My main goal is to build an investment and cash portfolio of $1,120,000* in 1500 days**, starting from 1/1/2013 and ending in February of 2017. I made my goal earlier this year, 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 at the month of November when our net worth went from $1,469,096 to $1,600,058 (!).
Warning: Poem time!
Remember, remember!
The fourteenth of November,
The home appraisal we sought;
Exceeded all expectations and I know of no reason,
Why all of our hard work,
Should ever be forgot!
The Guy Fawkes poem doesn’t actually go like that. However, the fourteenth of November was an historic day for us. With one email, our net worth increased by over $100,000. This story started over three years ago.
Uglyhouse
We downsized our house in June of 2013. The path to FI had made me realize how silly it was to own a home that had over 4,500 square feet. We had rooms that had no other purpose than to collect dust. However, downsizing wasn’t easy.
We decided on a neighborhood in Boulder County, Colorado. Unfortunately everyone else in the world had the same idea; the market was hot. Every house seemed to get 3-5 bids on it within 24 hours of hitting the multiple listing service. It was frustrating. Very frustrating. And then we found:
The One
When I first laid eyes on Uglyhouse, my immediate thought was ‘No.’ Actually, it was more like:
NO!!!
The home was a foreclosure that hadn’t been maintained well in its previous life as a rental. It wasn’t pretty:
But wait, perhaps the inside was fantastic?!
Negative Captain:
I wrote the home off, but that night, I had a conversation with the wife:
- Me: I really hated that blue house on first impression, but maybe we could fix it up?
- Wife: I didn’t think it was so bad. You’re the one that hated it.
- Me: The Fannie Mae HomePath rules state that we must live there for a year, but we could fix it up in that time and then rent it.
- Wife: Let’s make an offer.
We wrote up a contract and it was accepted. Then, two things happened to vault the home to its current value:
1) A change of plans
We soon discovered that we liked the people in the neighborhood and also the low-traffic, dead-end street. We decided to stay. Since this would be a home we’d inhabit until our girls finish school, we also decided to expand the scope of the remodel. Instead of just refreshing the inside of the home, we popped the top and added a second story.
All of this work started way back in June 2013 and just ended in October. The remodel set us back about $100,000 and cost many, many, many weekends.
2) Boulder County goes nuts
An already hot real estate market got even hotter. Prices have gone nuts in Boulder County and the bidding wars are ridiculous. We’ve since made offers on a couple other homes (flips or rentals) and each has had at least 10 other bidders, many with cash.
What the appraiser said
I’ve always had two main numbers on the right side of the blog. The first is my investment portfolio. This is our stock market holdings, cash and two real estate investments (hard money and syndication loans):
The second number is our net worth which includes home equity, bicycles, cars, dinosaurs and the Guy Fawkes mask:
The home equity in that second number is what matters here. Up until the fourteenth of November, I had valued our home at $350,000. I thought I was being conservative, but I had no idea just how much I was actually sandbagging the value. We decided to open a line of credit on the house and part of the process was a full appraisal (not an electronic one). Here is what the appraiser had to say:
$460,000!!!
Life is good.
Performance Update
My portfolio increased from $1,219,095 to $1,230,058 for a gain of $10,963. Despite those numbers, it was another losing month for my investments. I had money accumulating in my business account (which isn’t reflected in my numbers), so I transferred $15,000 into my personal account (which is reflected in my numbers). Without that, my portfolio would have gone down in value this month.
2016 (as of 11/30/2016)
- Days elapsed: 335
- Days remaining: 31
- 2016 gains: $172,097, (including 401(k) and some after tax contributions of about $45,000)
- 2016 401(k) contributions: $51,000****
Since the start (1/1/2013)
- Days elapsed: 1428
- Days remaining: 72
- Gains since 1/1/2013: $644,015
- Needed to quit work ($1,120,000 in investments): Mission accomplished!
- Net worth*****: $1,600,058
Stock Picking Experiment
So, there is still a tiny little part of me that clings to my old stock picking ways. I don’t like this, so I designed an experiment to break this habit. Like most stock pickers, I’ll probably underperform the S&P 500; thereby squashing my desires to play with Mr. Market. I set up a little portfolio with $10,000 back in June. For a while, I was crushing it. And then, the election happened and my tech-happy portfolio nosedived:
I’m now getting crushed. Mission accomplished!
P90X-ing
My mailman has a neuromuscular disease. Perhaps he picked the wrong career because our neighborhood is a walking route and he struggles a bit. While he has an awesome attitude, I can’t help but feel just a little sorry for him when I spy him hobbling down the street. Thinking about his condition also makes me incredible grateful.
My 43 year old frame is in great condition. Besides a minor case of asthma which I’ve had all my life and two slightly torn knees, I’m in great shape. I have no aches and pains. I don’t get headaches. I hardly ever get sick. Life is good. My mailman or anyone else with MS would love to have a normal body. Since I do, I need to appreciate and respect it. Besides, all the money in the world means absolutely nothing without good health. I have vowed to keep myself in great condition from here on out. Aside from an occasional beer and pizza, I’ll do my best to stay fit until I buy the dirt farm.
I used to be in pretty great shape too. In my prime, I weighed 155 pounds and could bench press 230. I could also crank out 70 push ups and 50 dips in a row. I have since let myself go, but I didn’t realize just how much until I saw some pictures of myself in Ecuador:
I must remedy this situation ASAP. To do this, I’ve been putting myself through rigorous exercise routines; been running about 15 miles per week and doing P90X routines. I’ve also been eating loads of nasty broccoli.
