The past month was a great one financially, on several fronts. Not only were stock market returns very favorable, but I finally received several thousand dollars that I was owed from the IRS for tax years 2019 and 2020, in addition to two stimulus payments that were not received previously. These payments contributed about a third of the net worth increase this month. Another third was through savings, and the final third was stock appreciation. In total, the net worth increase for the month was $10,828 for a total net worth of $11,221!
In last month’s net worth update, I finally reached a positive net worth! This month continue to move in the right direction and hopefully the days of having a negative net worth are in the past. I track my net worth through Personal Capital, but also utilize Mint.com for tracking my day to day expenses and keeping a budget. One nice thing that Mint has is a goal tracker and I have an “early retirement” savings goal of $650,000 by the end of 2029. According to Mint, I am running about 10 months ahead of schedule for my early retirement savings goal.
Personal Capital also has an annual savings goal tracker, but I find the long-term nature of the Mint tracker more ideal to the way I like to look at my financial goals. Seeing that I’m so far ahead of schedule is just as motivating to keep saving and investing just as if I was running behind schedule.
Positive Net Worth Two Months In a Row!
After breaking out of a negative net worth in last month’s update, I’m pleased to see the growth continue in a positive direction. After spending over a decade with a negative net worth due to substantial student loan debt, it’s nice to finally have more assets than debt. Something I am also looking forward to in the coming months is the effect of moving to a lower cost of living area during the remainder of the work from home period at my job.
I’ve managed to reduce expenses by over $1,200 per month as a result of this relocation and expect/hope to be able to continue working remotely for another year. If my WFH prediction holds, that would mean an extra $14,400 in savings spread across 2021 and 2022. This would be a great boost to my early retirement savings target and help achieve it another few months earlier.
Net Worth = Assets minus Liabilities
Change from Last Month
|Retirement Accounts|| |
|Taxable Investments|| |
|Misc. (Gold/Silver/Cash/Collectibles)|| |
|Total Assets|| |
Change from Last Month
|Credit Cards|| |
|Student Loans|| |
|Total Liabilities|| |
Net Worth = $11,221
Change in Net Worth from last month: +$10,828
Total Change in Net Worth Since July 2020: +$59,449
The strange dip in the graph above is a period during which my private student loans were being refinanced and the linked accounts both showed a positive debt balance for a short while.
In last month’s Net Worth Update I mentioned that I had missed the cryptocurrency surge despite first taking a look at Bitcoin when it was around $200/coin. I decided to take another look at the space during the rapid selloff that cryptocurrencies experienced near the end of May. Ultimately, I dipped my toe in the crypto waters and threw some “fun money” into the space. I’ve included my cryptocurrency holdings in the “taxable investments” portion of my balance sheet above, but am not looking at it as an investment and more like entertainment spending since it is highly speculative and may fall to zero. If it ends up worth something more someday, so be it.
The coins I decided to purchase are Ether and a couple of related ones that seek to improve the Ethereum blockchain. One thing I have noticed since putting some money to work here is that everything moves in coordination with Bitcoin. I expect this correlation to continue for the foreseeable future, but it will also be interesting to see if blockchains like Ethereum can begin achieving low cost transactions on a massive scale to facilitate widescale adoption in global commerce. Currently, it costs an extraordinary amount to conduct Bitcoin and Ethereum transactions and this is something that is holding those blockchains back from achieving frequent global commerce usage and acceptance.
(Nearly) One Month Anniversary of The Money Sloth
Next month marks the one-year anniversary of The Money Sloth and the beginning of my FIRE journey. I began tracking my finances with these monthly money updates on TheMoneySloth.com in July 2020 with a negative net worth of -$48,228. A big reason for creating this blog is self-accountability and sharing my experiences and knowledge for those who may be embarking on a similar financial journey themselves. If anything good came out of the Covid-19 pandemic for me, it was the self-reflection and decision to embark on this financial journey to begin taking more control over my financial future.
I hope you’ll continue to follow me on this journey!