FIRE July Update

This Month’s Story

Progress to Early Retirement: 55.2%
Progress to Financial Independence (3/4): 73.6%
Progress to Half Annual Spending: 110.4%
Percent Home Ownership: 60.1%
Net Worth / Annual spending tax adjusted: 13.8x of that Home: 2.5x Retire: 8.3x Non-Retire: 3.0x

I have been a very busy boy at my W-2 role these last few weeks hence the drought in posting. I’m a computer programmer, and I have been learning some new code. It’s taken a lot of my efforts. Summer has come, and with it the rise in yard work. Some conversations around the normal effects of the warmer weather; the need to mow the lawn, triggered another post. That broke the drought.

There are a few other changes coming that will show up in future posts. I have finally made some changes in my portfolio that I will be posting, including real dollars. I know folks like to see that stuff, and I will not say how much of this is relation to my retirement and non-retirement investments. It’s safe to say that some of this could be in IRAs or in brokerage accounts. Why am I being vague, because I promised my wife, who is more conservative about talking about money. Me, I could care less. I didn’t always think that way, but after reading and blogging for a while now, I see how this community acts and I am comfortable with it. So while I will hold that grey area a bit, I will post what I invested in, why, and of course the performance. That will be in a few weeks.

There is another good thing that has kept me from blogging a bit. I have been making a sound investment in my health and it has made me tired. Put simply, for the first time since Boot-camp 20+ years ago, I have been getting up at dawn to run. I am back training, and my foot is not bothering me. If you don’t know where I’ve mentioned this in the past, I broke two bones in my foot 15 months ago, and I tore a tendon for good measure as well. Oh, did I mention that I also pinched a few nerves in my neck too? Yeah, I tripped while running on a packed gravel trail, and busted myself up well. I don’t feel much pain while I am running, not all that uncommon in my experience, so I ran another 2 miles after the break. Shock protected me I think. Anyway, by the time I got back to my car, I knew there was a problem. It took a long time for me to get better, but I am now back in the rhythm. It’s hard to find time to do this, so I found the mornings like so many of those motivational speakers talk about. 4am, 5am, and so on is your time. My wife is asleep. My son is asleep, but I am up pounding pavement, and I am home to shower before or just as they wake up. Well, I have been averaging one 2 mile run every three days, and my speed is improving. I feel great, but it has taken me a bit of time to get to the point where I am not exhausted by the end of the day when I have time to write.

Now let’s talk some dollars. We had our water well fail the other day, but we got partially lucky. I called my well guy, and with some advice from him, we got water back on Saturday after only a few hours. They will be coming for a checkup soon, and I hope there is nothing special wrong with the system. Time will tell if we are out some money. I think the problem was that my neighbor was power-washing their home, and they used their well instead of renting a water tank to supply the water as is generally done in this area. If you use your well, you can burn out your pump as my wife’s father warned me. He was a construction worker, and is a collection of great wisdom for me. Saturday Night Live had a great skit about it back in the Mike Meyers days. I could not find a cut on youtube, but it was a great skit.

We did our annual pre-buy of oil this year. the prices seem to be good, and well, we get a discount for buying all at once. The best part is that we over bought last winter, so we had a few hundred left over to help pay this year’s bill. It’s always a guessing game, so I purchased the same amount of oil next year. Now before you ask, the savings is $0.25 per gallon, and that’s about 9% off per gallon at the price I paid which was about $2.5 per gallon.

Sadly our home’s value has slumped in the last few months, so while our investments have been helping our numbers, over-all we have been stagnant in total net worth. The SALT law change is stalling out the housing market. Bummer there, but what can you do. I only need the value to be there when we sell.

I have been talking for a while now about getting our deck done this year, but we have stalled on that. I am not sad about it. I mean money not spent is money not used. We do need to spend the money, but one more year is one more year of interest. We will not have the use of the space, and that makes me sad, but the real reason is that we were late in contacting contractors, and well you can’t get the work done if you don’t ask someone to do it.

