Star*Bucks ERE Journal

[Star*Bucks]

November 2015 Update:




Current Debts:
None

Current Assets:
Cash $10,438
Home $70,000
Car $0
401k $75,165
IRA $9,638
HSA $3,457

Total Net Worth $168,698

Net Worth increase of $4,459

I got a second job!!! I am very happy to say that I've found a company that wanted to hire me for my talents/experience and they were willing to work with my schedule. I hope to work 20-40 hours per week with them going forward. I haven’t received my first check yet since I started working with them late in the month but I’m very optimistic about things. I hope it works out. I’ve splurged on myself a bit during the Black Friday Cyber Monday weekend. I purchased a lot of the things on my list of travel essentials at very good prices. I basically spent all the money I earned from my first week working at the new job on these items.

-New Osprey Backpack (lifetime warranty)
-Packing Cubes
-International All in One Travel Charger
-Dry Sack by Osprey as well
-Columbia Water Proof Packable Rain Jacket
-Couple pairs of Merino Wool Socks
-Anker Battery Back up (help keep phone charged while on the go)
-ScotteVest Hoodie

Total spent on everything was just under $400 and that’s a bargain for what I got. For anyone who isn’t familiar with ScotteVest clothes I recommend checking them out especially if your traveling. They specialize in hidden pockets in their clothes so pickpockets will have one hell of a time trying to get my stuff. Realistically I still have $500-$700 I still need to spend on travel gear. Things I still need to buy are:

-More travel clothes, preferably Merino Wool
-Headlamp
-Quick Dry Towel or referred to as a Pack Towel
-Flip Flops for showers in hostels
-Small First Aid Kit
-Small Fold Out DayPack
-Travel Sized Wet Wipes
-A Unlocked World Phone so I can simply buy a sim upon arrival to a country
-Camera - GoPro with Sim Card or if the World Phone has a really good camera I could make due with that.

I plan on traveling with only a carry on bag to make my journeys easier and cheaper. My first trip will be some time in the second quarter of 2016 and chances are it will be to Thailand. I think it’s a great choice for a starter country as there are many western backpackers there and the exchange rate is very favorable.






Goals for November were:

~Continue losing weight & improve diet (lost one pound)
~Complete Camry's maintenance (Transmission fluid flush and detailing the interior) Failed!

Goals for December are:

~Finish the year off strong and try to hit or get as close as possible to my 2015 goals that were set out early on in the year.
~Work as many hours possible
~Continue to lose weight
~Pay Property Taxes

[Star*Bucks]

December 2015 Update (late update)

My net worth was almost the exact same as in November even though I received my Vanguard dividends (including LT & ST Cap Gains) all my paychecks and contributions to 401k. Net worth did not rise due to having to pay property taxes and an unexpected $600 repair on my sisters van. Her alternator went out and I was driving her back up vehicle, so I felt obligated to pay for her repair. If I had the van myself I could have fixed the van by just purchasing the new alternator myself for $180 and spending an hour replacing it, but such is life. Another reason there was no increase in net worth was due to the market pulling back a bit.

Net Worth Increase: Stagnant $0


2015 Year End Recap

Net Worth at the beginning of 2015 $124,786
Net Worth at the end of 2015 $168,698
Total Net Worth increase of $43,912

I reviewed the post I made on Jan 03 2015 and I had projected saving $42,850 in 2015 and I was actually able to save $43,912 a difference of + $1,062. Since I will have to purchase a new vehicle in 2016 it will push back my hopes of saving $42,850 for 2016, but I’m not changing that projected number ($42,850) for several reasons.

I will not be helping my family members this year financially and will instead only give advice and leave it up to them to take initiative and responsibility in their actions. (obviously this does not include emergencies)

I will have a newer vehicle that gets better gas mileage and since it’s new will not have to keep buying parts and doing repairs.

I am working a second job now so income will already be increased to help off set new vehicle expense

Most of the things I have wanted/needed I already have now. So spending should be low this year. Most of my travel gear has been purchased, my new macbook pro few months ago, so I don’t see any significant expenses in 2016.

