February 2017 Financial Update

Two months into 2017 and things are off to a great start for us.  Our income of $4,893 for the month greatly exceeded our expenses of $2,108.  Our net worth climbed another $38,000 to $1,756,000 primarily due to solid stock market gains.

Our taxes are filed and we’re due small refunds from the state and the feds totaling several hundred dollars.  My first effort at paying quarterly estimated taxes in 2016 were a huge success since I came very close to our actual tax liabilities without giving our state and federal governments unnecessarily large loans.  Our overall tax liability is higher in retirement compared to our working years thanks to the self employment tax due on blog earnings.  At least I’m increasing my future social security check slightly.

 

Income

Our investment income was $132 in February.  We get more monthly investment income since shifting $50,000 from stocks to bonds in January.  However, the majority of our mutual funds and ETFs pay dividends quarterly in March, June, September, and December.  Since the bond yield is about the same as our overall portfolio yield, our total annual investment income will remain roughly the same.

Blog income, shown as “other income” in the chart, remained strong at $3,581.  My early retirement lifestyle consulting income dropped to $465 after a very busy January.  That works out to about one hour per week which is perfect for me.

The $713 in Deposits includes cash back from my credit card (now I’m putting spending on Chase Sapphire Reserves to score 200,000 bonus points).  It also includes cash back rebates from the Ebates.com and Mrrebates.com online shopping portals. 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.  We had a bunch of spending late last year that finally paid out the cash back bonuses in February along with some referral payments for folks signing up through the links on this blog.

february-2017-income

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).

 

Expenses

Now let’s take a look at February expenses:

february-2017-expenses

We came in well under our budgeted $3,333 per month (or $40,000 per year) during February with total spending of just $2,108.

Utilities- $1,036:

This is mostly from the $800 I prepaid on our electric bill.  They charge a flat $2.40 fee for credit card transactions so I usually pay a large chunk at a time to avoid the $2.40 fee every month.  I prepaid enough to cover all spring and summer electric bills since I’m trying to spend $8,000 in three months to score my 200,000 Chase Ultimate Rewards points from our Chase Sapphire Reserve cards (hint: 100,000 point offer is no longer available online but the 50,000 point bonus for Chase Sapphire *Preferred* card is still available).

The utilities total also includes our regular monthly water, sewer, and trash bill from the City plus an abnormally low natural gas bill (thanks overly warm winter!!).

Groceries – $508:

We came in very close to our $500 per month average for groceries.  Not bad considering we bought several discounted gift cards for groceries at Walmart, Aldi, and Kroger during the month and still have about $150 in value remaining from those purchases.  If you haven’t checked out raise.com for discounted gift cards for places you already shop, then feel free to save an extra $5 off your first purchase at Raise.com.

They have sales a few times per month where they offer $5-10 off a $50-100 purchase or an extra 4-5% off all gift cards so it’s easy to get a discount on gift cards and score an additional discount from Raise.com’s promotions.  Since I already spend about $500 per month at stores such as Aldi, Walmart, and Kroger it’s an easy way to save 10%+ off stuff I’m routinely buying.

Homemade banh xeo Asian crepes.

Homemade banh xeo Asian crepes.

Obligatory monthly pho pic.

Obligatory monthly pho pic.

...which we enjoyed outside in the 70-80 degree weather this February.

…which we enjoyed outside in the 80 degree weather this February.  Gotta love “winter” in the South.

I tried out Instacart grocery delivery service during February.  They were offering $15 off a $35 purchase with free delivery.  How bad could it be?  Turns out it wasn’t that great.  They messed up several items by substituting other items that cost twice as much or more. And instead of the two bunches of kale I ordered, I received two partially moldy bundles of mustard greens.  The apples (sold by the pound) were huge while the lettuce (sold by the head) was tiny.  After complaining to Instacart and receiving a refund for the most egregious shortcomings I ended up spending a net of $10 for my grocery order so it wasn’t a bad deal after all.

I think the service is good enough once you learn to specify certain things like “pick small apples”, “don’t substitute”, and “kale is dark green and says k-a-l-e on it, not m-u-s-t-a-r-d g-r-e-e-n-s”.  If I were mobility impaired or without transportation this service would be 100% kick ass in terms of quality of life improvement, warts and all.

The one on the left is Instacart's choice of lettuce. The one on the right is what I usually buy. Mine is twice as heavy as the Instacart lettuce (and 5 cents cheaper).

The one on the left is Instacart’s choice of lettuce. The one on the right is what I usually buy. Mine is twice as big as the Instacart lettuce (and 5 cents cheaper).

Automotive – $165:

This represents our annual car inspection fees, licensing, registration, and taxes.  I appealed our vehicle’s tax valuation and they lowered the appraised value from just over $10,000 to $6,800, thereby saving about $35 in property taxes.  The effort required?  Emailing a scan of the Bill of Sale to the county tax assessors office.  Maybe 10 minutes including finding the Bill of Sale.  If they jack up my assessed value for 2018 I’ll be able to forward the same email in about 30 seconds and save another $35 hopefully.

A little DIY repair. The license tag lights burned out and as a result I failed the state safety inspection. $0.99 on ebay and a few days later and I had a fix. Though it took 45 minutes to install. In hindsight, I should have paid the auto shop $20 to install the new tag lights.

A little DIY repair. The license tag lights burned out and as a result I failed the state safety inspection. $0.99 on ebay for a pair of LED lights and I had a fix. Though it took 45 minutes and removal of all the back tailgate interior panels to install. In hindsight, I should have paid the auto shop $20 to install the new tag lights.

Travel – $150:

We’re still chugging away at our trip planning for our nine week trip to Europe this summer.  The $150 represents three sets of intercity bus tickets for the five of us:

  • Malaga, Spain to Granada, Spain on Alsa – USD$41
  • Granada, Spain to Seville, Spain on Alsa – USD$40
  • Venice, Italy to Ljubljana, Slovenia on Buscenter.it – USD$69

It looks like those Venice-Ljubljana tickets will be our most expensive set of bus or train tickets on the entire trip.  It’s crazy how cheap buses and trains are in Europe.  March’s expense report will include several more sets of tickets in the USD$40-50 range.

I'm hoping to see some of the great outdoors while in Europe. Slovenia looks particularly promising.

I’m hoping to see some of the great outdoors while in Europe. Slovenia looks particularly promising. This, however, is more local. A trail a couple miles from our house.

Healthcare/Medical – $114:

We paid $98 to the dentist which covers the 20% copays on two routine dental visits plus two fillings for our kids.

The balance of the healthcare/medical spending is one month’s health insurance premiums of $16. For us, the Affordable Care Act works phenomenally well in making our health insurance premiums tiny.

Will the ACA remain intact in 2017 and in the future?  Who knows.  The latest draft GOP “repeal/replace” bill didn’t look too ugly for the near term since it kept ACA premium subsidies intact through 2019, with the subsidies changing to a refundable tax credit starting in 2020.

Enjoying our free "made from pallets" balance machine

Enjoying our free “made from pallets” balance machine

Nothing like a completely empty pool and aquatic park during the weekdays for your private lap swimming. Impossible to get in here most weekends due to long lines.

Nothing like a completely empty (other than lifeguards) pool and aquatic park during the weekdays for your private lap swimming. Impossible to get in here most weekends due to long lines.

Electronics – $45:

I ponied up $80 for a new (used) smartphone in preparation for our Europe trip.  I had $35 of ebay gift cards purchased last year that brought the cost down to $45.  I went with the Samsung Galaxy S4 Active, a ruggedized version of the regular Galaxy S4.  The phone is a few years old but still a beast of a smartphone.  And if I drop it in a puddle it might survive the inundation.  If not, at least it won’t cost a lot to replace it.

