Ok folks, it’s June and the year is almost half over. Where does all the time go?
May was another busy but fun month for us. We celebrated some birthdays with family. We went on a cruise. Our kids have finished another successful year of school. And next week we watch our oldest kid graduate from high school!
Meanwhile, we are researching and planning the final details for our big eight week summer vacation in Europe. In a week, we will get on a plane and head off to Zagreb, Croatia where the adventure begins once again. Busy, busy, busy!
Financially, May was a great month for us. Our net worth rebounded by $103,000 to end the month at $2,770,000. Income during the month totaled $4,718 while expenses were $2,972 during May.
Let’s jump into the details from last month.
Investment income totaled $339 in May. Our equity index funds and ETFs pay dividends quarterly at the end of March, June, September, and December. As a result, we had a smaller amount of investment income last month. Here’s more on our dividend investments.
Blog income totaled $1,012 for the month. A pretty ordinary month for blog income.
My early retirement lifestyle consulting income (“consulting”) was $912 in May. These earnings came from 5.5 hours of consulting work during the month.
Tradeline sales income totaled $175 in May. This is lower than the past couple of months but still a nice chunk of change for minimal effort. I ramped up my tradeline sales in 2020 and discussed it in a bit more detail in my October 2020 monthly post and in my July 2021 monthly post.
For May, my “deposit income” totaled $75. This income comes from cash back and incentive bonuses from the Rakuten.com and Mrrebates.com online shopping portals (some of which was earned from you readers signing up through these links).
If you sign up for Rakuten through this link and make a qualifying $25 purchase through Rakuten, you’ll get a $10 sign up bonus.
My Youtube earnings payout was $175 during May. Youtube only pays out when you exceed $100 in accumulated revenue. Recently, my youtube earnings have been just under $100 per month on average, so I’ll be getting paid a bit under $200 every two months.
Here is the Youtube channel for the curious. It’s random travel videos, birds, kids, and a couple of DIY videos. There are only a few main videos that bring in most of the traffic (and revenue!).
The final $2,028 of income for May comes in the form of some bank account and brokerage bonuses. Mrs. Root of Good signed up for a US Bank Leverage Business credit card and cashed out $850 in rewards from this new card. Of that total, $750 came from the sign up bonus and the other $100 came from points earned while meeting the $7,500 minimum spending requirement.
I also cashed out $1,178 in rewards from our new Capital One Venture X credit card. $1,000 of that total came from referring four other people to the credit card.
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).
Tracking spending was one of the critical steps I took that allowed me to retire at 33. And it’s now easier than ever with Personal Capital.
Now let’s take a look at May expenses:
In total, we spent $2,972 during May which is about $400 less than our regularly budgeted $3,333 per month (or $40,000 per year). Travel and Insurance were the top two spending categories for last month.
Detailed breakdown of spending:
Travel – $1,319:
More travel spending! We spent $175 for gas and parking for our May cruise out of Charleston, South Carolina.
We also booked another cruise for October 2022. It’s actually 2 cruises back to back. So we had to make 2 sets of non-refundable deposits of $50 per person (or $50 x 2 x 2 = $200 total). We’ll pay the remaining balance of $750 or so in July.
The remaining $945 in travel spending was for the purchase of $1,025 in Airbnb gift cards. I used most of these gift cards to pay for the remaining balance on one of our airbnbs we booked in Europe for this summer’s trip.
If you are interested in getting free travel from your credit card like I do, consider the Chase Sapphire Preferred card (my referral link). Right now, for a limited time, the Sapphire Preferred card offers 80,000 Chase Ultimate Rewards points that can be used to book $1,000 worth of travel. Or transfer the points to a ton of different airline frequent flyer programs and book a free trip to Europe (with enough points left over for a free round trip within the USA)! Or cash out the points for an $800 check and buy whatever you want! The card also has a lot of nice travel benefits as well.
Insurance – $1,008:
Our annual homeowner’s insurance of $774 came due in May. The auto insurance bill also showed up last month. It covers six months of premiums and totals $233 for the two of us. We’ll be adding our daughter in the fall when we get back from Europe so the cost will increase significantly. We’ve been warned it’s going to be about $900 per year in addition to our current premiums.
Groceries – $300:
We only spent $300 on groceries last month thanks to a few factors. We are keeping our grocery shopping to a minimum as we try to deplete our fridge, freezer, and pantry of as much as possible before we leave for the summer. “Shop the fridge” is the new saying for what we’re doing.
During May, we spent several hundred dollars in Walmart gift cards acquired in previous months. Some of these gift cards were reflected in past months’ grocery spending. However, I also received a big chunk of free walmart gift cards from a cash back site that I use.
Our grocery spending will be higher in 2022 than in previous years. Inflation is the main culprit.
An example is the ingredient list for our homemade pizzas:
- 2x pizza dough: was $1.00, now $1.50 (+50%)
- 2.5x 1lb whole milk mozzarella cheese: was $1.43, now $3.74 (+162%)
- 0.5x jar spaghetti sauce: was $0.88, now $1.40 (+59%)
- 1 package pre-cooked sausage: was $0.79, now $1.29 (+63%)
- 1 bag sliced pepperoni: was $2.26, now $2.58 (+14%)
This makes 4 big rectangular thin crust pizzas. The cost per pizza is still very cheap for nice quality homemade pizza at about $4 per pizza. But in percentage terms, almost all the ingredients have zoomed up in price by 50% or more in the past couple of months.
I am blessed/cursed with knowing the price of basically all the groceries we buy almost to the penny. So I’m very conscious of the price hikes.
