April 2016 Financial Update
Now that April is over, we are one third of the way through 2016. How are we doing? Where are we going from here?
Financially, April was a great month on all fronts. Our net worth increased by $23,000 to $1,552,000. Our income remained strong at $2,471 even though it’s been a few months since we received any pay checks from employers. Our spending dropped significantly compared to last month to $1,829 (not buying a new minivan certainly helped keep expenses low).
On the personal side, April was an incredibly busy month. The weather was nice so we spent a lot of time outdoors. We were busy with kids’ school events and volunteering, hanging out with friends, and enjoying the wonderful life we have built through a decade of financial butt kicking. We capped off the month with a day trip to the beach for a wedding.
On to the numbers!
After receiving $4,476 in dividend income in March, our investment income dropped to just $130 during April. Since our portfolio is all funds and ETFs that pay dividends quarterly or annually, the months of March, June, September, and December are big for dividends. As this post goes live, we’re about six weeks from the start of the next dividend season in June. In 2015 we earned a total of $28,527 in dividend income.
Blog income, shown as “other income” in the chart, was fairly normal at $2,043. My early retirement lifestyle consulting brought in $180 in April (same as March). I’m still aiming to live off of four percent of our portfolio, and treating the blog and consulting income as purely discretionary money that we can spend if we want (or save if we want). The next month or two should be very good months for blog income thanks to a lot of recent attention in the media (part of what kept me busy during April!).
Deposit income of $117 includes $87 of ebay and craigslist sales plus $30 of cash back rebates from the Ebates.com and Mrrebates.com online shopping portals. I’m all about sharing the wealth, so if you sign up through this link and make a qualifying $25 purchase through Ebates, you’ll get a $10 gift card like I did. I try to do all of my online shopping through one of these portals and the cash back adds up fast. I’m not sure when I’ll actually get the cash but my Ebates account was just credited with over $100 in cash back from our January 2016 cruise I booked through Expedia (via Ebates). Very nice and worth the wait!
If you’re interested in tracking your income and expenses like I do, then check out Personal Capital (it’s free!). All of our savings and spending accounts (including checking, money market, and five credit cards) are all linked and updated in real time through Personal Capital. We have accounts all over the place, and Personal Capital makes it really easy to check on everything at one time.
Personal Capital is also a solid tool for investment management. Keeping track of our entire investment portfolio takes two clicks. If you haven’t signed up for the free Personal Capital service, check it out today (review here).
Now let’s look at April expenses:
Monthly spending in April totaled much less than our budget of $3,333 per month (or $40,000 per year). We didn’t buy a minivan and we didn’t have any large annual bills like property tax or insurance, so it was easy to come in well under budget for the month.
Grocery spending dropped back to a more normal $428 during April. I thought this would be a lot higher given how well we ate and how much we shopped for groceries during the month. I guess I’ll have to thank Aldi, Trader Joe’s, Kroger, Walmart, Food Lion, the Asian store, and the Mexican grocery store for keeping their prices low.
Healthcare spending increased significantly to $270. Since we no longer have dental insurance, Mrs. Root of Good paid $105 for her routine dental visit (the cash rate for uninsured patients at our dentist). We finally got to use our new health insurance when Mrs. RoG visited the doc to have a lump on her arm checked out. It was diagnosed as likely being a lipoma (a lump of fat, and please note, NOT lymphoma or anything like it fortunately!). The doc scheduled her for minor outpatient surgery the next day. The biopsy revealed it was, in fact, just a lump of fatty tissue and totally benign. Our insurance is working out well so far with two $20 copays paid at the time of service plus another $120 bill for the surgery (20% of the $700 price the insurance allowed for the surgery).
Health insurance premiums totaled $125 for our very impressive gold plated silver plan obtained through Healthcare.gov with some very sizable ACA subsidies. Quick update on our health insurance situation: four of us obtained insurance through the healthcare.gov exchange very quickly. We had to apply to the state’s medicaid/NC Health Choice program for our three year old (now four year old). We’re currently on day 87 of waiting for our application to be approved so our four year old has been uninsured since May 1 (during March and April we had the possibility of retroactive COBRA coverage for the little dude but that option expired April 30). He will have retroactive coverage if his NC Health Choice application is ultimately approved (which it should be). The wheels of bureaucracy move. Slowly. Let’s hope they finish processing the application before he’s five. And I think the State of North Carolina is distracted with other important issues these days, so I understand the delay.
Good thing we don’t pay state tax to fund the agency processing his paperwork. Except we do! Since we don’t have any tax withheld from a paycheck, we now have to make estimated tax payments. I made the first estimated quarterly tax payment of $225 for state taxes. We can pay online and we can even pay with a credit card for a 2% fee. Good to know if I need to meet minimum spending requirements for my credit card travel hacking hustle!
