April 2014 Financial Update

April left us slightly wealthier due to a small amount of stock market gains and very moderate spending.  Our year to date spending is back within our budgeted levels four months into the year.

With over $6,000 in total income during April, we more than covered our monthly expenses of $1,712.

Mrs. RoG’s paycheck keeps flowing in, and that represents roughly half of our monthly income.  Even without the paycheck from her job, our other income covered all of our expenses for the month (= financial independence!).

Income received from rootofgood.com totaled $876 in April.  This was a pretty ordinary month of blog income with revenue from various advertising networks in addition to Google Adsense revenue.

“Deposits” totaling $737 was mostly a repayment of a business loan made to family in 2013.  I also received some rebates submitted in January.

Ebay revenue was minimal in April with only $45 in sales.  I’m working on flipping some electronics on Craigslist in May, so hopefully I’ll make a couple hundred dollars.  Like most people, we have plenty of excess “stuff”, I just need to get it listed on ebay or craigslist to convert it from junk to cash.


April 2014 Income


In April we received just over $1,500 in dividends and interest from our investment portfolio.  That is in addition to over $3,000 in dividends received in March.  Year to date, we have earned $4,777 from our investment portfolio:


YTD Dividend Summary 2014 Q1


A quick note on the expense tracking and income tracking tools I use.  If you like these pretty graphics, that’s exactly what you get from Personal Capital.  But they really go beyond pretty pictures.  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.  It’s my first stop when I have a quick finance question like “how much cash do we have?” or “what do we owe on credit cards right now?”.

Personal Capital is also a solid tool for investment management.  Keeping track of our investment portfolio takes two clicks and is incredibly easy with Personal Capital.  If you haven’t signed up for the free Personal Capital service, check it out today (review here).


Now let’s look at April expenses:

April 2014 Expense


At $1,712 for the month of April, we did an awesome job keeping living expenses very low in spite of having three kids.  Even more surprising is that our April expenses included over $700 in travel expenses for our five week trip to Canada.  Travel expenses include an apartment rental for a week in Montreal through airbnb (save $25 on your next reservation through this link), two nights in a hotel in New York City, and passport fees for one of the kids.  For our family, the apartment rental will work out to be way cheaper than a hotel, and we’re getting a two bedroom apartment with a kitchen which will allow us to cook breakfast and dinner at home and avoid dining out all the time.

We’ll end up getting the Montreal apartment rental for almost free after the $400 sign up bonus from our Barclay Arrival credit card.

Gas, grocery, and restaurant spending was pretty ordinary for the month.  These expenses tend to stay the same month to month (which is a good sign!).  In the next few weeks I’ll have a post showing every single grocery item we purchased in April and you can see how our family of five gets by on $500-600 per month.

The “general merchandise” expense of $20 reflects a replacement of another kitchen appliance.  It’s been a rough year for our kitchen appliances with our oven, microwave, and rice cooker all dying in recent months.

Upon reaching the age of 18, our old toaster oven decided to celebrate it’s legal status as an adult by taking up smoking.  The broil element went bad, and it’s cheaper to replace the whole toaster oven than it is to replace a single element.  I’ll be getting a $10 rebate back on the $20 oven, so I can’t complain about $10 for a brand new toaster oven.  It’s even a lot fancier with an LCD panel, loud beeps, and a countdown timer.

We also had $62 of automotive expenses in April.  I’m working on the air conditioning on our 2000 Accord, and that expense includes a pressure manifold gauge set from Harbor Freight and a 3 pack of refrigerant cans from ebay.

We know repairs and replacements will be required from time to time so they are included in our budget.  This month it’s kitchen and automotive expenses, next month it will be something else.  One thing is certain, there’s always some “unexpected” expense so we might as well plan for it explicitly.


2014 YTD Expenses April


Year to date, we have managed to keep spending very closely in line with our budget.  At the end of March, we were a few hundred dollars over budget for the year.  After a low expense month in April, we are now back within our budget.

We budgeted $32,000 per year for retirement, so four months of spending is $10,667.  At $10,006 year to date actual spending through April 30, 2014, we are more than $600 under budget for the year.  Given that actual year to date spending includes big expenses like summer travel and prepaying utility bills, we are probably doing even better than it appears on the surface.


Net Worth: $1,365,000 (+$15,000)

Another generally positive month of investment returns led to an increase in our net worth.  With the generous stock market returns over the last few months and years, it’s easy to get complacent and forget that the stock market can also go down (on it’s way back up).


April 2014 Net Worth


That’s okay if our net worth goes down.  Our dividends and other income sources (excluding Mrs. RoG’s paycheck) are roughly enough to cover our recurring living expenses we budget for retirement.  Long term I’m betting equities will pay off well.

Real Estate Update

In last month’s financial update, I mentioned I was thinking about investing in rental real estate.  I decided not to pursue the opportunity.  After looking at the numbers, it would have generated around $4,000 each year in net cash flow after expenses for a cash investment of $50,000.  That cash flow plus potential appreciation would probably end up being slightly higher than the 8-10% I figure I might get from equities over the very long term.