I’m using a $0.99 global SIM chip purchased from Freedompop for service while in Europe.  It’ll give us 600 MB of data per month (actually x2 since I bought 2 SIMs).  Plus 200 minutes voice calling to US numbers, with 100 minutes of global calling.  I think it will work everywhere in Europe except Slovenia where they currently don’t offer service with the Global SIM.  Not bad for 2 bucks if it works like I think it will.  It’s working very well here in the US so far.

Gifts – $29:

The Samsung Galaxy S4 wasn’t the only cell phone I bought in February.  I also picked up a Kyocera Hydro Icon directly from Freedompop for $29.99.  This is going to be our oldest daughter’s birthday gift later in March, and our kid’s first entry to the world of smartphone ownership.  Scary times for sure.

The phone comes with free monthly service and includes 200 “voice” minutes, 500 texts and 900 MB of data each month.  I can set it up so overages are impossible for a one time $5 fee if that’s what my daughter prefers.  Otherwise she’ll be on the hook for monthly fees.  She has unlimited free wifi at school so hopefully the limited cell data won’t be a problem.

A commenter asked if I’ve done a review of Freedompop on my blog.  I haven’t but you can read my brief thoughts on it in my response to that comment.  Basically, I like it.  We’re on wifi most of the time and the 3G/4G data is adequate for times we’re not.  I put the “voice” minutes in quotes because it’s actually VOIP or voice over internet protocol for their voice minutes.  So if I’m in an area with bad cell data reception I can suffer degraded call quality.  Given that I only use about 5-10 minutes of call time each month it’s not a big deal.  It wouldn’t work for some, but for a light cell user like me it works perfectly. And the $0 monthly price tag is hard to beat.

Right now they have $2 US based SIMs available if you have an old inactive phone that takes SIMs and want to give it a go for a few bucks.  Or power up that old phone for Grandma or for your kids.

Gasoline – $39:

We finally refueled the minivan in February.  We’re carpooling with another family so we drive about 120 miles per month for that in addition to other routine driving around town for shopping, errands, entertainment, and recreation.

I actually refueled again on February 28th but the expense didn’t post on the credit card statement till March so you’ll see that expense next month.  I had to use up my Kroger fuel rewards set to expire at the end of February.  That should get us through March unless we take a big trip somewhere.  Though with nicer weather here we might be out and about a lot more swimming and exploring local trails and parks.  Or not, if the hammock calls my name.

Entertainment – $11:

$11 was roller skating admission for two kids.  Most other entertainment options are free or very cheap.

Who has time for expensive paid entertainment options when there's a lakeside campfire to be enjoyed?

Who has time for expensive paid entertainment options when there’s a lakeside campfire to be enjoyed?

Fire also doubles as a grill.

Along with some flame roasted steaks and sausages. Improv rock tossed in the middle to support the “grill” (aka an old oven rack).

Or things to climb on in the neighborhood?

Free things to climb on in the neighborhood?  Check.

Or more things to climb on ?

More things to climb on at a different nearby park.

Or things to build then climb on?

Things to build then climb on.

How about the state science museum coming to your neighborhood library with snakes and other assorted reptiles?

How about the state science museum coming to your neighborhood library with snakes and other assorted reptiles?

Restaurants – $6 (not shown in the expense summary graphic):

We bought takeout pizza twice during February.  Once was with gift cards bought in previous months (at a discount through Raise.com or elsewhere of course).  The second time was partially paid by us but also included some free personal sized pizzas the kids earned at school.

Not from a restaurant. $2.99 for a one pound bag of pork or chicken potsticker dumplings at Trader Joe's.

Not from a restaurant. $2.99 for a one pound bag of pork or chicken potsticker dumplings at Trader Joe’s.

Fish n green beans. Mmmm...

Fish n green beans. Mmmm…

 

Year to Date Living Expenses for 2017

february-2017-expenses-ytd

At $5,487 spending for the first two months of 2017, we are about $1,000 below our annual spending target of $6,667 budgeted for the first two months of the year.  And that’s in spite of paying the big lumpy annual home property tax bill and prepaying $800 toward the electric bill.

For the financial voyeurs, here is a full summary of our 2016 budget versus actual spending for all twelve months of last year.  In that article I make the case that we’re living a $100,000 lifestyle on roughly $40,000 per year.  Let me know what you think.

This month I plan to solicit bids from a number of contractors to replace our roof.  I expect this will cost around $4,000 to $8,000 which will probably be our largest expense all year.  Our other living expenses are usually pretty modest in March and April so we might not exceed our total annual budget even after the large roof expense.

Most of our travel expenses are already paid for our nine week trip to Europe.  By late January we finished booking 64 nights in Airbnb apartments for around $5,250 or about $82 per night.  We purchased $5,800 worth of Airbnb gift cards in December 2016 so we didn’t pay anything out of pocket in January for the Airbnb rentals (and we still have several hundred dollars left over for future travel).  The good news is that once we are in Europe in June through August most expenses will already be paid other than local transit, rental cars, food, and some attractions.  I hope to publish a big post during March outlining our nine week trip to Europe with a rough budget included!

 

Monthly Expense Summary for 2017:

 

Net Worth: $1,756,000 (+$38,000)

Deja vu! On the heels of a $38,000 net worth increase in January, we experienced another $38,000 net worth bump in February bringing our total net worth to an all time high of $1,756,000.  We didn’t celebrate breaking through another quarter million dollar milestone other than noting it, and accepting that we might get to experience breaking through that particular milestone again at some point if the market doesn’t continue going up forever (which it won’t).

February of 2016 found Mrs. Root of Good leaving full time employment for good.  One year later and our net worth is up by more than $300,000.  It’s a good feeling to have all this cushion in our portfolio but I accept that the stock market goes up and down.  We could just as easily lose $300,000 or more in the next year.  We’d still feel pretty wealthy since I know I felt wealthy one year ago at a ~$1,400,000 net worth!

 

february-2017-net-worth

A quick note on those spikes in the net worth chart.  Nothing crazy here, just hiccups from doing some asset conversions and transfers.  First, I converted my admiral class Vanguard shares to ETF class shares.  It’s a tax free conversion.  It makes the shares easier to transfer in kind to other brokerage firms.

I then transferred over $200,000 of ETF shares to Fidelity to pick up a his and hers 50,000 United Airlines mile bonus when you transfer $100,000 or more to a brokerage account.  This bonus is available once every 12 to 14 months so I’ll probably rinse and repeat in 2018 (by transferring assets back to Vanguard or elsewhere for a few months then round-tripping to Fidelity).  100,000 points equals four flights across the US or around three flights to Mexico/Central America/Caribbean.

This guy right here knows it's feeling like springtime right now!

This guy right here knows it’s feeling like springtime right now!  On a different note, why are dandelions considered a weed?

In investing moves, I maxed out our Roth IRA’s to the tune of $11,000 in February and contributed $4,050 as an employer contribution to my solo 401k.  I’m able to fund the IRAs and the 401k due to earnings from this blog.  Since I wanted to maintain my cash/bond reserve I transferred $15,050 from my money market account to fund these new IRA/401k contributions in the Vanguard Total Bond Market Index Fund.

Fixed income investments are now at roughly $65,000 bonds and $25,000 cash (in money market).  The bonds yield roughly 2.5% while the money market yields 1.0%.  I’ll suffer some cash drag on investment returns but I can sleep at night knowing I have a few years of living expenses tied up in relatively stable fixed income investments.

