October 2022 Early Retirement Update

Welcome back to another monthly installment of the life and times of Root of Good. We kept busy in October with a ten day cruise to the Caribbean plus several parties for family and friends. I need a vacation! Ha ha…

Fall is in full swing here in North Carolina. It was hot and humid this past week as the remnants of a hurricane passed through the state. Now the cool fall air is here to stay for a while (we hope!). We have to check the weather daily to know whether to turn on the heat or the air conditioning. 

Right now, we are two weeks away from our next big trip. We fly to Portugal for a week-long adventure around the Lisbon and coastal areas of Portugal. Then we depart on a transatlantic cruise back to the US of A in the middle of December.

Financially, October was a great month for us. Our net worth shot up by $118,000 to end the month at $2,557,000. Our income was modest at $2,178. However income was still higher than our even more modest spending of $1,565 during October.

Let’s jump into the details from last month.

 

 

Income

Investment income totaled $534 in October. Our equity index funds and ETFs pay dividends quarterly at the end of March, June, September, and December. As a result, we had only a small amount of investment income last month. Here’s more on our dividend investments.

Blog income totaled $439 for the month. This is lower than normal months. It should increase a bit over the next several months.

My early retirement lifestyle consulting income (“consulting”) was $456 in October. The consulting income represents 2.75 hours of consulting time. It’s nice to be able to help folks attain their financial goals while also providing a small income stream for me, too. 

Tradeline sales income totaled $125 in October.  I have noticed that the tradeline income varies greatly from month to month. Some months I’m earning $1,000 or so. Other months, the tradeline sales income drops to $0 or $125. 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 October, my “deposit income” totaled $23. Of this total, $13 of the “deposit 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. 

The remaining $10 of “deposit income” came from a random $10 Venmo rebate I signed up for. 

October Youtube income dropped to $0. 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!).

Closing out the income from October: an easy $600 of bank account bonuses. I signed up for two Chase checking accounts that paid $300 each for a new account bonus. Easy money! 

 

 

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.

 

Expenses

Now let’s take a look at October expenses:

 

In total, we spent $1,565 during October which is about $1,800 less than our regularly budgeted $3,333 per month (or $40,000 per year). Travel expenses and groceries were the two highest categories of spending in October (as they seem to be in most months!). 

 

Detailed breakdown of spending:

 

Travel – $738:

The biggest travel expense last month was the $501 final payment for our January 2023 cruise. We’ll be spending 10 days at sea exploring the central and eastern parts of the Caribbean. 

Other cruise spending included $135 for a pair of one way rental cars from Raleigh to Charleston and back home again for our ten day cruise last month. I found a good deal on one way rentals that worked out to be about half the price of parking at the Port of Charleston. At least once I factor in the gas savings compared to driving our minivan down there. I spent $43 on gas for the rental car, while gas for our minivan would have been about $90 to $100.

 

 

The final bit of travel spending was a $60 purchase at Amazon for a $120 Airbnb gift card. We have a near-limitless demand for Airbnb gift cards so whenever I see a discount on Airbnb gift cards I snap them up. This particular deal was an Amazon promotion tied to using American Express Membership Rewards to pay for a part of your purchase. I used 1 Membership Rewards point to pay for 1 cent of my purchase and got a 50% ($60) discount in the process.

If you are interested in getting free travel from your credit card like I do, consider the Chase Ink Unlimited or Chase Ink Cash business cards (my referral link). Right now the Chase Ink business cards offer 90,000 Chase Ultimate Rewards points that can be redeemed instantly for $900 in cash. And if you have a Chase Sapphire Preferred or Chase Sapphire Reserve card, those 90,000 Ultimate Rewards points are worth $1,125 or $1,350 (respectively) towards Airbnb or other travel reservations. This is the highest offer ever on the Chase Ink Unlimited/Cash cards and may not last too much longer.

Chase is pretty liberal when it comes to “what is a business”. If you sell stuff on eBay or Craigslist or do some odd jobs occasionally then you have a business and could get a credit card as a “sole proprietor”. 

 

 

 

Groceries – $441:

Our grocery spending dropped to an astoundingly low $441 for October. We weren’t home for 11 days of the month so that certainly helped keep spending artificially low. 

