March 2017 Financial Update

money-january-2014

I can’t believe we are already a quarter of the way through 2017!  Financially speaking, we are doing incredibly well as we ride this bull market up and up.  March left us $15,000 wealthier thanks to investment gains with our net worth climbing to $1,771,000.  Our expenses for a family of five were very modest at just $1,388, while our income remained strong at $3,747 for the month thanks to quarterly dividend payments.

On the non-financial side, life is going swimmingly well.  We’re two months away from our nine week sojourn through Europe.  Springtime brings us beautiful weather here in North Carolina so we get to enjoy the outdoors more.  And last but not least our oldest daughter made the A honor roll.  College scholarships here we come!

 

Income

Our investment income was $2,791 in March.  The majority of our mutual funds and ETFs pay dividends quarterly in March, June, September, and December.  During other months investment income tends to be much smaller (closer to $100-150).

Blog income, shown as “other income” in the chart, dropped to $508.  That’s due to the lumpiness in payments from advertisers.  A check came a few days into April instead of the end of March as I was expecting, so I’ll have a great month in my next financial update post.  Fortunately I have a very generous cash buffer so I don’t need to rely on the cash flow from this blog to pay my monthly bills.  My early retirement lifestyle consulting income dropped to $240 for March.  It’s just as well since I’ve been busy having fun on other pursuits.

The $180 in Deposits includes cash back rebates from the Ebates.com and Mrrebates.com online shopping portals. If you sign up for Ebates through this link and make a qualifying $25 purchase through Ebates, you’ll get a $10 gift card like I did.  I spent over $4,000 on gift cards to cover lodging for our trip to Europe and received over a hundred dollars of cash back from Ebates on those purchases.

The healthcare/medical “income” of $27 represents a reimbursement of some prescription copays from 2016 where we paid the full price at the pharmacy for preventive medicines that should have been free.  The insurance company noticed the mistake and repaid us on their own initiative!  I filed an additional claim for another $27 x 2 to seek reimbursement for two other instances of overpayments during 2016, but I won’t be surprised to never see a dime of that money.

march-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 March expenses:

march-2017-expenses

We came in well under our budgeted $3,333 per month (or $40,000 per year) during March with total spending of just $1,388.

 

Groceries – $421:

We spent slightly less than our $500 per month average for groceries.  We used up a few small gift cards for Aldi and Walmart that we purchased at Raise.com when they ran some promotions earlier in the year.  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.

If you’re curious about what kind of groceries we buy, here’s a snapshot of an entire month of groceries from a few years ago that probably includes more “junk food” than we routinely purchase in an ordinary month these days.  The low grocery spending is simply a continuation of our grocery buying strategy.

We don’t do extreme couponing at all.  Instead of couponing, we check the weekly sales papers from a few local grocery stores within 1-3 miles of our house and take notes on potential good buys from their selection of heavily discounted loss leaders and sale items.  We pick the best one or two grocery stores for the week and head there to get our staples, necessities, and the loss leaders and sale items.  Unfortunately most of the sale items are junk, so there has to be some compelling discounts on actual stuff we want to buy to attract us to the grocery store that week.  We do well using this strategy to save big on meat, seafood, fresh fruits and vegetables, some dairy, eggs, and non-perishables.

At any given time, we have several types of fresh veggies and a couple cuts of meat in the fridge (plus several more in the freezer).  In the pantry we keep plenty of rice, noodles, and basic canned goods on hand because we know we’ll be eating several times per day.  Using these basic building blocks, some fresh lime and cilantro, plus a pantry full of spices, curries, sauces, and seasonings, we can make just about anything.  Googling recipes works well too.

Just a few treats we made this month:

My delicious homemade pad thai

My delicious homemade pad thai

Calamari fried rice

Calamari fried rice

Thai pork cucumber salad

Thai pork cucumber salad

 

Travel – $396:

We continue to book bits and pieces of our summer Europe trip.  Right now we are two train tickets away from having all ground transportation booked.  During March we spent $396 on travel expenses.  Half that went toward a pre-paid rental car reservation with the other half spent on four sets of train tickets for the five of us (one of which will be in first class!).  Those train tickets will carry us across Italy, Slovenia, Austria, and Germany.

We also spent a dollar on a five pack of US-to-Europe electrical adapters from ebay.  Direct ship from China.  It amazes me that I can purchase electronics straight from China for under a buck including shipping.

In cruise news, we booked another cruise!  A very helpful Root of Good reader emailed me about an incredible deal over the 2018 Christmas holidays (yes, over a year away).  It was a price mistake but before the cruise line corrected the error, we managed to book the family on a seven night cruise out of Miami bound for the Caribbean on MSC Cruises’ new ship, the MSC Seaside.  Our total cost will be around $1,400 for two rooms to accommodate five of us.  We only had to make a $150 refundable deposit to hold our two rooms, with final payment not due until October 2018.  With two kids in middle school, the cruise over Christmas break is very helpful to avoid excessive absences from school.

 

Utilities – $191:

Water, sewer, and trash bill plus natural gas bill.  We prepaid the electric bill for several months ahead to generate some spending for our credit cards so we can score some huge sign up bonuses.

 

Electronics – $115:

Who knew photos and videos take up so much space? We had to buy a new 2 terabyte hard drive to store all that digital media.  We also picked up a few other goodies like a camera bag for the t5i DSLR camera we’re taking to Europe along with a lightweight wireless mouse.

 

Cable/Satellite (Internet) – $84:

Spectrum bought Time Warner. Along with a new internet overlord comes a new and improved higher price tag. Yay competition! Oh wait…

We’re now paying $45/month instead of $35 with Time Warner.  It took a while to negotiate Spectrum down to $45.  On the upside, they upgraded me from 50 mbit service to 100 mbit service.  Which doesn’t really matter since I rarely use more than 50 mbit of throughput.

The $84 charge also includes $35 for February plus a few bucks extra to make sure I paid the bill in full since the swap to the new rate looked complicated on the bill.

I’m looking forward to finding out more about Spectrum’s low income rate plan that provides 30 mbit service for $15 per month for “qualifying households”.  They don’t have information on their site about this plan yet, so I don’t know if we will qualify.  I would definitely take that package at a 66% discount since 30 mbit bandwidth is plenty for us (a high definition Netflix stream uses about 5 mbit, for reference).  As long as there aren’t too many hoops to jump through (like applying for the plan through a social services agency and filling out reams of paperwork).

 

An uncommon mid-March snowy day.

An uncommon mid-March snowy day in Raleigh, North Carolina.