But I’m lazy and didn’t want the hassle of managing rental real estate.  Maybe when our kids are older and I get “bored” I’ll jump back into the rental real estate game.  For now I’m happy with the real estate I already own.

As I mentioned in last month’s update, I checked my investment portfolio at Personal Capital and realized I already have around $150,000 invested in real estate through my mutual fund holdings.  Those investments plus another $150,000 for my primary residence means I have 22% of my net worth tied up in real estate already.  That’s enough for me right now!



Was the market kind to your net worth in April?


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  1. I too have a bunch of stuff laying around that I need to get onto Craigslist. I’m hoping to do it this month, but it’s looking more like June for all of that.

    As for the real estate investing, you made a great point at the end that I hope others don’t gloss over: you already own real estate in your portfolios. Many people don’t know what all their mutual fund or ETF is invested in. If you have a few funds with the same market cap, chances are you are doubling up on many of your investments. It’s important to know what the funds you are investing in hold. At a point, diversification starts doing the opposite of what you intended.

    1. I feel like I need to pile all my craigslist stuff up and just spend a few hours photographing it and listing it.

      Agreed on the diversification issues. I’ve heard it called a “closet index fund” when you buy a bunch of different funds trying to pick the winners.

  2. April’s looking good! In terms of real estate investing, I have been doing some turnkey investing, which means a lot of the headaches go away. Someone else manages the property, etc. Sure, you still have to manage the management company, but that doesn’t take nearly the effort that many folks in real estate have to give.

    1. What kind of yield or rate of return are you expecting on the turnkey investments? And are you in properties around NYC or somewhere farther afield?

  3. I love how you show us exact numbers.

    Have you ever created/ran a calculation to determine how much time it would take to manage an investment property? I’ve seen a lot of people estimate a 2-3% higher return vs stocks. However, few people know how much time they will be spending on a rental property. My guess is that extra 2-3% would not look so appealing.

    1. Too much time! 😉

      It really depends on how much you outsource. If you’re screening tenants and have turnover every year, and have to clean up and repair a few things, it can be a lot of work. Throw in the occasional problem tenant that flakes out on rent and has to be evicted and that’s more work.

      If I had to guess, the time commitment is probably measured in dozens of hours if you have just one unit.

      1. I agree. Time is valuable, and an increased return of 2% or so compared to a “do nothing” ETF is a no-brainer (for me).

        I recently had the opportunity to invest in a good real-estate situation, but declined simply because I didn’t want the added stress of dealing with property, tenants, etc. Part of the reason for early retirement, after all, is to get out of the “trading my time for money” game and be able to control our time however we want. (eg: Spend more time with our kids/family.)

        1. That’s my take on it too. I had to step back and ask myself was it really worth the extra stress and effort for a little bit more money. Maybe in 16+ years when the kids are out of the house I’ll get bored and want to make an extra buck and try my hand at rentals (again).

      2. Spot on Justin! We just had to evict another tenant..again..and this was managed by a company ..did the usual checks etc..but still flaked! Guess what too? I guess they couldn’t take their dogs for about 2 weeks and so left the little things free rein of the condo. Yep..we gotta replace the carpet too, it’s not salvageable. Once it’s done, we’re selling that too!

    1. So far it has been staying in our money market account earning about 1% interest. We might keep much of it there as a cash buffer for unexpected expenses. In case the market takes a dip, we can avoid selling devalued shares of our investments for a little while.

      We’ll probably max out traditional or Roth IRA’s this year so that will take care of $11000. And I may fund a solo 401k using this blog’s revenue. I’m not sure what, if any, tax liability we’ll have this year. Mrs. RoG might stick around at her job another year (they are giving her another 2-3 months extra paid time off next summer) so we might have this cash surplus for a while. The next year or so of cash flow is a little uncertain since we don’t know the exact month she’ll depart employment.

      1. very cool. I like the idea of keeping a large amount in cash to buffer against having to sell invested assets in bear markets, I haven’t given too much thought about strategy for withdrawing money in retirement, but its just as important as the strategies for saving for retirement.

        1. Yeah, it’s pretty comforting knowing that we could get by for a year or two without selling anything (assuming Mrs. RoG’s income disappears tomorrow). Takes a lot of pressure off when you don’t really care where the market goes for a couple years.

  4. Hey Root! Enjoy your blog and comments here as well as on MMM forums. Question for you. How do you account for housing? Is your primary residence paid off? Is it included in your net worth or excluded altogether? Just curious since I am looking through our numbers and trying to weigh paying off the mortgage early vs investing additional $ elsewhere. Thanks!

    1. We still owe a small amount ($40,000 or so) on our $150,000 primary residence. We have a fixed rate loan at 1.99% with 3 years until it’s paid off (unless we pre-pay it).

