Hey everyone, did you have a good month in April? The weather is finally nicer here in the Pacific Northwest. RB40Jr is wearing shorts to school every day now. That’s the real benchmark. Unfortunately, this means we have to buy a new set of clothes for him. Kids grow so fast and their clothes don’t last very long. Actually, the size doesn’t matter that much. Junior is so hard on his clothes. All his pants have holes in them after one season. That’s okay. I’m happy that he is an active kid.
On the financial side, we did well in April. Our net worth increased a bit because the stock market did very well. Our cash flow looked good too, but it was mostly due to luck. We got a big boost from an insurance payment. As for expense, we did well, but we also had a big tax bill. The extra income helped tremendously with that. All in all, it was a good month.
Okay, I’ll go over my goals first and then share the details of our net worth, cash flow, and savings.
2019 Goals
Here is my goal scheduling spreadsheet. It works really well. Try it out if you have a problem keeping up with your New Year goals. The key is to update the spreadsheet once a month to check progress. That will remind you which goals need attention.
Financial Goals
- Passive Income> $60,000. This one might be too ambitious. In 2018, we had $56,628 in passive income. This year we probably will have less than that. We’re consolidating our properties so the rental income will drop. I’ll use the proceeds to invest in dividend stocks and real estate crowdfunding. I’m not sure if we can generate $60,000 this year, but we’ll try. After 4 months, we had $14,768 in passive income. That’s really behind the pace.
- FI Ratio > 100%.This is my main goal for 2019. The FI ratio is passive income divided by expense. Once we reach 100% consistently, then we’ll be set to retire in style. Last month was great. Our FI ratio got a big boost and increased to 111%. The big improvement was due to a payment from our tenant for the damaged flooring. Our monthly spending is also pretty low now. That helps a lot.
- Save and invest > $100,000.Last year, we saved and invested about $102,000! That was awesome and I hope to repeat it this year. However, we probably won’t be able to do it. In 2018, my blog income was excellent, but it slowed down significantly this year. Consequently, it’s going to be very tough to save $100,000. So far, we saved and invested $28,777. That’s actually really good. Our saving rate is 51% so far. I’ll grade this one on an academic scale.
Blog Goal
- Update Retire by 40. I need to clean up the menu, sign up with some new partners, and rework a few affiliate posts/pages. This isn’t that difficult, but I have to find the time to do it. Then I’ll hire someone to install a new theme. This kind of work is very tedious for me so I usually put it off. I’m having a really rough time with it this year. All my attention has been on selling our condos. Everything else comes second this year.
Personal Goals
- Travel Hack 100,000 points.Yes! This one is done. Both of us signed up for the Capital One Savor card and received a $500 cash bonus each. This is a great card, don’t miss out. Click through on the banner below and see if you can find the right card for you.
- Consolidate down to 1 property. We are making solid progress here. We moved and both of our condos are for sale now. However, the real estate market in Portland slowed down tremendously. If these condos don’t sell soon, I might have to rent them out.
- Drop weight to 125 pounds. I rarely make a weight loss goal because it never worked before. However, I think I’ll be able to do it this year. I’m intermittent fasting* and plan to exercise 5 days per week. Currently, my weight is 130 pounds. It’s not changing much now so I might have to just be satisfied with that.
*Here is how I do intermittent fasting. I only eat from noon until 8 pm on the weekdays. This cuts down on the calories and I don’t miss breakfast much. I’m busy getting RB40Jr off to school on the weekdays anyway. Try intermittent fasting if you want to lose weight. It really works. If you can’t do it by yourself, I highly recommend Martin Dasko’s Fasting Course. It was very helpful when I first started.
Fun Goals
- Keep my happiness level at 8 or above. This is totally subjective. I’ll give myself a score at the end of the month and try to average about 8 this year. For April, I rate my happiness level at 7. The condos haven’t sold yet and that adds stress. Carrying 3 mortgages is no fun.
- Visit Chiang Mai for 6-10 weeks. I haven’t even started here. We’ll deal with this after the condos are sold.
Net Worth (+7.5% YTD)
I’ve been tracking our net worth since 2006 and it is very motivating to see the progress we’ve made. 2019 is turning out to be a very good year so far for the stock market. That’s unexpected. I’m being more conservative this year so our net worth lags behind the S&P 500 quite a bit. I’m still very happy with our net worth gains. 7.5% is really good in the grand scheme of things.
