Author Topic: Race from $2M to $4M...and Beyond!  (Read 514899 times)

ysette9

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Re: Race from $2M to $3M.....and beyond!
« Reply #650 on: January 28, 2019, 02:10:28 PM »
To be honest the taxes don't bother me. I moved here to Minnesota directly from the UK where the tax rates are pretty much the same, if not slightly higher.  Plus, Minnesota is pretty awesome!  Sure, the winter's are cold and snowy but that just adds to the variety of life!
I feel like it is easy for people to jump on the “move to where there are no taxes!”-train without stopping to ask what is paid for with taxes, and what you don’t get by living in places like that. What you should be looking at is where gives you the best total package of services and other quality-of-life improvements for your money.

Dicey

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Re: Race from $2M to $3M.....and beyond!
« Reply #651 on: January 28, 2019, 04:22:43 PM »
To be honest the taxes don't bother me. I moved here to Minnesota directly from the UK where the tax rates are pretty much the same, if not slightly higher.  Plus, Minnesota is pretty awesome!  Sure, the winter's are cold and snowy but that just adds to the variety of life!
I feel like it is easy for people to jump on the “move to where there are no taxes!”-train without stopping to ask what is paid for with taxes, and what you don’t get by living in places like that. What you should be looking at is where gives you the best total package of services and other quality-of-life improvements for your money.
Sing it, sister!

pecunia

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Re: Race from $2M to $3M.....and beyond!
« Reply #652 on: January 28, 2019, 06:02:19 PM »

I feel like it is easy for people to jump on the “move to where there are no taxes!”-train without stopping to ask what is paid for with taxes, and what you don’t get by living in places like that. What you should be looking at is where gives you the best total package of services and other quality-of-life improvements for your money.

That's for sure.  Last year I worked with this heavily right wing guy who moved from Illinois (high taxes) to Indiana (lower taxes).  He was raving about how much better it was to be in that land of lower taxes.  Not long after that I drove through some backroads in Indiana.  Potholes and filled potholes were abundant.  I kept asking myself why don't they repave these roads.  Then I recalled I was in Indiana and they are happier with the low taxes.

I would take Minnesota in a heartbeat, even a cold place like Ely.

soccerluvof4

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Re: Race from $2M to $3M.....and beyond!
« Reply #653 on: January 29, 2019, 04:05:58 AM »

I feel like it is easy for people to jump on the “move to where there are no taxes!”-train without stopping to ask what is paid for with taxes, and what you don’t get by living in places like that. What you should be looking at is where gives you the best total package of services and other quality-of-life improvements for your money.

That's for sure.  Last year I worked with this heavily right wing guy who moved from Illinois (high taxes) to Indiana (lower taxes).  He was raving about how much better it was to be in that land of lower taxes.  Not long after that I drove through some backroads in Indiana.  Potholes and filled potholes were abundant.  I kept asking myself why don't they repave these roads.  Then I recalled I was in Indiana and they are happier with the low taxes.

I would take Minnesota in a heartbeat, even a cold place like Ely.




Like most states there is good and bad to them. I go to  Indiana all the time and by West Lafayette it is extremely nice, big college town with Purdue being there.  Indianapolis has come along ways and become a very nice city that offers pretty much everything.  Up by Gary yes its a shit hole but there are a lot of nice areas to live with low taxes in Indiana. I find that to be the same in my own state as well Wisconsin. Milwaukee though getting better the areas to live are mostly a shit hole, Madison is very nice and everything between the two is really nice. Northern Wisconsin is hard to beat but like Minnesota you better be into winter sports.

Car Jack

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Re: Race from $2M to $3M.....and beyond!
« Reply #654 on: January 29, 2019, 07:37:59 AM »
If you move to a "low tax" state, be sure you understand what the taxes are.  Living in Massachusetts, I know what the taxes are on and what they're not on.  I'm paying income and property taxes and exise tax on my cars (some states call this personal property tax) and sales tax on things excluding food and clothes.

To our north, New Hampshire glowingly holds itself out as charging no income or sales tax.  There are taxes like meals tax, which tends to be missed, but of course you could simply not eat out.  Property tax tends to be around double what it is in Mass.  And of course, a huge % of NH people work in Mass, so they're paying income tax to us (thank you very much).  There are different treatments for dividends and such, so just understand these.  I used to work in NH and my cube mate lived in a town where a new high school was being built.  His property taxes doubled in one year.  In Mass, there's prop 2 1/2, (like CA) which limits property tax increases which have to be voted in for a specific project (like a school).  MA tends to also fund a huge portion of school building from state funds, softening the blow to the town.