Same view later in the afternoon when it was warm and sunny.

Same view later in the afternoon when it was warm and sunny.

 

Healthcare/Medical – $71:

I paid $55 for a routine cleaning and exam at the dentist.  It’s normally $99 but I paid the copays for the kids twice by accident, so the $44 overpayment was credited to the charges for my visit.

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.

Every month I speculate on the future of the Affordable Care Act and this month is no different. Except the continued existence of the ACA is less in doubt these days compared to the past several months.  In case you missed the news, March was an exciting and surprising time for American healthcare.  The House Republican plan didn’t make it to a vote because GOP leadership withdrew the bill due to lack of support.  The proposed American Health Care Act (AHCA) would have sort of kind of repealed the ACA after three years (effective 2020) and replaced the current ACA tax credits with something entirely different.  Tax credits calculated a different way!! (<– sarcasm).  Many of the other provisions of the ACA remained intact.  In other words, you might pay more or less for health insurance under the AHCA versus the ACA and you might call it Trumpcare instead of Obamacare, but it’ll still feel similar to the ACA.

But the AHCA didn’t make it to a vote.  The far right “Freedom Caucus” conservatives didn’t like it because they recognized it wasn’t really much of a departure from the ACA on a fundamental level (“it’s still an entitlement program”), while the moderates in the Republican party realized the AHCA would lead to tens of millions losing access to medical insurance and health care because of the removal of income-based subsidies currently available under the ACA.  Both the far right and the center didn’t want to take the heat in the upcoming midterm election of 2018 (note for non-US readers: our US House of Representative legislative seats are up for election every 2 years and campaigning isn’t far off for contested races).

What does this mean for early retirees and access to guaranteed issue (maybe) affordable health insurance?  Right now it means the ACA remains the law, subsidy cliff and all.  What is uncertain is whether the Republicans will introduce an AHCA v2.0 bill that gains traction.  The vote would have been very close on AHCA v1.0 so I can imagine an AHCA v2.0 could be successful if the right palms are greased and the greediest pockets lined with enough silver and gold.

Our family wouldn’t have fared horribly under AHCA v1.0, since we would still have guaranteed access to health insurance but starting in 2020 we probably would have paid several thousand dollars per year more for a policy with much higher deductibles and copays.  And the insurance would grow much more expensive as we aged, while the tax credits would increase only slightly to compensate for higher premiums.

The big question remains.  What is the fate of the ACA?  Looking at prediction markets where people bet real money on the outcome of political issues (like this one at Predictit.org), suggests a 30-40% chance that the ACA will be substantially repealed and replaced by year end 2017.  Interestingly, the market on the fate of the pre-existing condition coverage reveals just a 12% chance of losing that specific provision.  To summarize, people betting real money think there’s a fair chance we’ll have a repeal-ish and replace bill in place soon, but it will keep at least some provisions of the ACA such as coverage of pre-existing conditions.  I think prediction markets in general are more accurate than expert opinions or polls when it comes to knowing the unknowable.  Consider that the prediction markets were putting the odds of a Trump win as high as 36% in the week preceding the November 8, 2016 presidential election (so it wasn’t a complete surprise for those of us that follow the political prediction markets instead of solely the news’ polls and “experts”).

Will ACA be around in 2020 and beyond? Definitely. Maybe. I don’t know.

 

Gasoline – $64:

I filled up our minivan not once, but twice (!!) during March.  Once at the very beginning of the month and once at the end.  My Chase Freedom card was paying 5% cash back through the end of March so I went ahead and filled up before I needed to in order to snag a little extra cash back.  All this carpool driving to school is driving up our gas costs!

The upside to morning carpool drop off duty: beautiful sunrise/moonsets over downtown

The upside to morning carpool drop off duty: beautiful sunrise/moonsets in downtown Raleigh

 

Restaurants – $36:

We bought take out pizza for a birthday party for around 15-20 guests. We paid in part using gift cards purchased through Groupon during 2016, and the rest was a gift card purchased through Raise.com at a discount.

This was perhaps the most insane deal on pizza ever. I bought gift cards at a discount, and the gift card purchased through Groupon (using a coupon and cash back through ebates!) came with two free pizza coupons.  Then, when I bought the pizza for the birthday party, I used a 50% off coupon and stacked it with a “spend $15+ and get a free pizza code” promotion (times 2 for a his and hers account).  When it’s all said and done I think I paid $2-3 per large pizza.

We celebrated Pi Day on 3/14 at a local pizza place that offered 17″ NY style pizzas for $3.14 each ($6 and change for two, which was enough for a couple of meals for the five of us).  More $3 pizza.  In this case, restaurants are cheaper than home cooking.

17 inches of pure pizza x2. Only $3.14 each. Happy Pi Day!

17 inches of pure pizza x2. Only $3.14 each. Happy Pi Day!

And we got some fried chicken from Bojangle’s (a magical place here in the South if you like fried chicken).  $12 for a dozen thigh pieces.

Never pay retail.

 

Entertainment – $5:

$5 for roller skating admission for one kid.  We threw a birthday party for our newly minted 12 year old and hosted a few other gatherings at our house, but those expenses ended up in the “grocery” or “restaurant” category.

All the besties celebrating 12th birthday for our oldest daughter.

All the besties celebrating the 12th birthday for our oldest daughter.

Smashing the homemade piñata

Smashing the homemade piñata

Adults eating pizza and drinking beer. Can you find the fresh salad I carefully crafted that NO ONE TOUCHED?

Adults eating pizza and drinking beer.

Building dueling robots when the Children's Museum visited our library

Building dueling robots when the Children’s Museum visited our library

 

Year to Date Living Expenses for 2017

march-2017-ytd-expenses

After spending $6,876 for the year through the end of March, we are more than $3,000 below our annual spending target of $10,000 budgeted for the first three months of the year.  I don’t think we’ll make it to almost $40,000 of spending like we did in 2016.

I made progress on reroofing the house.  I don’t have a contractor yet, but I do have $3,300 in cash from the insurance company.  On the advice of some blog readers and family and friends, I called my insurance company to see if they could check my house for hail damage.  It turns out we DO have hail damage and we need a complete roof replacement (score!).  They estimated the price at just over $7,000, and cut me a check immediately for the actual cash value of the roof minus our $2,500 deductible.  In theory if the costs escalate above $5,800 I can recuperate an additional $1,300 or so in “depreciation” that they won’t pay me until they see receipts and documentation that the work is done.  I have a call into the insurance adjuster so I can understand exactly how all this works and how I need to negotiate with contractors to ensure the optimal deal for me.

