January 2016 Financial Update

One month down, eleven to go.  With the new year came a significant drop in the markets that left our portfolio a little lighter than it was during most of 2015.  We suffered a $64,000 net worth decline during the month of January.

Our income remained steady at $6,912 while our expenses ended the month at a modest $2,293.  In cash flow terms, we made much more than we spent.  However that didn’t mitigate the stock market losses to any real degree.

We were due for a stock market correction for a while and it’s finally here now.  Whether this is a real recession and how deep it might become remains to be seen.


In January, we received only $38 in interest and investment income.  Our monthly dividend income is very inconsistent, with most of the income arriving at the end of each quarter.  For all of 2015, we received $28,527 in dividend income.  If we are in the beginning of a recession, I expect the dividend income to be slightly less during 2016.

Blog income, shown as “other income” in the chart, remained solid at $3,112.  This is slightly above average due to receiving a check from a single advertiser covering all of 2015.  I expect to earn slightly less in February but the total should still be above $2,000.  I’m hesitant to forecast what I think I will make from Root of Good during 2016, but if the past is any predictor of the future, it should be $2,000 to $3,000 per month.  That’s quite a bit higher than the $600 to $800 monthly income I was expecting a couple of years ago!

In January, I continued to provide individualized advice through my early retirement lifestyle consulting.  Between that consulting and other freelancing income the “consulting” income totaled $472 in January.

The “deposits” income of $97 comes from cash back rebates from the Ebates.com and Mrrebates.com online shopping portals. I’m all about sharing the wealth, so if you sign up through this link and make a qualifying $25 purchase through Ebates, you’ll get a $10 gift card like I did.  I try to do all of my online shopping through one of these portals and the cash back adds up fast.  We scored almost $100 cash back from the cruise we just got back from.

Also in the “deposits” category are two class action settlement checks worth $15 each.  Score!  I think this was to settle my claims against Intel for misrepresentations they made about their Pentium 4 chip almost 15 years ago.  Vindication (and $30) is mine!

The “paycheck” income is from Mrs. Root of Good’s job.  Since September of 2015 she’s been working three or four days per week from home.  Last month Mrs. RoG worked exactly seven days.  We were on vacation for a week on a cruise, but she’s also trying to exhaust her allocated vacation time before joining me in early retirement soon.  We have some exciting news on that front in next week’s post!


If you’re interested in tracking your income and expenses like I do, then check out Personal Capital (it’s free!). All of our savings and spending accounts (including checking, money market, and five credit cards) are all linked and updated in real time through Personal Capital. We have accounts all over the place, and Personal Capital makes it really easy to check on everything at one time.

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



Now let’s look at January expenses:


We spent $2,293 in January.  That is only 70% of our new and improved budget of $3,333 per month (or $40,000 per year).  I’m hoping to find fun ways to spend all of that $40,000 during 2016 but so far we’ve been too busy having free or cheap fun to spend much more than what we have been (like the $24,000 we spent in all of 2015).

Our single largest expense in January was the annual property tax bill for our house.  At $1,614, it’s quite a steal compared to taxes in areas with high real estate values or high property tax rates.  $1,614 seems like a very reasonable amount to support education, police and fire protection, and our wonderful City parks and recreation department (among other programs).  For the curious, our house is 1,800 square feet and assessed at $154,000 for the 2016 bill (recently reassessed at $147,000 = cheaper property taxes in 2017!).

Another cheap month of grocery spending at $424.  We were out of town the last week of January so we didn’t shop for much in the week leading up to our cruise.  Instead, we played “let’s eat all of the food in the fridge” for a few days.  We routinely manage to eat about 99.5% of the food we purchase and waste very little.

There’s no secret magic to this efficiency, but rather a few easy rules we follow.  We buy only what we can realistically eat before it expires.  We eat leftovers (and intentionally cook extra to generate plenty of delicious leftovers).  If it won’t be eaten before it expires, it goes in the freezer.

The utility expense of $152 includes our natural gas bill from December usage and monthly water bill.  Thanks to global climate change (or possibly atmospheric gnomes and/or random variations in weather), we experienced a steamy December with temps in the 70’s some days.  Balmy temps led to very minimal usage of our gas furnace most of the month.

