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Monthly Financial Snapshot: March 2018

So I managed to make it through the busy part of the year alive and in one piece. Besides work, March was a pretty uneventful month, except for the markets. Market volatility seems to be here to stay, which has the potential to mess up the steady, even progress I had been enjoying up to this point. I still haven't lost enough in one month to outweigh the new contributions and thus cause a month-to-month decrease in Net Worth, but I'm sure that day isn't far off.

I did manage to execute a rollover of my after-tax 401(k) sub-account, better known to some as the so-called Mega Backdoor Roth. I had been putting this off for some time because I didn't know how complicated the process would be. Turns out all it took was a single phone call to my company's benefits hotline and they took care of the rest. By doing so, I was able to move my after-tax (non-Roth) 401k contributions and its associated earnings (about $40,000 in all) out of my 401(k) and split it into my Roth IRA (contributions) and Traditional IRA (earnings). The benefit of doing so is that any future earnings within the Roth IRA will be tax-free forever! This maneuver effectively sidesteps the $5,500 contribution limit to the Roth IRA and lets me put much more money in there. At a higher level, I think it's definitely not fair that only certain people with 401(k) plans which allow this are able to do it, and this loophole should either be closed for all or opened for all. Then again, if enough people knew enough and cared enough to pressure their congress-critters to make that change, maybe we would have a much better tax policy overall to begin with! </political rant> The bottom line is that I will continue to do this until it gets taken away from me or I retire, whichever happens sooner. It is also the reason for the shift in my progress chart from after-retirement to before-retirement.

All that being said, here's how my spending looked for last month:


CategoryMar-18Comments
Rent$768.75$750 for rent + $18.75 Plastiq fees
Internet$55.92Internet is kind of expensive.
Cell Phone$0.00Already paid for 1 year of service through MintSIM. = $15.51 / month!
Natural Gas$26.11Somewhat above average. Maybe this is the cost of frequent baking.
Electricity$21.07A little below average for the month.
Water$32.96Below average. Not sure why.
Groceries$241.71Above average. More meat.
Car Insurance$0.00I pay every 6 months in April and October.
Gasoline$67.14About average for the month. I have noticed gas prices have been going up slightly over the last few weeks.
Car Expenses$103.37Car registration.
Health$48.44Heavily subsidized, high-deductible health plans through my work. Includes health and dental. Also monthly gym membership.
Other$0.00Nothing this month.
Necessary$1,365.47About average for the month.
Restaurants$0.00Nothing this month.
Entertainment$3.99Went to see Ready Player One this weekend. Book was way better, but still entertaining.
Shopping$0.00Nothing this month. First zero shopping month since December 2016!
Travel/Parking$1,102.63Booked a trip to see family in a couple weeks. Also bought a ton of IHG points during a sale (effectively 0.45 cpp).
Gifts/Donations$15.17Birthday gift for my mom.
Software/Games$52.43Renewed my VPN subscription for 2 years.
Business$1,247.10Inventory
Other$0.00Nothing this month.
Discretionary$2,421.32Far above average, mostly due to travel and business stuff.
Total Expenses$3,786.79My spendiest month since January 2017
Gross Income$23,974.82Annual bonus, overtime pay, 3 paycheck month, business income, state tax refund. Perfect $torm!
401(k) Match$309.75My company matches 3% of gross salary
Taxes$8,668.10Lots withheld on my bonus, plus I made my Q1 tax payment early.
Net Income$15,616.47Still pretty high even after the higher spending and tax payments.
Savings$11,829.68Higher than normal, as one would expect.
Savings Rate75.75%Only slighly above average. High income can be offset by high expenses.
Net Worth$213,134.61NW went up even though the market was slightly down for the month. High savings overpowers a lackluster market!

Projected time to FI (assuming 6% growth and 4% withdrawal rate): 5 years, 6 months.

Comments

  1. This is awesome to hear you can do a Mega Backdoor! Thanks to you I’ve figured out how I want to save. I’ve setup my 401k to max out this year and a till working on contributing to 2018 IRA (just made 2017 haha). I’ll definitely have to call my benefits company too when I get to the point where I have more savings to execute a MBR. Enjoying the market roller coaster but hope it smooths our soon!

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