Starting my journey to early retirement

[Speed Racer]

Just a little update, at the end of July my net worth topped $35k. I see others have been doing 6 month updates, so maybe I will too to help me keep on track (and look back in the future). This past week was a little bit rough for my bank account though. I finally got my physical therapy bill (last session was about 10 months ago) and my insurance went up because of an accident that wasn't my fault. My car battery also died to go along with normal expenses that come out around this time. That's coming off the heels of having to buy two new tires since one of them went flat. It's really easy to see how some people struggle when unexpected expenses pop up.

 

[OldShooter]

The reasoning for picking a particular stock isn't always based on quantifiable numbers. I mentioned in another post that in a rational world, Tesla wouldn't be $800+ while Ford languishes around $5. Back in 2009, Ford was the company to invest in. It was the only one of the Big 3 that didn't take a bail out and Wall Street viewed Alan Mulally as a guy who could do no wrong. Look where the stock went after he retired. Last month, Microsoft was the company to invest in. It has a bright future in could computing and has slowly been shedding its image as uncool compared to Apple. ...

My response was to your statement: "... It's just that right now the market it low, so there is opportunity to earn more with individual companies. ..." The fact that one can look in the rear view mirror and pick some winners and losers is irrelevant. One can always do that.

Again, this is a small portion of my overall contributions. Although right now I wish it was a larger portion. It's up about 22% compared to about 11% for my total market index in the same time period. I don't think it's a big deal to invest in a few individual companies when the vast majority of my profile is literally invested in the entire market.

As long as you view it as amusement and not investment, it's fine and can be a lot of fun. Some people talk about using 5% of their portfolios to do this. There was a very insightful post here a year or so ago where the poster said his worst investing luck ever was when he made money on his first individual stock pick.

If you are struggling to pay the routine expenses of life, though, I guess I'd question whether amusing yourself with individual stock picking is a good use of any of your money. YMMV, of course.

Good job on buying the S&P.

 

[Speed Racer]

My response was to your statement: "... It's just that right now the market it low, so there is opportunity to earn more with individual companies. ..." The fact that one can look in the rear view mirror and pick some winners and losers is irrelevant. One can always do that.

As long as you view it as amusement and not investment, it's fine and can be a lot of fun. Some people talk about using 5% of their portfolios to do this. There was a very insightful post here a year or so ago where the poster said his worst investing luck ever was when he made money on his first individual stock pick.

If you are struggling to pay the routine expenses of life, though, I guess I'd question whether amusing yourself with individual stock picking is a good use of any of your money. YMMV, of course.

Good job on buying the S&P.

I guess I'm not sure what you mean on your first comment. I said nothing about looking in the past to pick winners.

I also have no trouble paying the bills, I was just commenting on how some people can struggle when multiple unexpected expenses come up. I probably won't invest my next paycheck, though.

While I have no regrets picking SPLG, I would have made much more money if I went with AMD like I had originally planned. With movie theatres reopening, those could be a good short term profit maker going forward.

 

[Speed Racer]

Time for my first official update here. Like many, I had a great year in the stock market despite what was going on in the real world. I blew past my goal of increasing my net worth $15-20k. It ended up increasing by about $33,000. Here's a little breakdown:

Cash: ~$1800
Roth 401k: ~$12000
Roth IRA: ~$8000
Taxable: ~$24000 This is larger because it's main purpose is my house down payment fund. Still undecided if I'm going to buy or rent. Might end up doing both in buying a rental property and living downtown like I've always wanted to.
Car equity: ~$5500
HSA: ~$600

It all adds up to being just shy of $52,000. On January 1st of last year, it was a little over $19,000. I'm not sure what this year will bring in terms of moving, so I'm going to keep my goal of increasing my net worth by another $15-20k this year. $70,000 is reasonable, but $75,000 would be even better lol. I certainly don't anticipate another market crash helping my gains. Although I'm off to a nice start with my stimulus check being deposited overnight.

If I don't buy any property, I'll probably pay off my car loan about a year early this time next year. It'll be nice to not have that coming out every month.