And when it comes to living well for the next 40 to 60 years, sleeping at night is pretty important.

 

 

Boy howdy, this stock market is on fire! Any newly minted millionaires want to out themselves publicly?  What are you sensible, frugal-minded people doing with all your newfound wealth?  

 

 

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145 comments

  • Nice job with lowering the budget by an entire thousand for the month of February! Now you have a lot of leeway to run with!

    For those who are interested in the Chase Sapphire Reserve 100,000 point offer, it should still be available in-branch until March 12, so unless something changed, that should still be an option.

    • I read that as well. Unfortunately I couldn’t find any Chase branches in New England.

    • Yes, thanks for mentioning that. If you have a branch nearby you can always drop in and get the 100k offer. Our nearest chase branch is in the mountains of W Virginia or in Jacksonville FL. Both 4+ hour drives away. Still a good card at 50,000 bonus points especially if you travel any significant amount. We’re planning on making use of the Priority Pass for lounge access several times this summer on our big Europe trip.

    • FYI, you can also pick up an Ink Business Preferred card for 80,000 points bonus. I’m thinking about it, but haven’t sign up yet.

  • Looks amazing! … your portfolio gains in one month can cover things for a year … it is good to plan these things out! God Bless, Beijing 🙂

  • It’s an awesome thing when you see your net worth increase more than six figures and weren’t even working. Even with me quitting work back in June, we were also up well into the six figures. Though like you said we may soon be going through the same milestones, this market’s been crazy.

    Nice work on planning out the Europe trip. You keep making me feel lazy about our trip to Barcelona. I gotta get moving on booking Airbnbs. But we also have our free trip to Jamaica coming up, so I’m a bit distracted 🙂

  • I like the Fidelity brokerage mile trick. How difficult is it to do that account creation and transfer?

    Does it take days where the money is isn’t invested? (I guess you’d be transferring shares so the shares are shares, always invested.)

    Does it worth with Roth IRAs?

    • It’s pretty quick and easy. Didn’t have to print out anything or sign anything in person to transfer TO Fidelity. The Fidelity to Vanguard transfer however took filling out a form and signing it then mailing in (I think). It’s all “in kind” transfer so no time out of the market. You transfer 1000 shares of BND and 1000 shares of VTI and those 1000 shares of each show up at the receiving institution (with tax basis info intact!).

      The particular promotion I did doesn’t work for IRAs but they have a couple other promotions that will work with IRAs (some cash back, some tied to giving you a 10% match on IRA contributions for next 3 years, so $550-650/yr x3 ).

  • Great post! You have this down to a science. I look forward to hearing more about your Europe trip, as my family and I are planning something similar. Do you anticipate it being relatively easy to get by without speaking the local language (or do you speak it)?

    • I speak proficient Spanish so no problems there. I can sort of read Portuguese and Italian (and understand a bit of both when spoken) due to the Spanish skillz and studying a little. I spent a lot of time studying German as well, so I can hopefully get by in Germany and Austria. Not even going to attempt learning Czech or Slovenian though 🙂 I have google translate on my phone and it can do real time translation of signs, menus, etc. I’ve heard that many places have English as a common language in Europe so hopefully won’t encounter too many problems.

      So to summarize, I’m going to wing it and see what happens. 🙂

      • Kein problem in Deutschland. Viel English ist da gesprochen.

        • That’s the conclusion I’ve reached too. And google translate is my friend. I imagine many Europeans speak better English than many Americans.

      • When I visited Slovenia two years ago, everyone spoke English – except in the old-man dive bar I ventured into in Ljubljana where the 60’s something woman was tending bar. I grabbed a beer from the cooler while my girlfriend order a Cynar (she loves the amaros). The woman poured her a half pint of Cynar (!?!) and opened my beer. I handed her a 20 euro note and got somewhere near 15 euros in return.

        By the way – when you go to Ljubljana you might like to take a bus ride or drive up to Lake Bled – for a beautiful long walk, roasted chestnuts, and a rowing trip to the church on the island in a boat that looks like a swan – a great day trip through a beautiful countryside. Also, the puppet museum in the castle at the top of the hill in the center of the city is AMAZING for kids and adults.

        • I like that – just take what you want and hand a large bill to the cashier. I’ve done that in Mexico where I couldn’t really figure out what we owed exactly or what price they told me. And always works at grocery stores too, but they seem to have questions for you (do you want paper or plastic? or do you want your reward points on a card or something).

          We’re definitely going to Lake Bled for the day. The rowing trip to the church in the center – do you rent a row boat and row yourself? Or is it manned by a rower that rows for you. I’d prefer the unmanned boat if I can find it!

          In Ljubljana we’re staying right next to the castle and definitely plan on heading up there for the day.

  • “The balance of the healthcare/medical spending is one month’s health insurance premiums of $16. For us, the Affordable Care Act works phenomenally well in making our health insurance premiums tiny.”

    Soooo, you increase your net worth by $38,000 last month, while us TAXPAYERS subsidize your healthcare!!!
    My healthcare premiums have INCREASED by OVER 1,400% since this horrible law took effect, while my deductibles and other out of pocket costs have DOUBLED!

    This is the problem with liberal policies, forcing those who work for a living to pay for those like you, who have no pride, and choose to suck off the public teat.

    President Trump and congress can’t get rid of obummercare fast enough.

    • Dave, thanks for posting. Quick question: did you wake up angry this morning or did your anger overtake you after reading my post? A little of both maybe?

      • I bet you are looking forward to that 2M mark which appears to be right on the horizon. That’s so awesome!! I have learnt so much from your posts. You are transparent with your financial life and thats what makes you one of the best financial bloggers. It gives us many helpful tips but unfortunately also attracts some hatemongers. Brush off the trolls and keep up the good work!

      • Yes, what doesn’t Dave get? I think he needs to reread your entire blog…

      • I understand Dave’s frustration with the system. On the other hand I applaud your savvy understanding of the rules and reg’s that you and your family fall under and the way you use those systems to your financial advantage. You didn’t create those systems. Good for you Justin. Hopefully Dave can use this blog to find ways to stretch his dollar’s farther. I know I have.

        • There you go! I don’t necessarily agree with the way the game is set up but I’ll certainly play by the rules imposed upon me (and vote for what I think is a more sensible approach).

          • David Wendelken

            “There you go! I don’t necessarily agree with the way the game is set up but I’ll certainly play by the rules imposed upon me (and vote for what I think is a more sensible approach).”

            That’s a fair position.

            It is ludicrous that people who have a fraction of your wealth are working to pay taxes to pay for your subsidies.

            Just like it’s ludicrous that Mr. Warren Buffet’s tax rate is a lower % of his income than his secretary’s is. (To be fair, Mr. Buffet is also wise enough to know that and point that out to the rest of us.)

            You’ll probably be stiffed on social security when they implement a means test, so it may well come out even in the long run.

      • Lol. Awesome comeback!

    • Funny….you mentioned Trump and Taxpayers together….hah!

      Also dear internets, remember Justin and family paid taxes for a long time while employed. They were just a little smarter than most by saving and investing the rest instead of lighting money on fire like most others do.

      • Yeah that is a fun connection. Though other billionaires like Buffett will tell you our tax system is particularly friendly toward billionaires 🙂

        As for our lifetime tax liability, I wouldn’t be surprised if we end up paying a pretty steep bill in our later years. That will happen if our portfolio keeps going up like it has been. RMDs and even dividends and interest (on top of SS) will add up quick.

      • Hmm, he paid 35 million in 2005. Aprox 25% of his income. How much did you pay? And what %? Last year I paid an effective rate of 19%. So u blindly agree with the left wing Trump haters ASSUMING he didn’t pay taxes?