Fortunately, we can afford a 20-50% bump in grocery prices so we really haven’t changed a lot in terms of consumption.
Utilities – $280:
The total utility spending was $280 last month.
We spent $81 on the electric bill and $151 for the water/sewer/trash bill. The natural gas bill, which provides heating and hot water, totaled $48 for last month.
Air conditioning season is here, so our electricity usage is ramping up. However, we won’t be here most of the summer cooling season, so our utility bills should be very low throughout the rest of summer once we go out of town.
Healthcare/Medical/Dental – $40:
Our current 2022 health insurance is completely free thanks to very generous Affordable Care Act subsidies that we receive due to our low ~$45,000 per year Adjusted Gross Income.
The “American Rescue Plan Act” passed in March 2021 makes the Affordable Care Act premiums even cheaper through 2022. Households with modified adjusted gross incomes (MAGI) below 150% of the federal poverty level get select silver-level health insurance plans completely free.
For the adults in the household, we spend $20 per month ($240 per year) for a basic dental insurance plan for each of us (or $40 per month in total). Our routine dental exams and cleanings with the occasional x-ray have increased in price recently. The cost is now $125 (no x-ray) or $170 (with x-ray).
With two routine visits per year, we will spend almost $300 per person. A $240 insurance plan provides those same services for free. And we get some minimal level of insurance if one of us needs a filling during the year.
Clothing/Shoes – $23:
We bought water shoes for the family.
This summer, we’ll be at the beach on the Adriatic sea. And playing in the rivers and lakes in Slovenia. Most of these beaches, riverbanks, and lake shores are filled with rocks instead of nice smooth sand. Hence the need for water shoes.
Restaurants – $5:
Paypal had a deal where you buy a $10 of Starbucks gift card reload and get $5 cash back. So I did it.
I go to Starbucks a few times per year to meet up with people, so this is basically the cost to rent a seat and drink their $3 cups of drip coffee for a couple hours at a time.
Cable/Satellite/Internet – $0:
We generally pay $18 per month for a local reduced rate package due to having a lower income and having kids. 30 mbit/s download, 4 mbit/s upload. Right now the cost of the internet service is temporarily reduced to $0 due to the “Affordable Connectivity Program”.
Gas – $0:
We bought about one full tank of gas in May but it was used almost exclusively for our road trip to Charleston, South Carolina for the cruise. I included the $70 in gas expense in the “travel” category for this month’s spending report.
Total Year-To-Date Spending for 2022
Our spending totaled $13,376 for the first five months of 2022. This is about $3,000 less than the $16,667 we budgeted for five months of spending in our $40,000 annual early retirement budget.
A paid off house and a paid off car keep our basic living expenses very low. This means we have the financial flexibility to afford little luxuries like booking several cruises and spending the summer in Europe while still keeping our overall spending low.
And in June we will pay over $1,000 for a rental car for 5+ weeks this summer.
In August when we return home from our summer trip, we will hopefully be able to purchase an additional car. Used car prices are finally starting to drop since February. I hope car prices continue that downward trend all summer so we won’t be paying $10,000 for a 15 year old Ford Escort.
Our oldest kid starts full time community college in the fall. It’s looking like financial aid will cover the entire cost and cover all the books too. So we shouldn’t have to dip into the 529 plan too much.
Monthly Expense Summary for 2022:
Summary of annual spending from all years of early retirement:
- 2014 – $34,352
- 2015 – $23,802
- 2016 – $38,991
- 2017 – $31,708
- 2018 – $29,058
- 2019 – $25,630
- 2020 – $28,466
- 2021 – $31,740
- 2022 – $13,376 (year to date)
Net Worth: $2,770,000 (+$103,000)
In April, we had a six figure drop in our net worth. May proved to be a much kinder month for us. Our Net Worth skyrocketed by $103,000 to end the month at $2,770,000.
These wild fluctuations don’t bother me a bit. It’s a nice form of “exposure therapy”. Consider a 1% change in a ~$2.5 million investment portfolio. That’s $25,000. And consider that a 1% move in one day is somewhat common. A big day is a 2% or 3% change. So I’ve grown accustomed to watching the portfolio swing $25,000, $50,000 or even $75,000 in value in a single day.
If I happen to check on the value, that is. Some days I do and some days I don’t.
Day to day, it’s just numbers on a screen. In fact, year to year it’s still just numbers on a screen.
Our withdrawal rate is under 3% of our portfolio now. That means we won’t even need to touch 97% of our portfolio for over a year. A lot can happen in a year, so why worry about it today?
For the curious, our net worth reported above includes our home value (which is fully paid off). However, please note that I don’t consider my home value as part of my portfolio for “4% rule” calculation purposes. I realize folks ask me about that every month so I just wanted to state that here for clarity.
I just returned from CampFI Midatlantic. It’s a 4 day, 3 night retreat where 70 or 80 FIRE-minded folks gather to discuss money, FIRE, and life.
I’ve been a presenter at all four of the Midatlantic CampFI’s since its inception in 2018 (2020 didn’t happen because of the ‘rona!). Each year I am amazed at all the clever, persistent folks seeking various forms of financial independence and eventually retiring early.
This year was no different! I had a chance to talk to low income earners, high income earners, family-oriented households, and some folks that live a nomadic lifestyle that makes our long summer vacations look like a short weekend getaway.
It’s always inspirational to see how other folks are making their dreams come true. And a nice feeling to think I’ve helped play a small part in helping other people plan and invest for the future.
Well folks, that’s it for this month! I’ll be busy traipsing about Eastern Europe in June and July, but I should be posting next month’s update roughly on schedule in the first half of July. Until then, take care!
Summer is here! What’s up in your life?
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