Sorry for the triple post! Just realized I didn’t include charity in my numbers in my initial post (adding now) or talk about it. I decided to start tracking my charity net worth in April 2020. I have no idea what cumulative amount we gave before then but I feel really encouraged watching the amount we give grow. I just add up monthly donations and track in a spreadsheet. I don’t consider political or religious donations part of charity for my tracking. I feel those are things that benefit me and are all about my choices and my opinions, rather than helping all people in need indiscriminate of religious or political views.
Our regular donations are at $300.75 a month right now, but we do some one-offs on top of that. Our current charity net worth is: $6,444.25. Very interested to hear how other people set charitable giving amounts, etc.
100% same. We keep $20-30k in cash, then another $25-30k invested post tax. Considering we’ve had years in the past where we spent 20% of our income on medical (IVF isn’t covered by most insurance), and the first year of Latte’s life was many thousands out of pocket, I just feel considerably safer having massive wads of cash available at a moments notice lol. Rational? Maybe not, we have huge credit limits and could pay stuff off quickly, not to mention special rules to withdraw from IRAs . But that helps me sleep at night.
Just a thought - Roth IRAs are after tax and you can withdraw the contributions at any time. Gains are not taxable if taken after 59.5. They occupy the same space as traditional IRA (the difference tIRAs are pre-tax) so max 6,000 (is it 6000 now?) between both, and have the same restriction of being able to withdraw gains without penalty (I believe - and there is a difference between pre-59.5 withdrawls and post- 59.5 withdrawls as relates to penalties; also once you have the account open for 5 years you can use earnings for certain things without penalty (you do pay taxes on them), including first time home buying, certain education expenses, and medical expenses. But better than after tax investment accounts because you don’t pay tax on the gains after retirement, at all, and you never lose access to your contributions.
When I was first saving for a house I used a Roth IRA but never ended up needing it, and it has over 100k in it (some of it is gains). All of the contributions are immediately and without penalty or taxes available to me. Using the Roth IRA contributions is part of my FIRE strategy, if I end up stopping working again before 59.5 or make less than my expenses. I am currently (this year) adding to it before making any contributions to my 401(k). I loose a tiny bit in match but gain freer access. (I may do 401(k) contributions after I hit the IRA limit.)
You know, when I first got started it was because I was a dummy. I opened a Roth IRA and a taxable investment account in college because I had read vaguely about them online or something, and contributed tiny amounts to both. Once I started working fulltime I maxed out retirement accounts first, then overflow to taxable.
In retrospect it was useful to (1) start another investing habit and (2) grow heaps of money that I tapped in my 20s and 30s to fund a passion project and a down payment. If you expect lump sum expenses before retirement, it could be worth diverting a little to post-tax savings for these purposes.
Thanks for the info! This is definitely something to think about. My husband’s IRA is a Roth, so it’s nice to know we could potentially pull from there if need be. When I start contributing to an IRA again I’m also opening a Roth, as my current IRA is a Traditional (for reasons that made sense at the time). I guess my question is can you set up a Roth IRA as a joint account? You don’t have to answer, haha, I can look it up. It’s just that in my ultra risk averse mind I’m imagining a scenario where one of us is incapacitated and the other needs access to the money. I want this emergency money to be equally accessible to both of us. Hm…will look into this now…
Hm, I don’t know about the joint account aspect. I suspect no, since technically it is an investment vehicle, but I don’t know? But maybe if you have power of attorney stuff set up (for just such an occasion) you might.
Definitely look at the details but it is I think valuable in that it is a bit more flexible than 401(k) or traditional IRA! Oh, and you definitely can have both as an individual, because I have a traditional IRA as well (which, once I started making more money I used instead, for the tax benefit). The only restriction is you can contribute up to the limit in both (combined) each year (so 6000 total if that is this year’s limit).
FWIW, I have my IRA accounts (and a taxable one also) in Vanguard - it’s very simple to set up there and manage. (My 401(k) is at a separate institution.)