« Last Edit: February 05, 2019, 06:30:52 AM by Car Jack »

Car Jack

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Re: Race from $2M to $3M.....and beyond!
« Reply #655 on: February 05, 2019, 06:34:37 AM »
After an absolutely horrible 2018 both personally and financially, I finally see my balances stabilizing and moving slightly up.  Clicked into the $2.3M in investments.  Not having to pay $500 per hour lawyer bills makes the school and college bills look like chicken feed now.  I might actually make more money than I spend this year.  That would be nice.  Oh....and my younger son is taking one community college course as part of his high school senior program.  $700 cost and he applied for a scholarship there and got it for $500.  Nice to see!

itchyfeet

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Re: Race from $2M to $3M.....and beyond!
« Reply #656 on: February 05, 2019, 09:58:15 AM »
Yes, a good start to 2019 bit I am still a ways behind my peak NW back in September last year.

Until property prices in Sydney bottom out progress towards a full recovery of NW, and the growth beyond that, will be slow.

Sydney property Prices have dropped 15% from the peak in mid 2017. I am thinking another 5% to 10% and then prices will be back aligned with what people can borrow which will support prices. That is unless interest rates go up which would cause a sh&t show at this moment (so unlikely). The Autumn selling market will be interesting to follow.

As my properties are still quite leveraged, even a 5% drop in values is pretty noticeable to my NW. I am still plenty ahead on property over the long term so I can’t gripe too much though. And as we won’t be selling for at least 4 more years there’s plenty of time for some growth before then. 🤞

Exflyboy

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Re: Race from $2M to $3M.....and beyond!
« Reply #657 on: February 05, 2019, 11:18:49 AM »
After an absolutely horrible 2018 both personally and financially, I finally see my balances stabilizing and moving slightly up.  Clicked into the $2.3M in investments.  Not having to pay $500 per hour lawyer bills makes the school and college bills look like chicken feed now.  I might actually make more money than I spend this year.  That would be nice.  Oh....and my younger son is taking one community college course as part of his high school senior program.  $700 cost and he applied for a scholarship there and got it for $500.  Nice to see!

What happened to you in 2018 CJ.. If you're comfortable sharing?

Car Jack

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Re: Race from $2M to $3M.....and beyond!
« Reply #658 on: February 05, 2019, 01:59:48 PM »


What happened to you in 2018 CJ.. If you're comfortable sharing?

2 completely independent legal battles.  Settled both. 

Exflyboy

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Re: Race from $2M to $3M.....and beyond!
« Reply #659 on: February 05, 2019, 02:32:24 PM »


What happened to you in 2018 CJ.. If you're comfortable sharing?

2 completely independent legal battles.  Settled both.

Great.. Huge weight of your shoulders I'm sure!

Dicey

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Re: Race from $2M to $3M.....and beyond!
« Reply #660 on: February 05, 2019, 04:09:03 PM »


What happened to you in 2018 CJ.. If you're comfortable sharing?

2 completely independent legal battles.  Settled both.
Great.. Huge weight of your shoulders I'm sure!
@Car Jack, I wondered the same thing. I poked around in your posting history to see what I missed. I didn't find an answer, but I was impressed with the quality of your posts across the forum. Thanks for your contributions to the greater good here. I love it when people help others find their way to FIRE...and beyond. I hope "Settled both." was a good thing.

soccerluvof4

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Re: Race from $2M to $3M.....and beyond!
« Reply #661 on: February 06, 2019, 03:57:26 AM »
Slowly creeping up but ways to go to get to last September. Not sure if will get there but never the less at least for a bit now the trend has been up. Probably jinxed it now. Oh well! is what it is.

Exflyboy

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Re: Race from $2M to $3M.....and beyond!
« Reply #662 on: February 06, 2019, 01:12:32 PM »
Slowly creeping up but ways to go to get to last September. Not sure if will get there but never the less at least for a bit now the trend has been up. Probably jinxed it now. Oh well! is what it is.

You DID jinx it!.. I "should" have been back in this club today (with just my investments) but NOOOO!... :)

Bateaux

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Re: Race from $2M to $3M.....and beyond!
« Reply #663 on: February 06, 2019, 01:29:27 PM »
I'd just started tipping the threshold of 2MM investments again.   No more big drops.

DavidAnnArbor

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Re: Race from $2M to $3M.....and beyond!
« Reply #664 on: February 06, 2019, 02:11:25 PM »
We're all in it together. Let's enjoy the ride.

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Re: Race from $2M to $3M.....and beyond!
« Reply #665 on: February 06, 2019, 03:38:47 PM »
I'm just curious how you all calculate your NWs--specifically, houses and mortgages?  I don't include the value of my house, but I also don't subtract the balance of my mortgage.  My reasoning is that I don't know the exact value of my house, but (after paying down the mortgage for 12 years and seeing home values in my area improve at least somewhat from 2008) I know it's at least more than my mortgage, and I'd rather underestimate my NW than overestimate it. 
 
I'm just curious about what others do--I don't think there's wrong way. 

onlykelsey

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Re: Race from $2M to $3M.....and beyond!
« Reply #666 on: February 06, 2019, 05:01:14 PM »
I'm just curious how you all calculate your NWs--specifically, houses and mortgages?  I don't include the value of my house, but I also don't subtract the balance of my mortgage.  My reasoning is that I don't know the exact value of my house, but (after paying down the mortgage for 12 years and seeing home values in my area improve at least somewhat from 2008) I know it's at least more than my mortgage, and I'd rather underestimate my NW than overestimate it. 
 