I’ve been budgeting $4,000 to $8,000 for our roof replacement so this might be a nearly free roof depending on how the quotes come back and how much extra work we get the contractor to perform.  The roof project was going to be our biggest expense of 2017, so this is great news for our budget.

We’ve already booked and paid for roughly $6,000 out of our $10,000 total budget for our nine week Europe trip this summer.  The remaining $4,000 of vacation spending will be concentrated in June through August while we are overseas.  We probably won’t spend a ton beyond that $4,000 while we are gone, so 2017 is shaping up to be somewhat of a low spending year already.

 

Monthly Expense Summary for 2017:

 

Cousin play time. Glad to be able to offer (free) childcare to family occasionally when they have to work

Cousin play time. Glad to be able to offer (free) childcare to family occasionally when they have to work

 

Net Worth: $1,771,000 (+$15,000)

Another month, another bump in net worth.  It’s easy to think the stock market only goes up and our accounts will keep growing in a mostly straight line forever, but I know that’s not true!

march-2017-net-worth

On the investing front, I didn’t do anything in March other than collect dividends and transfer them to my checking account.  I probably won’t touch the portfolio till it’s time for end of the year tax planning unless the markets make a big move up or down.  A big upswing will see me trimming away some equities and buying more of the bond fund.  A sharp downturn in the market will make me consider converting some cash or bonds back to stocks.  I’ll also be checking the asset allocation every few months to see if I need to rebalance any asset classes in the event the international markets zig while the US markets zag.  That’s how I manage a lazy portfolio.

The lazy man with the lazy portfolio proudly sporting his Vanguard gear

The lazy man with the lazy portfolio proudly sporting his Vanguard gear

Our cash position is close to $30,000 in savings and money market accounts, which is enough to fund around a year of expenses at our current spending rate assuming the dividends don’t stop flowing. On top of that we have another two years of living expenses in a bond fund (held inside an IRA) should we need additional liquid funds.  Things are looking very rosy for us at the moment.

 

 

Did you enjoy another positive financial month?  Any big financial moves coming up soon?  Any super frugal moments in the past few months to rival my pizza hustle?

 

 

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109 comments

  • I saw a pretty stable month. We saw a $9k increase for the month. Mainly due to the market rising and then our paychecks for the month. I figure any month that my net worth is going up is a good month for us 🙂

    Can’t wait to see and hear all about your epic Europe adventure. Looks like it’s going to be a blast.

    • Net worth increases usually make for good months 🙂

      • Great blog JustinRoG!

        I guess a large percentage of your portfolio was not U.S. equity as March was not a good month for tracking S&P500. On the other hand, international such as Europe equity was doing better.

        Thus, it net $15,000 gain for your March.

        • Yes, about half our investments are international. I think you’re right – internationals performed better than US so we probably beat the SP500 because of this.

  • By the looks of things you guys have a really though life…. 😉
    Once you get into a rhythm it is so easy to live a good life on very little money, as you clearly demonstrate is very doable. Well done I would say.
    Nice to see that all your expenses are well covered by investment income (and I’m not even talking about the net worth increase of $15.000).

  • Every month I marvel at the groceries. We are a family of 7, but closer to $1,000/month including all household supplies such as toilet paper, etc. We already shop between 3 stores for the staples that each has cheaper ….. but I think it’s time to look into this further. Thanks for the example!

    • We’re feeling the same way. We’ve just recently gotten more disciplined for our family of seven and we’re still projecting a $1,000 grocery bill this month. I think there’s a few ways we could be doing better – I’m wondering if we could buy discounted gift cards for Walmart and/or Aldi to save another couple percent in addition to getting the few percent we do on our credit card. Since we are not FIREd (yet), sometimes the extra time spent seeking discounts seems better allocated to money-making ventures that we are pursuing rather than expense reductions… Though I would like to do both and I think establishing good habits on the expense front is important.

      • We used to spend closer to $700-800 on groceries many years ago when the kids were younger. That was mostly due to not shopping around and buying everything at Walmart (our version of Costco I guess 🙂 Costco is further away and lines are crazy – worse than walmart if that’s possible). Then we switched it up and started shopping at Aldi for most stuff and filling in with loss leaders at the grocery store (maybe 1x/week) and walmart maybe once every month or two for hard to find stuff that Aldi doesn’t carry. Overall I’d say we save a couple hundred $ per month (maybe a bit more after inflation since this is probably 7-8 years later since 100% shopping at Walmart). Time wise it doesn’t take a whole lot more time because Aldi is a tiny store and you can be in and out in 15-20 minutes (walmart is 1+ hr EVERY FREAKIN TIME 🙂 ) and the occasional run to the regular grocery store sometimes replaces the Aldi trip or fills in mid-week instead of a second Aldi trip (you know, when you need more milk or some cilantro or kale or something fresh).

    • We slowly reduced our grocery bills over time. Just kept focusing on which store offers the best value. But we don’t go overboard and try to save every dollar possible. Just found the sweet spot. 🙂

    • Agreed! I was just wondering how a family of 5 can pay ~$500/month in groceries. It’d be great to see a grocery haul of some sort.

      I don’t usually buy things on sale that I don’t need either. It’s very tempting, but I know I’ll regret later on.

  • Nice work! I’m always impressed with these updates.

    As soon as you said the betting markets gave repeal a 30%-40% chance I thought, “Uh oh…isn’t that about the odds they gave a Trump win?” Which was even higher than the odds of the Cubs winning the World Series after game 4. Low probability events happen pretty regularly, so 30%-40% definitely doesn’t make me feel safe.

    Also, yesterday it came out that to get the Freedom Caucus on board, the next version of the plan is going to have much weaker protections for pre-existing conditions. We’ll see how that plays. Definitely an uncertain time for health insurance.

  • Well done in March. You are one of my favorite bloggers. I really enjoy the detail you provide in you monthly updates, it shows how someone can stop working and follow other pursuits.

    Thank you
    David

  • March was a good month for me. It was a 3 paycheck month so I was able to max out my 401k on March 31st. Beat last year of doing it in July. I also got engaged in March which was exciting. Figured it was time to lock in a real good thing.

    Nice Vanguard swag!

    • Hi Fervent,

      Be careful about maxing the 401k early if you have a company match.
      If the company matches say up to 5%, you only receive the match of 5% up until March 31st. If you spread out your 401k contribution, you can get the 5% match for the whole year ….

      • Great point. That’s how one of my 401ks worked. No reason to contribute early and deny yourself the 4-6% match or whatever on the latter months of the year.