    • Dave,
      Trump voters love his “business-savvy” and didn’t mind that he used the “system” to not pay federal taxes for 20 years and go bankrupt multiple times while living in palaces and owning a private jet. Help us understand your outrage with this situation again?

      • Yeah that’s the weird disconnect here. I actually like Trump’s approach to taxes (assuming everything he’s done was on the up and up). Kudos if a billionaire can figure out a way to pay no taxes legally. I’d love to see the tax returns just to see how his finances are structured. Might be worth a look to see if the income tax system is equitable if that’s the outcome though (and I’m not saying I don’t belong under the same microscope 🙂 ).

        • While I’m commenting, I may as well as a question I had while reading your post.

          Is your 200,000 points from the Chase Reserve card because you and your wife each signed up for one? Or did you get some super secret signup bonus?

    • Oh my. The irony of someone going ape on a blogger for using the government rules to their advantage, while in the same post glorifying a president that hasn’t paid taxes in years. The cognitive dissonance with the “has trouble working a microwave” crowd is astounding!

  • We are buried in snow here in Montana! But it’s provided a lot of great snowy hikes, snowman building, sledding, and other wintery (and affordable) fun. Looks like our expenses came in at $1569, which is low for us. But most months I feel like we did so many fun things, I can’t image how spending more could have made it better.

  • Great job again! Man, our winter is terrible this year. It’s snowing today! That’s crazy for Portland. We are all so ready for nicer weather. Our expense was around $3,500 in February. Pretty good for us. We’ll need to relocate to a cheaper location if we hope to cut back anymore.
    Income was really good so it worked out.

    • We stole your good weather 🙂 This must be the warmest winter on record here.

      Congrats on your income. I saw it’s been very solid these past 2 months.

  • Long time reader, first time commentor. 🙂 It’s just mind boggling how some of your expenses amount to what many spend on lunch! Great job! Who says you can’t live a rich fulfilling life and live it frugally! My wife and I are 38 and 39 and we are luckily both on board this early retirement train. This market has been on a rampage and I’m humbled and grateful to report our net worth crossed the million dollar mark this month. I was sitting on the porcelain throne in the morning (sorry TMI) and refreshing my personal capital app and saw 7 figures! It was a great moment but also somewhat anti-climatic. Exchanged a few texts with my wife (just outside in the other room) to tell her the news, sent some celebratory stickers back and forth and that was it. I don’t even think we talked about crossing that milestone at all after that. Reason being we are just barely halfway there and our goal is to have at least 2 million in the bank to comfortably call ourselves FI.

    I don’t think about it much but when I do it’s a bit surreal. We have always lived the average middle class lifestyle with 2 kids, two car loans, a house and your typical annual vacations. Once I saw the light of FI and got my wife on board, we sold the cars, the house, and cut back spending bigtime. We now rent, drive cheap leased cars, and within less than 2 years have seen our net worth go up multiple 6 figures.

    Thanks for all the great work on this blog, I eat up these blogs like my favorite sashimi and it really motivates me to keep going.

    • Congratulations on hitting the big 7 figure mark! Our journey past $1 million was similarly anti-climactic. Like hey, we’re here and it’s awesome but it’s not the finish line.

  • So good to see a new post from you in my inbox this morning! Glad all is going well for you and as always you provide great encouragement with your success.

    So, I finally took the plunge and as of March 1st – retired from full time employment. I would not call it extreme early retirement as I just recently turned 57, but still better 57 than 67. It does feel weird and I have found myself feeling very nervous at points throughout the day. Maybe this is usual?? I think I worry too much- LOL- ( my husband would say that is an understatement)- but curious if you felt uneasy or worried about money running out etc in your first few weeks of retirement.

    • Well done, Sal. And you’ll be fine. But adjusting can take some time. Enjoy!

    • Congrats on making the big move!

      I wasn’t really worried about money at all once I ran the numbers and knew we were fine. I did feel a need to be doing something the first six months or so. That feeling of needing to be busy slowly faded away after that 🙂 Now I have no problem doing nothing all day, though I tend to get involved in something every day.

  • Congrats on building that side income so nicely. 🙂

    I reaaaaally like that you can pre-pay your electric bill. That is freakin’ sweet. That’s a great idea to apply the upfront payment to the credit card too. I like your style. 😉

    • We’re pretty low spenders so these big minimum spending requirements are a bit intimidating. Hard to imagine spending $8000 in 3 months when you sometimes spend just $1000 in a month. Having the ability to drop $800 on the electric bill or $500 on the water bill to cover the next several months is a nice safety relief valve to help us ensure we can spend the required amount. And saving on the credit card fees at the utility is great too!

  • Thanks for giving me the idea to prepay my electric bill and get credit card rewards. I never wanted to do it because of the fee but paying several months at once may work for us, also.

    • It definitely pencils out for us. A $120 bill generates $2.40 on my 2% cash back credit card. So if I pay any amount over $120 I’m making a slight profit off using the credit card for amounts beyond that.

      • Won’t the electric company send you back the overpayment? Would still count though…

        • They never have before (nor has cable/internet, city water/sewer, or natural gas 🙂 ). I’m sure they would if I asked. Could be a clever way to manufacture spending. Drop a few thousand on a utility bill for $2.40 flat fee (or no fee for everyone other than electricity here) then request a refund check for the balance.

  • Congrats on another great month. Your net worth is getting a little embarrassing, in a good way. Discounted Aldi gift cards? I need to get on that boat. We are silly and pay full price at Aldi, fleecing I tell you!

    I have to ask about the Roth IRA’s though. Why bother? With low income your cap gains and dividends are tax free, without the added restrictions of a Roth IRA. Also, if you forecast your Roth IRA’s, to the age of 59.5, how much will you have in them? The number might be so large your eyeballs might fall out of their sockets. At least mine would, given 40k per year spending budget.

    Third, I would like to thank you for your college article. The FInance Patriot family was inspired to issue ourselves a “cease and desist” order on our $400/month 529 contributions. Due to the fungible nature of our assets, we are instead adding this amount to our monthly taxable brokerage investments. We assume a likely 0% tax rate on the eventual cashing in of this account, and there are no restrictions in how we use the funds (unlike a 529 account, which also comes with potential penalties).

    Sincerely,
    FP

    • Regarding Roth IRAs – money in that space is magical. It grows tax free and it’s really no problem accessing that money as needed. The $11000 contributions I just made, for example, can all be withdrawn right now with no taxes and no penalties whatsoever. The earnings on that money can grow tax free and be withdrawn tax free in ~20 years.

      Roth IRA withdrawals don’t count against AGI when it comes to things like ACA subsidies and other means testing/ tax credits tied to AGI.

      Right now we have a relatively small proportion of wealth in Roths so I’d like to get as much as possible in there. There’s also no RMDs so for super long term tax efficiency planning, that will help keep taxes small in another 30 years too.

      Then there’s the College angle. More $ in Roths = less in taxable accounts. That leads to a higher financial aid award (more free money!!). At a 5.6% per year “tax” on non-tax deferred assets, the FAFSA will effectively sap 50% of the value of our taxable accounts over the 9 years our kids will be in college. So I’m jamming as much $ as I can in tax deferred accounts.

      As for your comments re: college – that’s probably a good move to go toward taxable instead of 529 assets. Especially if you’ll be like me and many other early retirees and qualify for some financial aid come college time. The tax savings are minimal in most states and 529s usually come with more expensive investment options vs a choice of Vanguard ETFs.