Goals for 2015 were:
~Increase my 401k Balance by 25k (employee+employer contributions) DONE!
~Have my 6 pack back (would be first time in over 15 years) FAIL
~Take a International Vacation FAIL
~Build more meaningful relationships FAIL
~Focus on my business and in acquiring accounts FAIL
~Max Out 2014 & 2015 Traditional IRA Contributions DONE!
~Max Out HSA Contribution DONE!

Notable Accomplishments in 2015:

-Maxed out my 401k contribution for the first time 18k!
-Maxed out my Traditional IRA within the same calendar year for the first time
-Working 2 jobs (only since November 2015) and seeing the progress go faster, even though net worth isn’t moving up in dollars it is moving up in sheer number of shares I own since I am purchasing at lower prices and the market keeps going down.

Annual goals for 2016

-Max out 2016 IRA
-Max out 2016 HSA
-Contribute the max to 401k
-Take an international vacation
-Focus on health and losing weight
-Look into Uber & Lyft as side income


Goals for the month of January 2016

-Max out 2016 IRA
-Max out 2016 HSA
-Purchase a 2016 Toyota Corolla or other well priced car with good gas mileage and high resale value.
-Get in the habit of going to the gym
-Find a hobby or any way to relieve stress

[thrifty++]

$44k is a great annual net worth increase. The market has turned to shit atm and I am sure that will get better. I cant see why the USA needs to be so affected by China's meltdown. USA only exports 1% of its GDP to China I was reading. So it seems like just a panic reaction. In fact it seems like the world is channeling investment back into USA so the USA might end up doing well over the medium term since the USA is again seen as a "safe haven". Also the USD has skyrocketed since China started having issues so if you think of the international buying power of your assets now they have probably increased more than the loss from the stock market drops. Especially if you think about geo arbitrage ERE

[jacob]

I cant see why the USA needs to be so affected by China's meltdown.

Free QE money caused a lot of margin/leveraged speculation in emerging markets. When emerging markets fall, you have to sell your "good stuff" (that's not getting called) to cover the margin calls. Also with the Feds raising rates, US speculators need cash to pay back their leveraged loans which are no longer as cheap. They'll sell whatever they believe is overvalued.

PS: Watch for gold and bonds. As long as correlations hold, i.e. they move in reverse with equity, things are likely alright. If correlations break down, it means that the system is getting squeezed (call on cash) and we're all in trouble, I think this is the way to distinguish between a cash crisis and a whatever-crisis.

[thrifty++]

@Jacob - I don't actually understand what you are saying. I don't understand all the terms. What is QE money? What "good stuff thats not getting called" are you referring to being sold? Do you mean stocks that have gained large capital gain increases? What do you mean by a call on cash? Does that mean people are wanting to hold cash and nothing else?

[jacob]

In order of question marks:
1) QE means quantitative easing. It's a program that several (almost almost significant) central banks have engaged in which they buy government bonds from regular banks by writing out credit. In return, regular banks have invested this money in stocks. As a direct consequence, stocks have gone up whenever some major central bank (US, EU, Japan) have engaged in QE since 2009. When the US stopped QE in 2004, the markets consequently and predictably when flat.
2) Because a majority of investors are now "price-insensitive", the majority does care about fundamental valuation. Furthermore, the majority is leveraging their bets. This means that the "good stuff" is "whatever has gone up" over the past years.
3) Stocks or any kind of "risk" strategy. Google risk-on/risk-off.
4) If someone is investing on margin, which can be material, i.e. 10-100x, if they lose 10% of their position, they would have to sell most of it to post cash security at their broker.
5) No. The driving factor in this highly leveraged and price-insensitive market is short term ( weeks--months) movements. It has little to do with any desire to hold certain things.

PS: To continue this discussion, if desired, it should be moved to a thread of its own to avoid screwing up SBUX's journal.

[Hankaroundtheworld]

Goals for 2015 were:
~Increase my 401k Balance by 25k (employee+employer contributions) DONE!
~Have my 6 pack back (would be first time in over 15 years) FAIL
~Take a International Vacation FAIL
~Build more meaningful relationships FAIL
~Focus on my business and in acquiring accounts FAIL
~Max Out 2014 & 2015 Traditional IRA Contributions DONE!
~Max Out HSA Contribution DONE!