Here is a graph of our investment portfolio on Personal Capital.
*Sign up for a free account at Personal Capital to help manage your net worth and investment accounts. I log in almost every day to check on our accounts. It’s a great site for DIY investors.
2019 Passive Income ($14,768 YTD)
Here is a quick summary of our passive income. You can see all the details on my Passive Income page.
Generally, things look good. The rental income is slower than last year, but that’s expected. We’re consolidating down to one property. That will reduce our rental income, but our cost of living will be lower as well. It seems to be working out. Our FI ratio* is looking pretty at 111%. Hopefully, it will stay above 100% for the rest of 2019.
FI ratio = passive income/expense
Once we sold our condos, we will have some cash infusion. I’ll invest it in real estate crowdfunding and dividend stocks. Our passive income should increase with these additional investments. But it will take time to execute. You’ll have to follow along and see how it plays out.
2019 Cash Flow
Our cash flow was pretty good in April. It was mostly due to luck, though. We had to send in our tax payments so I wasn’t optimistic. However, we got a boost on the income side. I got a big payment from insurance and a $534 bonus from a credit card. These two helped us pull out a win in April.
Here is the Sankey diagram for April. You can get a quick overview here and see the details below. The big hit was the taxes and deductions.
Gross Income (target > $12,000/month)
For 2019, our gross income target is $12,000/month. I think we should be able to meet this goal almost every month. In previous years, I tracked take-home income and it was all over the place due to the deductions. This year, I’ll track gross income. In April, we grossed $17,427. That’s much higher than normal. See the side hustle bullet below for the detail.
- Mrs. RB40’s paychecks: $8,444.
- Blog Income: $2,304. April was actually a really good month, but we had to pay taxes too. So the blog income was just so so. You can read more details on my Blog Income page. RB40Jr is on the payroll now as model and photographer. The income will go straight into his Roth IRA. I’m excited to see how this experiment will turn out.
- Rental Income: $226. Our rental income should stabilize around $250 per month. Read more at the Rental Property Passive Income page.
- Dividend Income: $891. The dividend income was great in April. See more details at my Dividend Passive Income page.
- Real estate crowdfunding: $224. My real estate crowdfunding investment is starting to pay off. Read more at my Real Estate Crowdfunding Passive Income page.
- Interest Income: $17.
- Side hustle: $5321. I got a big check from insurance in April. A bicycle ran into the back of our car and made a huge hole and several dents. Their insurance sent me $4,787. That’s more than our car is worth at this point so I’m keeping it and fixing the hole myself. It looks like crap, but I can live with it. We also got $534 bonus from the Capital One Savor card. Mrs. RB40 signed up for the card and we used it to pay taxes. We spent $3,400 and received the $500 sign up bonus + $34 extra. It was awesome. If you’re looking for a new credit card, I highly recommend it. Cash is king, way better than points.
Monthly Expenses (target < $4,000/month)
For the rest of 2019, our monthly spending budget is $4,000/month. I decreased it from $5,000 per month. Our housing expense is significantly lower since we moved into out duplex. This makes a huge difference. In April, we spent $2,712. That’s really good. We had a couple of big expenses in the health and parent category. You can see the detail below.
Overall, it was a good month.
- Housing: $1079. Our housing expense looks good. Let’s hope we can keep it low for at least 5 years. This category includes mortgage, HOA fees, property taxes, utilities, and maintenance.
- Groceries: $433. We had a good month with groceries. I’m happy if it’s under $500. Check out what I cooked.
On the left is Okonomiyaki. This is a really easy dish to make at home. It’s basically lettuce pancake with bacon on top. You can make the topping sauces at home, too. It’s a great dish. Next is Tteokbokki, an interesting Korean dish. It seems like you can toss whatever you have in it. The essential ingredients are the rice cake and Korean hot pepper paste.
On the left is spicy Thai cashew nut chicken. This dish is really easy, too. Here is a good cashew nut chicken recipe if you’d like to try. On the right is the Bhindi Masala, okra curry . This is my favorite vegetarian dish so far, it’s really good. I got a big bag of frozen okra and it works just fine. The only problem is our son doesn’t like it. Oh well, he can have the Murgh Makhani (butter chicken) from Trader Joe’s. Here is a good recipe for Bhindi Masala.
