My main goal* was to build an investment and cash portfolio of $1,120,000* ($1,000,000 to retire on and $120,000 to pay off the house) in 1500 days**, starting from 1/1/2013 and ending in February of 2017. I made my goal in 2016, my 1500 Days are over, and I’ve left my job. In the interest of openness, I’ll continue to share my numbers.
I’m supposed to publish these performance updates every month. And now, I’m 3 months behind. That’s OK; you get a 3 for 1 deal today. April, May, and June all wrapped up in one.
Seeing Evil Rainbows
It’s been a good, but busy time:
Project House: We finally got our project house done and rented in April. It kept me very busy. I was still working on it 12 hours before the renters moved in. #ScopeCreep. We also found some problems with the home. You can’t run plumbing on an exterior wall!
Financially, it didn’t work out as planned either. We purchased it with a loan against our stock portfolio. Back then, money was cheap and our rate was a little over 1%. How the times have changed! Now, we pay 6.5% and I expect it to be 7% before the year is up. Oof.
We’re treading water. These numbers make for a poor investment and I’d be cursing it all, but our main reason for buying the home was to move into it after the girls have left the nest, so it’s not so bad. In any case, our Investment page now reflects the $50,000 in equity we have in the home.
Our plan had been to pay off the loan slowly. At 7% interest, we’ll pay it down a little more aggressively.
Bolt: We picked up a new Chevy Bolt! I LOVE having an EV. Not going to gas stations is glorious. However, the we didn’t live with the Bolt for even 3 months before an inattentive driver sailed through a stop sign and crashed into it. Sigh. It will get fixed if USAA will ever call us back. PS: USAA, your customer service is complete garbage!
Berkshire Hathaway: Road trip to Omaha!
Ramit: Mindy and I voluntarily appeared on Ramit Sathi’s podcast. Thoughts here and here. It was a grueling experience, but we’re in a better place now, so I’m happy that we did it.
Hawaii, LA, Las Vegas, Camp FI, 5K, July 4th, And Evil Rainbows
At the end of May, we went to Hawaii. It was glorious. We stopped in LA on the way back and a short time later, I went to see my family in Las Vegas. Soon after that, I went to Camp FI. This was followed by a 5k and then a big July 4th party. All of this left me completely exhausted. More exhausted than I’d ever been. On the evening of July 5th, I had an ocular migraine. My ocular migraine presented itself in the form of spinning, blinking rainbows in my peripheral vision. It was horrible and terrifying. Before I knew what it was, I had convinced myself that I had a brain tumor or multiple sclerosis or was near death:
AHHHHHH!!!
This caused me to have another terrible night of sleep which led to more sh*tty rainbows. Finally I figured out what was going on, got some rest, and the Rainbows from Hell went away.
I work hard, but apparently play even harder.
April, May, June
After a hiccup in April, the money train keeps chugging upwards:
- April: $3,861,599 -> $3,694,445 (-$167,154)
- May: $3,694,445 -> $4,089,141 (+$394,696)
- June: $4,089,141 -> $4,384,858 (+$295,717)
My portfolio lives and dies by Tesla. I don’t enjoy talking about this company because it’s a lightning rod for strong opinions. However, I must point out that Tesla is the reason for most of our gains this year:
$161 (stock gain this year) x 4,500 shares = $725,000
We’re not in Kansas anymore.
2023 (as of 7/1/2023)
- Days elapsed: 181
- Investment gains: $1,272,037
Since the Start of The Experiment (1/1/2013)
- Days elapsed: 3,833
- Investment gains: $3,798,815
It’s been an a great year. If it all holds (that’s a great, big if), this will be our best year yet for investment gains.
However zooming out, we’re still down from our all-time highs at the end of 2021. So meh.
We’re Done
Moving forward, we’re keeping it simple. We’ll wrap up our current home remodel, declutter, and coast. No more rentals or big projects. Time to rest.
More 1500 Days!!!
You can also find me (and the dinosaurs) at:
Mile High FI podcast:
Also here:
- Facebook: Facebook group and page
- YouTube: My channel is mostly devoted to home improvement, but I have some other material coming up soon too.
- Instagram: Pretty pictures of dinosaurs, sunsets, and nail guns!
- Twitter: Spontaneous, often insane, ramblings
- Coworking space: On the surface, MMM HQ is a coworking space. Look a little deeper and you’ll see that we’re really building community. The members of MMM HQ are some of the finest people I know.
*My goal wasn’t to have $1,120,000 at the end of 1500 days, but at any time before the day count was up. Why? It all goes back to the 4% Rule. Remember that our little friend, Mr. 4%, is nothing more than the most conservative safe withdrawal rate. Since my investment portfolio now sits at $1,550,000, I can spend about $62,000 in my first year of retirement.
**My original goal was $1,000,000 and no debt, I later raised the goal by $120,000 to $1,120,000 because I will have debt in the form of a mortgage and I firmly believe in not paying it off (LOOK at the MONEY I’m MAKING!). My compromise was to have enough money put away to cover the mortgage at the time of retirement.
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Nice work Carl! Hope you had fun at CampFI. Well-deserved to Coast, you’ve done more “worthy” work than many of us working folk at desk jobs!
Great. NOW SELL SOME Tesla SHARES.
Give the government what the government deserves (pay some capital gains taxes) and put the rest of the money in broadly diversified index funds.
Haha! My hypothesis for Tesla hasn’t yet played out:
I probably won’t wait until 2030 to sell, but who knows. I can see Tesla being the most valuable company in the world this decade. I can also see it bankrupt.
Most of what I’m banking on is that the world moves to electrification and that Tesla leads the charge**.
If I’m nuts, please call me out!
