Financial Update Report – October 2017

MichaelFIRE, Investment, Misc, Net Worth14 Comments

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Financial Update Report – October 2017

Below you will find a snapshot of our personal financials for the month for October 2017.  This includes a brief synopsis of our net worth and monthly cash flow activity.

Curious as to WHY I calculate and share our personal net worth?  I explain it here.

Want to track your finance the same way?  See how I use Personal Capital to help create these financial reports absolutely FREE.  Also, download my budgeting spreadsheet found in my popular post – How to Budget Like a Bad Ass!

October Overview

So, I just got back from the TR’s Life & Wealth Mastery seminar a week ago.  It was great!  I learned so much and took so many notes, I thought my hand was going to fall off.  🙂

Anyhow, I’m working on a couple of posts to share some of the ideas I learned at each seminar.  Look for these soon.

The end of October put a nice grin on to my face.  Why?

We finally tipped the scale and officially crossed $2M of net worth!

It may very well be a temporary position, but it’s a fun goal post to reach nonetheless.

Ironically enough, we also had our largest negative cash flow this month (I’ll discuss details below).  It just goes to show you the power of compound interest in contrast to extraordinary spending.

Let’s have a quick look at how things penciled out last month.

Net Worth Summary

Net Worth marched upward with a 5-digit gain and pushed us past the $2M mark.  We ended the month of October at $2,003,214 vs. $1,934,374 this past August.  This is a $68,840 increase in our net worth or +3.5% by percentage.

Yes, this is a significant increase!  And, there were some considerable increases in both equities and real estate values.  But, I also added in some new assets since we were so darn close to that multi-million dollar goal.

$20k of this increase is me adding in the value of our cars ($15,000 combined, both paid off) and misc valuables ($5000).  I may pull the cars back out at some point since it’s constantly losing value, but for now, it’s relevant.  😉  Misc valuables consist of electronics, jewelry, things, etc.  I’m sure it’s probably closer to $20k+ in value (sold off in a fire sale), but I just added $5000 (25%) to stay conservative.

Here is what the entire 2017 year looks like so far.  It’s hard for me to fathom an increase of nearly $250k based off of pure appreciation across different asset classes.  I’ll take it though!

Yet, this does beg the question, do we need to rebalance?  And if so, where?

Cash Flow Summary     

So, cash flow isn’t a pretty of a story as net worth.

October was a negative cash flow month again with a loss of -$6311.  This was our largest loss in a single month this year and I’ll discuss specifics below. 

 

Income of $12,396 for the month remained lower than usual due to one Vegas property still paying off its recent turn over costs.  The good news is that we finally re-rented the other home for $1225/month.

Our income is primarily made up from my wife’s teacher salary, rental income, dividend income, and misc investment income (eg. RealtyShares).

Rental income has been down due to two homes being vacant.  Both are rented now, but some of the capital expenditures are still being paid back to the property management, essentially wiping out the rent paid from Oct.  We should be back to normal income levels soon!

Expenses

October’s expenses of $17,550 were the highest for the year.

The extraordinary expenses are attributed to:

  • Travel – Hotel and Meal Plan at Life & Wealth Mastery – $3000
  • Plane ticket – Purchased ticket for Mom to travel with us to London this coming December – $764
  • FBA – Purchased more units of product and paid the balance of the order – $1700
  • Charitable donation – $500
  • Oh yeah, I also bought a bike! – $600

So, yeah that’s an extra $6564 spent this month.  I’m okay with it though because it was conscious spending on investments & giving.

I won’t lie though, I’m hoping this goes down significantly in November!  😉

Portfolio Balances (Equities)

My portfolio was just slightly above the S&P 500 this month.  Equities have certainly played a significant role this year with an appreciation of $82k this year so far.  I’m glad I kept some skin in the game despite being bearish these past couple of years.

Final Thoughts

After attending Wealth Mastery this past week, it’s a bit fitting that we finally hit the $2M goal post for the first time.

I’m excited as ever to keep pushing this forward to our 10-year goal of $10M.

There are a lot of things to do with more money, including, but not limited to pursuing our direct passions, helping others, giving back, traveling, and purchasing some new toys.

The world needs more conscious millionaires, and I’m counting on you to join us!

Readers, how was your October?  Did you see a nice uptick in your equities (stocks)?  How about real estate? 

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Michael

Hi, I have been blessed to take an early retirement in my mid-30's so I can focus on becoming a better father, blogger, and investor.

My goal is to help you find your personal path to financial freedom, and to enjoy the entire journey.

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14 Comments on “Financial Update Report – October 2017”

  1. Congrats on hitting the $2M milestone! I’m glad you had a great time at the conference. I’m sure many people missed you at FinCon, but you just have to pick what works best for you hehe.

    I saw that you’re continuing your Amazon FBA experiment. I’m looking into FBA too, and I’m looking forward to seeing part 4 of your FBA series! ^.^

  2. Wow, nice October Michael! Congrats on hitting $2M!

    Yes your cashflow was pretty negative this month, but with those big net worth increases it hardly matters! It’s a similar situation for me — Our $52k in annual dividends won’t quite cover our costs this year, but if I consider our capital gains (after taxes) it’s really not a problem.

    I too am curious about the FBA experiment! Would like to see an update on that series soon!

    1. Thanks, Mr. Tako. The FBA experiment continues, but it’s a slow process… profitability – TBD!

      I’m always amazed at your healthy dividends. 🙂

  3. Congratulations on this new milestone!! I bet it felt so great when it happened and then back to your normal daily life.

    That’s how it was for us. We hit a milestone in October as well. We surpassed the $1M mark for net worth. It happened my heart started beating a million beats a minute for a few minutes, then back to laundry and life. 🙂

    We have three properties and didn’t see any market fluctuations there, but we saw a 7% increase in our equities and that put us over the milestone. Let’s see how long this market will allow us to be in the 2 comma club

    Thanks for sharing, can’t wait to be early retired like you!

    1. Oooh, congrats Lena! $1M is so exciting… and honestly better than $2M (not that I’m complaining). I just folded a huge load of laundry today. 😉

  4. $2M, woot! It sounds so much easier than the first 1M, am I right? 😉

    I’ve thought about adding items like our cars or jewelry (our two pieces haha) but feel like they’re really only liabilities because we don’t have any intentions of selling them, only replacing them if needed, so they’re not actually worth anything in that sense.

    How often do you normally rebalance your portfolio?

    1. I decided to break the saying, “it’s a long quicker to your second million than your first”… our second took 11 years vs. 9 years. Then again, I wasn’t working for nearly 5 years of the second one. 😉

      I typically rebalance a few times per year, but I’m considering outsourcing this to a wealth manager soon. I know I’m missing some easy pickings with tax harvesting, etc.

  5. A good month for you guys. Congrats on reaching $2M! Impressive for a young family. Enjoy your upbeat posts.

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