An unexpected free upgrade on our cruise - a room with a view. And a neat nook that the kids wish was in their own cabin.
An unexpected free upgrade on our cruise – a room with a view. And a neat nook that the kids wish was in their own cabin.

We didn’t pay the electricity bill in January, but instead paid a huge lump sum at the beginning of February to cover our electricity for the spring and summer.  I’m once again playing the travel hacking game.  I need to manufacture $3,000 in spending by April to get $400-500 in free travel from the Barclay Arrival Plus card, and pre-paying utilities is an easy way to meet the spending goal by spending money on things we already purchase.

I’ll get a second card for Mrs. RoG soon and the combined rewards from our two cards should pay for most of our December 2016 week long cruise on the MSC Divina (in a balcony room!).  We already received almost $1,000 in free travel from the Barclay Arrival Plus cards back in the spring of 2014, and we’re gonna do it again this year.  These babies are churnable apparently (churnable = you can apply again even if you already had the card in the past).

If you want to get a free cruise too, check out all the credit card offers here.  There are also plenty of cards that will reward you with free international airfare or many free nights in hotels.

Mind-blowing rocky shoreline in Freeport, Bahamas.
Mind-blowing rocky shoreline in Freeport, Bahamas.

In case you missed my recent series of articles on cruising, here they are:

Our $36 in travel expenses covered the gas to drive to Charleston for our cruise.  I count gas purchased while on vacation as a vacation expense instead of a gasoline expense.  We parked at a friend’s nearby office building and saved $85 compared to the port parking fees.  She generously offered to drop us off at the port (thanks, Sarah!) and we brought her back a liter bottle of Bacardi rum.  Sounds like a fair exchange, right?

I thought we were escaping the cold winter. Playing minigolf 13 decks up from the ocean doesn't help.
I thought we were escaping the cold winter. Playing mini golf 13 decks up from the ocean in 30 knot headwinds doesn’t help.
Eventually it warmed up. The spicy Thai curry stir fry helped too.
Eventually it warmed up. The spicy Thai curry shrimp stir fry helped heat things up a bit too.

Our “cable” bill is really our internet connection from Time Warner Cable.  Who would be silly enough to still have cable in 2016?  Apologies to sports fans out there since I know you are the ones keeping Comcast and TWC solvent (gotta have the ESPN fix, right?).

Entertainment spending of $24 represents a pool pass good for 15 admissions to any of our City’s wonderful pools or the water park.  At a buck sixty per entry, that’s an expenditure with seriously high ROFOI (Return Of Fun On Investment).  We’re also paying a fixed cost for all the parks and rec facilities through our property taxes which is why the marginal cost of a single water park admission is so low.

The $5 electronics expense was a package of three replacement USB cables for the kids’ Amazon FIRE tablets we bought last year.  The connectors on the original cables wear out over time.

Absent from January’s expense report are restaurant spending and regular gas purchases.  We didn’t spend anything on dining out during the month nor did we drive very much other than the road trip to the cruise (accounted for as “vacation” spending).  I think I’ll have to refill my fifteen year old Civic eventually (it’s not electric, you know) so get ready for a big $20 expense in February or March.


Net Worth: $1,439,000 (-$64,000)

January marks the third consecutive month with a drop in net worth.  We are roughly $140,000 poorer than we were about eight months ago and almost exactly as wealthy as we were at the start of 2015.

Investing in equities is a dance where you take two steps forward and one step back.  It’s less fun to take a step back, but necessary before you can take another two steps forward.

The $64,000 in losses sustained during January represent around two years worth of living expenses.  This seems like a huge amount of money to lose but it’s just part of the dance of solid long term returns (unless it really is different this time!).

january-2016-net worth


I’m not close to worrying about the sharp drop that commenced with the new year.  I was happy with our net worth levels during 2014 when we spent most of the year with a lower net worth than we have now.  If we see another 20-30% drop, I’ll start to take a closer look at our spending and finances to make sure we will be fine.

But I’m pretty confident we won’t run out of money in early retirement.  We have a stream of dividends coming in, the blog income is fairly steady, and we still have well over a million bucks in our investment portfolio.