Here is RB40Jr’s 2nd favorite dish – hamburger and fries. First place is pizza. I made this on our carbon pan, it worked out very well. Lastly, I made BBQ pork sliders. This one was an easy weekday meal. I cheated and used Trader Joe’s BBQ pork. The Hawaiian rolls and coleslaw rounded out the meal.
- Transportation: $105. I got some epoxy, Bondo, and touch up paint to fix the hole at the back of our car. It looks like crap, but that’s okay. I don’t really care how it looks anymore as long as water doesn’t get in. At this point, I rather keep the cash than get it repaired by a professional. $4,787! I also filled up a couple of times.
- Parent: $500. My parents are going to visit Japan. I’m helping them with this trip.
- Kid: $0.
- Pet: $22.
- Bills: $124. Insurance (auto, home, term life, and umbrella).
- Health: $58. RB40Jr visited his doctor and the gym membership fee.
- Travel: $51. Mrs. RB40 went on a short business trip. Travel hacking is a great way to reduce your travel expense.
- Clothing: $186. Mrs. RB40 replaced a pair of shoes. We also got some bigger clothes for Jr. Kids grow so fast.
- Entertainment: $114. We ate out 3 times in April.
- Misc: $41.
Others
I don’t count these as personal expenses. We paid a big tax bill in April. If we didn’t have the extra cash infusion, we would have had a negative month. Whew! This year, I’ll try to send in enough estimated tax.
- Taxes and deductions: $6,282. We underpaid our taxes last year so we had to send in some money to the IRS and Oregon Department of Revenue.
- 401k and Roth: $6,980. I contributed $1,500 to my 401k. Mrs. RB40 contributed $1,480 to hers. We also contributed $500 each to our Roth IRAs. Lastly, I contributed $3,000 as an employer to my 401k plan for 2018.
- Extra Savings: $1,453. This went into our checking account for now. I’ll invest it when I can.
2019 Savings
We saved $29,331 so far in 2019. Our current saving rate is 52%. That’s really good. I’ll try to maintain it around 50% this year.
- Joe’s 401k: $10,000.
- RB40’s401k: $5,870
- Roth IRAs: $4,000
- 529 College Savings: $0
- Extra savings: $9,461
YTD 2019 saving rate = 52%.
April 2019 Wrap Up
All in all, we had a great month. Our net worth increased nicely and our cash flow was solid. The expense was higher than usual due to taxes, but we got some cash infusion to soften the blow. Everything worked out quite well.
How about you? Did you have a good April? Are you making some progress on your New Year goals?
*Sign up for a free account at Personal Capital to help manage your investments. I log in almost every day to check on my accounts and cash flow. It’s a great site for DIY investors.
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Passive income is the key to early retirement. This year, Joe is investing in commercial real estate with CrowdStreet. They have many projects across the USA so check them out!
Joe also highly recommends Personal Capital for DIY investors. They have many useful tools that will help you reach financial independence.
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Wow, all those food pictures look amazing, Joe!
I kind of did a double-take when I read “Drop weight to 125 pounds”. Say what? I don’t even weight that little. Yeesh. Now I feel fat and feel I need to go work out. Thanks for that.
Interested to see the impact of your intermittent fast. I’ve never tried it before. If you end up gaining weight, it might be a good thing though, cause muscle weighs more than fat right? The only time I’ve succeeded at losing weight is using the Paleo diet (and even then I had cheat days). Now, with all the book stuff, I’ll probably need to do an intermittent fast to get rid of the extra pounds (they do tend to sneak up on you when you’re sitting at desk, typing for hours on end). Let me know how it goes! Good luck!
Mrs. RB40 doesn’t like that goal either. She said it’s too little.
My weight is stabilizing around 130 lbs. I don’t think I can drop much more.
IF is good. It works.
Never understood Tteokbokki, I’ve tried it and it’s just spicy chunks of rice dough that’s flavorless without the spicy sauce. Ramen noodles is the way to go *_* soaking it all up!!
We overpaid taxes again and got $6k back. I think hubs is overly cautious. I told hub we’re going to get audited because that’s a pretty large refund.
I didn’t know your car was worth under $5k! That’s so low!! That means you made it out in the green really, awesome!
Your patch up job on the Mazda actually looks pretty good! You did a good job AND you got to keep the money too from the insurance.