      • It depends on the company. I max out my 401k by March each year but I still get my company match each quarter through year end. Call your 491 administrator and ask them how it works.

    • Congrats on the engagement! Big wedding or something simple?

    • Nice! I am set to max out my 401k for the year next week. Done by end of April, not too bad 😉

  • We do grocery shopping split between the farmers market for fruits and veggies and the grocery store for everything else. The market here tends to be about half the price for vegetables and fruits. We tend to buy meat on sale and freeze until usage. I belive our family of four grocery bill is about 80-100 a week. It sounds like we’re in the same ballpark. We don’t buy housewares like toilet paper, cat litter, or paper towels at the grocery store, they come from Amazon in bulk.

    • Yeah, sounds pretty similar to our spend if we subtracted personal hygiene stuff, paper products and cleaning supplies (usually bought at Aldi or Walmart).

      • I’ve simplified and saved by reducing my daily cleaning supplies to white vinegar (mixed 1 to 1 with water) for most needs, a brand-name bleach cleaner (still <$2 a bottle) for after I cut up meat, and a non toxic "green" cleaner for the rare occasion when the first two don't work.

        I also have a few specialty items like stuff that gets rid of soap scum in the shower, and the (store brand) magic eraser, but these things last me more than a year.

        I used to use $1 spray bottles from the home store for the vinegar mix, but was always annoyed that they would fail quickly. So I "splurged" and bought one bottle of a name brand vinegar cleaner (It was like a $1.50), so now I have the fancy — and reliable spray bottle — which I refill with my homemade vinegar mix.

  • That’s a nice looking pad thai!

    Sweet score on the cruise, thats crazy they book out so far ahead! We are contemplating a longer winter trip for January 2018. I’ll have to find someone to clear snow for us though. It’s always a risk for us leaving the house that time of year here in CT.

    • They even have cruises as far out as 2019. Can’t imagine booking that far out, though I couldn’t imagine booking one for 21 months out until I just did it. 🙂

  • I always like your updates, coupled with the pictures of food. Looks like you are really spending below your target. I think that a lot of people are expecting a pullback ( based on what I read). I would welcome buying shares at lower prices from here.

    I think that the ACA is something that many early retirees are looking at ( the ONL blog recently talked about it too). I am hopeful that at some point, it will stay and be improved to a point where we get the scale of one entity negotiating with hospitals, doctors, pharma companies. But we can all dream, right?

    • Wait, you want to see actual reform in the healthcare system? 😉 Yeah, hopefully something good will come out of having all three branches of government controlled by one party but I’ll remain a skeptic until I see the legislation signed into law.

  • Congrats on a good money month! And oh my gawrsh, that pad Thai looks AMAZING. I’ve been meaning to make it at home when I have the time.

    March was an okay month. We were able to put an extra $1,500 towards student loans since it was a three-paycheck month. Otherwise we were over budget on groceries and our “Other” expenses, so we’ve got work to do in April. 🙂

    • Three paycheck month?! I miss those 🙂 It’s like an unexpected bonus. All the state employees I worked with LOVED those months (we were on a 2 week paycheck cycle).

  • You are doing great and may have sooo much money when the kids get older that you just don’t care. But, your expenses WILL go up…way up…when they get a little older. Little kids are cheap (unless you have to pay for daycare). Big kids…not so much. For example, did you know that a prom ticket is $80?? Local Division volleyball (not travel ball) $1,000?? Auto insurance $426/mo?? (we have superior credit and nothing on the driving record, but Florida insurers hate teenagers, especially teen aged boys!) I could go on, but you get the picture. Comcast is what we are stuck with (I’d rather do without internet than have to go back to AT&T…their customer service is abominable) and they make you play the package game every year. I just had to accept an price increase of $30/mo because our promo was “no longer available” (it’s now $71/mo). Medical? Holy cow! We’ve got a great BCBS plan through my employer. They pay the lion’s share of the premium and give me $2k towards the deductible. We still had $10k of out-of-pocket last year!! We don’t have anyone with a chronic illness, but health care costs are out-of-control. If your kids don’t play sports, don’t drive, don’t wear size 14 shoes, don’t get sick, or have no social life, you should be just fine! =)

    • I agree that some expenses will go up as the kids get older, but looking at RoG’s budget it just looks like they are more than in a good enough position to handle these adjustments. I have five kids, and we have no intention of paying all or even most of their car insurance bills when they are old enough to drive. My kids are 12 years old and already have a growing lawn care business. I anticipate by the time they are 16-1/2 (driving age in MD) they will be bringing in anywhere from $6-10k per year mowing lawns and that will more than pay for their driving. They are also actively saving now to purchase car(s) when they are at that age.

      The one place RoG is killing it is healthcare and I applaud them for figuring out how to make the system work for them. I have thought about what they are doing for my own family in a FIRE situation. I have a feeling we’re going to see the ACA heavily stabilize over the next 2 years as the Republicans put their imprimatur on the legislation and effectively endorse it permanently. One thing that could kill RoG is if an assets test were added in addition to an income test for the stipend. But the reality seems to me that this family is really resourceful, are drawing an exceptionally low total off of 1.7 million in assets, etc. Theoretically you can pull 4% of your portfolio a year and have it run forever if you are wisely invested. Couple that with some blog income here and there – and all the sudden you are set.

      One thing I’d like to ask RoG is whether they feel comfortable using the low-level high school in their area. (They have talked about their elementary being the worst in the county). I have always felt that elementary school ratings are significantly less important than middle and high school ratings, where kids begin to follow their peers as much as their parents. But – since RoG is retired-in-place, and Wake County, NC has a thriving home school community, they could decide to go homeschool, magnet, or charter to escape a bad high school situation and perhaps even give them more flexibility to travel as their kids age.

      Pretty awesome stuff, RoG – love watching you guys – you are an inspiration.

      • That’s what we’re thinking – the kids may end up making some money by the time they are 16 or so and start paying their own way for some stuff. The 10 year old was pulling in $10/hr tutoring for a while and I can imagine her rates will only go up once she leaves elementary school 🙂

        “One thing I’d like to ask RoG is whether they feel comfortable using the low-level high school in their area. (They have talked about their elementary being the worst in the county). I have always felt that elementary school ratings are significantly less important than middle and high school ratings, where kids begin to follow their peers as much as their parents.”