Lol, it looks like the "easy" goals were successful but the difficult ones failed. Not a critic, but recognizable, for the difficult goals it requires change of lifestyle and that is always tough, you almost need to re-program yourself. Good luck with reaching this in 2016

[Star*Bucks]

$44k is a great annual net worth increase.

Thanks Thrifty! I was surprised to see that number as well; When I retire and backpack around SE Asia or S America I plan to live on approximately 15k a year; so in essence in 2015 I saved up the equivalent of 3 years of retirement. I'm shooting for more this year

Lol, it looks like the "easy" goals were successful but the difficult ones failed. Not a critic, but recognizable, for the difficult goals it requires change of lifestyle and that is always tough, you almost need to re-program yourself. Good luck with reaching this in 2016

Hank am I that transparent? lol I am painfully introverted/shy and it's very difficult to get over it. I've even drove to the gym before and while in the parking lot saw it was busy and drove right back home. It's a sort of social anxiety I guess but I am aware of my problem and I am working towards solving it. Hopefully 2016 will be a step in the right direction.

[Star*Bucks]

January 2016 Update:



Current Debts:


Current Assets:
Cash $1,497
Main 401k $73,990
2nd 401k $754
IRA $18,101
HSA $6,471
Home $70,000

Prior Months Net Worth: $168,698
Current Net Worth: $170,813

Net Worth Increase of $2,115

I’m glad my net worth increased even though my investments have gone down considerably. Working 2 jobs isn’t for the weak and I am thankful this next week job#2 has slowed down a bit and I won’t be working full time hours at my part time gig. I am hating the idea of purchasing another vehicle and I’m over thinking this whole process. I think I’ve finally come to my senses and decided to buy a used hybrid vehicle 3 to 4 years old with low miles and definitely something bigger than the Corolla. I sat down in a 2016 Corolla this past weekend and I’m too big of a boy to be in one of those daily. January 2016 marked a first for me in that I was able to max out my IRA & HSA for 2016 right at the beginning of the year and won’t have to worry about it; Feels Good! Whatever vehicle I end up with I do not plan to put any money down and I’m sure my interest rate will be great since I have been working to build my credit score for some time now and it’s a strong score. I will be paying double to triple the car payments monthly regardless of the interest rate and hopefully will have enough left to start investing after tax dollars for once.



Goals for the month of January 2016 were:

-Max out 2016 IRA DONE!
-Max out 2016 HSA DONE!
-Purchase a 2016 Toyota Corolla or other well priced car with good gas mileage and high resale value. FAILED
-Get in the habit of going to the gym FAILED
-Find a hobby or way to relieve stress FAILED

Goals for February 2016:

-Purchase a vehicle and give the van that I’m borrowing back to my sister
-Get into a routine with fitness and nutrition
-Find a hobby or way to relieve stress

[jennypenny]

Why are you trying to buy a new Corolla? There are plenty of good used ones available, and if you have to finance, rates are favorable on used cars right now.

I would think a used Corolla rental should be pretty easy to find. We've bought used rental cars twice with no problems (once from a dealer's rental unit and once from Enterprise). This article has more info.

[thrifty++]

Yes I also am wondering why you are buying a new car.
I dont have a car now and dont need or want one but previously when I did buy cars I always bought a used one for about 3.5k/4k and they were always fine. TBH buying a new car sounds like throwing your hard earned money down the toilet, especially when you are so unhappy about doing it.