Hopefully your condos sell soon!
my mother-in-law gauged the side of our old car a few years ago. we would have let it go but they were already making a claim for their car so we put on in for ours and kept the cash. ch’ching.
Hey, I have been doing Intermittent Fasting for roughly 8 years. It really is the easiest way to stay trim and get to eat somewhat normally too. Sure you skip food during the day but that is simple. Dinner is the tough meal and with IF, you get to feast.
Keep it up.
Looks like things are going well, Joe! I’m eager to hear more about how things go with RB40Jr on the payroll. I’d like to do something similar with our daughter once we move and get settled.
Looks like we’ve got a little competition to get our sites revamped. You beat me on the new logo (I just need one period), but I need a new theme as well. I’m probably going to take on most of the theme-change myself, which I’m not looking forward to. But I am testing a plugin called WP-Staging which lets you clone your site for testing. That’s making it much easier to find what’s going to break without trying to do it on the fly.
— Jim
It’s actually really complicated with taxes. I think this is the last year I’m doing this. He’s not making much anyway.
I’m rethinking the redesign. This current layout is good enough. Readers can find the latest blog post easily. I’ve seen some redesign and the posts are too hard to find. It’s annoying.
Thanks for the tip on WP-Staging. I’ll use that.
Nice to see that your income has grown and expenses has gone down with residential arbitrage. Stock markets have been performing real well and ever since the beginning of this year the rates have averaged closer to 20%. This is a good signal as the losses incurred towards principal investment during last year have been leveraged with YTD gains. Fingers crossed 🙂
Looks good Joe, making great progress on all of your goals. Definitely need to work on the happiness level more. 🙂
I can’t believe how big that tax bill is. Damn!
The happiness goal is tough right now because of the condos issue. Once we sold, life will be a lot better. Or even if we rent it out. It’d be better than just waiting. This is killing me…
Don’t use that picture when you apply at the local auto body shop for a job! Just tell them you have experience! Seriously Joe, nice windfall with the accident. I’m surprised a bike could do that much damage. Tom
The picture actually looks a bit better than real life. I could spend a lot more time, but I don’t think I could improve it much more. It’ll just be a minimal improvement for a lot more time. Not worth it to me.
Yes sir, our month was excellent, we had a net income of approx. 11900 USD. The dividends alone were 5100 USD.
Expenses were a bit higher than normal 1950 USD, but it is garden time, and we had to do some maintenance, and also our car needed some supplies for the summer (a pair of new summer tires). A few barbecues also cost us some money. Wintertime is much cheaper…
We did some shopping on the stock market, namely some US BDCs like MAIN and ARCC. I like these companies due to their solit cash flow, and they have also been battle tested during the recession 2008-2009 and faired quite well considering the high risk. Roughly 10% of our portfolio is in US BCDs.
It is fun to commpare expenses and incomes from such different countries like Sweden and the US. Your salaries are usually much higher than ours, but we don’t have to bother with health insurances, child care, college etc. As an example, for 40 hours of supervised childcare for our 5 year old with breakfast, lunch and snacks we pay 129 USD/month. However, we are only allowed to keep the children there provided that we work full time, for unemployed and students, it is usually limited to 15 hours/week.
your wife has an excellent salary. In comparison, my friend is a CFO at large industrial company, and he earns roughly the same gross salary as your wife. Tech salaries in Sweden are not the greatest if you compare to countries closer by such as Germany, the UK etc. A senior java developer with 20 years experiences usually earns around
4800 USD/month gross salary, maybe a little more if he/she is a consultant.
I am not a big fan of socialism myself, but if you have children, you get lots of benefits (almost free childcare, free healthcare, free dental care, free school, college, university). The losers are definetly singles with no children and high salaries. They get very few benefits, but have to pay like 65% tax instead. If I was one of those, I would not live here…
Wow, your income far outpaces your spending. That’s fantastic.
I’m envious of your childcare cost. That’s very inexpensive.
I guess socialism encourages the population to have more children. That’s good for the Scandinavian countries, right?
Yeah we save roughly 70% of our income, and have done so for a few years now. I run a blog with focus on savings and FIRE, so it helps with the image, so to speak 🙂
Well, I have read quite a few books on the topic, and in fact socialism by itself doesn’t seem to encourage having more children. It is rather the level of education among the population that set the bar on how many children a family get. This is also something that Bill Gates is pushing for in his foundation. Increase the education in a country, and you will reduce the population, and increase the wellfare.