If you’re worried about the markets, all I can suggest right now is to stick with your asset allocation and see if you need to rebalance by buying any downtrodden asset classes.  If you’re still working, keep plowing money into the market and you’ll thank yourself when the inevitable recovery happens.  After that, go outside and play (or stay inside if it’s freezing out!).  Turn off the talking heads on CNBC and stop checking your stocks every hour.



How did you do in January?  Are you worried about the downturn in the markets so far this year?  Or dropping even more dough in the markets?



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  1. I’m not too worried about the downturn, I’m continuing to invest aggressively. We aren’t planning on touching any of it for at least 15 more years. The US stock market as a whole has been overvalued with all the Federal reserve’s money printing. I’m actually more comfortable investing now than I was a few months ago.

    1. Same here. Low prices make me more confident that the funds will go up in value sooner rather than later. High prices have the opposite effect – I know I’m buying AFTER the big run up. It’s counterintuitive, but no different than feeling good about buying something at a steep discount at the grocery store or that railroad parcel behind your yard (in your case).

  2. Our January was nice and boring. We aren’t too worried about the downturn, although it hurts to see the drops in our investments. The only change we have made is to build up a little more cash, in case we get laid off, or a recession does hit, we would still like to RE in 2018, and then all the money won’t be tied up in investments we don’t want to touch until things recover.

    I need to read up on your cruise stuff – we really want to take the kids on a Disney Cruise in a couple years – those things are pricey!!!

  3. Every couple of weeks I need to remind myself to stop watching our portfolio like a hawk and just let all the automatic saving and rebalancing measures we’ve put in place do their jobs. Sometimes it’s hard!

  4. I love your ROFOI analysis – we often look at purchases and ask where they fall on the “happiness curve”, i.e. spend a little money to get a lot of happiness, spend even more money to get marginally more happiness. So our $150 used moped that we drive on date nights is at the peak of the happiness curve, but paying $400 to rent an ATV for an afternoon on a guy’s camping trip is way to the right of the curve (and thus will not be paid for lol).

        1. Don’t get me wrong – I’m still a huge fan of low cost passive index funds. I happen to slice and dice and have 10 different asset classes in my portfolio, so that’s where my comment is coming from. Some sectors were harder hit than others in the past couple months (developed international, emerging markets, small cap, metals and mining/commodities for example). If you own US Total Market, Total International Market, and Total Bond Index, not much to do other than possibly shift $ from bonds to the other asset classes. But if you own slices and dices of the market (through index funds), it might be time to take a look if there are out of balance asset classes. I haven’t yet looked but might soon.

          Still 100% a fan of index funds! 🙂

  5. It’s been a tough month for investments. I gave formal notice for early retirement just week (4/1 @ age 49). My boss wondered if that was a good idea, given the S&P500 fell -8.5% year to date. Fortunately, we have a lot of cash built up so that we can weather the storm!

    1. If an 8.5% loss is all it takes to destroy your early retirement plans, then those aren’t great plans to weather the next several decades! 🙂 Sounds like you’re in a good position to weather whatever sprinkles, shower, or storm that’s brewing right now. Congrats!

  6. January was not so great. February isn’t looking much better. Are we in a full-blown recession? Not yet. Investor expectations haven’t really gone too pessimistic. As much as irrational exuberance hurts at the top end of a cycle, it can help at the bottom end. The key here is that I don’t think the US corporate sector will respond to this market correction like it did post 2008: more layoffs, benefit cuts, or mass outsourcing might result in a backlash even in excess of Occupy Wall Street. On a practical level, the cuts made since the last recession means that we’re probably closer to an efficient labor market (definitely still reeling on the manufacturing front), with a proportionally smaller ability to head into a full recession. And unlike the last two recessions, we don’t really have a “bubble” going on right now: energy does not behave like housing or dot-coms. Both GPD and personal income posted minor increases for the past 6 months, and I’ve seen our forward-looking risk of recession somewhere around 15%.

    My biggest concern is finding more money to put into the markets this year. My major purchase was in August 2015, so I didn’t exactly nail the timing. But as long as I keep averaging in on the way down, it will pay off on the way up.

    1. Can’t say I disagree with your analysis. Things are certainly less rosy today than they were 6-12 months ago, but that doesn’t necessarily equate to deep recession (consecutive negative GDP growth) and a steep stock market drop. These market dips seem to occur about once per year and more often than not prove to be short lived.

