PoP Balance Sheet – September 2015

Welcome to our September 2015 Balance Sheet!

We use the structure of a monthly income statement and balance sheet in tandem to make sure we are keeping our expenses low and planting our pennies wisely. If you’re not already tracking your finances using these two methods, go to mint.com and get started today! If you have any questions about how we do this just post a comment and we’ll be sure to help!

The S&P500 dropped another almost 3% this month.  Though we had a decent month in terms of income/spending, we weren’t quite able to counteract all of the market’s downward inertia, and our portfolio saw a drop as well.  On the bright side, we were able to buy shares at lower prices!  =)

There wasn’t a whole lot else to note, just that Mr PoP’s 401K is officially maxed out for the year.  Mine happened a month ago, so there won’t be any more deposits into those accounts until January.  We’ll be putting whatever after-tax money that comes through our paychecks instead into our taxable accounts.

Where are we this month?

  • Our total assets down by $5.8
  • Our total liabilities went down by $1.0
  • Net worth went down by $4.7K 
  • Total net worth as of the end of September is $901.6K, which represents a 0.52% decrease this month.

And for the details…

dyerware.com


Assets

Stock Accounts

  • 401K accounts: $249.6
  • Roth IRA accounts: $155.8
  • HSA account: $11.1
  • Taxable Brokerage Accounts: $82.7
  • Total Stock Accounts: $499.2 

Real Estate (based on current market comparable sales)

  • Primary Residence $239
  • Investment Duplex: $140 – increased by $10K
  • Investment Residential Land: $80
  • Total Real Estate: $459.0 

Cars (values from Kelly Blue Book)

  • Car 2: $7.6
  • Total Cars: $7.6

Cash Holdings

  • Checking Accounts: $13.4 – have since moved $3K over to our taxable account
  • Savings/Money Market Accounts: $19.0
  • Total Cash Holdings: $32.4

Total Assets: $990.4 

Liabilities

Real Estate Loans

  • Primary Mortgage: $87.7
  • HELOC on Investment Duplex: $0.0 (re-advanceable)
  • Personal Loan – Used to Purchase $50K Duplex: $0.0
  • Total Real Estate Related Loans: $87.7

Revolving Credit

  • Credit Card Balance: $1.2
  • Total Revolving Credit: $1.2 

Total Liabilities: $88.9

Net Worth = Assets – Liabilities

Net Worth = $901.6, down 0.52% from August

 

Tracking Investable Asset Growth

This first graph shows the growth of our investable assets (net of any liabilities against them), and shows the distribution of the various equity classes we hold. Pretty self explanatory.

dyerware.com


 

How Many Years Of Spending Do We Have Saved?

Here I’ve taken the total of our investable assets for each month and divided it by the expenses (excluding our investment property expenses) for that month. The idea being that this shows how many years we could live off of those assets at that rate and gives us a better idea of what lifestyle inflation (or intentional deflation) can do to the relative value of our savings.

dyerware.com


It fluctuates in a much bigger range, because in high spending months (like February 2013 when we spent almost $7K paying off our car completely and February 2015 when we spent a bunch installing solar panels), the denominator is so much bigger. Because of that, it’s the overall trend we’re looking for.

Early Retirement Locale Index

Mr PoP wanted one more way to understand more viscerally how much we have in “investable assets”, so we’ve come up with what we’re calling our Early Retirement Locale Index. The basic idea is that we know how many years of savings we have at our disposal if we were to continue living in south Florida. (That’s the chart above.) But using the “magical” 25 years of savings necessary for early retirement, where would we have to move so that our current investable assets would cover 25x our COL adjusted current spending? (Note, this is purely for fun, we’re not intending to move. Don’t worry Mama & Papa PoP!) If you want to follow along, we’re using this Cost of Living Index from Expatistan, and using the average of the two big cities in south Florida on the list (Miami and Tampa) as our current COL index, which gets us 193.5. Our city isn’t on their full list, hence the average – but maybe yours is. Then we’re solving this equation:

Current Years Saved/ 25 = COL Early Retirement Locale / COL S. FL

12.51/25 = COL Early Retirement Locale / 193.5

COL Early Retirement Locale = 96.83

… which brings us to Ankara, Turkey!

When we saw Ankara as our ERLI city this month, our thoughts went to the 2 million Syrian refugees that Turkey has taken in since 2011.  Thoughts of early retirement seem pretty trivial compared to what they have gone through, eh?

Here’s our journey through the ERLI so far…

  • January 2014 – Delhi, India
  • February 2014 – Quito, Ecuador
  • March 2014 – Kiev, Ukraine
  • April 2014 – Chiang Mai, Thailand
  • May 2014 – Madras/Chennai, India
  • June 2014 – Colombo, Sri Lanka
  • July 2014 – Bangalore, India
  • August 2014 – Yerevan, Armenia
  • September 2014 – Skopje, Macedonia
  • October 2014 – Brasov, Romania
  • November 2014 – Prague, Czech Republic
  • December 2014 – Mexico City, Mexico
  • January 2015 – Zadar, Croatia
  • February 2015 – Kiev, Ukraine
  • March 2015 – Cairo, Egypt
  • April 2015 – Bangalore, India
  • May 2015 – Niteroi, Brazil
  • June 2015 – Nowhere!
  • July 2015 – Skopje, Macedonia
  • August 2015 – Recife, Brazil
  • September 2015 – Ankara, Turkey

 

How was your balance sheet in September? Where would your savings land you today?

11 comments to PoP Balance Sheet – September 2015

  • We are neighbors again! I also landed in Ankara, Turkey. I have a bunch of homework, so I haven’t written my September post yet. It’s amusing to me that the difference in our cost of living areas means that my savings are worth a similar amount to yours despite you guys having saved so much more!
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  • Lucas

    Yay for more shares at a lower price!

    You might know about these already (or have after tax 401k available), but the IRS changed the 401k after tax to Roth roll over rules so that after tax contributions to a 401k can get rolled directly to a ROTH on conversion. This is a huge backdoor for roth contributions without the income restrictions.

    http://www.bankrate.com/finance/retirement/after-tax-401k-rollover-to-roth-ira-rules.aspx

    My funding order list (for maximum tax efficiency) is now 401k Match, HSA MAX, 401k Pre-tax, Max IRA Pretax or ROTH (depending on eligibility), 401k After tax (to roll to ROTH), taxable investing.

    • ahhh, I think you’re talking about what Mad Fientist calls the Mega Backdoor Roth IRA? Where you add after-tax $ to your 401K, then roll it over immediately to Roth?

      It’d be great if we were eligible, but neither of our employers lets us put any $ above the $18K limit into our 401Ks. The explanation I got when I asked was that if I wanted to put after-tax $ in, I could do so using our Roth 401K option (but still subject to the $18K limit), but they weren’t changing the rules to let me put more than $18K in when no one else cared to. =P

  • That’s awesome and enviable that both of you have already maxed out your 401K accounts – great job! I missed those early locale places, too – looks like both of you are starting to have plenty to choose from! :)
    anna recently posted..Some ‘splainin’ to doMy Profile

  • Miya

    Sorry if this is a dim question, but how do you keep contributing to your IRAs when your income is that high (I assume your total income is post-tax)?

    • We contribute to Roth IRAs (our income is well over the deductible limit for a traditional IRA contribution), either directly if our income is under the Roth limit, or last year we did a backdoor Roth for the first time. This doesn’t get us any tax benefits now, but will in the future, so it’d be silly for us to invest in a taxable account to the exclusion of the Roth IRA and forgo this delayed tax benefit.