However, during the recent years with the huge number of immigrants arriving in Europe in general, and Sweden in particular, most of these people have a very low level of education, and yet they get the exact same benefits as any other tax paying Swede. These people have a very small chance of ever finding a job, since we have very few jobs for people not having at least a college education. What do they do? Well, they stay home and have children. If you have more than 3 children, you get a “bonus” payment, and if you have 6 or more, you will get enough benefits so that you dont even need to work (or study swedish). Also, it is almost impossible for the county to enforce any kind of regulations on them (like, if you haven’t learned enough swedish in two years, you will not get any benefits), because children are protected in the social law. If a family have children, the county is omligated to provide free healthcare, schooling etc no matter what. Even people who are here illegaly are allowed to get schooling, healthcare etc.
This has caused a lot of friction in the swedish society during recent years, where for example lots of swedish born elderly people and retirees live under poor conditions due to a broken public pension system, where immigrants get lots of benefits, for doing nothing. Our version of the republicans have gained lots of momentum over this, while the socialists/democrats have been pushed back.
That is not too shabby surviving April, which is by far my toughest month, Joe.
For some stroke of (bad) luck, my yearly insurance premiums (auto, home, umbrella, etc) happens to be in April as well as usually owing a decent amount to uncle Sam. It definitely makes April one of my most expensive baseline months with typical fixed expenses.
The market has certainly been kind since the awful Dec of last year so it is nice to see my net worth continually trend upwards and reach new personal highs.
April is usually a tough month for us too. Good thing I paid a lot of estimated tax last year. It would have been a lot worse if I didn’t.
That’s great getting the FI Ratio above 100%. I look forward to seeing what it is once the dust settles with the condo sales behind you and no lucky one-time payments.
This site was my introduction to the sankey diagram and I’m not sure I like it. It seems like your income is less than your expenses, simply because the number of sources is fewer. At a glance it seems misleading. Once you analyze it, it makes more sense.
I wonder if anyone else feels this way. Two pie charts with diameters based on the income and expenses could work better in my opinion. (Not suggesting that you change, just think it’s a weird diagram system.)
Yeah, the $1,500 one time payment from our tenant helped a lot.
The sankey diagram is easy to make. I’m not sure how to do the two pie charts. Maybe that can be a project for you. 🙂
The sankey thing was kind of a general observation probably better suited for the people who created it.
I don’t track expenses, so it’s not for me, but I bet something like the pie chart idea already exists.
How can you have a weight goal of 125!?that’s wild I shoot for 175 as an aspiration. Maybe I should eat more lettuce and bacon pancakes. Nice progress Joe. I am making good progress on my new years goals as well but strangely since I reached FIRE, most of those goals aren’t financial any more but personal. The work never ends. I guess it just gets better.
I’ll add my height to the detail. I’m 5’4 so 125 is a healthy BMI. Although, I don’t think I can get down that low.
I heard a funny quote last night – life is a series of problem to be solved. That’s pretty good.
Good luck with your goals.
Nothing wrong with that car repair and $5,000+ in your pocket!
I could have spent a lot more time on it, but I don’t think it’ll look much better than that. Cash is king. 🙂
Great job with your savings, Joe!
Like you, our portfolio values went up last month. However, our net worth still took a dip because some of our property valuations got adjusted downwards. That’s okay though, it’s better to have more conservative valuation estimates.
Glad to see your hole is gone now with your car. 🙂
I don’t change our property valuation in my spreadsheet. I don’t quite trust Zillow.
Lookin good Joe! Can’t complain about a 7.5% net worth increase and a 52% savings rate!
That said, sorry to hear about your big tax bill. That is a really big bill! You know what they say though… if you’re paying Big Taxes it means you’re making Big Money!
By comparison, our tax bill was much smaller. I guess that means we made less. 😉
I’d be happy with 10% net worth gain in 2019. That’s huge at this point in my life.
Well, the tax bill really wasn’t that bad.
* $1,500 for IRS
* $2,500 for OR
* $1,000 for estimated tax
* The rest for Mrs. RB40’s monthly taxes and deduction.
OR is the tough one to swallow. April is when I wish we live in WA.