[Star*Bucks]

February 2016 Update:




Current Debts:
Credit Card $ 1,016
Auto Loan $18,167



Current Assets:
Cash $1,499
Main 401k $75,911
2nd 401k $757
IRA $19,357
HSA $6,465
Home $70,000
Car $21,139

Prior Months Net Worth: $170,813
Current Net Worth: $175,945

Net Worth Increase of $5,132

So I finally took action and purchased a brand new 2015 Toyota Prius Two (the base model) Toyota has excellent deals to get the 2015's off the lot and I took advantage of their $3,000 manufacturers rebate as well as haggled the Internet/Fleet department. I got the car for just under 19k (more than $6,000 below MSRP & $5,000 below invoice!) and out the door with tax, license, & registration it came out to $21,600. I purchased it halfway through the month of February and I'm seeing huge fuel savings! I will report more on the fuel savings in next months update since I'd like a full month to compare with prior months. I highly recommend the 2015 Prius to anyone who is in the market for a new vehicle. It comes with 2 year or 25,000 miles free service/maintenance, which is basically 5 oil changes and 1 or 2 tire rotations. I was able to get a 2.79% interest rate through my credit union and now I'm deciding if I should be gung ho about paying it off fast or if I should just invest more. My monthly payment is approximately $380 and my first payment wasn't due until April but I went ahead and made an initial payment of $3,500.

I don't think I mentioned this but I dumped Comcast last month and went to a internet only plan with another company. I'm saving $62 per month now although there is a 2 year agreement with termination fee, but I don't plan on changing/cancelling service. If something were to happen and I did need to cancel the contract the termination fee is only $150 so as long as I stay with them over 3 months I'm good.

My best single month Net Worth increase was back in October of 2015 and it was $8,677. It's not going to be easy but I would really like to see a 5 figure increase in one month to beat my best month ever. Let's see how March goes since I know my quarterly dividends get paid in March.

Goals for the month of February 2016 were:
-Purchase a vehicle and give the van that I’m borrowing back to my sister DONE!!
-Get into a routine with fitness and nutrition FAILED
-Find a hobby or way to relieve stress FAILED


Goals for March 2016:

-Read the owners manual for the Prius & get to know how to use it better.
-Start exercising preferably at the gym or home workout if no time to visit the gym
-Complete 2015 Tax Returns

[George the original one]

> I was able to get a 2.79% interest rate through my credit union and now I'm deciding if I should be gung ho about paying it off fast
> or if I should just invest more.

Good rate, however interest rates are not the only cost of car loans. Very often the lender requires insurance above & beyond what you might choose for yourself (e.g. you might choose no comprehensive, no collision or collision with high deductible).

[Star*Bucks]

There are plenty of good used ones available.
a used Corolla rental should be pretty easy to find. We've bought used rental cars twice with no problems (once from a dealer's rental unit and once from Enterprise). This article has more info.

I spent a lot of time considering this option but having 2 jobs and very limited time I really wanted to go for new. Buying used (for me) is extra effort in taking the car to a mechanic to be inspected (unless it comes with a good warranty) also I have been working on older used cars in my household and I'm just done fixing stuff. Luckily I found a pretty good deal and I am planning for this to be the final car that I ever own

Yes I also am wondering why you are buying a new car.

I had to weight the options and it just made sense Thrifty, and I am very happy with the choice, got an awesome deal

Good rate, however interest rates are not the only cost of car loans. Very often the lender requires insurance above & beyond what you might choose for yourself (e.g. you might choose no comprehensive, no collision or collision with high deductible).

Yes actually that's what happened to me back in 2014 when I purchased a 2014 Nissan Altima and financed with NMAC, but this time I financed directly with my credit union and they didn't have any requirements what so ever

[Star*Bucks]

March 2016 Update:




Current Debts:
Credit Card $513
Auto Loan $11,753



Current Assets:
Cash $1,497
Main 401k $83,798
2nd 401k $1,270
IRA $21,362
HSA $6,870
Home $70,000
Car $21,000

Prior Months Net Worth: $175,945
Current Net Worth: $193,531

Net Worth Increase of $17,586 Best net worth increase EVER!! WOW!

March 2016’s Net Worth increase is the equivalent of 40% of the total Net Worth increase in all of 2015. I knew it would be a good month and I thought I would hit a 5 figure net worth increase but didn’t think it would be this good. So I don’t work a second job any longer but I had 1 full and 1 partial weeks check from my old job, then it was a 3 paycheck month with my main job. I was cashed out remaining vacation from last year since this company doesn’t let you roll it over. Also dividends were paid out and lastly I received my tax refund which wasn’t much ($400). The next 3 paycheck month is September and dividends are being paid out in September as well. Hopefully I can try to crack this record then (I’d be happy with any 5 figure increase).