I'm just curious about what others do--I don't think there's wrong way.
Because I know I am not living long-term in my Manhattan condo, I include its (conservative, non-zillow) value, subtract the value of my mortgage, and subtract another 50k for anticipated transaction costs on selling.

AlexMar

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Re: Race from $2M to $3M.....and beyond!
« Reply #667 on: February 06, 2019, 08:20:51 PM »
I'm just curious how you all calculate your NWs--specifically, houses and mortgages?  I don't include the value of my house, but I also don't subtract the balance of my mortgage.  My reasoning is that I don't know the exact value of my house, but (after paying down the mortgage for 12 years and seeing home values in my area improve at least somewhat from 2008) I know it's at least more than my mortgage, and I'd rather underestimate my NW than overestimate it. 
 
I'm just curious about what others do--I don't think there's wrong way.

I use Personal Capital to calculate my Net Worth.  It includes all of my accounts, which includes credit cards, mortgage, etc. etc.  For my houses, I did some pretty simple research on comps and put in the house at a realistic value minus an estimate of realtor fees.  In other words, my house should fetch $1.5M based on recent sales, conservatively, but I put it in at $1.35M.

Your house is absolutely a part of your net worth calculation, and so is the mortgage.

AlexMar

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Re: Race from $2M to $3M.....and beyond!
« Reply #668 on: February 06, 2019, 08:23:40 PM »
I'd like to join to help motivate me. Currently at $540k and hope to hit the big 1M in the next couple of years.

I made it to $748k! Keep saving everybody!!

I made it to $988k and was getting excited... and then taxes hit! Looks like it'll be another few months yet :(

I finally did it!! Crawled over the line to $1,000,330 today!  Feels pretty surreal. Never thought I'd actually be worth a million dollars. Now I guess I keep on saving towards the next million!

Currently at $1.11m.  Don't really have a goal number at this point. I love running my own business so just tryna ride it out as long as possible and "make hay while the sun shines" as they say.

Passed the half way point!  Somehow we have $1.535m. Not sure how long the next 0.465 will take but I'll report back if we get there!

It took a little longer than I’d hoped due to the market being a douchebag lately but we Just hit 2 million today! We’re officially multi-millionaires I guess! I crunched the numbers and I think our “fat fire” number is around 2.5-3M so I’ll probably keep trucking away till we hit that, then I’m not sure what I’ll do.

Can I join your thread?  We just hit 2M yesterday! And with the friendly market today we're up another 15k already!  I'm carrying over our progress from the race to 2M thread if that's OK as I like keeping track of it this way.

Felt like we got stuck around 2.3M forever but finally hit 2.5M today! Next stop 3M... and beyond!

Facing the same challenge.  I've been sitting at $2.5 for at least 2 years now.  Just a TON of investments into the business is killing my savings rate, plus a bunch of spending on the house (and another house).  Kept me stagnant and I hate it.  But this year is THE year to start funneling money away again.  $3M seems so far off but I think I can hit it in 12 - 15 months (hopefully).

By the way, your story sounds a lot like mine.  I'm 2 years older than you and around the same NW, but about 8 years ago I was earning only $45k/year and 6 years later was in the $2M+ NW category. I never thought it would happen.  It's really a wild ride.  Congrats!

Fortunately, I already have a good management team in place and can work when I feel like it, which is still rather often.  My goal is to continue building the business, make a ton more money, and sell it when I'm 45 - 50 (or leave it to my kids).   The thing with owning a business is that you can really FIRE but not "really" FIRE.  So you keep earning the same if not more money but feel like you aren't tied to the job at all.  So you don't get a strong desire to FIRE.  Which is why I'd rather wait.  I'm hoping with the sale of the business and future profits plus compounding, $20M.

Best of luck with your venture!  Some of these software companies sell for huge amounts.  So you may have a total gold mine when or if you unload it someday.
« Last Edit: February 06, 2019, 08:33:01 PM by AlexMar »

soccerluvof4

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Re: Race from $2M to $3M.....and beyond!
« Reply #669 on: February 07, 2019, 04:35:47 AM »
Guess i did Jinx it yesterday but for the most part it was a sideways days. 5 days up I believe maybe some profit taking. Anyhow were in it for the long run so while it feels good running up gotta remind ourselves of that once in awhile BUT I'd rather be saying that back on the other side of 3M.

Dicey

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Re: Race from $2M to $3M.....and beyond!
« Reply #670 on: February 07, 2019, 09:02:56 AM »
Finally peeked at account balances yesterday. I think it was worth not looking for a while. We're not at last September's number, but it's not far off. Boy, a lot of potential stress avoided for the win!

Exflyboy

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Re: Race from $2M to $3M.....and beyond!
« Reply #671 on: February 07, 2019, 11:06:15 AM »
I'm having a little personal gloat cus I managed to rebalance at almosth the exact bottom in Dec and I rebalanced again on Monday.. Almost the exact top..

