Welcome to my monthly net worth February 2021 edition. Another month has come and gone, which indicates a need to review the changes in my net worth. For all of the new followers, welcome! I track my net worth monthly to see where I am in comparison to my annual short term goals. Additionally, it is an opportunity to see my progress towards reaching my long-term goals.
February 2021 Personal Update
Before I jump into the details of my net worth in February 2021, I will share some personal updates. What happened in the month of February for The Financial Engineer? Well, not a lot. It was a somewhat slower month.
The month was unbelievably cold. Additionally, we had a couple of snow storms that accumulated over a foot of snow. This brought an opportunity for our oldest to play in the snow with her dogs. She loved every minute of it. Although, the extreme cold did not allow for many days for her to safely do so. I did not enjoy the snow as much as she did.
We live on a corner lot in an subdivision. The snow plow is generous with the amount of snow they placed at the end of my driveway. I spent 2 hours digging out the end of my neighbors and our driveway. The snow was about 6 feet deep at the corners of our driveway.
We did plan one vacation trip with some family. We are going to rent a lake house in Michigan. This should be a relaxing trip in the middle of June.
If you did not read the last month's net worth update, my mom was diagnosed with cancer. My mom received an update for her treatment. She will be going into surgery March 7. This is the first step to fight her stage 2 diagnosis. Undoubtedly, it is good that they are able to get her into surgery so quickly.
February 2021 Professional Update:
Our office is still extremely busy with various projects. I have assisted with submitting 5 projects since the start of the year. Moreover, these projects are relatively large in size. This has been quite an exciting time. Importantly, meeting client deadlines is extremely important.
With the increase in my working hours, comes a decrease in time spent on the side hustles. Again, this month had almost no income from side hustles. However, I anticipate the side hustle income to increase in the coming months. Since vaccine rollout, COVID cases has dropped significantly this month. The hospitals are no longer needing to divert patients due to being at their limit. This is great news and a good sign of the trend we are heading into. As such, the extra income will continue to increase my net worth.
Now, lets dive into the details of my net worth for February 2021.
February 2021 Actual vs. Budget Spending:
This month's spending was great. I met budget on almost every category. As such, my savings and investing percentages increased significantly.
Please note, each budget section (listed below) is based upon my salary. It does not include any other income sources. The thought is to save all other income 100%, and not include it in the annual budget. As a reminder, I break out my budget into 3 categories:
- Fixed Costs
- Financial Goals
- Flex Spending
Now, let's take a dive into the difference in fixed costs!
HSA allowable contributions increased to $3,600 for 2021. As such, my monthly HSA contribution will be slightly higher than last year. I am reevaluating how many bank accounts I have. There will be additional accounts added this year to manage savings for all my single annual purchases. For example, I will have a savings account for our annual recreation center fee. These accounts will help me manage large, one time payments. For example, I have opened a SoFi savings account that will be used to save for our vacations. Subsequently, the budget spreadsheet will be adjusted to accommodate these accounts.
Next, let's dive into my Financial Goals.
Great increases to the children's 529 occurred this month. I contributed an additional $70 into each account. I typically contribute $140 / child each month. However, it should be noted, the 529 accounts are not reflected in my net worth. Curious to know why? My net worth tracking page explains it all!
Although it is shown as an overrun, I increased my contribution into the 401k accounts this month. This was due to an increase in my contribution percentage for the year.
As previously mentioned, I am adjusting my management style for liquid savings. I will be placing large, one time payment savings into individual accounts. These line items will continue to take a small portion of my income each month. They will slowly build up throughout the year for the large costs.
I saved an additional $100 for the short-term rental investment. We will be waiting for a good opportunity to purchase this in the near future. Investing takes patience and is a waiting game. It will be interesting to see where the government's moratoriums take the economy this year.
Lastly, 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. Although, I did not meet this overall budget I did not exceed my eating out budget! This budget is set at $150 every month. This would be 1 of 9 months where we met the budget.
The shopping budget was not met either. This was due to purchases for a co-worker's newborn baby. I will
Let's wrap this month's overview up!
Overall February 2021 Net Worth:
Comparing February 2020 with February 2021's net worth is exciting. The year-over-year growth was 59%.
As always, I have continued to put money into the 401k and IRA accounts. I have focused more attention into the short term savings for the real estate investment. I am staying the course and resisting the emotional decision pressing me to reallocate the investments. Who knows when or how the stock market correction will happen? This is why I am not trying to time the market.
I have increased my annual contribution to my 401k to 11%. I will also increase my contribution to my Roth from 2% to 4%. The short-term real estate investment will hopefully become reality this year.
The Financial Engineer's February 2021 net worth is now roughly $186,214. The change was driven by a reduction in my debt. Additionally my employer's match contribution was deposited into my account for 2020. I am extremely grateful that this occurred despite last year's recession.
Overall, I am extremely pleased with the massive increase in my net worth. Again, it should be noted, the value in my daughter's 529 plans are not reflected in my net worth.
My February 2021 savings rate was 7%. Contrary, my investment rate was 22%.
I was fairly accurate with my prediction for February 2021. Historically, a lot of my growth occurs in the last month of a given year and into the first quarter of the following year. I anticipate March to show a large increase in my net worth as well.
How is your net worth looking?