February had a wild finish. Lot’s of moving pieces and, of course, the market dropped like a rock. How are we handling the market correction?
I try to take the long view on investing, but I can’t help but watch the volatility recently. This is me checking my Personal Capital account at the end of February:
As always, you can check the latest and greatest info on the Track Our Progress page.
First, the numbers:
Net Worth:
- End of February Balance: $558,225 Down $22,592.00 (-3.89%)
- Year to Date (YTD): Down $7,317
- Since January 2018 (this is when I started tracking our net worth): Up $253,225
Portfolio:
- End of February Balance: $401,201 Down $26,277 (-6.15%)
- YTD: Down $14,037
- Since January 2018: Up $161,201
This is the first down month for us since September 2019. Scary headlines and shrinking balances aside, I think we’ve been handling it well. I am happy to report that we haven’t panic sold anything. In fact I have tried to “buy the dip” and make sure our extra HSA and taxable account balances have been invested during the down days. If we were much closer to retirement, I don’t know if we would be handling the situation as well. Only time will tell.
Monthly Contributions: $5,588
We had to pay the balance for our new kitchen floor so, contributions were down a bit this month.
February Highlights
Problem Floor No More!
The contractor installed our floor this month. We are loving it. As a hardcore DIY guy, hiring this work out was initially a tough pill to swallow. I am happy to report they did a good job. My anxiety over hiring a pro was quickly eleviated when it took them over 30 man hours just to remove the floor. I am not a pro by any means (as evidenced by the fact I installed the floor we replaced!) so I can’t imagine how long it would have taken me.
Here’s a pic of the almost finished product:
Keeping Spending in Check
We’ve set a goal to reduce spending on certain discretionary categories by 20% compared to 2019. Categories include alcohol, dining out, clothing, general merchandise, and entertainment. In February we spent $494 LESS than our BUDGET! So far we are 2 for 2 in staying below our budget this year.
Mrs. Heartland on FIRE got a Raise!
She was one of, if not the, highest rated in her group during her company’s annual review period. She, in turn, received one of the highest raises in her group. This equates to a few extra grand a year. I am super proud of her!
What does she want to do with the extra money? Well, she mentioned she is thinking about front loading her 401k with the difference between her old and new paycheck. How cool is that!
Coming Up in March
Rental Decision Point
We rent out our old house and the tenant’s lease is up at the end of March. We are not renewing their lease. Now we need to decide what to do with the old place. Make repairs and rent it back out, or do we fix up the place and sell it? Property values have risen recently which are enticing, but transaction costs and taxes are pulling us back towards renting.
How have we been comparing these options? Our property manager is also a real estate agent and has been sending us comps to help us gauge the market. My wife and I went through and estimated repair costs for both the rental and selling options and developed a forecast (as best we can) of future maintenance. Then we compared the future value of sale proceeds vs. the rental cash flow. When it was all said and done we arrived at a sales price that we would need to meet or exceed to consider selling the house.
We will do a thorough walk through and re-evaluation of comps once the current tenant is out and we will update our estimates. If the numbers say sell, we will go that route, and if not, we will happily re-rent. Hopefully, the stock market volatility and coronavirus concerns won’t spill over into the housing market by then.
Taxes, Taxes, Taxes
My wife has been working through filing our tax return. We still have a bit to go, but early indications show we will have a small return, with a large tax bill to the state and a decent return from the Federal government. Weird how that works.
In year’s past, we have gotten some larger returns and honestly, this gives me mixed feelings. While I generally agree with the “don’t give the government an interest-free loan” mindset, it is a bit disappointing to not have a fat return. Ultimately, we must be doing something right if we were close overall.
Home Garden From Seed Version 2.0
Last year was the first year I grew our garden from seeds. Overall, it was a good success with lots of tomatoes, jalapenos, and basil. However, there were several plants that were busts (all the kale, spinach, arugula, and the bell peppers). This year I am sticking with the successes and replacing the failures with bunching onions, zucchini, and cilantro. I swung into the local Home Depot and grabbed everything this week. Now if I can get my two kiddos to help me get these seeds sown, we will be back in business.
Thanks for reading and an early Happy St. Paddy’s Day to ya!