Should start shorting the market as clearly my track record is exemplary ..:)

soccerluvof4

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Re: Race from $2M to $3M.....and beyond!
« Reply #672 on: February 09, 2019, 03:54:10 AM »
Finally peeked at account balances yesterday. I think it was worth not looking for a while. We're not at last September's number, but it's not far off. Boy, a lot of potential stress avoided for the win!



I'm with ya on that sentiment! Was good to to see the market wold its ground yesterday so maybe, just maybe we have a chance getting back to those September numbers and beyond but this political climate is not helping things.

wannabe-stache

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Re: Race from $2M to $3M.....and beyond!
« Reply #673 on: February 14, 2019, 01:19:03 PM »
Finally peeked at account balances yesterday. I think it was worth not looking for a while. We're not at last September's number, but it's not far off. Boy, a lot of potential stress avoided for the win!



I'm with ya on that sentiment! Was good to to see the market wold its ground yesterday so maybe, just maybe we have a chance getting back to those September numbers and beyond but this political climate is not helping things.
this is one of the (only) great things about still working and earning. despite the markets, we are still up about $300K since the lows in December due to consistent savings.

EscapeVelocity2020

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Re: Race from $2M to $3M.....and beyond!
« Reply #674 on: February 14, 2019, 01:49:05 PM »
Finally peeked at account balances yesterday. I think it was worth not looking for a while. We're not at last September's number, but it's not far off. Boy, a lot of potential stress avoided for the win!
I'm with ya on that sentiment! Was good to to see the market wold its ground yesterday so maybe, just maybe we have a chance getting back to those September numbers and beyond but this political climate is not helping things.
this is one of the (only) great things about still working and earning. despite the markets, we are still up about $300K since the lows in December due to consistent savings.

Yup, it's funny, I make so much more money in the 'modern era' (and get to keep much more of it due to tax reform) that I am happily pared back from taking risk in the markets.  I'm happy that we are back near S&P 2800, but I don't want to bite my nails around what Trump decides on signing legislation or what China wants to do with US bonds, etc.  Passive income no longer feels so passive, it feels like 'agreeing with things I disagree with' income.  Happy to earn good active income and feel good about what I do.

Exflyboy

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Re: Race from $2M to $3M.....and beyond!
« Reply #675 on: February 14, 2019, 02:05:54 PM »
You guys just wait till you're retired!..:)

It is a little nerve wracking seeing one investment dip (briefly) below $2M (even with pensions/rent that basically cover one baseline spending).

But heck.. First world problems.. get over myself..

soccerluvof4

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Re: Race from $2M to $3M.....and beyond!
« Reply #676 on: February 15, 2019, 02:38:53 AM »
Finally peeked at account balances yesterday. I think it was worth not looking for a while. We're not at last September's number, but it's not far off. Boy, a lot of potential stress avoided for the win!
I'm with ya on that sentiment! Was good to to see the market wold its ground yesterday so maybe, just maybe we have a chance getting back to those September numbers and beyond but this political climate is not helping things.
this is one of the (only) great things about still working and earning. despite the markets, we are still up about $300K since the lows in December due to consistent savings.

Yup, it's funny, I make so much more money in the 'modern era' (and get to keep much more of it due to tax reform) that I am happily pared back from taking risk in the markets.  I'm happy that we are back near S&P 2800, but I don't want to bite my nails around what Trump decides on signing legislation or what China wants to do with US bonds, etc.  Passive income no longer feels so passive, it feels like 'agreeing with things I disagree with' income.  Happy to earn good active income and feel good about what I do.





Thats how i have felt lately and have found myself being a bit more defensive in things. Small adjustments like moving stuff out of VMMXX into CD's and T-Bills but never-the-less there is so much shit going on and its been a long run but it seems to always have been like this.  To your point the one good thing with me being fire'd and my DW two years ago deciding to go back to work after two years off we do save a bunch on Health Care and every dime goes into 401k, HSA etc.. that is left so that to helps us stay above water and she loves it which takes some of the guilt I was feeling since the bread winner all the years leading up to this. Were still up at least 15% from when I fire'd 4 years ago but thats playing a big part in it.

itchyfeet

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Re: Race from $2M to $3M.....and beyond!
« Reply #677 on: February 15, 2019, 03:03:55 AM »
I was playing around in my spreadsheets the other day and was a bit astonshied by how quickly the stash continues to grow if I am drawing down 4% but the stash is delivering a (perfectly possible) 6% real return.

With a conservative plan our futures should be bright despite all the political noise.

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Re: Race from $2M to $3M.....and beyond!
« Reply #678 on: February 16, 2019, 08:23:31 PM »
I've been covering my face a bit, but finally checked. At $3.45M (includes property value, minus mortgage), which is down from our October high of $3.85M. Property prices have dropped a bit, actually. Which in the Bay Area, is pretty unusual. But, not unexpected, from my side. I'm expecting a further dip before things stabilize.