      I feel you on the mis-timing of new investments. I had a rollover from my ESOP of $26,000 and put it all in back in August or September I think. Oops. Then made a big solo 401k contribution and 2 IRA contributions during the year after a small dip. Oops again. I think I might have a few thousand more $ to put in my solo 401k for tax year 2015 but that might be the end of excess cash that needs to be invested.

  7. Would you feel as comfortable if you didn’t have the blog income or your wife’s income? Just curious.

    Also, when the market takes a crash, does one decrease the budget to 4% of the new balance? It’s a big question for folks without a side gig, and one I have not seen addressed on any ER blog. Someone might feel comfortable living on 40k when their assets are a million, but might not be okay when their accounts drop 20% and they only have 32k that year.

    1. My wife’s income is coming to an end in the near future (read more about it next week 🙂 ) so that income doesn’t provide any comfort.

      The blog income provides comfort in two different ways. The first is a small measure of comfort from knowing I have current cash flow. That comfort is tempered by the fact that the income stream could shrink or dry up if the market environment changes for blogging and advertising. The second measure of comfort comes from the knowledge that I can always hustle more, work a few more hours per week, and make even more money. Obviously if I’m working 10-20 hours per week it won’t look like the early retirement I envisioned, but it’ll still be way better than working 40+ hours per week and commuting. Working more will be plan C or D, with cutting expenses Plan B (or rather reverting back to the $30k per year we spent in 2014 and 2015).

      I plan on spending up to 4% of whatever portfolio value we have, so I would definitely adjust spending down to $32k if our portfolio dropped to $800,000. That could happen if we have
      another 2008-2009 crash (which is unlikely given those crashes happen only once every few decades). I probably would feel less certain about spending money without the blog income stream though. As it is now, we have more income than we need so my focus is on spending more rather than less.

      1. I really appreciate your honest answer. I think some of the ERE folks underestimate how much their blog income/side gigs contribute to their sense of security, even if they are living at a 4% withdrawal rate. It’s one thing to live on, say, $25k or $40k; it’s another entirely to have that be the total of one’s income and the total of one’s ability to earn. Presumably there are folks out there who live entirely off a modest investment and can’t or won’t earn other money, but obviously we don’t hear from them on the blogosphere.

        I make decent coin at my day job, and I am fortunate to be in a field where I can work extremely part time (thirty hours a month, whatever) as long as I don’t mind traveling a few days a month. But it’s also INCREDIBLY high stress, difficult, and dangerous, and the field requires constant practice to remain competent, sharp and certified. So the joy of early retirement would, in many ways, be destroyed if I had to entertain the idea of continuing my present career in any capacity, yet it’s lucrative enough that it would be almost impossible to give up entirely as a back-up source of income. First world problems, I know!

        Thanks for the answer, though. Early retirement may come my way, but it looks like it will be sullied by having to continue my career, thus defeating the purpose.

        1. I suppose I’ve turned into a bit of a hypocrite since I DO have this side stream of income now. I could say I am segregating the blog proceeds into a separate account and not touching the money at all, but that would be a lie. It’s cash, cash is fungible, and one dollar spends just as well as another regardless of it’s pedigree.

          But at the end of the day I continue this blog because it’s a fun pastime and not because I want or need the money. I also acknowledge that this source of income could shrivel and dry up at any time without a lot of warning, so I’m not overly reliant on this income, and instead prefer to rely on my 4% of portfolio value primarily. In my 2016 budget post, you can see how I’m hesitant to increase my spending level to include all the blog income since I’m not sure what it’ll be year to year. I might also decide to stop actively writing for the blog at any time (don’t worry – won’t happen soon I don’t think!) – it’s an option I like to preserve since my goal in early retirement is to do whatever I want whenever I want without the need to generate earned income.

          As for the general concept of a side hustle income in early retirement, I’d say it’s about as common to have one as not, especially for those retiring in their 30’s and 40’s. We don’t mind doing something fun and productive, but want a radically different lifestyle than the traditional 9-5 permits (along with the schedule, lack of vacation time, and stress).