I’m also spending my way through some Walmart gift cards I obtained in the past, so I would guesstimate that we actually spent $150-200 more on groceries than my expense tracking reflects. 

 

 

 

Utilities – $226:

The total utility spending was $226 last month.

We spent $157 for the water/sewer/trash bill. The natural gas bill, which provides heating and hot water, totaled $28 for last month. We just started using the heat during October so most of the gas usage comes from the fixed fee part of the bill plus the water heater gas consumption.

The electric bill totaled $42 last month. As the weather gets cooler, we are using the air conditioning a lot less. 

 

 

Gifts – $53:

$53 for gifts for Christmas.  Our gift spending usually gets lumped into another category somewhere since we pick things up throughout the year when we see a good deal. 

 

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 – $37:

We went thrift shopping and got a lot of clothes. It happened to be Ladies’ Day where everything was an extra 25% off. So Mrs. Root of Good completed the purchase at the checkout register to make a great deal at the thrift shop even better.

 

Gas – $28:

I topped off the gas tank before heading out of town for our cruise. It was hurricane season too, so I like to keep plenty of gas in the tank in case we need to evacuate suddenly. And I like to keep a full tank to mitigate against major supply disruptions if a refinery or pipeline gets washed away. 

 

Entertainment – $5:

We went to a friend’s retirement party. Beers were $5. 

 

 

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”. 

 

 

Total Year-To-Date Spending for 2022

Our spending totaled $25,593 for the first ten months of 2022. This is almost $8,000 less than the $33,333 we budgeted for ten months of spending in our $40,000 annual early retirement budget.

So far, our 2022 spending looks incredibly good, given the high inflation operating in the background. We are over our target on travel spending, but lower spending in other categories more than makes up for travel inflation. 

The travel spending keeps on going up, but that’s okay. If we blow past our $40,000 overall spending target I think it’s fine. Maybe I’ll adjust the spending target upwards at some point. But so far we don’t seem to have a problem staying under the target on an annual basis. 

We are still sharing one car. Since no one in the house has a job, our driving needs are fairly limited and mostly flexible. Our daughter drives to college classes twice per week for a few hours at a time. We postpone grocery shopping or other errands until she’s home. I can walk or bike to a lot of places too which is healthy and saves a few bucks on gas. 

We hope to buy a new used car soon. This past weekend, we found a good deal on a single owner, accident free, well maintained ten year old Kia Rio with 150,000 miles at the dealership directly across from our neighborhood. They dropped the price on a Saturday afternoon to a mere $6,500! I called that evening to inquire about the car. It was already sold unfortunately. Good deals go quickly I guess.

Used car prices remain highly inflated but we’re ready to plunk down some cash to get a second car. The search continues.

 

Monthly Expense Summary for 2022:

• January – $1,193
• February – $2,535
• March – $5,356
• April – $1,321
• May – $2,972
• June – $3,782
• July – $2,947
• August – $1,398
• September – $2,527
• October – $1,565

 

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 – $25,593 (year to date)

 

 

 

Net Worth: $2,557,000 (+$118,000)

Strong stock market returns led to a $118,000 gain in net worth for us last month. This comes on the heels of a $200,000 loss in September. At least we are making back part of the recent losses, right? 

No worries here. The portfolio goes up and down all the time. And we are only spending a tiny portion of the total value each month. Our $1,565 spending last month, for example, represents only 0.06% of our net worth. And we had enough income during the month to totally offset all that spending. As I say, no worries here! 

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.

 

 

 

Life update

October was another busy month. November, December, and January look to be equally busy with the Thanksgiving and Christmas holidays and two long cruises plus a week in Europe. 

I have hesitated to book any travel in the first part of 2023 just because our schedule is so hectic already. Yes, it’s time for a vacation from vacations for a bit. Who knows, maybe we’ll end up doing another trip in the spring before our big summer adventure in South America in 2023. 

In the meantime, we are enjoying the fall weather and spending time with family and friends. 

Well, that’s it for me this month. See you again in another month! 

 

Looking forward to the winter holidays? Or are they usually a stressor for you?

 

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