Mint App gives me a budget of $170 for gas based on the average of my past usage and in March I spent only $70 which is a savings of $95. This is especially good because I did more than average driving. I started going to the gym again and running errands, going jogging at the nice trails near Nimbus Dam and Folsom Dam. I’m still fat but I feel much better, I’m not getting winded quickly like I did when I first started and I hope I keep this momentum.

I splurged on a new pair of shoes and a nike hoodie, both were on sale and cost a total of $125 combined.




Goals for the month of March 2016 were:

-Read the owners manual for the Prius & get to know how to use it better. Fail
-Start exercising preferably at the gym or home workout if no time to visit the gym Done
-Complete 2015 Tax Returns Done


Goals for April 2016:

-Look for a second job

[thrifty++]

Wow that is a huge chunky increase! It must feel good.

[Star*Bucks]

Q1 2016 Review:

Taking a step back to reflect. I started this ERE journey in April 2012, four years to date. When I started I had massive debt, and no money saved. I began to contribute 25% of my gross income to my 401k and live very frugal, giving me the ability to put the bulk of my earning towards my debts. My biggest failure during these 4 years has been with the spending associated with cars. I couldn't qualify for a newer car loan in the beginning of 2012, so I bought what I could a 2002 Toyota Camry for $8,000 with a ridiculous APR of 13.49%. I paid the car off in 10-11 months and paid 1k in interest. I had the car until January of 2014 (only 2 years) the whole time I owned it I kept having to put money into it. I minimized the amount I spent by doing as much of the work myself but it was still a good amount spent. In the beginning of 2014 the car had a lot of miles and was starting to break down so I purchased a new 2014 Nissan Altima. My credit had improved quite a bit so my APR was 4.99% which I still didn’t like so I paid the car off in 10 months. The price was under 23k out the door and I don’t remember how much I spent on interest. After I paid the car off is when I became permanent at a work site close to my home; so I no longer needed a reliable newer car since I was no longer driving all over the State. I gave the Altima to my brother which wiped out the remaining amount of money I owed to him which was roughly what the car was worth and made me debt free for once. I went back to driving my old 2000 Honda Civic which I loved and was cheap to insure, drive, fix, and I didn’t worry about it where ever I parked because most people wouldn't want to steal or break into it. Then my Civic died on me in October of 2015. It would have cost more to fix it than it was worth. So I took months borrowing spare cars from my family and taking time to make a wise purchase. I was so tired of dealing with cars; the buying, financing, fixing, maintaining, etc. It took me 4 months but finally in February I purchased my current car a new 2015 Toyota Prius. I got an excellent deal since the dealerships want to get rid of the 2015’s to make more room for the 2016’s. I got the car for $21,600 out the door and credit rating still improving got me a 2.79% APR. Remaining balance as of today is $11,753. My goal is to pay this car off in a total of 6 months and I hope that it’s the last car I buy. Toyota Prius have a very low cost of maintenance and are very reliable. If I didn’t have all these set backs with cars I’d be leaps ahead in this journey but live & learn I guess. I could go back further and tell more horrible car stories like the 01’ Isuzu Trooper fully loaded SUV with horrible gas mileage but I think this gets to the point.

Once the Prius is paid off all excess money can go into after tax investments and get me to my target number for FIRE. Which gets me to my next point, how much do I need for early retirement? My plan was to retire and spend as much time as I want backpacking the world like a budget conscience hippy. I follow a lot of budget travelers on social media and the consensus is that a 1k per month budget is comfortable in many places around the world. That’s 12k per year so maybe if I were to budget 15k per year to cover incidentals my FIRE number would be 375k. If I sold everything I had I’d be more than halfway to that number now! It took me 4 years to get to a net worth of $193,531 but I think the next few years will be a lot more productive since I will be debt free within a few months and I also have dividends helping me along the way (I understand there may be set backs if another market crash occurs etc). All of my funds are in retirement accounts currently and I do plan on doing annual conversions to a Roth IRA like the MadFientist outlined. I’m also not opposed to finding some sort of work online that can help me cover any costs as I travel so I can leave my investments working for me.