Exflyboy

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Re: Race from $2M to $3M.....and beyond!
« Reply #679 on: February 16, 2019, 10:25:45 PM »
yeah I'm getting a little nervous about this rally. I am considering moving from 8/20 (80 stocks/20 bonds plus cash) to 72/25.

I would be quite happy with continued gains at the lower stock ratio, but and extra 5% in bonds that I could roll back into stocks if the market took another sharp correction would be quite nice.

Last year out WR was about 1.5% so its not like we need to take too much risk.

EscapeVelocity2020

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Re: Race from $2M to $3M.....and beyond!
« Reply #680 on: February 17, 2019, 01:48:53 AM »
I don't calculate my net worth very often anymore since it involves currency fluctuations and interest rates, but this latest rally has been an unexpected surprise.  Not as exposed to it as I would have liked for my age, but I'm doing fine.  I think that the US is still seen as a stable store of value, but this battle over 8B and what a President can declare could put a damper on the market.  Or maybe China falls apart even more quickly than the US which makes us a good bet!  I just shake my head at what could have been possible had anyone other than Trump been elected :)

Bateaux

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Re: Race from $2M to $3M.....and beyond!
« Reply #681 on: February 17, 2019, 06:09:48 AM »
I don't calculate my net worth very often anymore since it involves currency fluctuations and interest rates, but this latest rally has been an unexpected surprise.  Not as exposed to it as I would have liked for my age, but I'm doing fine.  I think that the US is still seen as a stable store of value, but this battle over 8B and what a President can declare could put a damper on the market.  Or maybe China falls apart even more quickly than the US which makes us a good bet!  I just shake my head at what could have been possible had anyone other than Trump been elected :)

Those of us in this thread are better off than 95 percent of the US households.   We'll weather most financial storms.   Trump has been more of a mental drain on me rather than financial.   We're holding about 250k in bond funds.  That could get us through several down years.  I'm buying more stock and bond funds as we're still working.  In a 50 percent market drop, we're still millionaires technically.   It's going to be ok.

LWYRUP

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Re: Race from $2M to $3M.....and beyond!
« Reply #682 on: February 17, 2019, 07:03:38 AM »
Just for some context, though, I have an account that is mostly foreign stock that was over $200k this summer that is still $178k today.

So U.S. markets are at all-time highs but if you have a globally diversified portfolio you may still be under where we were in the summer. 

Exflyboy

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Re: Race from $2M to $3M.....and beyond!
« Reply #683 on: February 17, 2019, 12:58:10 PM »
I don't calculate my net worth very often anymore since it involves currency fluctuations and interest rates, but this latest rally has been an unexpected surprise.  Not as exposed to it as I would have liked for my age, but I'm doing fine.  I think that the US is still seen as a stable store of value, but this battle over 8B and what a President can declare could put a damper on the market.  Or maybe China falls apart even more quickly than the US which makes us a good bet!  I just shake my head at what could have been possible had anyone other than Trump been elected :)

Those of us in this thread are better off than 95 percent of the US households.   We'll weather most financial storms.   Trump has been more of a mental drain on me rather than financial.   We're holding about 250k in bond funds.  That could get us through several down years.  I'm buying more stock and bond funds as we're still working.  In a 50 percent market drop, we're still millionaires technically.   It's going to be ok.

Yeah I think having a large pot is a form of hedonistic adaption.. I.e a heck of a good problem to have!

DW was asking me the other day (this is one of those "what do I do with all these funds if you get hit by a bus" conversations) what would we do if the market really tanked like it did in 2008?

without missing a bit a beat I told her.. I take my pension from the UK (OK doesn't work too well if I'm actually dead) and we tighten our belts ever so slightly.

The net result of this our WR would be zero, then we wait for the market to recover all the while still having a shit-ton of money to rebuild the house if the big earthquake happens on the left coast.

Its pretty amazing to step back from this situation realise we are all financially invincible.. almost..:)

JoJoP

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Re: Race from $2M to $3M.....and beyond!
« Reply #684 on: February 17, 2019, 04:29:35 PM »
 I love it that we all have such different options.  Since our NW is 90% real estate, stock market fluctuations don't do much for our bottom line, better or worse.  If real estate tanks, or the rental market falters, then we're looking at a non diversified wealth portfolio, so to speak.   Losing a good tenant is my financial equivalent of a down day on the stock market-- something that's certain to cost me a couple of grand or more.  Ditching a bad tenant would be more like a bad quarter on the stock market.  A massive earthquake or fire storm would be my Black Friday. 

A couple of posts above, @blinx7 is down $22K since last summer, more than 10% of that account.  Ouch.  That would be about a year's loss of rental income on one of my rentals, which cost me about the same (200K ish purchase price, renting for $1900-2000 month, costing taxes and insurance, but no mortgage).   In my spread sheet, though, the income and the asset are distinct.  The asset is still there but the income is reduced.