      • I’m curious: Was it your 2016 Roth contributions or your 2017? Wondering how much/if you have concerns about blog income spiking hard and making you ineligible to make Roth contribs.

        I’ve been looking to migrate a Roth and a taxable investment account from eTrade to Fidelity or Vanguard. Regarding your transfers, you had no issues with the tax basis coming over correctly? I have nightmares about that not working right.

        • It was 2016 contributions (made in 2017). I usually wait till close to year end to make sure I’m optimizing my tax strategy. Not too worried about income spiking given that I wait, though it’s certainly possible if things go crazy viral and traffic increases 6-8x what it is now. I could always recharacterize to traditional (nondeductible) IRA contribs or withdraw (I think??).

          No issues with tax basis migrating correctly (though I still need to double check the transfer to Fidelity – it looks right from a quick glance). I DID have an issue with tax basis and lots when I converted from Admiral to ETF shares. One position showed a $13000 cost basis vs the $77000 it should have been (kind of a big problem 🙂 ). It pays to double check the cost basis of tax lots upon transfer, and a note to the receiving institution should resolve it. I simply told Vanguard “you broke it, fix it” and they did so without a bunch of instruction from me.

  • Great month RoG. Amazingly low spending as always. FYI – You are the king of promotional deals!

    That Fidelity offer looks interesting. Do you know if it the brokerage account needs to be funded with cash or can it just be assets moved around? I wouldn’t want to generate any unnecessary capital gains…that alone would make it not worth it.

    • We are in the process of doing two Fidelity miles offers (my wife and me). It can be cash or assets transferred. For us, it was almost all assets transferred from our Capital One Investing account. After you meet their requirement, they promptly credit airline miles into your rewards account.

      • Wait, are you saying as soon as you transferred in the $$ that you immediately had the bonus miles? I might need to follow up if so.

        • I don’t know that it was immediate but in a few weeks the bonus miles showed up in our AA rewards account. It didn’t seem an extremely long period of time.

          Also we signed up for the Business Ink card for the 80k miles promotion. Business cards at Chase, Citi and AmEx don’t count towards Chase’s 5/24 rule.

          • I’ll give it another week or two.

            Can’t wait for that Business Ink card. And very glad it won’t go against 5/24 since I’m up against it right now (somehow miraculously squeezed past 5/24 for the Sapphire Reserves in spite of being at 5/24 for me and Mrs. RoG).

          • Where did you get the info that the 5/24 rule doesn’t apply to the Chase Ink Business? All data points online indicate otherwise. Do a google search for “chase ink business 5/24 rule” and you will see.

            • I believe the 5/24 rule applies when you’re applying for the Chase Ink Biz card. But I don’t think Chase Business cards count as one of the five cards in the 5/24 rule (meaning you can get a couple biz cards and not increase your card count under 5/24 to bar you from future applications for additional Chase cards).

            • don’t know for sure but I guess it might depend on whether you apply for the buiness card as a sole propiertoship company, with your SSN (may count towards 5/24) or if you already have an entity with its own ITN (may not count)

    • It can be cash or in kind transfer of assets. I chose the latter since I didn’t want to stick cash there at their 0.01% interest or whatever paltry rate they pay. 🙂 I’ve already verified that they have $235,000+ shown as transferred in under this promotional offer, so I’m good to go with just the big stack of ETF shares. It appears that they pay the 50,000 bonus miles after your 2 month window to transfer assets in closes, as my points haven’t posted yet. I talked to the guy at Fidelity that handles promos and it sounds like a manual process where he’s reviewing your transfer and posting the miles himself.

  • Another amazing month. I need more lessons!!! Ha! Have you posted about this solo 401k? This sounds like what I need to set up. I’d also be interested if you set up a SCorp for your business or Sole proprietor? I set up an SCorp to avoid self employment tax but now I’m dreading tax filing. So I would also love a referral for which tax software you recommend. Thank you again for the inspiration to keep plugging along. Id tell that Dave guy that anyone successful more than likely sacrificed something else at some point to get where they are. “The man on top of the mountain did not fall there.”

    • Solo 401k is easy to set up. Vanguard is who I used. Fidelity looked promising too.

      I didn’t do S corp due to tax complexity vs. potential money saved. I might investigate that in the future if my blog income increases during 2017 (seems to be plateauing from what I can tell so far).

      As for tax software, I prepare my taxes manually so I can’t be too helpful. All the major ones seem decent but you’d have to research which one is best for S Corp filers and go with that.

      As for Dave, I don’t think changes in insurance policy at the Federal level will make him happy.

      • We used Fidelity for our solo 401k because (at least at the time of set up) Vanguard wasn’t allowing you to invest in Admiral shares through their i401k product. While Fidelity was letting you go with Spartan.

        We also have an SCorp. And at the time being I’m having an accountant do it because I’m not quite sure how to get all the balance sheets and cash flow statements in order, but I’m going to try to replicate what the do this year. I guess QuickBooks makes it easy to import everything to Turbo tax. Or so I’ve heard.

        • Good point about the Vanguard limitation to Investor class shares. I have an allocation slice devoted to International Value so that’s what my 401k consists of 100%. Since it has no Admiral share class available, I’m no worse off. Though as my account balance grows I might eventually top out the International Value allocation dollar amount and have to choose an investor class version of something I could go Admiral/ETF on otherwise.

          • I’ll have to check but I don’t think ETFS are available through it either. Just an FYI, they’re still cheaper than most everything else. They do offer Roth through their i401k which is nice.

            But yeah that’s why we went Fidelity i401k. Everything else is with Vanguard, save taxable stuff. I have a legacy account with Wealthfront, but I like their TLH among other things. Might transfer it but that’s a broader discussion for another day.

  • We just crossed the one million in investable assets mark ourselves due to recent market gains. If we were to include our home it would be a bit more but I’ve always felt uneasy using home as a way to pad net worth. Looking to do a modified version of early retirement in 5 years give or take, but definitely need more clarity on health care policy for sure (and enough time and performance to know that whatever policy is enacted will stick around). We live in a high COLA as well so it will take longer to pay off our mortgage but hopefully we can focus on that in the next few years. Congrats on your milestones and ability to live on your terms!

    • Sounds like you’re on the right path! Hopefully in 5 years we have more certainly with respect to health insurance and subsidies (if any). I thought we were at that point with the ACA until Nov. 7th 🙂

  • “Obligatory monthly pho pic”. Can I get that recipe from Mrs.RoG? It looks SO good.

    Great job on your blog and dividend earnings! I think we’ve all proven that you actually MAKE money in retirement, despite all the people who think we’re going to run out of money. Take that haters!

    And yeah, I’m with you on the whole markets are on a tear but this won’t last. Nothing goes up forever. It’s been pretty exciting watching the portfolio go up, up, up but my biggest excitement comes from the dividends and fixed income.

    Looks like your European trip planning is going well 🙂 I’m just as shocked as you are at how cheap transportation is in Europe. One of our readers was asking us how much it costs to get from Manchester to London UK, and I found a bus for $5 Euros a person for a 4 hour bus ride! That’s cheaper than Thailand. How are they NOT losing money with those prices?

    • Those euro transport prices are crazy and I don’t fully understand them other than they must be promotional rates for a very limited number of seats. We saw a lot of €5 tickets too but we could only book 2-3 tickets at that price, so the other 2 kid tickets were often 50-100% more expensive! But for trains, it seems kids ride free in Germany and Austria, so their €28, 38, and 48 fares include 2 adults and all the kids too. Just incredible value. I compared to US prices on Amtrak and Greyhound (train and bus) and it was $190 on the train and $150 on the bus from Raleigh to DC (about the same as those capital to capital rail fares in Europe), so somewhere between 3-8x the cost in the US. Maybe the euro carriers get huge government subsidies? Those high gas taxes must go somewhere.

