December recap: Much like all of you, the market was punishing this month. I tried to take advantage of market volatility by selling weaker positions I don't intend to continue holding for tax writeoffs this year, then immediately reinvesting them in higher quality positions so as to remain invested in the market but harvest tax losses to reduce my 2018 ordinary income. I had a Roth conversion earlier in the year which, coupled with the Trump tax plan, leaves me in an uncertain way living as a homeowner in a high tax state, so any little bit that reduces my AGI is good (along with a sizable charitable contribution from earlier in the year as well). The one positive is that my passive income is growing at a nice rate percentage wise, but I've just got to move the needle more on the dollar amounts. If I can, my goal is still to FATFIRE in 22 and a half years. The second half of the year has been difficult, I made several investments that in hindsight turned out to be at or near market highs, so that hasn't helped.
December's budget saw a trip out of state to spend the holidays with family, which despite the expense, was totally worth it. Between that, Christmas presents (which actually do make me/my wife happy), and an oil tank refill, I managed to save just under 37% of my take home pay this month, which wasn't great, but is acceptable. On the plus side, we had a great trip seeing everyone. Sister in law and her husband will be having a baby in the summer, so we'll be planning a vacation with them in the spring since it'll probably be the last one for a while. Should be nice, albeit expensive, but it's a once in a lifetime kind of thing, and I'm looking forward to it.
Overtime and opportunity for promotion at work are pretty much nonexistent, and my next raise hits in April, although we figure to get a raise with retro pay going back about a year sometime later this year, which will go directly into my 457 account if/when it occurs. I am applying to grad school to round out my resume, no word on if I'll get in yet, but I'm cautiously optimistic. Might as well try to distinguish myself so when the possibility of promotions open up again, I can stand out from the herd.
Looking back at the numbers for the second half of the year, I'm actually quite disappointed. Even though my savings rate went up considerably, the volatile markets put a damper on the benefit of the additional saving. Just have to remind myself how much worse the numbers would have been had I not taken those strides, and focus on the 89% increase in my passive income in 2018 alone. Specific spend cuts I targeted, like avoiding driving to work where reasonable and bringing lunch almost every day saved me approximately 3% of my takehome pay in the second half of the year.
All told, for second half 2018, I managed to save 45.2% of my take home pay, plus pre-tax savings, which if added to the numerator and denominator of savings/take home pay, bumped my savings rate to 56.8%. I'm not counting mortgage payments in that formula, although I do count mortgage payments as adding to my net possessions. So in reality, if primary home equity counts, it's probably closer to 60%. I just have to remind myself that I am doing the right things and stick with it. I had a few weak moments (a soda here, a snack off the McDonald's Dollar Menu there) but nothing terrible, but I'd like to minimize those in the future.
The basement project is still hanging over our heads - we have one estimate so far, trying to get a second, then deciding which contractor we will use. I'm dreading it, but it's necessary, and our enjoyment of the house will rise significantly once it's done. I got the steam pipes insulated, so the heat is running more efficiently, and I just have to insulate a few joints to complete the job.
Other initiatives to improve our lives on my radar are getting my wife a credit card with better rewards to use - maybe something built around airline miles. Thinking of the Blue Delta SkyMiles card. It would be nice to not pay full freight for airfare every time we go somewhere.
Other than just trying to stay the course...lifestyle creep is a mother, trying to beat it back...
December 2014: $89,173 (I don't have the exact date I hit 100K, so including this here anyway)
December 2015: $106,299
December 2016: $147,449
December 2017: $182,600
June 2018: $217,065
July 2018: $221,250
August 2018: 222,274
September 2018: 224,569
October 2018: 220,241
November 2018: 226,052
December 2018: 219,103
Topic: Race from 100 to 250k (Read 1360913 times)