Clothing and shoe purchases totaled $200 for the month. Everyone but me got new shoes and the ladies got new swimsuits. We also did a bit of thrift shopping.
Utility spending of $167 includes the water/sewer/trash and the natural gas bill.
Restaurant spending of $103 included some horribly unhealthy but delicious donuts, Chinese take out, and a fun lunch out with an old friend. However, the bulk of the restaurant spending in April was for a meal at the restaurant where the beach wedding reception was held ($62 for okay but not great food). We had to pay for our own meal but (1) we can afford it and (2) at least the bride and groom didn’t have to pay tens of thousands of dollars for their wedding. Nicely done newly married couple!
The $69 electronics purchase was an ASUS RT-N66W router. We tried to go cheap on a router last month and it didn’t have the range that we needed to cover the whole house. Lesson learned and $15 wasted (but we have a backup router just in case).
The uncategorized expense of $67 was mostly the purchase of our new couch at a thrift shop benefiting the homeless. The curb sleepers of Raleigh get some of our cash to keep them off the street and we got a new couch. Now to craigslist the old couch for more than we paid for the new(er) couch. We also found some other ridiculous items like a brand new pair of shorts from Jos A Banks with tag still on for $3. The only reason this expense was uncategorized is that Personal Capital couldn’t categorize the purchase correctly since it’s the first time we’ve shopped at this particular thrift store. After I update it, it’ll be in the system correctly for good and subsequent purchases from this retailer will appear correctly too.
The minivan needed a few final touches before getting it road ready for our summer trip. I spent $16 on some fancy windshield wiper blades at Walmart (they were on clearance) and $42 for tire rebalancing. The tech said the wheels were way out of balance. The vibrations observed at mid to high speeds disappeared immediately after the rebalancing. So far so good on the used car purchase.
The entertainment expense of $48 was a brand new camera lens for Mrs. RoG’s photography addiction. I debated whether to put this in entertainment or electronics because it’s really both.
Not shown in the expense graphic because of their small dollar values were:
- gifts – $45
- gasoline – $40 (mostly the trip to the beach at 23 miles per gallon in our minivan with 7 passengers)
- internet – $31
- service charges/fees – $26 (Mrs. RoG’s 401k – I’ll have to follow these closely to see how much they total per year)
That’s a lot of consumption but we still spent at a level 30% below the poverty line. Maybe we’ll throw in some cigarettes, alcohol, bail bonds, flashy rims, and lottery tickets to bootstrap our way up to the lofty heights of poverty level living next month (no offense to my distant kinfolk if you guys are reading this month’s edition of Lifestyles of the Rich and Boring).
Year to Date Living Expenses
At $17,065 year to date spending, we have exceeded the $13,333 budgeted for the first four months of the year by a few thousand dollars. This includes the minivan purchase in March, so if we keep under spending our monthly $3,333 budget (like we do many months) then we’ll be back on track in a few more months.
I just received the annual or semi-annual bills for about $1,000 for home, auto, and umbrella insurance policies. July and August should be fairly low cost months too since we’ll be traveling for half of each month on a road trip through the US and Canada and have already paid for all of our vacation lodging expenses.
Our goal this year was to spend more than the $24,000 we spent last year, and so far we are on track spend a bit more than that paltry figure. Regardless of whether we spend the whole $40,000 budgeted for 2016, we are having a good time, enjoying life, and doing the things we want to do in early retirement. And that’s what matters the most, right?
Monthly Expense Summary:
- January 2016 – $2,293
- February 2016 – $2,030
- March 2016 – $10,911 (includes minivan purchase)
- April 2016 – $1,829
Net Worth: $1,552,000 (+$23,000)
Another month of net worth growth! Yippee! We are within $40,000 of our all time high net worth reached in 2015.
The net worth is just a number to me. I don’t really get excited when I see a $23,000 increase in one month because I know the net worth figure will fluctuate by a five figure amount almost every month. That’s just the nature of the stock market and there’s very little one can do when investing most of one’s portfolio in equities.
If volatility concerned me, I would shift into more stable asset classes like bonds and cash. But it doesn’t so a high equities allocation is fine with me.
Every month we are growing more and more comfortable with our early retirement finances. Toward the end of 2015 and beginning of 2016, we watched our investment portfolio drop almost $200,000 over a three month period. A few months later, we have recovered all those losses and even gained a small amount.
What will the future hold? If by future you mean the rest of 2016, I have no clue other than it will go up and it will go down. In 2025 or 2030, I expect markets will be up. Let’s check back in at that point and compare notes.
In the meantime, I’m ignoring the daily market vacillations. I’m planning on enjoying a beautiful May in North Carolina (one of our best months weather-wise) and ease our way into summer when we depart for our road trip up north in mid-July.
And you? How was your April? Enjoying the rising stock market? Gearing up for summertime fun?