Hearing most of you discuss the ups and downs of the stock market has given me the courage to rethink our RE-centric portfolio and get a little more cash into stocks and bonds.    From an outside perspective, I'd say ya'll rolled with the punches and bounced back pretty well.  None the worse for wear and tear! 

Dicey

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Re: Race from $2M to $3M.....and beyond!
« Reply #685 on: February 17, 2019, 11:47:01 PM »
I love it that we all have such different options.  Since our NW is 90% real estate, stock market fluctuations don't do much for our bottom line, better or worse.  If real estate tanks, or the rental market falters, then we're looking at a non diversified wealth portfolio, so to speak.   Losing a good tenant is my financial equivalent of a down day on the stock market-- something that's certain to cost me a couple of grand or more.  Ditching a bad tenant would be more like a bad quarter on the stock market.  A massive earthquake or fire storm would be my Black Friday. 

A couple of posts above, @blinx7 is down $22K since last summer, more than 10% of that account.  Ouch.  That would be about a year's loss of rental income on one of my rentals, which cost me about the same (200K ish purchase price, renting for $1900-2000 month, costing taxes and insurance, but no mortgage).   In my spread sheet, though, the income and the asset are distinct.  The asset is still there but the income is reduced.

Hearing most of you discuss the ups and downs of the stock market has given me the courage to rethink our RE-centric portfolio and get a little more cash into stocks and bonds.    From an outside perspective, I'd say ya'll rolled with the punches and bounced back pretty well.  None the worse for wear and tear!
I'd suggest that your RE is a reasonable bond equivalent. In your position, I'd focus on adding stocks to your portfolio. Reading jlcollinsnh's Stock Series is a good place to start.

SwordGuy

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Re: Race from $2M to $3M.....and beyond!
« Reply #686 on: February 18, 2019, 12:23:33 AM »
Net worth as of:

EOY 2017: $2,523,000.
EOY 2018: $2,553,000.   
Current   : $2,625,000.

That includes real estate investments and our house less its mortgage in addition to stocks and bonds.   I see no reason to consider real estate investments as second class citizens and count them as worth nothing for this thread.   

Assuming the market remains static, we'll jump another $30,000 or so once we finish some renovations on a property in the next 2 weeks.

If we just have historical average market returns for the next 3 years we'll make $3,000,000 easy peasy.

We have some heavy investment expenses requiring cash outlays over the next 2 years.  Once those are done we'll focus on how to share the wealth rather than hoard even more of it.   

For example, I'm looking at setting up a house to rent rooms to students at a university.  They'll be able to decide whether they want to share a bedroom with another student or not, so a 4 bedroom house could house up to 8 students (assuming the local codes allow that).  (If not, then I'll use a smaller house.)

Let's pretend it takes $10,000 to keep the house operational, including vacancy, repair set asides, taxes, property management, insurance, etc.  In addition, let's assume that the house receives $20,000 in rental income.    After subtracting all the money it takes to keep the place running, we also subtract out anything the students broke by being stupid about it (as opposed to it just wearing out).  For example, they have a big party and some drunken frat boys break the deck railing because they think hitting it with hammers is cool.   Let's assume it costs $1,000 to fix that.  That leaves $9,000 income left over.  We would distribute it back to the students on a pro-rated basis.   If they recruit enough students to fill the place up and don't trash the place, then they'll get about 1/2 their rent back in time for next year's tuition payments.    I'm still researching that market and keeping an eye out for a great deal so I can't be more exact on the numbers.  My guess is I'm a year or three away from being able to pull his off, assuming the right property is available.

Plus, if I want to attend that university for fun, my own costs will be lower too.  No reason I can't help myself out while helping others!  If I run the numbers correctly, the house would be self-sustaining even after we're dead and gone.
 



soccerluvof4

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Re: Race from $2M to $3M.....and beyond!
« Reply #687 on: February 19, 2019, 04:18:59 AM »
Like i have mentioned before I keep dancing around the 3M line but I dont count my paid of Mortgage and or 529s couple other things where its money spent BUT if we had a 2008 event which I think its good to and figure out what would you do or how to protect yourself I wouldn't panic (but would freak out internally since fire'd) If the market dropped 50% as My portfolio wouldnt. Best I could tell it would have to drop closer to 75% for that to happen but I am hoping with some moves I am making I might be giving up a little upside to protect downside but you just don't know. Personally while I feel this market seems to be a bit tired and not sure if will get to September highs we could blow past it as well. Seems hard to really figure out what is really going on and what isnt. People I talk to that are alot smarter than me feel there is no reason for the market to drop for the next 2-3 years minimum but again who knows. Sentiment can do amazing things. One thing I do feel is that there is still alot of money that wants to get in and when we had the most recent drop it came back pretty damn fast as people sure bought.

Exflyboy

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Re: Race from $2M to $3M.....and beyond!
« Reply #688 on: February 19, 2019, 11:54:42 AM »
Yes I feel the same about the market in the short term. We currently run 80/20 (stock:bond+cash) but I am hoping today to move that to 75/25 for a little more downside protection.