          For your own career, if it’s difficult to re-enter or overly stressful to think of re-entering the workforce, then I would have ample buffer in your investments to cover a sharp market correction, plus an adequately conservative asset allocation that wouldn’t drop as much as 90-100% equities in a crash. Maybe that means planning on a 3% withdrawal rate and a 60/40 or 70/30 stock/bond ratio.

  8. The down market can become a head game for a lot of investors. It’s painful watching new investors chase the bull’s tail and almost always losing money trying to time the market. My equation is simple: no other investments are as easy or offer as much potential upside as the stock market. I’ve done a few of the other options (real estate, owning a business) and the amount of work that went along with the investment was daunting.

    1. Same here. I’ve owned real estate and ran a small business and all proved to be bigger headaches than automatic investments into a mutual fund. The 2 minutes I spend every few months to transfer accumulated dividends to my checking account are very enjoyable and stress free!

  9. Great job with your online income. $2-3,000 is great. That’s my target as well.
    Our net worth dropped in January as well, but not that much. I think we have a bigger percentage invested in real estate and bonds than you do. That’s helping a lot in this environment. Our net worth decreased just 1%.
    Actually, a full blown pull back would be welcome. I want to move most of those bonds to stock.

    1. I’m pretty much all stocks other than a year or two worth of expenses in cash/short term bonds and 10% of NW in our primary residence. So when the market drops 5-6% in a month we will see a similar NW drop.

      I wouldn’t mind a pull back since we don’t have to sell anything for the next 6-12 months given our cash on hand. I’m trying to purchase some Carnival Cruise shares so we can get free on board credits when we cruise and the stock (CCL) has finally pulled back about 25% in the last month so it’s getting close to the limit order price I set. Another 10-15% and we’ll be there. 🙂

      What’s your plan for moving from bonds to stocks? Start nibbling soon and slowly put it in? Or waiting for a certain milestone in the market for a big move?

      1. I’m waiting for a bigger drop before I convert some of my bonds. I’ll start when I see 20% drop. If the market doesn’t drop that much, it’s okay too. I don’t mind holding some bonds. 🙂

  10. I’m definitely more worried than you are that the recession is already here. Sent that out in my private newsletter on Sunday. It’s good you are making blog income, because if not, I think you might be a little more worried. But as I said to you at the very beginning of your blogging journey, you can make money blogging about early retirement so you won’t really have to worry! haha.

    BTW, you get my e-mail about my book?


    1. I read the newsletter and know you’re definitely calling for less than stellar times in 2016. So far it looks that way!

      As far as blog income, it certainly helps ease my mind some. But we are spending so little compared to what we COULD spend based on a 4% withdrawal that I’m nowhere close to relying on the blog as a source of income. We could handle a 30-40% decline from the peak in 2015 and still be spending under 4% of portfolio value.

      Yes, I received your email about the book but haven’t spent much time thinking about it. Let me review and get back to you.

      1. Think harder! Lol

        No worries if not interested. I’m seeing a pretty big uptick in interest in the new year and with more layoffs coming.

        I see my book as a defensive income stream during down times. It is a no brainer IMO, but of course I’m biased. Got another tranche of my deferred comp last week, four years after leaving my job. Getting a final large tranche in 1/2017!

        Better than retiring early is to retire early, not have to do nothing for 5 years and get paid.


  11. We did okay for the month, but had a slight net worth decrease. I can handle a small drop.

    You have mentioned that Mrs ROG is burning vacation time before quitting. In California, an employer has to pay out any accrued vacation, so many people treat it like a small retirement account. We have a very high cap, so you can have several hundred hours accrued. Even staff that use most of their time end up getting 40+ hours cashed out when they leave. Sometimes I think California labor law is a beast, but this is one aspect that I like.

    I also allocatte gas/food/etc to vacations to avoid the regular cateogries having spikes in months we travel. We just booked tickets to Cancun using points, but still had to pay $300 in government fees. We are actually staying with a relative in Playa del Carmen for free and the rental car was $27 for the week! Using credit card sign-ups/points to subsidize vacations really saves us a lot of money each year.

    1. Vawt, I’ve had experience with vacation/sick leave payouts. Completely agree that people treat them like a retirement savings account. That part, I have no issue with. The real issue is that it creates some weird incentives on how people use their time (especially if we’re talking about sick leave). You see the small 40+ hour accounts because there are people who value leisure very highly on their utility curve, or simply have no sense of the future (practically, it yields the same result but skews the root cause analysis). My econ degree is getting a workout today!

