Happy Fourth of July!
June just wrapped up, and with it goes a very expensive month for us. It seemed like everywhere we turned some expense would pop up. Well, as the saying goes: “Them’s the breaks”.
With the onslaught of expenses, how did our finances fare?
Surprisingly well, actually.
As always, you can check the latest and greatest info on the Track Our Progress page.
First, the numbers:
Net Worth:
- End of June Balance: $498,204 Up $35,112 (7.58%)
- Year to Date (YTD): Up $106,366 (27.15%)
- Since January 2018 (this is when I started tracking our net worth): Up $193,204
Portfolio:
- End of June Balance: $344,408 Up $27,724 (8.75%)
- YTD: Up $80,871 (30.69%)
- Since January 2018: Up $104,408
Monthly Contributions: $6,664
June was buoyed by a strong month in the market. Additionally, June marks the payment of quarterly dividends. In our case, we received $1,240 in dividends in this quarter.
The values of our primary residence and rental property both rose as well, to the tune of $6,500. Real estate values seem to be cyclical here with the peaks in the summer and the trough in the winter. As such, perhaps this marks the annual peak?
June Highlights
Burning Cash
As I mentioned earlier there were a number of expenses that cropped up throughout the month. Including:
I had an ear infection that was super fun. This was my souvenir from our Gulf Shores vacation. Clinic costs and medicine ran about $80.
Our water heater started leaking like a sieve due to significant corrosion. So we had to replace it. Total damage = $1,200. Ouch.
Our tenants complained about water in the basement and possible mold. Two visits by property management, and a service call for a plumber. Costs yet to be determined but expected to be around $350 to $450.
The tile floor in our kitchen buckled in a couple areas and needed to be repaired. Poof went another $100. If I subbed this out to a contractor the fee would have been much much more.
My 1-year old car needed an alignment. $80 down the hatch.
What made this sting more than it should was a couple of large planned expenses fell in this month: Namely, the first car payment on my wife’s car and our car insurance renewal.
Not great timing. And it gets better (worse?) because…
We are Refinancing Our House
We committed to refinancing in June, just before the water heater, alignment, and tile issues arose. In early July we expect to close on the new loan. Out of pocket expenses will be between $5,000 and $7,000. Of that about $1,800 will be closing costs while the rest will be prepaid interest, insurance, taxes, etc. to fund the escrow. We will get the prepaids back, but it will take awhile. Also, since the loan term is being shortened, the minimum payment is going up about $300 per month.
Now that the gory part is out of the way, what are the benefits?
We are dropping the PMI (which has been costing us $108 per month). This is a result of rising housing values locally. We are shortening the loan term to 15 years (from 30) and reducing the interest rate 1% (4.125 down to 3.125). As a result we are guaranteeing ourselves a return on investment of 8%, as I discussed in my prior post HERE.
Coming Up in July
We will have to dig into the high yield savings account to cover the out of pocket costs for the refinance.
At the end of the month, my wife and I will be heading west for four days. We are hitting up San Francisco, Sonoma, and Napa. I’m very excited as I’ve never been to California myself. Most of this trip’s costs have been covered with travel rewards points, but there will be costs for food, wine, activities, wine…. and wine.
At least these expenses are anticipated. Let’s hope it stays that way!
Thanks for reading and happy June!