 

[Speed Racer]

Time for my second update! I forgot I updated this thread in January and not April when I originally started the thread. These numbers are still as of January 1st, though. I didn't end up moving, but even so my net worth increased way more than I expected and I cracked $100,000 for the first time! That's really exciting for me because it's the first major milestone and I didn't think I'd hit it for another couple years when I first started. A big part of this is because I still haven't moved. I'm 99% sure I will be actually moving this year. I may just rent my brother's duplex because this market is so crazy. I decided not to pay off my car since there's only two years left, and I don't want it to affect my loan status should I find a house.

With all of that said, I don't really know what to expect of my net worth again this year. I don't expect to double my money for a third year in a row, that's for sure. I'll say anywhere from $130k-$150k would be great depending on when I move.

1/1/2022 numbers:
Cash: ~$7500
Roth 401k: ~$25000
Roth IRA: ~$17000
Taxable: ~$38000
Car Equity: ~$9000
HSA: ~$1400
Bitcoin: ~$1400

All of it adds up to just over $101,000!

 

[Speed Racer]

Update number three! A bad year in the stock market and some life changes meant not much movement in my net worth over the past year. I bought a house in April before rates were crazy high and recently became engaged. I have a lot more expenses and have a wedding to plan for (not until next year), so I don't expect a whole lot of movement this year, either. I do expect to spend less on the house (about $11k last year repairing/upgrading) and I think the stock market will be higher by year end. $115k-$120k would be nice by the end of the year.

1/1/2023 numbers
Cash: ~$2200
Roth 401k: ~$28000
Roth IRA: ~$15500
Taxable: ~$7600
Car Equity: ~$12000
HSA: ~$2300
Home Equity: ~$37000

That adds up to just over $105,000.

 

[HI Bill]

Congrats on the home purchase, and dumping BTC! Yes, 2022 was rough, and 2023 may be also, but I'm banking on 2024!

 

[Speed Racer]

Update number four! As we all know, 2024 turned out to be a great year in the stock market. That provided a nice boost to my numbers and gets me to where I thought I would be this time last year. No big changes expected this year, other than getting married. Even that is really just a change on paper, but I'm still excited nonetheless! She has been wanting a dog for a long time, so that may happen in the second half of the year depending on where we are on paying off wedding expenses.

Last year I paid off my car, so that will be a nice extra cash flow in the coming year. Properties were also reassessed, and my value went down thanks to the lower purchase price because of the work it needed. That will save me about $900 per year for the next three years. I expect to have the PMI removed as well, so that will be another $50 per month in the second half of the year. I value my house very conservatively for net worth purposes, but with the work we've done, I easily have $100,000 in equity.

As usual, I'm not sure what 2024 will bring for my net worth. A lot of it depends on how much of the wedding we have to pay off ourselves. I would like to start making IRA contributions again in the second half of the year since I'll no longer be having so much cash outflow from the house and wedding. I think $160000 is a reasonable goal. Hopefully 2024 is a solid year and I'll start to see my retirement accounts take on a life of their own in 2025.

1/1/2023 numbers:
Cash: ~$300
Roth 401k: ~$45500
Roth IRA: ~$20000
Taxable: ~$9500
Car Equity~$12000
HSA: ~$3300
Home Equity: ~$47000

That all adds up to just over $138000!

 

[Surewhitey]

Nice progress considering the home purchase and wedding. I got married @ 26 & that was our real starting point. You're definitely ahead of the game compared to most. I didn't even really know about investing until ~28...and unfortunately we learned the hard way.

Keep it simple is my 25+years hindsight... Don't worry about single stocks or alternatives.

 

[Speed Racer]

Nice progress considering the home purchase and wedding. I got married @ 26 & that was our real starting point. You're definitely ahead of the game compared to most. I didn't even really know about investing until ~28...and unfortunately we learned the hard way.

Keep it simple is my 25+years hindsight... Don't worry about single stocks or alternatives.

Keep it simple is great advice. I'd say 90% of my retirement funds are a combination of S&P 500, large cap growth, and total market indexes. I currently have easy access to the brokerage and IRA numbers. Last year the IRA was up about 32% and the taxable was up 25%. The difference? The taxable is all invested in individual stocks. It's still diversified, but it would have been nice to have that extra 7% gain.