I’ve been tracking my finances since 2003! At the time, my net worth was close to negative $21k (over $10k credit cards and $20k in car loans, though I sold a car to a friend, acted as a bank, and was owed ~$8k.) 2004 was actually a bit worse as I rang up more credit card debt approaching $15k, but then I started to turn things around.
Sometime in 2006, I broke $0 and my net worth increased every year since then, except 2011… during a relationship based largely on image and status, and during which at one point I owned two Acura sedans…
In 2014, I finally met the right woman, and in 2015 we married, so that’s where my chart begins! I have long considered myself extremely fortunate. While growing up in a (low0 single income large family, I found a computer in a pile of trash, and got to try my hand at BASIC in a special program in elementary school. While I dropped out of college (with less than $9k debt), I kept learning how to code, and ended up doing well with web development. My wife is naturally frugal and helps keep my spending in check, though I still sometimes take advantage of my luck to make life more cushy.
I bought my first house in 2007, and sold it last year, which helped pad the taxable investment account. Before that, I had similar concerns that we would only have pre-tax money, but now that concern is largely behind us!
It’s been a steady climb, though as more makes it into investments, you can see the impact the market indices have on our net worth. The first obvious dip was from how 2018 ended, and the next big dip was in March 2020. (Just before that is the net gain from selling that house, which I had recorded as only being worth its 2007 appraisal…)
Yes, I have my mortgage as a liability and my appraised value on sale as an “asset”. Although interestingly I do not track my car loan or it’s asset value- I didn’t want to add a column on my spreadsheet, and cars come and go for us lol.
ETA so yes I count equity, but a conservative number for it.
I graduated from grad school in 2014 and started paying off student loans. You can see that I got a better job in 2016, and then you can kinda see that I found MMM in late 2017 and started getting really serious about savings in 2018.
The vast majority of my net worth is in investments; about $25k is cash and the rest is mostly index funds, split between a 401k, a Roth IRA, and an HSA. I still have just under $15k of student loans and do not own real property.
Ooo I don’t have beautiful graphs over time…I think I have net worth for the last couple years that I could piece together though.
Having just bought a house, I now track “liquid net worth” and “total net worth”. In the total, include the mortgage as liability and the purchase price as an asset. At some point I might get fancy and pull in the current Zillow estimate but until the market cools off I probably will just stick with the purchase price.
I’ve got one I started when I ran out of patience with Mint making stupid errors and erasing history I’d rather keep…now I mostly do a quick check-in around the end of each month at the same time as I review purchases for weirdness.
Blocked out labels are just employer stock/employer retirement since they’re named. And the Roth jumped like it did since while I’ve been backdooring into it for 10+ years (easy to do if you don’t already have untaxed money in a Trad IRA), my workplace just enabled the megabackdoor option last year and I’m taking advantage.
ETA: I track the mortgage as a liability (it’s just called ‘house’) but I don’t count its value as part of my net worth since it’s not actively making money unless I’m renting out rooms and if I sold it I’d still have to live somewhere.
I couldn’t decide what to track, so I tracked 4 different things… I don’t generally worry much about my student loan balance as payments are income based, and there’s a decent chance that if FIRE goes to plan I’ll never pay them off anyway (they are written off after 30 years).
This starts in my last year of university, then things start happening in 2018 when I got a real job. there’s been a real spike this year because I’ve had a fair bit of bumpy income (the company I work for got acquired so some big tech bonuses etc. are floating down). Income has been between £35k and £52k over the three years. I’m renting a room at the moment - I have a big chunk put aside in cash savings accounts for a possible down payment for a flat, probably in a year or two as I’m happy with my living situation for now and may as well save while I can (and hope I don’t get priced out of the market…).
I’m attempting to balance pre-tax pension and post-tax ISA saving so that the maths works out if I start withdrawing post-tax income in about 10 years, though it feels like a bit of a guessing game.
I really love your idea of a charity net worth @AllHat ! I had a similar realisation a few months ago that I felt like I needed to be tracking it in order to make it a priority. I just have a yearly tracker at the moment. I’m aiming to donate £6000 (which is the max that I can get matched by my company) by the end of the year - I’m a little behind because I only started in March, but have a nice tracker going (or rather, I did, before I spilled tea on it).