        Great question. We’ve mentioned it a couple times in passing but never gotten into the middle and high school issue too much on the blog. I’m right there with you on the elementary not really mattering as much but focusing on a “good” middle and high school. Which is exactly what we did. 🙂 Our oldest got into the Academically and Intellectually Gifted middle school magnet program so she’s currently attending the flagship magnet middle school (probably best in the district in terms of academics offered). That winning lottery ticket also gets her younger sister into the same school. And they are essentially guaranteed admission into the “best in the county” high school for academically gifted children (where Mrs. RoG and I also attended). We avoided the “worst in the district middle school” (which is currently undergoing a rebuilding process w/ new principal – our old elementary principal! – and mostly new faculty) and our assigned high school is pretty awesome but kind of far out in the ‘burbs. So we really lucked out with the middle and high schools here. We might throw our name in the hat for the awesome charter high school near here but I’ve heard they get 1000 applications for 100 seats (some of which go to younger siblings) so no real serious intent to attend there.

        You are right about the peers. So far they are on a good track with latching onto the “good” friends and letting some of the “less good” friends go their own way. Getting into the right middle school is a big help in that regard, as I could tell some of her 5th grade elementary classmates probably aren’t on the path to FIRE in their 30’s (if you know what I’m saying 😉 ).

    • So far, so good on the size 14 shoes. 🙂 I figure kid costs will go up some but not sure how much exactly. It’s a pretty moderate cost of living around here. And even if costs spike for several years, that’s not permanent, just a few years. So we can afford it. For example, if they get busy during the summer with jobs, volunteering, extracurriculars, social activities, etc then we probably won’t be spending $10,000 on nine weeks in Europe since we’ll be staying home. I bet that transferring $10k from the travel budget to extra kid costs will work out just fine 🙂

  • Yay for another great month.

    Where are you going on the cruise? Next time let us all know about the deal. I am looking to go on a our first cruise.

    • It’s leaving from Miami and going to Caribbean. Destinations include St. Thomas, Nassau, Puerto Rico, and MSC’s private island (currently under construction but supposed to be AWESOME!). We rarely pick the cruise based on destinations though. Nassau, for example, is a place we’ve been to so many times that we don’t always get off the boat in port. Instead we find a nice hot tub, relax, and enjoy a quiet meal while the ship is mostly empty. Found a nice family from Cuba to chat with during the last Nassau port visit when we skipped the sightseeing and lounged around on the boat.

  • What percentage of your assets are in tax-deferred accounts? I am trying to organize my own and wonder what’s the best process flow. I have read about the SEPP and Roth conversion ladder and wonder if there is any other “theory”.

    • I don’t know about theory, but having a good amount in taxable accounts is a good way to go. For us, we are going to take out IRA withdrawals with penalties I think, which should amount to $2800 per year, in the 0% tax bracket. These will be offset by 2k per year in child tax credits. For the rest of our needs, we will sell taxable investments. Because we will be in a favorable tax bracket (family of 4), we will pay 0% taxes on dividends and capital gains.

      • FP, double check the child tax credit to ensure it’ll apply to offset those early withdrawal penalties. Without earned income I don’t think the child tax credit is refundable, and the 10% early withdrawal penalty is assessed on the 1040 AFTER you determine your regular child tax credit. SO what I’m afraid of is you’ll have $0 tax due based on your regular taxable income, $0 child tax credit (due to no regular tax liability), and then your 10% penalty kicks in and you can’t take the additional child tax credit. Hopefully I’m wrong or missing something with your specific situation, but just wanted to point that out (as I think I would lose the additional child tax credit if I didn’t have earned income from “self employment” aka blog income).

        • You scared me for a second. I think earned income only applies to the EITC, not the child tax credit. I’ll do a dry run in taxact.com just to make sure.
          https://turbotax.intuit.com/tax-tools/tax-tips/Family/7-Requirements-for-the-Child-Tax-Credit/INF15610.html

          • I couldn’t figure out how to check the additional child tax credit on Taxcaster or taxact’s free calculators, but running through the forms manually, it looks like you’ll end up hitting a roadblock on line 4 of Form 8812 (additional Child tax credit) where it asks for earned income (line 4a). Since that will be zero (assuming no retirement side hustle earned income) then your additional child tax credit will probably be zero (in addition to your regular child tax credit).

            Hope I’m wrong or overlooking something! Report back as I’m curious if this strategy would work for others.

            • Like FinancePatriot, I thought that when you withdraw money from a tax-deferred account that that money is considered earned income since it wasn’t considered earned income in the year you earned it. Is that wrong? If so my entire plan is wrong! Oops. Thanks!

      • wouldn’t it be better to spend the taxable account first? and to roll IRA to a Roth which you can use in 5 years with no penalty (if you already have a Roth and your contributions are high enough you can withdraw the amount you roll, I think)

        • In our case, the taxable account will get depleted quicker, and we’ll end up paying higher taxes even with the rollovers. If we stretch the taxable accounts over many years, and pay a 10% penalty, in the 0% bracket and offset by two child tax credits, we may actually pay lower taxes over many years. It says so on my spreadsheet but all scenarios I am looking at are esoteric.

          • hmm are those penalties treated as taxes? I really don’t know how that works. however if you know you will pay $2,800 in penalties I assume you know you will withdraw $28,000 per year from your IRA, if your plan is somewhat fixed you could benefit from setting up a SEPP from your IRA, as far as I know the main drawback from a SEPP is its inflexibility, but if you don’t need flexibility why not do it and save the $2,800?

    • Looks like 23% in taxable accounts (including the money market cash balance) and the rest is mostly trad IRA/401k/457. Roth balances are in the $60-100k range I think.

  • Hey Justin,

    Read a story of you on https://gma.yahoo.com/one-couple-saved-more-1-123418990.html. I really want to roundhouse kick(sorry, stressful work week) the people in the Yahoo’s comment section.

    Happy Friday!

    Mr. Frugalenginerds

    • Saw this too! Didn’t see the comments – but the people on Yahoo Finance are generally internet trolls.

    • Rule #1 of FI Blog Club – don’t read the Yahoo comments 🙂

    • I didn’t think the comments were that bad. Mostly just people who have a different philosophy (but still in the rational domain), and some who just live in a different universe. Probably the same folks who spend $600 a month eating out, $150 a month on coffee, and have an iPhone 7… but struggle to pay their bills and don’t understand why…

  • Among your entire post, I am most impressed with your very low grocery bill. In our early retirement budget, with one less mouth to feed, we put in $750 per month. I am hopeful this is going to be on the high end.

    Since I am still working, we are only taking a week long trip to Puerto Rico in May. With points and miles, I was able to keep this trip to around $2,000 all in, four a family of four, including four flights and 7 night hotel stay, kayaking trip, and a rental car. If I had been travel hacking longer (only started last November) it’s likely it would have been even less.

