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February 2014 Goals and Financial Update

by retirebyforty on March 5, 2014 · 37 comments

in cash flow

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February was really busy and I was exhausted all the time. I guess that comes with being a stay at home parent. I was also a little sick most of the month and was busy with turning over a rental. It’s done and I’m glad that’s out of the way! Anyway, let’s go over our 2014 New Year resolutions first. Reviewing them at the beginning of every month will enable me to see how we’re doing and keep the momentum strong.

1. Invest $50,000 in tax advantaged accounts

We added $10,250 in February. Mrs. RB40 made a mistake on her designation form and contributed twice as much as usual. It’s fixed now so it should be back to normal in March. I had a record breaking month of online income in January so I went ahead and maxed out my Roth IRA contribution.

For 2014, we saved $13,550 so far and we are about 27% toward our goal. 

  • Mrs. RB40 401k: +$2,900
  • My solo 401k: +$1,450 I will break down the business income and expense in our monthly newsletter so if you’re curious, sign up with our email list.
  • RB40 Jr’s 529: +$400
  • Roth IRA: $5,500

2. Generate $12,000 in passive income

We had a light passive income month and made $727 in February.

For 2014, we made $1,921 so far and we are at about 16% to our goal.

3. Get Leaner

I’m trying to get back in shape after 18 months away from the gym and reduce my body fat percentage from 20% down to 17%. I think my scale might not be very accurate. I didn’t make to the gym a few times last month and when I did, I was a bit sick. It was just a busy month and I thought I’d slide back a bit. I just took measurements before sitting down and the scale told me my body fat percentage is 18%. That’s good progress from 19% last month. I’m pleasantly surprised because I don’t feel leaner at all. Anyway, I’ll try to get more good workouts in this month. BTW, I lost about 4 lbs so far.

4. Travel

Take a family trip to Hawaii. We are looking for tickets. The flight over to the Big Island is a direct flight and it’s not too expensive. The flight back is not good though. Most of the flights back get in too late and we’d have an overnight stay somewhere before getting home.

5. Blog Goal

My goal this year is to exceed 120,000 pageviews/month. In February, we had about 97,000 pageviews. A bit slower than January, but we’ll keep working on it.

Net Worth (+1.5% YTD, +2.5% MTM)

I have been too busy to pay attention to the stock market, so it’s a pleasant surprise to see the gain in February. I’d like to see 8-10% increase in our net worth for 2014, but we’ll see how it goes.

If you need help keeping track of your finances, try using Personal Capital to manage your budget and net worth. It can help you keep track of your income, expenses, and net worth, all in one place. Personal Capital is geared for investors and has many great tools. See my review of Personal Capital and how they helped me reduce what I’m paying in investment fees.

Personal Capital helps manage my cash flow, net worth, and asset allocation.

Personal Capital has a great Investment Checkup tool. It will help you keep an eye on your asset allocation so you don’t drift too far from your target.

Cash Flow

cash flow financial goalTake Home Income (target > $5,000)

Our take home income didn’t meet our $5,000 target this month, but that’s because Mrs. RB40 contributed too much to her 401k. I’m not too concerned because we’ll see extra take home in December. We had a positive cash flow month, so it’s not a big deal.

  • Mrs. RB40’s Paychecks: It doesn’t look like much because she is paying for our medical coverage, maxing out her 401k (2x normal this month), contributing to our FSA, and deducting child care credits. This income is dependable which is good in uncertain times.
  • Online income: My take home was not bad $1,454 this month. That’s already excluding tax withholding, retirement saving, and 529 saving. I will break down the online income in our monthly newsletter so if you’re curious, sign up with our email list.
  • Dividend and interest: February is a slow month with dividends. Not much excitement here.
  • P2P lending: Our current ROI is 8.27%. That’s down a bit from last month. I also have $1,770 sitting around waiting for a good borrower. P2P lending also became very passive for me so I’m generally happy with it.  See my last update – Peer to Peer Lending Is A Pretty Good Passive Investment. I will write another update as soon as I get the yearly statement.
  • Rentals: The rentals are doing well so far in 2014. February was a slow month with just $201 income. I’m going to sell our rentals to take profit this year. The market is hot so I want to take advantage of that.
  • Misc income: $14 class action settlement check from Clearwire. $100 birthday check (toward education) to RB40 Jr. $250 bonus check from my new business checking account.

personal capital cash flow spending expense

Expense (target < $4,500)

We spent $3,669 in January. That’s well within our target of $4,500. We didn’t have a big purchase, so it’s not too bad. This month I used Personal Capital to track our expense and it worked pretty well except the housing expense. We pay property taxes once a year, but I want to show it on our monthly housing budget, so I manually add that in.

Housing: $2,163. Mortgage, HOA, and 1/12 property tax.

RB40 Junior: $377 this month. Childcare, new clothes, birthday gifts, etc…

Cash allowance: $300 for discretionary spending. A bit lower than usual this month.