DavidAnnArbor

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Re: Race from $2M to $3M.....and beyond!
« Reply #689 on: February 23, 2019, 07:35:29 PM »
I'm back up to close to $1.7 million in liquid assets, and now the home equity keeps going up, and is now $420K

PhrugalPhan

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Re: Race from $2M to $3M.....and beyond!
« Reply #690 on: February 23, 2019, 10:08:47 PM »
To make it to this group I had to include my GF's TSP numbers and our pensions.  Just today if I add in all my financial numbers (add in $35k in savings), my total is $955k, her's is up to $1,058k.  We're over $2 Mil!!!.  And I don't have to include my house (paid off), nor either of our pensions ($30k/yr for her starting this January - I'm vested at $31k/yr starting in 4 years).  And she finally realizes our finances will be fine (she was STILL worrying???).  We need to work on merging our households this winter and fix up my house but having money will make things happen.
Well after writing this our numbers certainly tanked last fall, but we're back to $2 Mil again ($960k for me, $1,040k for her).  And she's retired now getting a pension and doing tax return work to keep active.  Will we go up and down around that mark for some time, or are we finally going to stay above?  Inquiring minds want to know.

soccerluvof4

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Re: Race from $2M to $3M.....and beyond!
« Reply #691 on: February 24, 2019, 04:28:47 AM »
To make it to this group I had to include my GF's TSP numbers and our pensions.  Just today if I add in all my financial numbers (add in $35k in savings), my total is $955k, her's is up to $1,058k.  We're over $2 Mil!!!.  And I don't have to include my house (paid off), nor either of our pensions ($30k/yr for her starting this January - I'm vested at $31k/yr starting in 4 years).  And she finally realizes our finances will be fine (she was STILL worrying???).  We need to work on merging our households this winter and fix up my house but having money will make things happen.
Well after writing this our numbers certainly tanked last fall, but we're back to $2 Mil again ($960k for me, $1,040k for her).  And she's retired now getting a pension and doing tax return work to keep active.  Will we go up and down around that mark for some time, or are we finally going to stay above?  Inquiring minds want to know.


I need a couple more up days to get back to my last September Highs Dancing at that 3 mark including paid of home valued at 300 very conservatively. So to your point I hope we get it but who knows. Friday was filled with Doom and Gloom articles I read and I always like to read the comments and the one article in particular not one person disagreed with that guy up to where i read. Shouldnt of depressed myself. Guy has been predicting the collapse since the 80's.

This was the article that got to me a little bit- https://www.marketwatch.com/story/father-of-reaganomics-says-get-out-of-the-market-bonds-and-stocks-and-put-your-money-in-cash-2019-02-22?mod=hp_markets

itchyfeet

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Re: Race from $2M to $3M.....and beyond!
« Reply #692 on: February 24, 2019, 09:19:34 AM »
We are still not back to September highs as yet, as we are suffering from falling property prices in addition to the volatility’s of stocks.

Auction clearance rates on the weekend in Sydney were the best they have been in many months, so there is a glimmer of hope that the correction’s downward slide is slowing down, but I think it might be a little wishful thinking on my part. We will see what the coming weeks results look like.

I have always been very overexposed and over leveraged to Sydney realestate, and have done well in a rising market over the past 20 years. Now the market has turned I am hemoraging a bit.

I think it could take most of 2019 to get back to my August 2018 high water mark even with a high savings rate. It really depends on how much more prices fall.

It’s a tad frustrating when I called the top of the property market in early 2017 but after much deliberation decided not to sell out of the market at that time.

The funny thing is we decided not to sell back then on the chance we might need to return to Sydney for work, and now with the drop in property prices it probably means we will end up having to work in Sydney once more (although hoping otherwise), whereas if we had sold in 2017 we would have enough in our stash not to have to work again. Hindsight is wonderful!


ysette9

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Re: Race from $2M to $3M.....and beyond!
« Reply #693 on: March 01, 2019, 03:27:17 PM »
Totaled up our non-529 investment accounts last night and got an amazing $1.96. You’d been warned: I’ll be joining this thread soon enough!

Exflyboy

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Re: Race from $2M to $3M.....and beyond!
« Reply #694 on: March 01, 2019, 07:28:05 PM »
Totaled up our non-529 investment accounts last night and got an amazing $1.96. You’d been warned: I’ll be joining this thread soon enough!

Was this after Friday's close? If it was Thursday you should be over the bar now..:)


MaybeBabyMustache

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Re: Race from $2M to $3M.....and beyond!
« Reply #695 on: March 01, 2019, 08:30:31 PM »
Welcome, ysettee9! :-)

My husband finally sent me info on his accounts that I don't have login access for. We're up to $3.558M. Stock/retirement is up, we've continued to pay down our mortgage debt, all of which has led to some nice gains from this time last year. Our house value continues to be the weak spot, as zillow shows a small decline. We're not worried, as we have a significant amount of equity & aren't terribly surprised by the small blip. Still up $500K in 2 years time.