    There is good news on the horizon though. I had the “severance” talk with my boss, and unlike the promotion I had previously asked for, he verbally agreed to this within seconds and without hesitation. I can’t wait to see what he comes back with. I am hopeful this won’t drag out forever, but we shall see. I bought Financial Samurai’s “layoff” book, as I thought quitting would be quite an unprofitable endeavor. I was right, it would have been.

    Since I have never been retired before (I am 40), did you find that being home, instead of at work, did you find more ways to save money than when you had been working? Were there any financial surprises you didn’t anticipate, either favorable or unfavorable? I am hoping when I retire, soon, I will find additional ways to save money.

    • I don’t know that there were any big surprises once I retired. Our utilities might have increased very slightly due to being home more (flushing the toilet more, using the lights more, etc) but not enough to make a blip in our utility bills beyond random annual fluctuation from energy rates changing and variable weather patterns.

      I think we’ve actually improved on restaurant spending and grocery spending since we have even more time and energy to cook, and be very intentional about what we’re buying. There’s a lot more free time so we can pop in a grocery store on the way to/from somewhere to snag some deep sale items vs. skipping that and paying the going rate while working.

  • Alright, so where did you get the Vanguard gear?

    • I follow them on twitter and facebook and they occasionally give stuff away. And I occasionally tweet nice stuff about them (for free of course, I don’t think they pay for that kind of marketing).

  • Nicely done (as always)!

    I’m glad you mentioned that you don’t rely on your blog income because some people assume us bloggers aren’t really using the 4% rule and are just using blog income to supplement our expenses. They have no idea how sporadic blogging income really is. Sometimes google just cuts your earnings randomly, or affiliates delay their payments.The income itself also fluctuates from month to month.

    It’s always good to have a cash cushion and never rely blogging income as part of your retirement plan.

    I’m always amazing how little you guys spend on eating out. I spend double what you spend with half the amount of people. *hangs head in shame* What can I say? I love eating out.

    Great job on another awesome finance update post (love these)

    • As another FI blogger I know you get it – it’s income but it’s not like I can rely on it 100%. Who knows when it’ll shrink to irrelevancy or I’ll get bored of this blogging thing and move on, right? I mean, no plans so far but will 40 or 50 year old me still want to put words on a page and hit “publish” like 37 year old me?

  • Great month! I’m just continuing to invest in the markets every month. Long term investor so no need to time the market. And how did you get the Vanguard gear?

    • I follow them on twitter and facebook and they occasionally give stuff away. And I occasionally tweet nice stuff about them, so maybe that helps 🙂 I’m definitely a Vanguard suck-up / fan boy.

  • Amazing month Justin! That’s some impressively low spending you’ve got this month. Nice job!

    I always love your commentary about the ACA. Keep it up!

    That Phad Thai looks amazing too ….almost as good as mine! 😉

  • CrossvilleChuck

    Having just finished my tax return this week, I wanted to comment on that aspect of ones financial life. As a fellow retiree it is incredible how much the average worker is screwed by taxes in this country. For example, my wife and I have various sources of income in early retirement – my interest and dividends and her early SS and a pension, so it winds up being a reasonable amount of adjusted gross income (our capital gains are still offset by tax loss harvesting I did in years past during the downturns). Our total Federal tax bill this year, all in, was 1.4%. When I actually worked my taxes and fees in the North were much closer to 50%! While I did have a good 401K plan and other ways to save while working, once you get to a point that you are comfortable then it really makes no sense to continue working. Sad but it is today’s reality.

    My advice to others? Save as much as possible, live below your means, stay married to one person, have a child or children that you can actually support on your income, stay healthy, enjoy life, and retire as soon as possible. There is a better world out there and it does not include Uncle Sam and high-tax states fleecing you for everything possible. Go Volunteers!

    • Pretty much. 🙂 I figured out early on that you lose a larger proportion of your paycheck the harder you work. So I saved what I could and pressed the eject button. That actually led to a small tax increase in my case since I lucked into all this income from my blog and it’s taxed as self employment income. But still very low overall. 🙂

    • “stay married to one person”

      That’s old-fashioned advice that makes a hell of a lot of financial (if not also emotional sense). Divorce is ludicrously expensive and can easily set you back 10+ years from whatever goals you thought you had. I realize for some folks it’s not an option.

      Marry someone who is marrying you forever, forever.

  • Spectrum can go kiss my arse. Every year I order cable from Nov to Jan. with no problem canceling. Spectrum bought TW in the midst of my cable joy. Tried to cancel, “oh you have our new customer price”. Finding out having internet + phone will costs appox only $20 less (which is higher than my previous). I’m annoyed. Their home phone costs $30 instead of TW prior $10. the promo for 100 mbps is $35. i used to have 200 mbps w/ TW. when i was transferred they told me it would be the same. nope. 100 mbps. i notice the lag all the time (2 high streamers in the house). anyway… thx for letting me rant. but one of my to do list items is to find good service else where (w/out contract is proving difficult to do)

    Love the NC view. nice colors.

    • So far we haven’t been stuck with any contracts. I’m temporarily avoiding AT+T because I didn’t want to do a contract with them since we might cancel service for the 2 months we’ll be overseas this summer.

  • Hey, don’t be stealing my moniker ;-).

    Congrats on the great month. My March was pretty much “Even Steven.” I’ll take it given how things have been earlier this year. I didn’t expect both my stocks and my local real estate continue a 20%+ pace all year.

  • I went to raise.com and saved 40% on Nutrisystem gift cards. My $300 of food cost me $180. I enjoy reading your blog and look forward to your updates. I really appreciate you saving me $120 though! Thanks so much!

  • It’s 6am here and that pad Thai picture still made my mouth water!

  • Looks like another great month for you and your family. congrats on that!

    We also did pretty well as March is the month that I receive my annual bonus and salary adjustment. We set a savings goal of $75k this year and are well on our way to reaching it.

    Thanks as always for the detailed post.

    • What did you do with the bonus? Invest at the top of the market or try to hold out for a dip? I would usually dump it into the market as soon as I got it even if I thought the market was high.

  • Nice DIY pinata! Mrs. RB40 should make one. 🙂
    I’m looking forward to reading about your trip. Sounds really exciting.
    For blog income, why don’t you just use their websites and report the income. The physical check might be a little late, but you should be able to see how much you’ll be paid.
    Great job with your expenses as usual.
    I’m reading Bogel’s Common sense on Mutual fund and it is changing my mind about international investing. International equities just cost more and doesn’t perform any better than US.
    Check it out, you might like it.

