June numbers:
- Personal:
- Gross monthly W2 pay: $5,375
- Net monthly W2 pay: $3,275 (-$341)
- Total credit card debt: $23,836 (+$99)
- Total other non-mortgage debt: $7,946 (-$1,412)
- Total mortgage debt: $152,677 (-$830)
- Cash/cash equivalents: $7,022 (+$1,099)
- Total retirement savings: $139,560 (+$10,391)
- Non-Equity Net worth: $-37,877 (+$13,642)
- Total Net Worth: $247,422
Overall I’m starting to see some positive changes for the first time since the crash in the market and the beginning of working from home. Undoing the damage of huge expenses at the end of 2019 is ongoing, but is managed mostly and accelerating. My regular W2 job has been the star here as it has given me regular income I can use to offset those expenses over time.
Into the specifics – you’ll see I forgot to note the change in net pay in prior months as I increased my 403b contribution in February/March (if I recall correctly). I saw the market crashing and figured working from home I’d save money on eating out and shopping, which I have. So I added 3% to my contribution. I haven’t missed the money yet so I’ll let that ride for a while.
Debt paydown is ongoing. Credit cards went up $99 but that’s including fees for moving my final group of debt to 0%. The ‘other non-mortgage debt’ went down a good chunk as spending finally flattened last month with all rental real estate expenses having come in and been paid. Hopefully those are the last ‘surprise’ expenses for the summer so I can focus on rebuilding my contingency fund, paying myself back (more on that in a future post), and doing planned capex over the summer. That ‘other non-mortgage debt’ is an old loan against a whole life policy at 6% which I’m paying off this week and my HELOC at 5.25%. Other than the mortgages those are the last loans I have at any rate higher than 0% which is a pretty nice place to be.
The increase in the cash category is related to market returns. I capped my cash savings account at $1,000 and my per-paycheck savings of $150/pay now goes to my brokerage account. I’ll drain that if needed, but I’m comfortable having that money in a more risky bucket than most. The cash savings amount works out to a little under 10% of my net income and the plan is to increase that when I eliminate any debt above 0%.
Retirement savings and non-equity net worth also increased with market growth. The star of my economic life continues to be my mortgage debt paydown. I looked back at one of my early net worth updates (July 2018 if you’re interested) and monthly paydown was about $710/mo – it’s now up to $830/mo. If you assume those properties are totally paid off at (early!) retirement, $830/mo income would require $249,000 in savings using the 4% rule. Saving $249,000 at $3,275/mo net income W2 income would take a while – so using my blended rental/investment model will be faster in the long run (I dearly hope).
Anyway, that’s it for now! Stay safe and well everyone!