      As a guy who has been on both sides of designing a good sick leave/vacation leave policy, I’m still in favor of such a program. People have proven time and again that they will eventually learn to game a system, so if an employer doesn’t pay out vacation hours or sick leave, they can expect that people will use them in bottom-line-hurting ways. I’d rather pay out lump sums to my employees at the end of their careers than deal with pervasive unanticipated “sick days.”

      1. I know I did when I left my job at the State before retiring! I got cashed out for 30 days of unused vacation time which was like a six week severance package (from a job that had zero employment rights). That amounted to $8,000. Then I received unemployment of $7,000. Add them together and that’s about half a year’s worth of living expenses. I knew that cash was waiting at the end of the rainbow which is why I never needed much of an emergency fund!

    2. I think her employee manual says something like “Except in the State of California…” before it says unused vacation time won’t be paid out. They only allow employees to accumulate 30 days max (10 days carryover from previous year plus you get your full 20 days on Jan 1 – so it’s not like you accrue the 20 days throughout the year). They have unlimited sick leave so nothing to “cash out” when they leave (though Mrs. RoG, being much more honest than me, has never used more than a handful of days in 10 years).

      Interesting take on the allocation of gas and food to vacation budget. So are you saying if you have $100 per week budgeted for food at home you move the $100 to the vacation budget if you’re planning a week away? I did that when budgeting for our trip to Mexico because I realized we would be skipping $1000 per month or so in food, gas, and other expenses back home (which goes a long way to vacationing in Mexico where we can live it up for $2,000-3000/mo using points!).

    3. When I left full time employment a few weeks ago I had 44 vacation days I was paid for. That will cash flow my husband’s masters degree. Yay! I’m very grateful I was allowed to accrue so many days.

  12. It is comforting to read stories from people that are in early retirement and how they approach markets that are down. I am still full in my accumulation phase, so, I see this a a big buying opportunity. We just stick to the plan.

    I find it interesting read that you have a “job” again by counselling people. That would be my goal as well…

    1. I think I spent 4 hours on that “job” in January so it’s a very nice pastime that pays some $ at this point. And that’s about as busy as I want to get. 🙂

  13. Interesting that your appraisal went down. Ours went up despite the fact that the most recent house to sell in our neighborhood was for a cool $32K (we nearly bought it, but thought better of it when I realized I would definitely want to work another 6 months to be sure we could afford all the necessary repairs to convert it into a rentable property.)

    Looks like a great January for you, and I’m excited to hear about when your wife quits her job. I sort of get the feeling that she might be even more antsy to do work than you.

    1. I’m not sure why ours went down by about 5%. Things are definitely way hotter today in our ‘hood than they have been in the last decade. I think there are 2 houses listed for sale out of 1000+ in the neighborhood. I never see the $100,000 fixer uppers any more. Everything seems to be $20-30k more than it was a couple years ago. I thought about buying up some for rentals but so many places sell almost overnight for asking price (or more). Not quite North Hills hot but it seems to be leaning that way when the properties are priced correctly.

      That $32k house must have needed a lot of work I guess? I’d be hesitant to pick it up too if you are planning on leaving your solid income stream soon.

  14. Nice update RoG. Unlike you, I don’t have that blog income yet, so I’m a bit more concerned.

    Like you, the quoted values in my portfolio declined for January. That doesn’t bother me too much. The market can offer me whatever price they like. If dividends start declining, I get worried then.

    I really welcome a downturn because it gives me an opportunity to invest my excess cash. Just not too big a downturn. 😉

    Apparently I’m very Goldilocks about it. 🙂

    I’m curious about how you manufacture spending for card rewards. You’ve mentioned pre-paying utilities…any other tips?

    1. I used to buy Visa Gift cards at Walmart then load to my Bluebird account, then pay the credit card off using those gift cards. Amex killed that deal unfortunately.

      Now I’m back to pre-paying utilities and anything else that I can buy ahead of time.

  15. Good for you for not fretting too much about the drop. There are still many years for the market to come back around in your favor!