    • I know I could report “expected” revenue but prefer to keep it simple for me and work on a cash basis accounting method and report what’s actually received during the month. There’s a chance some vendors won’t pay or pay very late so I like to count my cash once it’s deposited and in my account 🙂

      I’ve read Bogle’s Common Sense on Mutual funds. I get the argument against the need to own international investments but I guess I’m more of a modern portfolio theory follower. International isn’t 100% correlated with US equities (primarily due to forex fluctuations it seems), so adding international into the mix and increase risk adjusted return. It does seem to dampen volatility many times, though to be honest I haven’t tracked my volatility and return vs. the SP500. It’s also a hedge against the US NOT being the bestest greatest most #1 country on Earth 50 years from now. Worst case, my foreign equities do better than US and I can move somewhere overseas with the $$. Kind of a plan B for adverse global political outcomes for the US. This isn’t a 2016/Trump related sentiment, but rather something I came up with ~12 years ago when initially setting up my asset allocation. 50-60 years of investing is a long time and empires have evaporated in lesser time frames. Though hopefully we’ll be trading messages in another five decades and the US will be a perfectly fine place to live. 🙂

  • Do you all have an article on College Savings and what you’re planning for college? We have 5 kids and have always wanted to give them state school education. In our state, that means about $40k per year each or $200k. We have already saved $50k. There is a strong chance our daughter (who has special needs) will not go to college, but we want to give her some benefit comparable to what her brothers will get. Given my kids ages, I’m a little behind in saving but we are actively pursuing contributing today and since my kids are homeschooled, there are some opportunities to get dual high-school/college credit in Junior and Senior years of high school for free or singificantly reduced costs. (Did you know that Community College is free in NC for 11th and 12th grade homeschoolers?)

    • I’m sorry, I meant $10k / year each – not $40k / year. The total for 5 kids for 4 years is $200k in that traditional model.

    • Here’s the article I put out recently on our college plans and how to pay for it. We’ll do surprisingly well with the financial aid formulas so the bill won’t be as steep as I was expecting before doing the analysis. Basically, we’ll probably end up paying somewhere in the $40-150k range total for all 3 kids at in state schools. Total cost of attendance is only $24k or so per year right now, so that’s only $100k total for a 4 year degree. Are you saying your state schools run closer to $40k/yr?

      Thanks for the heads up on the free community college in 11th and 12th. Is that homeschoolers only? Our tentative plan is to load them up with AP courses and possibly college courses during high school. That worked for me to the tune of almost 2 whole years of college credit when I left high school (check out that linked college cost article for more explanation there 🙂 ).

      • I was a little confusing in my initial statements. Our Maryland (MD) state schools are approximately $10K per year for tuition only. My wife and I are planning only to pay for tuition as there are several schools in commutable distance from our house’s location. So that means we need $40k / kid for 4 years of college. And with 5 kids that’s $200k for the whole deal. We’ve got $50k in 529 accounts so far and about 5 years until college starts (and therefore 9 until it ends). So we have some work to do, but we’re making steady progress. We’re hoping to get this mostly squared away this year as this is our last big “question mark” for the ability to take some bigger risk including going semi-retired and using part-time self-employment to make up the final bit of gap.

        In North Carolina (at least Wake County), if a child is home schooled for high school they can dual-enroll in community college and get dual high school/college credit for classes. In this scenario, community college is free for the years a child is technically in high school but dual-enrolled. (I’m still learning about this stuff as we have been considering relocating to Raleigh from Baltimore for two years… We have friends who home school out of North Raleigh and are planning to do this.) In Baltimore, MD, community college is 1/2 priced for home schoolers dual-enrolled, not quite as good as Wake County… AP classes provide the same benefit if the school will accept them, which most will.

        • Re: college costs – gotcha. $10k/yr x 4 years x 5 kids = $200k total. Pretty manageable even if you have to fund some out of your paycheck or your FIRE portfolio since you have several years to make the payments.

          Dropping your income down through semi-retirement would also improve your shot at a decent financial aid package (FAFSA formula looks at income more heavily than assets).

        • Five kids also – two in college, one next year and then the last two a couple of years after that. We committed (at least in our minds) to fund four years of school for each (tuition + room/board). I know there is a whole debate on what and how much to fund, but I will leave to others. It was what we decided to do. LOL

          In may case, we are planning on $30K/year x 20 years (5 kids x 4 years each). I think this is very conservative, but plan for the worst and hope for the best. 🙂

          I was however, a bit disappointed in the merit scholarships available to the two we currently have in school. Both were good students in high school, well rounded activities, female, going into STEM majors, considered minorities, etc. but not a whole lot was out there. 🙁 To a certain extent, i think “in school” merit scholarships are tied in to financial need, so are not true merit scholarships.

          In any case, Mr Root of Good – another excellent month. You seem to have the work/life balance figured out perfectly!!!!! Keep up the good work.

          • Wow – what a huge number for college – but I have respect for your commitment to it. We looked at the 5x multiplier and went tuition-only in our planning.

            A little disappointed to here about your experience with merit scholarships. My kids are minorities, 3 from foster care and two from international adoption. At least 2 will go into STEM fields and I’m hoping for Doctor/lawyer from my youngest (haha!). I had hoped that we might see scholarships kick-in a little bit to help out.

            • Reality if often different with respect to costs. Kids work full time during the summers or part time during the year but it doesn’t seem to add up to as much as it used to. They switch majors and the way the schools courses are now structured with prerequisites a switch in major can easily result in an extra year for an undergraduate degree. The kid you would think would have no issue in school struggles their junior year in high school for personal reasons and the grades drop, and that’s the year the colleges tend to look at for scholarships. Many kids apply to multiple, smaller, scholarships of maybe $500 a year and garner a dozen of them, only to have your kid’s college pull back grant aid an equivalent amount on you so you still get to pay the same amount as if they never went through the hassle of getting those multiple scholarships. If your kid does get a full ride, you may end up having to claim it as “income” on your taxes, as if it were a gift as my supervisor recently informed me he has had to do. You need to be careful if you are putting money in a 529 because the market may dip (shades of having a 2009 high school graduate) and the 529 is often attached to “funds” and suddenly the 529 may be worth less than you put into at the start of the child’s senior year because you weren’t planning to switch it to the more conservative “college” fund until they actually, you know, started attended college. So now you have to take money out of hide or take losses. Lots of fun with college to look forward to, plan your best but just remember to be flexible.

