month, would like to know..

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