Being an engineer, I make data-driven decisions all the time at work and at home. I do apply if-else programming logic or decision tree in my head when there are options (with consequences) that I need to choose. This drives mrsRandom crazy a lot of times since she’s more of an artist.
Of course being a mortal, I make emotional / impulsive decision as well at times, which sometimes is illogical. But in financial world, it’s all about the numbers. In fact, retirement is all about a dollar amount, how much is enough to give you the option of not going to work tomorrow.
As such, it is measurable. As long as you review periodically and make the necessary adjustment to ensure you stay on the course, you will hit your goal, plus and minus some buffer.
I’m an introvert engineer, so I’m far the opposite of being a bragger. I’m hoping that this post (I’m shooting for monthly updates) can be a useful data point for you to help making investment decision. If I do well that month, it’s a good example to follow. If I do worse that month, it’s a reference of what not to do.
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FI Progress: March 2018
March was better than February, where the stock market took a dip. My investment is mostly resolved around VTSAX, VXUS, VYM, and VBTLX (Vanguard’s low cost index fund). Equity is 100% real estate, currently spread across 2 rentals and 1 primary residence. Seattle’s real estate is still hot, for now, we’ll continue to ride the uptick in real estate. At some point in the near future, I’m planning to re-balance real estate and stocks to be more like 50-50 spread.
I use Personal Capital (highly recommended free app / website) to keep track of my investment and cash. Once you link all of your online accounts to Personal Capital, your progress is tracked here automatically. Use my referral link here to get $20 from Personal Capital once you link a qualified investment account to your new account.
As for Real Estate Equity, Personal Capital gets the market value from Zillow, thus it tends to be off. It’s best to get the value from your local real estate professional based on comparable sold properties. I factor in 10% for repair and closing cost in the chart above to get a truer number (if I sell all properties).
My goal is to hit that $1M mark in 2019. It’s an ambitious goal, but if real estate continues to appreciate the way it is in Seattle’s area and if I stick to the saving rate goal below, it’s not impossible to reach.
Saving Progress: March 2018
Our saving goal for 2018 is $90,000. Read this article on how I allocate these money in various tax-optimized investment vehicles. I think we are still on target. There will be temptations throughout the year to overspend on vacation and shopping, but posting this monthly helps us to be discipline.
We live a simple, frugal live. But we’re still far from being minimalist. There are areas in our life that can still be optimized, but at the same time, keeping my family happy makes me happy! So there are checks and balances. You spend on things that matter to you. You don’t even spend a dime on things that matter to other people (but not to you).
Since we plan to retire on 2025, this is not a sprint. But it is not a marathon either. It’s super easy to be a consumer in America. But delay gratification is the key to early retirement. You get to pick and choose what you want to save now and spend later. It’s a good idea to measure your progress against your goal periodically and be flexible to make adjustment in order to stay on the course when life throws a curve ball.