  • Great update. I just love that “lazy man and his lazy portfolio.” I’m all about lazy 🙂 Every investor loves those end of quarter months as that’s when we get most of our dividends. Keep inspiring and doing a great job controlling expenses, enjoying time with family, making great food and watching that passive income continue to grow.

    • The only problem with quarterly dividends is that I forget they are coming. Other than December they are usually pretty small compared to a quarter’s worth of spending, and we already have a year or so sitting in the money market account so cash flow isn’t much of a concern.

  • This is an incredibly detailed income report, much more so than some of the other personal finance bloggers I follow.

    You’re another person who I keep seeing Ebates come up and earn them money. OK, I’m looking into this. Glad your blog income is up in the $508. Keep it up! Plus all your other investments. =)

  • Great update! Do you have any suggestions for car insurance. My car is financed to be paid off in the next year. I drive very little mileage, but my insurance is still pretty high living in South Florida. I have state farm and recently checked into their Drive Safe program. I signed up they sent me the GPS for my car, but my phone was not compatible with the app. Solution was to either buy a new fancy phone that would increase my cell phone plan and cost of the phone or get OnStar or InSync with a monthly bill. I already have my cell phone down to $30 per month with MetroPCS, Samsung phone and good service.

    When I told them to have the discount would cost me $, they basically said those were my choices.

    Would love to hear your ideas. Thanks so much for all your advise.

    • We always check around every couple of years to make sure we get the best rates. I’d suggest looking at any “mutual” companies in your area, as that saved me a bit on the last round of searching. We’re paying just $450-500/yr total for the 2 of us, but it’s liability only (at a half million coverage though) and on a minivan so we’re probably rated as pretty boring, safe drivers. Also accident/ticket/claim free 3+ years.

  • Hello Rootofgood, the net worth just keeps going up. Pretty low expenses you have and thats a feat of its own with 3 kids. I guess frugality has improved in FI. Good luck in April.

  • Great job as always. Can’t wait to hear all about your vacation.

  • How do people find out about cheap travel and cruises? That is one aspect I could improve on!

    • I pick up the knowledge over time. One easy way to find a cheap travel destination is “geographic arbitrage” – check out foreign exchange rates and see which ones have declined the most over the past year or two. Cheap foreign currency usually means the entire country is on sale AND you can still find specific deals in your target country.

      Also check out my cruise posts.

  • Stacey Chadronet

    I love your updates! So inspirational for me. I am moving from part time work to no time work later this year and so agree with your comment about meals and cooking. Having the time and energy to plan and cook meals is such a money saving and healthy change. I also love your ebates/Raise gig. It is a sport playing with that system! Keep these updates coming. ; )

    PS – Looking at the college comments. Big movements towards state schools being paid for by the state. I’m sure you saw New York make that move. I live in Rhode Island and our governor is pushing this hard as well. Imagine how great that would be….

    • Free college would help a lot, for sure! Though for us, the non-tuition part of college costs more than tuition itself (but maybe we can save some $ versus the averages they use for room/board, books, etc).

  • Hey Justin – do you have a post that breaks out your net worth by asset type? Do you include your house / van in the number? Or is it only invest-able assets? Also do you guys do rental property or anything like that?

    • I have a post on asset allocation. Otherwise, I don’t have a specific post breaking out net worth but here it is: $1.6 million investments, house is worth $150k or so, and the rest is cash/money market.

      The van isn’t included in the net worth figure I report here ($7-8k; inconsequential vs overall net worth!) but I do include it in another spreadsheet I update once per quarter for net worth. No good reason for the discrepancy other than “that’s just how I set it up a long time ago” 🙂

      We don’t have any rental properties, and don’t plan on getting any in the near future. That could always change but for now we’re happy with the current set up with mutual funds/ETFs.

      • Thanks for sharing. What’s your pre-tax vs. post-tax allocation? Do you foresee ever needing to pay taxes on withdrawals or will you be able to manage it to tax-free?

        • About $350k in taxable (including $30k or so of cash/money market funds), maybe $200k in various Roth accounts and the balance ($1 million) in trad IRA/401k/457.

          Will we have to pay tax on withdrawals? Maybe but not a lot. There’s a chance that we simply don’t spend that much between now and age 70.5 and our trad IRA/401k balances keep growing faster than we spend it. In that case we will probably pay a fair amount of taxes on RMDs. But it also means we’ve won the financial game of life 🙂 To mitigate against big RMDs I’m focusing on Roth conversions right now. I might even convert larger amounts to Roth and pay a little tax right now to do so (but the ACA loss of subsidies makes that a losing proposition while the ACA remains in place).

          • Thanks! This has been really helpful to me in thinking about our own situation.

          • Your excellent Roth Conversion article is almost exactly 2 years old, and if I recall you hadnt quite started that plan yet. It would be super cool for an update and how you are actually balancing tax burden/ACA subsidies cliff, etc.

  • Thanks for sharing, it always brings great encouragement to a newbie like me seeing someone else be able to live off of dividends and being smart with their money!

    Looking forward to hearing more about your trip as it gets closer!

  • http://www.aposenteaos40.org

    Can’t stop admiring this family.
    My YTD expenses are already getting at 11k…I’d love to cross the Rent line out of my budget as it’s the biggest expense but I’ll never be able to…I’m a renter for life!

  • Hello JustinRoG,

    I am stunned at your monthly investment income. I am at the point where I max out my tax advantage accounts and looking to start investing in index funds.

    Are you still using the same asset allocation (2015 Dividends) from your post titled, “Living on Dividends in Early Retirement”?

  • Your spending is inspiring. Every time I start to feel jealous of a financially independent person I remind myself of all the luxuries I am choosing to send money on. In March my family of 5 spend $1135 on groceries and $391 on eating out. And it’s all in the same place that your food money is as of this moment. Ugh.

  • Nice work. Keep growing that nest egg.

    I worry about investors who hold a large portion of their net worth in one investment (the stock market) and rely on it going up to continue growing their wealth. I notice many investors don’t care much about diversification, but are overly concerned with fees and making investing as easy as possible.

    I worry about the price of this strategy. Many people lost their shirt in 2008, 2000, the 1970s and 1930s by going all-in on one asset class and not selling out when the trend changed. Stocks are soaring now, so all-in bets are beating nearly everything else, but I wonder how investors plan on protecting their assets when the trend changes.

    Historically, when stock markets decline there are several asset classes that perform well: 1) Managed Futures; 2) Gold; 3) Treasuries; 4) Gold; 5) TIPs and 6) MLPs. These may not always perform well in the future during bear markets, but they may be worth looking into to protect downside of stocks-heavy portfolios.

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