    I get paid mid-month, so we’re still waiting to see how the first month of the year shook down. Unfortunately, I think we’re going to have to dip into savings by a couple hundred, but I suppose it could be worse. We just found a way to nix a major expense, but it meant a $400 charge on the card for setting everything up.

  16. I admire your ability to not let these big dips get to you. Now that we’ve been saving for a while, the fluctuations sure are big — we’re currently down about a year and a half of living expenses since the start of the year. I’m definitely getting better about not worrying too much in the face of these fluctuations or corrections or whatever they turn out to be, but I sure *know* when we’re down (though, interestingly, care less when we’re up). By the way, we are definitely inspired by how you keep spending less than what’s budgeted for the year — we hope to follow that model when we quit in a few years!

    1. When you quit working, you have a lot more time to focus on doing things yourself. From cooking to chores to DIY stuff around the house. Tasks that used to be outsourced stop being chores and become more pleasurable when you aren’t trying to wedge them in around working hours. More free time also translates to ability to shop for better prices and shift your consumption to times of day or times of the year that are off-peak. Lunch specials instead of dinner prices; off season vacation costs.

  17. Going on a cruise in 2 weeks, very excited! My January was pretty cheap since I did some traveling for work for almost 2 weeks. I just keep investing no matter what the market is doing 🙂

  18. Justin, great analogy – “Investing in equities is a dance where you take two steps forward and one step back.”

    Nice job with your cash flow this past month!

    My NW wasn’t hit as hard in Jan (-1.6%), but that’s primarily because I’m more heavily weighted in real estate.

    1. I’m jealous of all the real estate investors like you, Retireby40 and Financial Samurai with your real estate holdings. 🙂 Although I have to say, my real estate asset class has performed the best in my portfolio year to date, so I’m benefiting from holding RE in a way too.

  19. Hi Fuego ! Nice to read your blog. I’m back in school / studying and teaching part time – after several months of FIRE, I couldn’t handle the stress of NOT working…specifically feeling unproductive by not having income and then of course, watching portfolio fall….even though I’m at a comfortable and conservative WR with dividends covering most of our needs….I felt compelled to go back and do some “side hustle”…. I’ve considered an early retirement blog, but I’ve little confidence in my writing ability.

    It seems for most early early retirees (EER’s) income of between 3K and 4K per month (beyond dividend / portfolio income) is the level that strikes a good balance of safety/security without moving back into working full time mode and being stressed out from that…

    1. Hi papadad111! Thanks for stopping by.

      This blog is a great outlet for my creative and productive energies. As far as starting a blog, it’s a pretty crappy way to make a buck for most people. It’s fun for me, but I wouldn’t have started it if my goal was to maximize income.

  20. “We are roughly $140,000 poorer than we were about eight months ago” well, if you put it that way I almost feel sorry for you 😉
    Nice month as usual, hope you are able to spend the $3000 on that credit card to get the rewards.

    1. In 8 more months we might be $140,000 richer than we are today (or that much poorer 🙂 ). No need to feel sorry for us, it’s just a number until we have to sell something.

  21. If I’m reading your numbers correctly, your blog income is now approaching a level that will soon easily support your yearly expenses. Worst case scenario could soon be you live off that and can’t put more in your portfolio. Not a bad position to be in…though I wonder how does a potential recession affect blog cash flow?

    1. Yes, that’s about right. If things continue like they did in 2015 then most months our expenses will be covered by the income from this blog. I wouldn’t have to touch the portfolio at all in that case.

  22. I’m not going to even look at my portfolio to see how it is. I put the money in as a long term investment, so there’s no sense in getting upset about something that I have no control over, and that is likely a temporary situation. 🙂

  23. Always learn something here and Kudos on the growth and monetization of the blog! I really appreciate that it is YOUR blog, not a collection of sponsored advertisements disguised as “personal thoughts.” All the blogs I love to read — RoG, Frugal Girl, Surviving and Thriving, Frugalwoods, NCA — share this quality: one person’s quirky, articulate, funny, helpful thinking. And cruise photos don’t hurt 😉 Congrats on another great month. Thanks for all the tips!

  24. I am very sure you will be fine. Well we all be fine. As long as we keep monitor our income/spending level and don’t touch the principal. Up and down is just a part of how the market works and I made peace to myself already. Thanks for sharing! Love the fact that you take good care of your family! Great job!



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