      • Wow. That’s awesome that Germany and Austria let kids ride for free. Good to know.

        I remember reading about kids riding for free in the summer on the lifts in Switzerland too. Hopefully they have that in Austria.

        Yeah, I’m thinking that maybe the euro carriers get subsidies…there’s no way they can give you those prices otherwise.

        • I saw that kids ride free in some places during the locals’ summer vacation from school. Only place I remember is Vienna in July/August and we sadly had to eliminate that destination this time around. Maybe some other places offer the same kids ride free though. And those lift tickets in Austria are about the same. With the family pass for 2 adults and a few kids it isn’t much more than the cost for 2 adults alone.

          I think Munich has a family transit pass too that’s basically the same as 2 adults. Too bad restaurants won’t offer the same deals! 🙂

  • I also need to get more active in transferring my ETFs between competitors to secure rewards. Thanks for the reminder.

    Great job for the month. Love to see the increase in NW.

  • Regarding that empty pool: one of the unexpected perks of not having a 9-to-5 commitment anymore is that I get to enjoy that kind of quiet quite often. Deep discounted movie times on Tuesday and Wednesday, grocery shopping after lunch when nobody is there, free reading and browsing at Barnes and Noble again when no one in sight, etc. Being able to help family and friends with their time-pressured commitments is also nice. Not sure if there is a monetary value but there is value there, no doubt. And I am still looking forward to enjoy cheap travels during the off-peak.
    Good one!

    • Living off peak is great! Also enjoy the less crowded grocery stores and museums during the week too. And not driving in rush hour traffic generally.

  • Gotta love the stock market right now, huh? Awesome net worth report!

    Minnesota is having a pretty easy winter this year. February had some record breaking high temperatures and the snow has melted already. I’m not a fan of winter, so I’m loving it!

    I’m looking forward to that big post about your trip later this month. I would love to slow travel Europe and need all the tips and tricks I can get!

    • That’s good to hear re: winter. Glad it hasn’t been too bad. I always feel for you guys when I see the dark blues and purples on the national weather map 🙂 I’m ready for real spring to get here too where it’s nice almost every day.

  • I feel that I learn something new every time you post. I had no idea I could make miles off of a transfer to Fidelity, and I had never heard of Freedompop before (other than Hasselhoff belting out I’ve been looking for Freedom). Glad to hear your Europe trip planning is shaping up so well and congratulations on a stellar February.
    Since we already did the two CSRs, I’ve moved on the Chase Ink Business Preferred. 80k UR points here we come.

  • Thank you for sharing your financial updates. You inspire me to do better with my finances. I didn’t make a million yet but I am close to half a million.

  • Nice progress. Prepaying electric bill with credit card is a great idea. Not sure our utility company will allow that with a low flat fee. Normally they charge a 2.5 to 3% of the bill.

    • Ours used to do a % fee but they switched to a very low flat fee several years ago. Big win for us since I almost always pay a big $800 lump sum which covers the whole summer AC season plus spring and fall.

  • As a fellow Raleighite (is that how it’s spelled, or said?) I just have to say I love your blog. We have four more years before we quit our jobs and can’t wait. I tried finding some tips on AirBnb hacking (if it exists) since I think I have read something about that before on your blog. We’re headed to Cuba for a week in June and need to do AirBnB there since we heard hotels are horrid. Any handy links to one of your entries you can post?

    • You’re right about the hotels: they’re government-run and way overpriced, especially given their run-down state. On the other hand, Cubans can apply for permission to offer rooms in their homes, called casa particulars, and these are tremendous, on the whole.

      It’s like an early version of AirBnb and they are a country-wide network. You only need to book your first night or two in Cuba through AirBnb (since there are a few high-level Cubans who represent casa particulars to AirBnb and thus skim off money from the local owners).

      Once you’re in Cuba ask any one of these casa owners to arrange for your next place in whatever city you’re visiting next. They’ll phone ahead and have someone from the next casa meet you off the bus.

      Even if you don’t have any lodging arranged you can walk around any city and look for the sign indicating that a place is a casa particular – they look kind of like a blue upside-down anchor. Try Googling “casa particular sign”.

      We were there a year ago – happy to answer any questions.

      As far as AirBnb hacks: you have used a referral, right? Currently it’s $40 free and I’m sure Justin will share his referral code with you. Otherwise, buying AirBnb gift cards on eBay is a good way to put spend towards a credit card sign-up bonus.

    • I’d suggest starting your airbnb search ASAP since the best/cheapest places fill up quickly. If it’s just the 2 of you then set your search criteria for 2 people and then pick the type of accommodations you want (whole house/apartment rental vs private room in a house). Then look all over the city you’re visiting. Sometimes going a little further out from the very center of town can get you a quick bus/taxi ride from the action but in a quieter neighborhood that’s also less touristy AND closer to non-tourist local restaurants and groceries. And maybe a bus station to get out of town for the day.

      In terms of what to look for, I usually skip over any place that’s 4 stars or worse if there’s a ton of inventory in the city. Then start searching on the cheapest places, favoriting (with the heart icon – make a “favorites” list or whatever it is called) as you find attractive properties. Go more expensive till you find a big enough pool of possible candidates for your stay. Then dig in deeper, looking at the reviews, amenities, pros and cons of each. That’s what we did to narrow down several hundred potential rentals per city to maybe 8-10 per city, then sent inquiries to 2-3, often asking for a discount (for us that meant asking them to waive the extra person fees for 1-3 of the kids – this was successful more than half the time I would say).

      If you’re staying in 1 place the whole week you might get a sizeable discount vs 5-6 nights. Sometimes it’s cheaper to rent for 7 nights instead of 6 given the way the host offers a weekly discount. You could book for 7 then leave a day early (or negotiate a weekly discount for a 6 night stay).

      I checked airbnb for Havana and the price for private rooms (with host living in the house) is $42/nt on average. Go to whole house rental and it’s $92/nt. So you can save a ton by renting a room in a house shared with others. Overall it looks like some incredible deals – lots of 5 star places just remodeled and looking great in the sub-$40-50 range. 🙂

      And if you want $40 off your trip feel free to use my referral link (I get $20 or so I think). Enjoy your trip!

    • I’ve also noticed Delta airlines has a promotion currently with Airbnb, 3 miles/$ spent. Must book by Apr 31, 2017; must stay before Apr 31, 2018. Also a bonus for new airbnb guests.

  • Solid month!

    I’m very curious to see how little my spending ends up being in March compared to Jan and Feb. It’s certainly not my goal to spend as little as possible, but I do think that being outside of CA state lines (starting tomorrow!) will help a bit on the bottom line. Of course, I’ll probably use way more gas then I normally do, as I don’t seem to be running out of interesting landmarks to see within an hour or two of Albuquerque…

    • We tend to spend LESS while on vacation since most of our other costs are already prepaid in previous months. It’ll be a neat experiment for you for sure!

      And at least gas is cheap right now.

  • Hmm. I’d never thought to prepay the power bill to keep the credit card fees in check. I guess it will work well so long as interest rates stay lower then cash back rewards…

    The fidelity transfer trick is pretty cool as well. I’ll have to look into that.

    As for the market, I’m still sticking to my plan which is just to let everything ride and dump more money into my asset allocation. As such I’m not doing much with the market change.

    • You are right – the numbers change slightly with 5% money market rates. At 1%, it’s not much of an opportunity cost to give the utils a loan for several months 🙂

      Good job on sticking with the plan!