Groceries: Actually $331. Personal Capital missed a transaction somewhere. Not too bad even with eating more organic food in 2014.

Insurance: $188. That’s auto, home, and my life insurance.

Hobbies: Mrs. RB40’s Toastmasters conference fee.

Utilities: $61. That’s just electricity for our condo.

Healthcare/Medical: $46. Gym membership.

Surplus (+$6,465 YTD)

We only had $155 extra this month. I’ll take it.

Our saving this month is +$155.

Piggy Bank 2013

  • Travel fund: +$965.
  • Roth IRA fund: $0 right now. Maxed out 1 Roth IRA so far and will work on the other one.
  • Slush Fund:  $0

How about you? Did you have a good February? 

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{ 37 comments… read them below or add one }

Income Surfer March 5, 2014 at 3:05 am

Congrats on record breaking January income. You keep knocking on 100k pageviews per month. I remember it coming up a couple times last year. It will be nice to see you cross that threshold. It looks like February was a great month around your household
-Bryan

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Dividenden-Sammler March 5, 2014 at 3:21 am

Your online income is awesome!
Higher than the paycheck of your wife!
My own online income in february was round about 25 EUR :-)
How do you achieve such high amounts?

Best regards
D-S

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retirebyforty March 5, 2014 at 9:02 am

That’s just because she contributed too much to her 401k. She also pays for health insurance, child care, and other deductions. Just keep at it and hope for the best. :)

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jane savers @ solving the money puzzle March 5, 2014 at 5:19 am

What is an FSA?

I think it is a great idea to sell the rentals. You will have a lot of extra time (to go to the gym) and a lot less headaches.

My February was not good. I won’t be able to make any real strides in my finances until I come up with a way to earn more income.

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davidmichael March 5, 2014 at 6:26 am

Joe,
Congrats for a great month.

So…I am amazed your grocery bill is so low. My wife and I average about $500 a month, includes house (RV stuff) and beer/wine, etc. Could you show a breakdown in your grocery list. Our aim is to lower our grocery bill to $400 a month. Thanks.

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retirebyforty March 5, 2014 at 9:04 am

I will work on the article. Our kid doesn’t eat that much right now so that’s probably a factor. I’m sure our grocery bill will be way up when he’s a teenager.

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Justin @ Root of Good March 5, 2014 at 6:50 am

I like it. The “extra money” is still positive, even after a light month. And Mrs. RB40 put some serious cash into tax deferred savings on top of that!

Keep up the hard work. January was really busy for me, yet February was very laid back and relaxed. Here’s to hoping for a nice slow-paced March for you! Don’t forget to kick back and take it easy every once in a while. You’ve worked hard all your life to get to the stage where you can enjoy life a bit. You have earned it!

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retirebyforty March 5, 2014 at 9:08 am

I’m hoping I’ll have more time to relax once our kid goes to preschool 3 day/week in September…

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Susan March 5, 2014 at 7:17 am

I would also be curious to hear about how you are able to keep your grocery expenses at $10 per day – for 3 people? Thanks.

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retirebyforty March 5, 2014 at 9:08 am

It’s really 2 people. Our kid doesn’t eat much right now. :)

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Financial Samurai March 5, 2014 at 7:18 am

A positive cash flow month is a positive cash flow month!

February was good. Had some decent media mentions that boosted traffic. It’s funny, but I enjoy watching traffic grow much more than watching money grow b/c 80% of the money is just invested, so I guess that’s a 80% savings rate. The rest is to just pay for bills

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retirebyforty March 5, 2014 at 9:09 am

Good point. I don’t pay much attention to traffic anymore, though. I still enjoy looking at our net worth grows. :)

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SavvyFinancialLatina March 5, 2014 at 7:24 am

Great financial progress! You don’t have to work at a corporation to make money.

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retirebyforty March 5, 2014 at 9:09 am

Thanks! I’m glad I’m finished with the corporations.

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John @ Frugal Rules March 5, 2014 at 7:51 am

Nice work on the online income! Record breaking ain’t too bad. ;) We’ve had a really good start of the year ourselves and about ready to max out our Roth accounts this month. Great work on the groceries, we’re just at $400 ourselves even with quite a bit organics thrown in.

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retirebyforty March 5, 2014 at 9:10 am

Great job with the Roth IRAs.

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Done by Forty March 5, 2014 at 10:07 am

Awesome numbers there, Joe! I’m so impressed with your passive income goal: that’s the part of our financial lives that needs the most attention.

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retirebyforty March 5, 2014 at 5:00 pm

We really need to ramp up our passive income a bit more. It’s not quite enough for us to both retire yet. Someday…

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Kim March 5, 2014 at 10:36 am

I am really excited about having a solo 401k this year. Do you know if you have to wait to actually earn the income to invest it or can you put more in at the beginning of the year as long as you don’t go over the limit for the whole year? We have quite a bit sitting in savings that I’d like to go ahead and invest now, but I am just not sure of all the rules.

