We were supposed to be on a family beach vacation in Florida this month. This was pushed back due to the virus. On a lighter note, we did not spend money on the vacation. This definitely helped maintain my net worth.
As day 3,126 (or so it seems) in quarantine wraps up, I wanted to take a moment to check in and share my net worth. The chart that tracks my net worth was all over the place. Between the positive market movements and my daughter's delivery bills, that little graph was up and down throughout this month.
What a ride the stock market has taken us on. I am not sure if we have reached the 8 seconds on the bull's back, or if we are in the pin preparing to go for a ride on that 1,500 pound beast.
After a huge drop in March, stocks made up a ton of losses. Let's not forget that scary moment when the S&P 500 closed the first quarter down 20%. What a turn around in a short period of time, as the S&P 500 has shot up from 2,237 points to 2,991 index points. Thankfully, the positive market increase offset some hefty bills that I paid.
I have fought off emotions to make any moves to my portfolio. In fact, I have continued to contribute to all investments more than originally budgeted for. I find it important to always invest, especially when others are worrisome.
May 2020 Actual vs. Budget:
This month's spending is not as bad as it seems. I invested in a beautiful website, which required a domain fee. Starting a blog can be less expensive with some domain providers, but I wanted to use an entity that manages numerous sites and is well accredited. It was also important to have a completely customizable website, with amazing framework. In order to do so, I purchased a premium theme from Studiopress. The launch of the website was funded through my AMEX, so I could claim air-miles for my family's future travel (if 'Rona finally leaves us all alone).
In addition, I received a quarterly bonus from my employer. This is not calculated into the Actual vs. Budget tables (shown below). I have my yearly budget spreadsheet setup to track my spending based upon my monthly base salary. Any other additional income would show up as an overrun in Actual vs. Budget tables (shown below) This is mainly to prevent lifestyle creep. As a civil engineer, everything is ALWAYS over budget and behind schedule!
Now, let's take a dive into the variance in fixed costs!
I increased my contribution to my HSA account to revive the balance. As mentioned previously, we paid for our daughter's medical bills in full this month. By doing so, we received a 10% discount from the healthcare system! Take note, as you could negotiate this through your own future medical needs. Uncle Sam received his cut of my quarterly bonus (hence the overruns), and I did not properly budget for our car insurance at the start of the year.
We have been seeing a lot of commercials about our insurance provider returning dividends to their customers for relief during the pandemic. I plan to call them this month to see where we stand on our payment (or credit)! Numerous car insurance agencies are providing credits to existing customers. Please do the same if you have auto-insurance through Geico, State Farm, Chubb, Liberty Mutual, Farmer's Insurance, or any other auto-insurer. Otherwise, this is money left on the table.
Next, let's dive into my Financial Goals. This will be an interesting look into the juiced 529 investments.
Whoa, I used my credit card? As previously stated, I invested in a domain and framework for this website. I paid for it using my credit card in order to obtain more air-miles. This actually sent my accrued air-miles over 100,000 (I am a saver)! My family and I will definitely use those miles when it becomes safe.
I love leaving my student loans in this section, as I completely paid them off last year. This was 2 years prior to the maturity date! It is my reminder of the successes I had so far. This will fuel the drive to accomplish this year's goals.
I reallocated my vacation and emergency fund money to be placed into the short-term rental savings. Although it appears to be an overrun, I added an additional $125 to my children's 529 plans this month. It should be noted that the 529 accounts are not reflected in my net worth. My net worth tracking page details why.
As the blown budget reflects, I had some spring maintenance for our primary residence. This portion of my budget always seems to overrun in the spring. I start noticing projects to do outside.
Finally, I will share the flex spending evaluation.
I always try to meet budget in my flex spending. This section consists mostly of wants, and not needs. Can you believe I have budgeted for approximately a case of beer a month? I failed miserably to meet this budget. Alcohol sales can sky rocket in quarantine, ha! It is good to track alcohol purchases, as it is a reflection on consumption. This provides an opportunity to reflect on my health.
As most of you are aware, Mother's Day was this month. The girls and I treated momma to a home made steak dinner. We also made our annual purchase of outdoor flowers for her. In addition, we bought some additional fishing supplies and took her fishing.
Thank goodness I did not have to drive much this month. That is what saved the budget from being blown out of the water.
Overall May 2020 Net Worth:
The good news is most states are easing shelter-in-place orders. This is showing promise to investors, which in turn is reviving the economy and markets. As always, I have continued to put money into the 401k and IRA accounts, which helps the net worth increase. I am staying the course and resisting the emotional decision pressing me to reallocate the investments. There is quite a way to go before I retire. My current contribution to my 401k will remain at 8%. I will also continue to place 2% into my Roth IRA.
Side-hustles will soon fire back up, as I strive to increase income for the real estate investment. I have steered clear of some side-hustles to reduce my family's exposure. As cases drop in my state, I will look for more ways to generate income quickly. I believe a potential housing crisis looms. This is an opportunity for investing into the real estate market. As most know, I am looking to invest in short-term rental property within a year. The ripple effect from the 'Rona virus will create a buying opportunity.
The Financial Engineer's May 2020 net worth is now roughly $125,346. This was an increase of $1,724 from last month. The change was driven by an increase of $3,076 in my 401k and $431 in my IRA. However, medical bills from the little one's delivery offset a good portion ($2,352). The remainder of the changes were driven by paying off debt (mortgage and car loan).
Overall, I am happy with the slight change in my net worth. My family does not have a burden of a monthly payment for the birthing costs, and the net worth increased! Not to mention the increased in my daughter's 529 plans that are not reflected in my net worth.
How is you net worth looking during these turbulent times? Any suggestions on how I could improve mine?