  • Another amazing update – (not a surprise though!) So I finally looked up our gas & electric provider and they take credit cards with no fee at all! We own 8 rental units and pay for common area electric in addition to our own gas & electric at home. This is an easy $2500 – or 2500 points a year (or more…) and it would be really easy to help meet minimum spend. We just picked up two Chase Reserve’s (in branch) last month – so we have an $8K spend (but owe $7K in taxes too!) I’m also going to look into Freedom Pop. We just switched to Project FI and Republic Wireless (hubby on one, me on the other). We are in Wi-Fi a lot too – not sure what we are paying now is really worth it at all.

    • Give freedompop a look. Very low cost of entry to test them out, especially if you have an old ATT or Tmobile phone that takes SIMs. Saw a $1 deal on their US based SIMs yesterday!

      As for your credit card spending, you can put the $7k tax bill on credit cards. Fee is under 2% and tax deductible as a business expense if you’re paying business taxes (I think; consult independent tax counsel of course 😉 ).

  • I have signed up for your blog but never get an email unless I post a comment and check the email follow up box. I keep checking your blog to see if you have posted anything new. Is there some way to fix this?

    • That’s strange. I’ll have to see if I can fix that issue. Could be my email server not sending or your service blocking it as spam.

      edit: I just checked the subscriber email database and didn’t see yours. I tried to add you and it will send you a confirm email to your email address used to post the above comment.

  • Hey Justin…love the blog! Thx for sharing!

    You wrote “Will the ACA remain intact in 2017 and in the future? Who knows. The latest draft GOP “repeal/replace” bill didn’t look too ugly for the near term since it kept ACA premium subsidies intact through 2019, with the subsidies changing to a refundable tax credit starting in 2020.”

    I would like to learn more about this. Can you tell me where you learned this info?
    Thx!

  • Why did you convert to ETF shares? Could you have moved over a number of Vanguard VTSAX shares instead? Does Fidelity just hold them as Vanguard shares or do they convert them to equivalent Fidelity fund shares?

    • I had Admiral shares of Vanguard funds. They won’t transfer to Fidelity, only the Investor Class shares. So I converted to ETFs to simplify things (and still get the same low cost expense ratios as Admirals in general). I was also thinking ahead to doing the transfer again in another year or so. Fidelity would force a sale of Admiral shares transferred over from what I’ve read.

  • Awesome month! There can’t be many who prepay their utility bills. The electric company has to like that. Although I see why you’re doing it. Congrats on passing another quarter million milestone.

  • First time commenter! I have done a cursory glance, but can you point me to information on how your funds are invested if you have such a post? I feel like my investments should be growing more than they are especially in this bull market.

  • A few questions for you.

    The fidelity trick is not for Roth Iras? or 401ks?

     Would you recommend putting your e-fund there?

    You have to hold the entire amount of money there for 9 months correct?

    You are travel hacking like a mad man. What are you going to do with all those miles?
    We go the Reserve card times 2 and we were able to buy 6 round trip tickets plus a lab child to Europe for 165k points. I thought we were going to need 360k points to get there, so getting this now was so awesome to me. We still have points left over

    Is your wife in on the blog biz? Is that how you are able to open biz accounts for both of you?

    I can’t wait to hear more about your trip planning.

    Why did you decide to go Airbnb route instead of travel hacking hotels?

    • this particular fidelity promo I did is only taxable accounts (well, a few other account types work but not IRAs or 401ks). Other promos do allow IRA transfers to qualify.

      E fund would work but interest is near zero. Might be able to buy an ultrashort term bond ETF or low ER fund that pays okay. Of course if you’re already getting near zero on your efund it’s no worse at Fidelity.

      Yes, you have to hold money all 9 months. Even withdrawing dividends would count as a withdrawal according to their account rep.

      Not sure what I’ll do with all these miles. Unsure what we’ll do summer of 2018 (road trip? Mexico? Europe again?). We’ve talked about a winter 2017 trip to SE Asia so that would consume quite a bit of points.

      How did you get 6 round trips to Asia for 165k points? 50% bonus on ultimate reward points through CSR card and buying tickets through their portal? In hindsight I could have done this for Europe and saved $$$ since tickets got really cheap for a while. Might do exactly this in the fall if we want to go back.

      We have a business for my wife. It’s just not very profitable 🙂 I need to start paying her for helping with the blog (so she can do $18k Roth 401k too!)

      Why airbnb and not hotels: I got a great deal on the airbnb gift cards thanks to a very helpful blog reader’s tip 😉 I looked at hotels but the costs were never less than airbnbs, even if I did some cashback and discounts on gift cards then booked through hotels.com. And with airbnbs we get a full living room and kitchen everywhere we’re staying. At $82/nt on average (before considering I paid only 80% of that $82/nt) we did pretty good for 2 bedroom places in general. European hotels seem to have rooms for just 2-3 people with family suites costing about as much as a 2 person room x2 (didn’t see many American style hotels where cost for a 2 queen bed room is the same as 1 person in a queen or king bed).

      I looked for good redemption values for my Starwood (which is transferable to Marriott now) and didn’t see many good choices where we are visiting in Europe. Would have to book 2 rooms for the family everywhere we’re going, and many places it was expensive for a good location or cheap but you’re out by the airport (and not always near public transit). US, Mexico and Canada seem to offer much better values for redemption of these points.

  • David Wendelken

    Have you considered using a house-sitters site instead of AirBnB? With a bit of luck you could stay somewhere for free…

    • Considered it but didn’t really pursue it. I’ve heard the competition is stiff to get desirable places. I’m also not an animal person (and others in my family are much less so!) so if it was a gig that involves pet sitting it would be work for us. We’re also jumping around every week or slightly more often so there’s that scheduling difficulty. As it is, we’ve been able to schedule out the travel between cities pretty optimally so we’re traveling middle of the day, arriving afternoon or early evening, mostly direct connections, 2-5 hour travel times.

  • Great post – you are consistently the best at making retirement look like fun.

    I saw you mentioned you are looking into getting a new roof this month. I’ve just happened to be reading about passive solar features recently, and read that white roofs are the way to go for energy efficiency.

    • Interesting food for thought. Makes a lot of sense. Our current asphalt shingles are kind of a cedar bark color (on the dark side but full of grey, charcoal, and reds). I suppose going lighter, even if it’s a beige or sandstone color is better than dark colors (even if it’s not completely white). I wouldn’t go white because we have some roof surface that doesn’t get sun hardly ever so mildew grows there and it would become a maintenance issue (along with it showing dirt and stains in general possibly). And at our split level house, the upper roof slope drains onto the lower roof so we might have any gunk from the top accumulating on the lower roof.

      A light non-white color might be a good compromise.

  • Interesting – it makes sense that a white roof would show more dirt and gunk, but I wish I knew how apparent that would be. White roofs are rare enough that I can’t even think of an example to look at in person. I agree though, a lighter non-white color might eliminate most of the drawbacks while still reflecting a lot more heat than a dark roof. Make sure to include your roof story in your next monthly update so I can see where an informed consumer with similar values to mine ends up on the issue :-).

  • Amazing month….I’ll second on a “heads-up” on the roof outcome. I am in the process of doing our roof as well and the “lighter color” makes real sense. I’ve found there is a lot to decide with the roofing options available today. As for health insurance and the ACA….looks like you may be “set” till 2020 or later with all the politics involved. Kind of sad, IMHO, that we can put a man on the moon but can’t provide fair, affordable healthcare to all….