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retirebyforty March 5, 2014 at 5:01 pm

You probably should wait. The limit is dependent on how much money you make. I guess if you’re sure, you can invest a little bit. I’d wait though.

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Living Smalltimore March 5, 2014 at 11:15 am

Is the market that great to sell your rentals? Is it better than it might be in a couple more years?

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retirebyforty March 5, 2014 at 5:02 pm

The market is hot right now and probably will continue for a little while longer. I can’t really tell, but it’s much better than when we considered selling in 2007… Might as well take profit now.

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Dividend Mantra March 5, 2014 at 4:40 pm

Joe,

Congrats on yet another stellar month. You continue to kill it on the passive income! And always glad to see the rental income in the positive territory. :)

You’re off to a really nice start for 2014. You guys will deserve that big trip to Hawaii!

Best wishes.

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retirebyforty March 5, 2014 at 5:03 pm

Thank you! It will be a big family trip so I’m really looking forward to it. We haven’t traveled for a while now.

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Bryce @ Save and Conquer March 5, 2014 at 5:45 pm

You mentioned that your wife has fixed her 401(k) withholdings, so you will hopefully have even more positive cash flow going forward. Your online income is great. Keep it up.

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Amy K March 6, 2014 at 6:24 am

Hopefully this does not apply to your wife, but I did find a Gotcha with my company’s 401k match and wanted to pass it along:

I always contribute up to the limit. Thanks to a raise I hit the limit early in December and didn’t have a contribution in my last paycheck of the year. Since I didn’t have a contribution I had no match that paycheck, losing out on that $50 or whatever I had expected.

With my previous employer I think the match was put in quarterly, rather than paycheck by paycheck, so this wasn’t an issue (or I never noticed).

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so March 6, 2014 at 9:28 am

The match is usually “trued up” at the end of the year in that case. Check your plan documents.

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retirebyforty March 6, 2014 at 11:24 pm

OK. I will double check. My old employer match once a year. I’m not sure what her employer does.

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Colin March 6, 2014 at 8:22 am

Wow, $472 in dividend/interest income in February! I’m jealous! I get only $30 in monthly dividends (on non quarter-ending months).

What are your thoughts on maxing out my 401k? I max out yearly, but do it over the course of the year rather than maxing it out early in the year and my employer doing a true up at year’s end (they stop contributing once my contributions would stop when i hit my max and then at year’s end, true up to ensure I receive a full year’s worth of company matching). I probably could max out in 1/2 the year or so but didn’t like the unpredictability of life events that may occur when my income is low because I’m trying to max out early.

Anyway, just found your site and love it so far. I’m 33, single, minimal debt ($2k on a car loan), a portfolio at $410k and maxing out yearly on my Roth 401k & Roth IRA and usually about another 5-10k in other non-retirement savings throughout the year. I think I’m on the right track to hit $1M before 40.

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retirebyforty March 6, 2014 at 11:26 pm

I think dollar cost averaging out over the year is a good plan. I only maxed out early once. That was when I left my old job at mid year. You’re doing really well at 33. Keep at it.

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No Nonsense Landlord March 6, 2014 at 7:59 pm

I would keep the rentals. I made solid income with mine, and I have a few tips for you on my site to make your life easier as a landlord.

It’s OK to contribute more to the 401K, the more in earlier, the more gains, generally. I always max mine out about this time of year. It has helped me out considerably.

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Pat March 6, 2014 at 8:56 pm

How do you have health insurance at $46/mo??? My husband and I worked hard to have no bills in retirement – we only have groceries, utilities, property tax – but our health insurance is $600/mo – now granted that is good coverage. But last Sept. he needed major surgery – thank God we had the policy – the hospital bill alone was $45K of which we paid $2400. Do you have some kind of policy with a huge deductible?

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retirebyforty March 6, 2014 at 11:29 pm

Sorry, I didn’t make it clear. My wife still works and we are insured through her employer. That $46 is just incidental. $600 is a lot, but I’m glad to hear it is working as intended.

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Erin @ My Alternate Life March 7, 2014 at 8:06 am

Great job this month! We are still working on getting our groceries down — already over $100 for March, and it’s only the 7th. Crap!

February wasn’t bad, but we were short on income due to being out of the country for most of January. March should be our first month back on track! Here’s hoping :)

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retirebyforty March 7, 2014 at 9:43 am

$100/week isn’t that bad. :) Good luck in March.

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King March 7, 2014 at 11:48 am

I stumbled across this site through your Yahoo article and I’m really glad I did! I’m 31 now and want to retire by 40 or at least be close to financial independence. I had one stock in particular that really helped me get closer to my goal. Anyways, congrats and keep up the good work. You can count on me to contribute to your “views” per month!

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retirebyforty March 8, 2014 at 9:45 am

Good luck with your plan! Glad to have you.

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