Dicey

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Re: Race from $2M to $3M.....and beyond!
« Reply #696 on: March 01, 2019, 10:01:06 PM »
Totaled up our non-529 investment accounts last night and got an amazing $1.96. You’d been warned: I’ll be joining this thread soon enough!
Come on over, @ysette9! True confession - I only spitball our number. DH has a very generous Defined Benefit Pension that he can activate in two years. I know there's a formula to calculate the value of this, but I can't be arsed. We also have rentals. It's hard to gauge what they would actually sell for. They're in a resort area, so the price can vary a lot depending when they go on the market. Most people on this thread don't include equity, but our $1.4M home is paid for and we fully intend to downsize when DH retires, so I throw it on the pile. Hell, I could even be in the "and beyond!" section. I just don't think it's that important to fret every single dollar. It's a game of horseshoes for me. Close enough still wins.

Exflyboy

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Re: Race from $2M to $3M.....and beyond!
« Reply #697 on: March 02, 2019, 01:58:01 AM »
Totaled up our non-529 investment accounts last night and got an amazing $1.96. You’d been warned: I’ll be joining this thread soon enough!
Come on over, @ysette9! True confession - I only spitball our number. DH has a very generous Defined Benefit Pension that he can activate in two years. I know there's a formula to calculate the value of this, but I can't be arsed. We also have rentals. It's hard to gauge what they would actually sell for. They're in a resort area, so the price can vary a lot depending when they go on the market. Most people on this thread don't include equity, but our $1.4M home is paid for and we fully intend to downsize when DH retires, so I throw it on the pile. Hell, I could even be in the "and beyond!" section. I just don't think it's that important to fret every single dollar. It's a game of horseshoes for me. Close enough still wins.

Exactly! When you are beyond a certain point it really is meaningless. If you are significantly beyond a certain point (like say 2% WR or less) its completely irrelevant. If fact its almost impossible for ones NW to not continue to climb with time.

I noted that I was down about $300k by Christmas Eve but it made no difference whatsoever, even with being retired.

The biggest problem is going to be some significant tax bills come RMD time.. Either that or we start spending a lot more money than we are now!


soccerluvof4

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Re: Race from $2M to $3M.....and beyond!
« Reply #698 on: March 02, 2019, 09:30:54 AM »
Totaled up our non-529 investment accounts last night and got an amazing $1.96. You’d been warned: I’ll be joining this thread soon enough!
Come on over, @ysette9! True confession - I only spitball our number. DH has a very generous Defined Benefit Pension that he can activate in two years. I know there's a formula to calculate the value of this, but I can't be arsed. We also have rentals. It's hard to gauge what they would actually sell for. They're in a resort area, so the price can vary a lot depending when they go on the market. Most people on this thread don't include equity, but our $1.4M home is paid for and we fully intend to downsize when DH retires, so I throw it on the pile. Hell, I could even be in the "and beyond!" section. I just don't think it's that important to fret every single dollar. It's a game of horseshoes for me. Close enough still wins.

Exactly! When you are beyond a certain point it really is meaningless. If you are significantly beyond a certain point (like say 2% WR or less) its completely irrelevant. If fact its almost impossible for ones NW to not continue to climb with time.

I noted that I was down about $300k by Christmas Eve but it made no difference whatsoever, even with being retired.

The biggest problem is going to be some significant tax bills come RMD time.. Either that or we start spending a lot more money than we are now!



Totally! I basically look at it like on April 2nd I will be fire'd 4 years and I have more than I did fire'd and for 2 years did a 5% withdrawal to do some work on the house and stuff. Might not be at my all time highs but sniffing around it and the plan is working.

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Re: Race from $2M to $3M.....and beyond!
« Reply #699 on: March 04, 2019, 05:13:51 AM »
Totaled up our non-529 investment accounts last night and got an amazing $1.96. You’d been warned: I’ll be joining this thread soon enough!
Come on over, @ysette9! True confession - I only spitball our number. DH has a very generous Defined Benefit Pension that he can activate in two years. I know there's a formula to calculate the value of this, but I can't be arsed. We also have rentals. It's hard to gauge what they would actually sell for. They're in a resort area, so the price can vary a lot depending when they go on the market. Most people on this thread don't include equity, but our $1.4M home is paid for and we fully intend to downsize when DH retires, so I throw it on the pile. Hell, I could even be in the "and beyond!" section. I just don't think it's that important to fret every single dollar. It's a game of horseshoes for me. Close enough still wins.

I'm here if I count my pension.  I'm not in a system that connects a lump sum value to it.  I figure current vested at age 62 if I left tomorrow using the 4% rule puts it at $625,000 which moves me into this thread.  If I'm just count what I track in my accounts I'm solidly in the middle of $1-2 million arena.  I do count home value but I discount it by about 20% in part because I have chosen to keep a low cost mortgage and invest the difference.  In my mind by leveraging my home I have more invested so the home also needs to be accounted for as both an asset and a liability.