  • I had my roof done about a year and a half ago. Here are a few tips:

    1. I used GAF Timberline HD shingles which after some research seem to be decent/ reliable. They sell them at Lowes so you can check them out.
    2. Many times negative reviews on shingles are due to the contractor not installing them correctly and not so much the actual shingles.
    3. Register your roof with the shingle MFG for the warranty. I did this even though I think my contractor wasnt on the certified contractor list. I figure it gives me some more protection in the event something happens years down the road. (bad batch of shingles, etc)
    4. I went around the edge area of my roof with a ladder all the way around the house. You can see up close a few feet up. Look closely. I walked the roof also on my rancher house. I found about 20 nails that were either not quite in all the way or were partially or fully exposed (instead of being up under the shingle above it). I tagged them and asked the roof guy to come back and fix it which he did. It may seem picky, but might as well get it as perfect as possible if its going to be on there for 15 or 20 years.

    • Good tips, thanks. I can climb up on both of our roofs as the pitch isn’t too steep, so I’ll make sure to inspect. I figure the contractor will do a “walkthru” with me as they are wrapping up to make sure I’m happy. If not I’ll do so and follow up with a punch list.

      I think those GAF Timberline shingles are what I have on the roof right now. Definitely what I’ve bought to replace occasionally. Nice solid build to them. I’d probably go with similar architectural shingles vs the 3 tab. Not much difference in materials cost ($800 or so for the good ones vs save a few hundred and compromise on quality).

      • If you have a chimney, a lazy or unskilled roofer will put up some flashing around it and do it poorly.

        The top of the flashing will have a gap between the brick and the flashing. The bad roofer will slather that gap with some silicone and call it a day.

        This is a problem because the silicone will eventually fail. The metal and brick will expand and contract as heat from the weather is applied. It is literally a matter of time before it leaks. This is an “active” defense against leakage by the silicone.

        The correct way is to cut a small groove into the brick and fold the top of the flashing into it. Not a 90% fold, but close to it. The water coming down the chimney will flow over the folded metal and away from the gap. Silicone can still be applied under and on top of the flashing, but that’s an extra “active” defense. The passive defense of the flashing set into the groove is the primary way water is stopped.

        Hope that helps!

  • Hi Justin — just wanted to say hello as my family is also heading to Spain soon. Barcelona first but then Malaga / Granada / Ronda / Seville in the south. I’m curious what your plan (if any) is for eating out on a budget with kids?

    Another funny coincidence is I read back through your blog and noticed you were an engineer. I recently noted on my blog that it seems at least half of all personal finance / early retirement bloggers are or were engineers! Why do you think that is?? –R

    • Southern Spain seems pretty reasonable for dining out. We’ll probably do an occasional lunch or dinner, and cook other meals. Breakfasts are usually pretty simple and cheap, and something we have at our rental apartment (eggs and bread/pastries, or fruit, or cereal and milk, or yogurt).

      A few specific tips from a friend: order agua del grifo for tap water. It’s safe and free. Otherwise, when you order “agua” you might get bottled water or sparkling water (presumably €2-3 per bottle). Don’t touch the bread if you don’t want to eat it. They’ll bring it out and if you eat it you’ll be charged. Some places charge more for outdoor seating (I assume in tourist areas).

      I’ll add more: lunch is often cheaper than dinner if they have lunch specials. We also do take out a lot so we can split a few things and add some stuff from the grocery store to accompany the meal (fruits, veggies, cheese/bread, etc).

      We’re fortunate to speak fluent-ish Spanish so navigating restaurants in Spain will be rather easy.

      Why are many FIRE’ers engineers? Attention to detail, spreadsheet knowledge, decent disposable incomes, not particularly flashy/materialistic work cultures.

  • Amazing seeing your portfolio growing in one month more than I make in one year 🙂 Greetings, Ben

    • Yeah, that’s about what we made per year when first starting out. In fact I think it is Mrs. RootofGood’s exact starting salary at her first job after grad school!

  • I’m sure you have a broad set of readers, but I get a kick out of the fact that on every post a large percentage of the comments are from people with their own FIRE blogs. No doubt commenting to try and drive traffic to their sites.

    • Something like 99.8% of readers are lurkers and never comment. The blogger commenters are active online and comfortable posting and discussing this stuff. I’m actually surprised that I have an many readers that do comment that AREN’T PF or FI bloggers (like you!). Some blogs have virtually every comment from another blogger, so I’m glad to get some “organic” comments here. 🙂

      • There is one other aspect to the commenters here. I too am an owner of a FIRE blog, but I just started this year. All of us that have other blogs started by reading the guys that have been around for awhile, like Root of Good and MMM. I have found many other blogs worth reading that provide different perspectives by looking over other blogs from commenters. There is always room for more on the limitless internet.

  • I’ve been reading your blog for years, and am still happy to hear about all the cool trips you are taking your family on. I’ve been trying to get to FI, but..am still getting out debt. I’m basically treading water for the past 4 years. I’m happy to live vicariously through you. Can’t wait for your trip!

  • I’m amazed at the blog income. You could probably live on this alone. Check out my own blog if you’re interested.

  • Justin:

    First, a big thank you! I am a long time reader, finally commenting. I very much appreciate the details you lay out every month. That kind of transparency is what helps someone like me, still in the trenches and late to the party, keep working towards designing my future.
    (Also, David Wendelken is right on the money about the chimney flashing for the roof. I did my own roof 2 years ago, and luckily learned how to do the chimney the correct way. I was fortunate I stumbled on the correct technique, as I was replacing someone who did it the wrong way. The flashing had pulled away from the chimney, often over 1″, letting rain right down in!)

    Thank you again, I sincerely appreciate it!

    – The Tepid Tamale

  • This could be really crazy on paying electricity in advance. But the reason you do that is much worth full. I am impressed with your pre-planning on the utility expenses.

  • A great post. You really are a pro aren’t you. In the UK we pay for water in advance and then depending on how much you actually use you get a rebate at the end of the year..Or, a bigger bill!

    • Our natural gas and electricity providers offer that. Basically pay a flat average amount each month x12 then they change your flat amount after 12 months. I never do the average monthly bills though.

  • Hey Justin – long time reader, big fan. Love the simple luxury you’re able to provide for the family. If you ever decide to do an Asia trip give me a shout – happy to give some ideas for Tokyo!

    • Sounds great! Hopefully we’ll make it to Japan some day though we don’t have any plans in the immediate future. Maybe if we ever get our SE Asia trip planned we can do a long layover (like a week or more) in Japan.

  • Thanks for your blog Justin….a couple questions…..I noticed you’re reporting your Networth gains in a month over the few entries I looked at as approximately $38,000 recently. A quick calculation shows a cumulative return per month to be ~2.2% of your total investments. At this clip you’re bringing in ~26% per year, or $400k. You mention there could be volatility in your positions. What kind of investments are netting you $3-400,000 per year consistently?….your monthly “income” (read not investments) is roughly $5000, so that’s a meager bit of it, but you’re already fail-safed that by keeping your costs below. I guess I’m asking how are you investing….straight index funds (Vanguard/Fidelity etc) – if you had all of the portfolio in an index fund mix, how is it returning $38,000 two months in a row? Or are you rounding? If you view your positions as risky, are they a good idea to keep when “retired”? Or is it all gravy for you anyway? And/or you could simply go back to work…..some curiousities, and maybe its all in the blogs and I’m too lazy to read on…..
    -PC

    • The monthly net worth changes vary widely. Sometimes we lose $100k in a month. I don’t view the stocks as particularly risky, but rather view volatility as an implicit fact of owning stocks. Great for the long term, not so much when you lose $100k in a month. 🙂 Of course I’m investing for several decades so monthly volatility doesn’t concern me.

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