*Yes, Elon has been full of shit regarding this many, many times, but this time feels different. I’m no fool and still am not convinced Tesla ever nails it, but if it does, watch out***!
**See what I did there? 🙂
***Watch out for the stock to go bonkers, not to get struck by a robot car! 🙂
You’re so outrageously far ahead on Tesla, why keep eating the risk of having it be so dominant in the portfolio? What you would pay in capital gains taxes seems like a small price for getting rid of such a risky and portfolio-distorting single-stock bet. And it’s not as if you somehow need still more upside. If you think further upside isn’t that big of a risk, then you must have some rationale to justify Tesla’s stratospheric valuation; what is it?
Tesla is valued crazy high for what it does today, but if it accomplished everything it’s working on, the valuation is cheap. Of course, it’s risky and a very long-term play. I’m counting on Tesla figuring out the dry electrode process for batteries, becoming a major player in grid level energy storage, and turning it’s charging network from a loss-leader to a profit center. Autonomy would be crazy profitable too, but I’m not convinced Tesla will solve it.
Well done on a successful start to 2023!! It is interesting to watch the changes in your portfolio. Does it ever get any easier to ride the market swings mentally?
I’m not up to Carl’s NW, but I’m in my early 40s and I’ve been FI for over five years now. It definitely gets easier to ride the swings.
I’ve had several months with six figure swings and they create less excitement/stress than back when I was having four figure swings in my 20s. It’s probably a mixture of age, experience, and having more than enough at this point. I’m kind of curious how my dopamine/cortisol levels change now compared to 10 or 20 years ago.
Swings: We’re not in withdrawal mode yet, but it would give me anxiety to sell assets after a big drop down. When we are in withdrawal mode, I think I’ll keep more cash on hand to ride out crazy dips.
Thanks Carl and Travis – I appreciate both of those perspectives.
First time commentor – first got to say I have loved your blog over the years. 2nd congrats on your success.
I went to the Berkshire meeting for the 1st time this year and had a couple of core lessons I will never forget.
First is capital allocation. They always have 20% cash or liquid assets. Through thick or thin. Always. To ride out the unpredictable.
Second is they never overreach allocation. Case in point from the meeting was Geico. They have 15 Billion in premiums in Florida. That is out of 300 Billion across the country. They cap it at 5 percent so any bad Hurricane does not wipe them out. They could sell as much as they want in Florida. They don’t
My point here relates to a Morgan Housel quote. It takes 2 different skills, one to Get rich and then one to stay rich. Once you are rich it’s easy continue with what got you there which could include overreach. And then get wiped out by a long tail event.
Tesla is great. I just hope it fits in your capital allocation to stay rich
Hi Vader!
Glad you like the Berkshire meeting. Will you go back again?
Tesla/stocks: If it went to $0, I wouldn’t be happy, but it wouldn’t affect our life either. The older I get, the less I like owning individual stocks (just more to think about). By the end of 2025, we’ll know if Tesla solved their major initiatives (cheap batteries via a dry-electrode process and autonomous driving). I’ll reconsider the stock at that time. Even if Tesla fails at those initiatives, it still has a crazy lead in EVs. However, I wouldn’t value the company nearly as high.
Carl, In your comments on Tesla valuation, you address their vehicle lineup and FSD, but no mention of energy storage. This portion of the business has been ramping rapidly the last couple quarters and is generating real revenue at roughly 10% margin. Elon said years ago that the energy side would be as big or bigger than automotive.. I’m not convinced of FSD either, but FSD isn’t core to my Tesla investment thesis, nor his AI0Tesla Bot, though both could end up being huge. Tesla’s continued successful execution in the energy and automotive sectors alone is enough for me to want to hold the majority of my shares for at least the next 3 years, probably longer. I put Tesla’s current risk of going bankrupt at near zero. I’m prepared to lose half the value of my Tesla shares in a worse case scenario in order to be on board for the coming years.
Hey Justin!
I think storage could be huge, but I worry about it too. Storage is just a box of batteries with some software that figures out if electrons should be flowing in or out. A company that can produce shit-tons of batteries will have an advantage. Right now, CATL is a lot better at making cheap batteries than Tesla. CATL also has an energy storage solution.
But, Tesla may have a couple of things going for it:
1) Just like EVs, the market for energy storage is massive, so maybe there is room for everyone, at least for a while.
2) Perhaps Tesla is close to getting the dry electrode process perfected. We already know they solved it for the anode. Last time someone tore apart a 4680, the cathode (much more difficult) was still a wet process. I’m really curious to see what a generation 2 4680 looks like.
I also wonder if Tesla has plans to produce a LFP or better yet, LFMP battery. It seems like this chemistry is the future, especially for storage.
Agree that the battery storage market is pretty commoditized, but also agree that the demand for storage will be so huge for the foreseeable future (decade at least) that it won’t matter. Anyone that can put a competent product into the market will sell every unit they make at a reasonable profit. I would also like to think that Tesla, as with their cars, will differentiate their storage products with their software engineering prowess and their ability to service the grid at a granular level in real time. I suspect the IRA also gives Tesla an advantage as the only domestic supplier of commercial scale energy storage. And, perhaps foolishly, I still hold out hope for mass production and affordable pricing for the solar roof.
Can’t wait for the earnings call on Weds. Taking a little profit in the run-up just in case margins fall short.
I will be going back to Berkshire. It was a good time to sit back and evaluate the big picture. In our day to day it can be easy to not ask the big questions. And the Berkshire meeting at some level sets your thinking back to the basics. Got to say I was impressed with their small home town attitudes
As I get older, about the same age as you, I lean more and more to targeting the 5 percent returns. More is just more after a while. And 5 % is more than enough when the pile is big enough.
It is tough to switch gears to that 5% goal but as I get older risk get more painful