Q1 Progress
January + $2,115
February+ $5,132
March+ $17,586

Total Q1 Progress $24,833 or in other words just under 2 years of freedom.

$24,833 is 56% of 2015’s entire year net worth increase but done in the first 3 months of 2016. I’ve got big hopes for the remainder of 2016. My hope is that I will be able to pay off the Prius quickly and then save $8,850 before the end of 2016 so that I can immediately max out my 2017 IRA & HSA as soon as January comes around. I’m sure I can accomplish that but I also really wanted to take a international trip this year. I’m not sure I can do everything with only the earnings from my job so I am currently looking for s second job to make sure I can accomplish all my goals this year.

[Star*Bucks]

April 2016 Update:



Current Debts:
Credit Card $1,502
Auto Loan $9,266



Current Assets:
Cash $1,525
Main 401k $87,627
2nd 401k $1,200
IRA $22,828
HSA $6,788
Home $70,000
Car $21,139

Prior Months Net Worth: $193,531
Current Net Worth: $200,339

Net Worth Increase of $6,808

I am back to working a second job again with the prior company I was working with but it is very few hours. They contact me when they need assistance with things they are having difficulty with and I worked a total of 6 hours in April, and I am guessing I will work less than 40 hours for the entire month of May with them. I have been looking for another job all together. Something that would pay me what I am worth and get me to the 6 figure pay scale which has been unachievable for me so far. If I do get a position like that I wouldn’t keep a second job as it wouldn't be necessary and would be more of a hassle. I’ve also lost 7 pounds, so from 230 pounds to 223. I am feeling more confident and comfortable in myself.



Goals for the month of April 2016 were:

-Look for a second job DONE!


Goals for May 2016:

-Apply for quality jobs with high pay scale or attract clients to my company
-Continue to exercise and lose weight
-Try to strip down even more of my belongings and become more minimal.

[thrifty++]

Wow thats a big meaty jump in net worth again and it must feel like a milestone hitting 200K!

I have a second job as well. But its more a problem they want to give me too many hours and I don't want to work too much as I need some time for life. I am trying to get as efficient as I can so that I can do more work for them more quickly.

[Star*Bucks]

May 2016 Update:




Current Debts:
Credit Card $143
Auto Loan $8,885



Current Assets:
Cash $2,654
Main 401k $90,561
2nd 401k $1,518
IRA $22,828
HSA $6,952
Home $70,000
Car $21,139

Prior Months Net Worth: $200,339
Current Net Worth: $206,624

Net Worth Increase of $6,285

This will have to be a quick update. I ended up working less than 32 hours at my 2nd job the entire month of May, I wish I could have done more. I made a little change in my 2016 annual plan. Previously I was going to pay my car off as soon as possible but then I decided not to because I’ve already paid off about 60% of the original amount and because I have a favorable interest rate. After doing some number crunching I decided it would be better to start building an emergency fund, a separate travel fund because I’m definitely going to take a well deserved and long overdue vacation, and I want to have the money saved up to be able to fund 100% of my 2017 IRA & HSA right away in January 2017. The only way I could accomplish all these things would be to let go of the burden of trying to pay the car off quickly. Initially I would have paid it off in about 7-8 months but now it will be about 13-16 months; still not bad.

I transferred a little over 1k to an online bank for my travel fund and they have several days hold on the money which is why it is not showing in the Mint screen capture. Also I had a few hundred dollars gain in my 2nd 401k plan which was really nice as well.

This is the 4th month in a row that I’ve had over 5k net worth increase and it makes me happy but I am also mentally ready for the overvalued stock prices to drop; I’ve got that feeling. Also dividends are paid out next month so here’s hoping next month can be another 5k+ NW increase.



Goals for the month of May 2016 were:

-Apply for quality jobs with high pay scale or attract clients to my company (SO-SO)
-Continue to exercise and lose weight (actually gained back 3 pounds but still working out)
-Try to strip down even more of my belongings and become more minimal. (Didn’t have time)


Goals for June 2016:

-Stay out of this heat and enjoy life. No expectations whatsoever….