My main goal is to build a portfolio of $1,120,000* in 1500 days**, starting from 1/1/2013 and ending in February of 2017. I made my goal a couple months ago, but believe that it’s a worthwhile exercise to continue with my financial updates until the end of 1500 Days, so I continue.
It’s time to take a look back at August. But first, I’ll discuss something I’ve been thinking about for a while: uncertainty.
The Interview Question that I Hate Most
I always despised this question in job interviews:
Where do you see yourself in 5 or 10 years?
Because I’m pathetic, I’d make up something that I thought the interviewer wanted to hear:
I see myself in positions of increasing responsibility. Maybe I’ll be a team lead or system architect.
If I were honest, I would have answered:
I’d like to be doing exactly what I do now; writing code. I have no aspirations to do anything else including designing systems or management of any kind. And I really mean that last part. I never want to manage anyone. Ever.
If I had found the path to Financial Independence, I would have answered:
If I’m still spending 8-9 hours a day in a 36 square foot cube, going out for “happy” lunches when a co-worker has a birthday, sitting through annual performance appraisals, hoping that I don’t get fired when the CEO does something stupid and sales crater, I’ll have considered myself a failure.
If my life works out how I planned, I have no idea what I’ll be doing. Whatever it is, I won’t be doing it here.
The Joy of Uncertainty
I love uncertainty. Before I explain, there is one important and crucial exception:
Not money uncertainty.
I have extreme money insecurity issues. I want my finances to be secure. Never forget that the best part of having enough money is that it frees you from having to think about it.
Now that that’s out of the way, this thought makes me smile:
I have no idea what my daily routine will look like in 5 years. I have no idea how I’ll spend summers or other breaks when my children are out of school. I don’t have a clue what projects will consume me or what new passions I’ll discover.
Uncertainty is a scary word, but what it really means is options. And freedom. Hold up, I feel a graphic coming on. Boom!:
Perhaps Robert Frost said it best:
Two roads diverged in a wood. I took the one less traveled and that made all the difference.
Meh (more patheticism [yeah, I just made up that word])
August wasn’t a spectacular month, but my portfolio did go from $1,200,350 to $1,211,898 for an increase of about $11,000. Reading that sentence, the one before this one that I just wrote, is amusing. I gained $11,000 in a month and I’m like:
I remember when I started investing and would do cartwheels when my portfolio was up $100 in a month. Now, I’m a total jerk because I’m up $11,000 and I clearly don’t appreciate it.
Of course, this is the nature of humans. We get used to our place in life and need bigger and better things to make us happy – the hedonic treadmill. I need to back up a second; maybe all is not lost?
Do we really need bigger and better? What about different instead? An FI life, free from the constraints of work, allows you to do whatever you want. When something stops moving the emotional needle, move on to another challenge. You shouldn’t do this with money, but once you have enough, you shouldn’t be thinking much about it anyway.
So yes, I embrace the uncertainty. I have no idea how I’ll fill in the blank pages of my life’s book. And I would have it no other way.
It’s time to get on with the performance update.
- Days elapsed: 242
- Days remaining: 123
- 2016 gains: $153,937 (including 401(k) and some after tax contributions)
- 2016 401(k) contributions: $51,000****
Since the start (1/1/2013)
- Days elapsed: 1337
- Days remaining: 163
- Gains since 1/1/2013: $625,855
- Needed to quit work ($1,120,000 in investments): Mission accomplished!
- Net worth*****: $1,461,898
Life has taken some interesting turns recently:
- We are 99.9999% done with the house. The bank will appraise it soon and with any luck, will increase our line of credit.
- We moved $270,000 to a self-directed solo-401(k). I don’t have time to write about this now, so tune in for a future update.
- Free time! Since we moved into our fixer-upper home in June of 2013. Unless I was traveling, there hasn’t been a weekend where I haven’t worked on the rehab. Now that it’s thisclose to being done, I’m going to have loads more free time. I’ll now be able to work on stuff I’ve been planning for years.
I like uncertainty. However, I am certain of one thing: Life is good.
*My goal isn’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. So, if I were to quit my job now, I could spend about $44,000 in my first year of retirement. I’d stick very close to that number too because market valuations are ambitious. Let’s say that Mr. Market caught a cold tomorrow and my portfolio dropped down to $800,000. No big deal. This would mean I’d be safer stretching my spending a little north of 4%.
**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 which I firmly believe in not paying it off. My compromise is to have enough money put away to cover the mortgage at the time of retirement. So, to retire today, I would need about $1,120,000.
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****My 401(k) contributions include my own, Mrs. 15oo’s, and the contributions from my corporation. Self-employment with a solo 401(k) is a very powerful savings tool. I should have done this years ago.
*****The numbers on the right side of the page only reflect my investments and cash. Net worth includes, but is not limited to:
- Home equity
- Our San Diego FinCon memories!: OK, memories really aren’t worth anything at all. However, we had a wonderful time in San Diego hanging out with our Financial Independence pals.
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