Each month, I break down my finances and financial progress. This serves primarily to keep me accountable. I hope it also helps others see the power of an income centric approach to early retirement investing. Today’s report covers the month of November 2018 with year to date updates.
music selection: “I’m So Excited” — The Pointer Sisters
Wells Fargo (taxable): This finished the month at 28,124 up from 27,992 at last month end. That is a 0.47% monthly gain. Year to date, this account is down 2,557 or 8.33%.
Interactive Brokers (taxable): Here I finished the month at 239,105 down from 251,041 last month. That is a monthly loss of 4.75% and a year to date result of minus 26.17%. There is no putting lipstick on the pig. The recent market volatility hit me hard.
Interactive Brokers (tIRA): This account is up to 158,135 from 157,707 last month. The monthly gain is 0.27% and my year to date result is a 3.29% loss. The account is narrowly trailing the benchmark.
HSA: This account is up 137 on the period to 3,335. That is a 4.30% move in the right direction. For the year, I am down 115 or 3.33%. This account is expected to decline a few percent a year (excluding new contributions) as I spent from it for doctor’s appointments and medication.
Checking: Cash is down to 8,745 from 10,904. That is a 19.80% decrease from last month. Year to date cash has changed by minus 27.20%, driven by spending and transfers to HSA.
Total investable assets come to 437,444 down 2.97% from 450,838 last month. The year to date mark is minus 17.4%. I am down versus the S&P benchmark including after deducting spending.
Don’t forget to see the long term trend at Lizard King’s Transparency Page.
Income tax: I have a 12,945 tax asset on deposit with the service. Because of the mishap with UVXY, I expect to have a trivial tax liability this year and should even qualify for the maximum ACA subsidy. Net tax rate could be negative for 2018.
I have automatic withdrawals from my taxable investing accounts set to provide a cash income of 25,000 a year. Against a liquid net worth of 437,444 that is a withdrawal rate of 5.72%. I earned 2,883 in options premium income during the month of November and am on pace to earn 38,103 in options for the year or 1.52 times budget. Additionally, my income centric approach to investing includes 30,501 in expected distributions, dividends, and interest for the year or an additional 122.00% of budget. In the event of a downtown, I should be immune to the need to “sell at the bottom”. At the same time, I can expect steady and robust growth to keep ahead of inflation. Together, my budget is covered 2.74 times over by portfolio earnings. This is a great comfort as the portfolio balance declines with the market correction as I am not obligated to sell shares into a downturn to meet budget.
Spending was 2,024 for the month, which is just over the 2,000 target. Year to date, I have spent 23,996 and am pacing 26,145 for the year. That is 1,145 over budget. Driven largely by 5k+ spent on Stansberry Research products. I should not need to purchase more advice in the future thanks to my flexible Choice membership.
I earned 150 this month or 138 after payroll taxes for my efforts at the Memorial Hills UD municipal water board. It is a small amount but over a year’s time it adds up to another full social security credit. This should improve my eventual payout when I reach qualifying age.
Devour your prey raptors!