For 2013, I’m going with a new format for our monthly cash flow posts. I’ll keep it more generic up top and add more detail at the bottom for readers who are interested. It should be easier to read and you don’t have to go through all the numbers unless you are curious.
- 2013 Financial Goals: Contributed $11,000 to both Roth IRA accounts. This was pretty easy because I sold off some stocks near the end of last year and earmarked $11,000 for the Roth IRAs.
- 2013 Financial Goals: Increased Mrs. RB40’s 401k. In January, Mrs. RB40 increased her contribution to take advantage of the increased contribution limit ($17,500 in 2013.) We should be good here.
- Did not spend any money on gasoline! I filled up in late December and didn’t have to buy gasoline in January. We only drive once or twice a week now and it feels great to avoid the gas stations.
- A positive month for the rental income. One of our tenants left in early December, but the place filled within the month so we didn’t lose too much income. We still have the drainage to deal with, but that’s on schedule and hopefully it will be done soon.
- No new clothing challenge is still on track. I haven’t been tempted by anything yet.
- Added a row for Estimated Tax in the expense sheet. Starting this year, I’ll have to pay estimated tax every quarter because the online and rental income will be a significant portion of our income. Previously, these income streams weren’t a big percentage because I had a W2 from my employer. I’ll withhold 20% for tax.
- A rash of defaults at Prosper dropped my seasoned (over 10 months) ROI from 12% to 8%. This month we only made $47 from peer to peer lending. This is below my $100/month target, but we’ll see if we can recover next month.
The SP500 gained about 6% in January. In comparison, our net worth grew about 3.5%, but that’s somewhat expected. Our net worth is not 100% invested in the stock market after all. Actually, that’s really good for just one month because my goal for 2013 is 7-8% net worth growth. I’m thinking about taking a lot of money off the table if February is as good as January and we hit that 7-8% goal early.
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We did pretty well with cash flow in January. We didn’t have a lot of expenses and our income was good. Our saving for January is $1,376. We’ll allocate $500 to Baby RB40’s college education and split the rest between travel, fun money, and additional investment.
- 529: $500
- Travel fund: $250
- Fun money: $250
- For investment: $376
Income (target > $4,500)
No big surprise this month. The rental, dividend, and P2P incomes are a little low this month, but they are all positive. The online income picked up the slack and we made enough to cross over the $4,500 income target.
Expense (target < $4,000, not including tax)
We actually did very well with our expense this month. If we take out the tax, we spent around $3,000. That’s well below our $4,000 target. We didn’t do much in January and I even asked myself – Are we being too cheap? Can’t argue with the result though.
Wrap Up January
All in all, I’m quite happy with January. We didn’t spend much money and had a nice positive cash flow month. I think February should be good too. Of course, it is a short month. We’ll see how it goes. How about you? Did you have a good January? Any progress on your New Year Resolutions?