And just like that, another decade bites the dust. I started the decade as a recent college grad with nearly a net worth hovering near -$50,000 and almost zero financial IQ and ended the decade married, with children, a rental house, and a net worth over $500,000. What a ride!
Speaking of that net worth… wanna see how we did in December?
As always, you can check the latest and greatest info on the Track Our Progress page.
First, the numbers:
Net Worth:
- End of December Balance: $565,542 Up $23,229 (4.28%)
- Year to Date (YTD): Up $173,704 (44.33%)
- Since January 2018 (this is when I started tracking our net worth): Up $260,542
Portfolio:
- End of December Balance: $415,238 Up $25,983 (6.68%)
- YTD: Up $151,701 (57.56%)
- Since January 2018: Up $175,238
Monthly Contributions: $11,432
We ended the year with a bang. I got my annual bonus which allowed us to increase our contributions significantly. Plus the market was quite frothy as well.
December Highlights
Filling Up the Roth Buckets
As I mentioned below, I got my annual bonus in December. After discussing how we should allocate the money, we settled on contributing the bulk of it to our Roth IRAs. We didn’t stop there. We then took funds out of our high yield savings account and maxed out our annual Roth contributions. This is something we have never done before, but I hope to turn it into an annual tradition.
A Look Back at the Decade that Was
In looking at the numbers, it is amazing to see how far our finances progressed this decade. As I mentioned before, I entered the 2010s with a negative net worth of about $50,000 and my wife was closer to negative $90,000 with most of the debt coming from student loans.
What makes our progress more impressive is we’ve only been paying close attention to our finances the last 5 years or so, and we didn’t discover the Financial Independence movement until 3 years ago. Before that, fiscal mismanagement was rampant. I discussed the gory details of our financial follies in a previous post HERE.
The point of this is to underscore the fact that, no matter your financial past, things can change in a hurry. Even though the best time to fix your finances was yesterday, the next best time is today. Get to work and your future self will reap the benefits… and likely sooner than you think.
Coming Up in January
Troubled Floor No More
In January, we plan to replace the cracked ceramic tile flooring in our kitchen. When we purchased the house we had noticed some cracking in the tile and has assumed it was shoddy installation or damage from the previous homeowners. Naively, I replaced the floor with another ceramic tile one in 2015… As it turns out the cracking is due to seasonal foundation movement (shrinking/swelling soils) as opposed to poor installation. Within a couple years after installation the new floor started cracking in the same locations. Multiple rounds of piecemeal tile replacement later and the issue is still popping up.
Well enough is enough and we are going to have hardwood installed. Wood is more forgiving that a rigid tile floor, so it should perform much better. I know enough (I am an engineer that deals in soils and foundations) to know the cost of correcting the soil issue is cost prohibitive. So hardwood it is.
Savings Strategy Tweak
We’ve been saving up money in our high yield online savings account over the past year with the goal of using it to either buy into my company’s ownership or perhaps purchase another rental property. In doing so, we’ve had a decent chunk of change missing out on the continued bull market.
Towards the end of the year, the timeline for buying into my company’s ownership became more distant and the overall idea less desirable (due to my creeping burnout with the industry). As such, the need to have a stockpile of cash readily available has been diminished. Therefore, at the end of the year we pulled out some of those savings and filled our Roth IRA buckets as I previously mentioned.
Moving forward, we plan to direct savings that are over and above our pre-401ks and HSAs into our Roth IRAs. This will, in effect, front load our investments for the year. Once the Roth buckets are filled, then we will return to adding savings into our high yield online savings account or figure something else out. A good problem to have to figure out, to be sure.
Here’s wishing you all have a prosperous new year! Thanks for reading!