Now I am a fan of DIY, and I am not afraid of a saw. I do not know the building codes around here, and I could learn them. The fact is that the work would take me a long time, and while I will do a lot to save money, I have my limits. I’d rather have the summer with my son, then spending it rebuilding a deck. If I had a lot of friends to help, as my father did, then I would do it myself. I remember the rebuild that he and a bunch of his friends and our family did after the original one that they all built when I was in diapers had started to rot. Those were different times, and people don’t seem to do that anymore. It could also be that that generation of my family were all tradesmen, and I think they lived a different life. I think that is a lost community event, or perhaps its just that I know too many white collar workers. It occurs to me that this sounds a lot like those mustashians, and for me, it was just growing up. Most summers, now that I think of it, we were doing something like that for someone. This is probably why I always am fixing electronics when I visit friends and family. They all feel bad to ask, but I like helping and I’m good at it.

The charts will show some changes in them this month as I moved money around a bit. Again, that will be detailed in another post. I’ll get to it hopefully this week, but we will see. I know I should post on a regular cadence, but like the Beatles said, we’re all doing what we can. I’ll continue to write as often as I can, and hope folks still want to read what I have to say.

I really hope we can get an average of 7% yield a year for each of the next 7 years and of course that I can keep saving at this rate. I would not FIRE at that point as my home would not be paid off yet, but I would likely change jobs. Even if I didn’t, my stress levels would drop significantly. I really want to get off this treadmill, and I am looking forward to that day. To be clear, I am working on a FatFIRE here, but I’m also asthmatic, and that is not cheap. My expectation is that my mortgage payment would be enough to cover my health costs which are low when I work out regularly, and that is why that has become so much of a priority for me! The major trick is to also to eat better, and happily my love of running and my desire to perform better is stronger than my desire to eat unhealthy foods.

The value of our home has dropped noticeably over the last few months, and I really can’t make a solid guess there. The big jump was that large mortgage payment, and you can read here about my decision process. Paying it off in 10 years when we want to FIRE, or more likely downshift as I call it as I fully expect to work, just not as hard. As the months go by, I will have to change that graph, but perhaps in the short term, I can just rotate the x-axis labels to make it more readable. There has to be an option in the code for that. I’m using a python script to generate all these charts, and to make them all, I only just add the data items to a google worksheet, and my code does the rest. As I tinker with the code periodically, I will no doubt make adjustments here and there.

I adjusted the data in this table to make the chart more detailed. I had an account where we moved some cash around from Cash 2 to Other Cash, and it was only one month where there was a jump in November of last year. I was moving it around in our emergency fund. Well, I just put it in our other account so that the scale on the chart is better. This month, I zeroed out a mutual fund account, and reinvested it in my Dividends and Speculative account. That will stay at 0 going forward, and I may just move the money into that column historically to keep the chart looking better. The nice thing to notice is that the only accounts that are negative are the ones where we moved our cash positions into our home, and closing that one account. The mutual funds are invested in other stocks and mutual funds, but that is a story for another day. Anyway, this gives you a clearer picture of what is going on, and I like it better. I am not sure how much I like the mouse over interfering with the legend, but I will have to noodle on that. The sum is down 5% but really that money was just transferred, again, to our home value, so it evens out.

Like most people, most of our money is tied up in our retirement accounts, and as you can see, they are doing well. That one account that is doing so well is the one from my wife’s current job as opposed to her old job which has a greater sum, and is not getting any new W-2 money. Our annuity only gives us quarterly reports, so I don’t update it if I don’t get new data. That’s why you see step-wise increases there.

Well that’s about all for this month in review. I will be scheduling the water company to inspect our system, so hopefully they don’t find anything. I have a few more ideas to talk about so hopefully I can get back to my 2 articles a week or more schedule that I would like keep to.

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