      I “cheat” and leave the mortgage off my monthly expense updates because we have liquid cash and investments to pay off the mortgage any time we want. I do include all other housing expenses (maintenance, insurance, taxes, big replacement items, etc) in our $32,000 retirement budget and in these monthly financial updates.

      For us, the mortgage is just a cheap way to borrow money. If the market goes up much more than it has already, I’m certainly going to be tempted to sell some investments and take the cash we have on hand and just pay it off. For now I like the liquidity the cheap mortgage gives us, and if I want to I can use our cash on hand and other liquidity to buy more real estate or buy other things if the opportunity arises.

      The long term plan (ie beyond 3 years) is to not have a mortgage during retirement. That was our plan all along, and the “retirement” just happened a few years before the mortgage was paid off.

      The decision to not carry a mortgage in retirement is mostly emotional. It’ll be easier not having the fixed obligation each month even though mathematically it makes sense to borrow money at 3-4-5% if you expect 7%+ long term. Any mortgage we could get would only represent 10% of our net worth anyway, so it’s not a big deal one way or the other for us. If things got really bad economically, we could drastically cut our expenses and know that we own our house free and clear.

      As for how we include it in net worth, the mortgage and the house value are included in the net worth I list here. I’m carrying my house at a value of $140,000, so minus the $40k mortgage, the house adds $100,000 to our net worth. Over 90% of our net worth is in investments. I don’t expect the house to ever produce income in the way that stocks and bonds do, so I don’t include the house value in any “4% rule” calculations.

      We could always rent our primary residence out if we decided to take up long term travel. So the house is “valuable” in that sense, and would provide a little extra revenue to offset our housing costs somewhere else.

  5. Love the blog RoG. I appreciate your sense and sense of humor around financial planning and will be looking forward to future posts.

  6. Curious to know- What is the hourly income that you generate from this blog (Total monthly income/Total hours invested in maintaining the blog)?

    1. I’m not detail-oriented enough to keep time logs what I put into the blog. I’d have to guess in the last month I spent 15 hours writing new posts (which haven’t been very often). Maybe 5-10 hours moderating and responding to comments, keeping my social media accounts updated, and interacting with other bloggers and members of the media. And perhaps a few hours dealing with “business” parts of the blog (talking to advertiser reps, cashing the checks, accounting, keeping advertising in compliance).

      Let’s say I put 30-40 hours per month on average into the blog. On average, I might expect $800/month revenue. That means I’m “earning” $20-25 per hour. That’s not too bad compared to what I used to make per hour.

      Or I could be off by a factor of 2 on the time I spend, and it would be $10-12 per hour. That’s just barely minimum wage.

      I’m not in it for the money (thank goodness!).

  7. You mention that you are going to do some craigslisting of unused stuff… that reminds me I should do the same thing! I have an audio receiver in the basement that hasn’t been used in a couple of years that I’m sure I could unload.

  8. Nice month. In blog income alone, you almost covered your mandatory expenses excluding vacation. Have you thought about adding a little more work in your retirement life? With your skills, I am sure you and your wife could easily make 30-40 k without a ton of hours and flexibility. Given the way you can stretch a buck, I can only imagine what sort of damage could be done on a 50 k retirement budget.

    1. I would say I have thought about it and realize exactly what you’re suggesting. Making $30-40k wouldn’t be too hard. I may have picked up a tiny bit more freelance writing today which could push me 10% closer to that level of income.

      The truth is we don’t need the money today. But I’m always open to interesting opportunities to share what I know. And getting paid for the opportunity is even better! The problem is that I’m not really interested in working very much right now. Kids and other interests are keeping me busy and entertained.

      But a few hours of paid work per week (that’s also interesting) is nice in a way. I get the feelings of productivity and a job well done that I did in my working days without the stress of office politics and discordant personalities or the pressure of deadlines and making a wrong decision (that could lead to loss of life or serious financial issues). For now I’m not actively pursuing writing opportunities or other paid employment, but if something presents itself I at least pay attention to what’s on offer.

      I don’t know if you have seen my article on “running out of money in early retirement. These little opportunities to make money seem to constantly pop up. If we ever get in a pinch and need more cash, I’m growing more confident that we can ramp up productive efforts a bit to make money. And $30-40k per year probably isn’t out of reach even for casual work.

  9. Thanks for the update. Looking forward to your upcoming grocery post. That expense is currently my biggest concern as I approach FIRE. Eating organic is damn expensive and will require a significant amount of assets to maintain based on current spending. Hopefully your next post will show some ways to reduce that expense.

  10. Dude, you’ve got the Early Retirement lifestyle on lock! Looking forward to mine, though without significant pay increases, may be 15-20 years out. But retiring at 45 vs. 67 still sounds pretty nice to me! 🙂

    And nice work on the blog income. I have had a decent increase this year as well, though I’m sure I could optimize more, etc, but just a bit too lazy on that front 🙂

    1. 45 is definitely better than 67!

      I’m feeling good about the blog income. For May, it was down a good bit to “only” $600-something. But I’m expecting a lot of revenue in June from lots of traffic back in April.

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