And I must share the pictures. I hate posting them, but there is no way around it. I do it for:
- Transparency: It’s one thing to tell you I’m in better shape, but pictures are much more powerful. It is no different from me sharing my finances.
- Humiliation: Posting these is humiliating, so it’s extra inspiration to work harder. I wish I didn’t need external sources (you) to keep me motivated, but I’m not perfect.
- Inspiration: Maybe I’ll inspire a couple of you to join me in my fitness journey. Let’s keep each other motivated.
I’ve already dropped 7 pounds since Ecuador, but there isn’t much to be inspired by this month. Readers with weak constitutions, kindly avert your eyes.
Remember, remember!
The visit to Ecuador,
Where I maxed out my gut.
I have no desire,
To keep the fat I acquired,
It’s time to get cut.
*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 $48,000 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 and 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.
***This is an affiliate link. If you sign up, the blog (me) makes some cold, hard cash. Personal Capital is a totally free and awesome way to keep watch over your investments. It’s worth it for the fee analyzer alone. I would never recommend anything that I don’t personally use and completely believe in, so give it a try. If you’ve already signed up through the link, please know that you are a fine person of above-average intelligence.
****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 ($350,000 after the appraisal!)
- Cars
- Bicycles
- I’m on empty. Nothing clever to see here this month.
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*Only if your life is pretty bad to begin with.
So much going on this post Carl! Congratulations on the great jump in net worth, although just looking at the pictures you can tell the house is a million times better.
The photos are great. It’s smart to rely on external motivation. Are you familiar with the anti-bet where you agree to donate some amount of money to a group that you hate if you don’t meet your goal? I haven’t gone that far yet but I know it would motivate me.
But you may just inspired me to exercise this morning …
-Josh
Biglaw Investor recently posted…Tax Gain Harvesting: An Introduction
Anti-bet! Great idea! Or I could make myself have to bring up politics with some of my nutty relatives. Just the thought of that kills my appetite. Mission accomplished!
Time to sell the house, cash in, reinvest and rent…. Oh right, you are already Financially Independent without the house. In that case ENJOY IT, you worked hard enough for it to be in this pretty state (nice appraisal by the way, probably makes up for some of the hard work).
Good luck on the P90X, would be seriously impressive if you manage to get back to your old hay-days. Which certainly is possible if you see Mr. Tony Horton. Don’t forget that a healthy, primarily plant based, diet will very quickly amplify the results.
Team CF recently posted…November 2016 Dividend Update
Ha ha, yeah I’m not a die-hard fan of home ownership, but with children, I like the stability that it provides. Plus, my monthly mortgage, taxes and insurance payment on my 4 bedroom, 3 bath home is $1,200/month. Meanwhile, the guy in half of a duplex on our street (2 beds, 1 bach) pays $1,300/month.
Yep, I don’t eat meat much these days. I worry about getting enough protein though. I’ve been eating a lot of cottage cheese, eggs and beans.
No need to worry at all, you probably get way more than you need: http://nutritionfacts.org/video/do-vegetarians-get-enough-protein/
Did P90X three times, of which the last time on a completely plant-based whole foods diet/lifestyle. Never been as fit, and I never recovered as fast at that list time. It was an amazing difference, never expected the impact to be this big.
Team CF recently posted…November 2016 Dividend Update
Thanks for the information! I wanted to email you to discuss, but didn’t find a contact form on your site.
The house really does look great. All the sweat equity paid off. Congrats!
I finished up my deck several months ago and just waiting for final inspection. Contractor is slow as molasses, but I figure, if it can get approved in 2017, it’ll look better on my house record saying the deck was built in 2017 instead of 2016. Trying to look at the positives!
Sam
Woot, happy that your deck is finished! What’s next?
Yeah, very pumped. It has been a dream come true, seriously. I’ve always imagined waking up in the morning, stepping through some thick sound proof sliding glass doors, and doing a big stretch on my deck with a deep breath of fresh ocean air!
Not much left. Probably some landscaping in 2017, and a hot tub below the deck! 🙂
Sam
You paint a pretty picture Sam.
I am not shocked at your appraisal – you guys really transformed the place. Though I never thought it was as ugly as you guys claimed… you should have seen how bad some of the dumps we looked at were while in foreclosure! (Our current house included…)
Now I’m curious to see what you end up doing with that HELOC!
Mrs PoP recently posted…PoP Balance Sheet – November 2016
HELOC! Come on neighbor, sell me your house so I can Airbnb it. The PoPs will have a place to stay when they’re in town!
The transformation is amazing, and the house looks pretty good too. 🙂
When are you adding some investment properties to the fold? Continued success.
… Is that a ceramic llama with a V mask? I like it!
It’s funny, because when we were house shopping we actually found several houses that were uglier than your Uglyhouse–and we made bids on them! The market was hot here in our town as well and we were desperate to get a home in a decent area. We did end up with a bit of a fixer-upper, but it’s great that we didn’t have to rip it down to the studs.
Woohooooo!!! Congrats on that home value! That is crazy awesome that your appraisal shot up that way! Does that mean your taxes will increase, though?
Bravo for vowing to get in shape. I’ve gotten a little doughy myself, so I’ve been going to cardio dance classes. They allegedly burn up to 1,000 calories, but I believe it. I’m struggling to find the time to exercise along with everything else going on in life, but you just have to get rid of the excuses and Do It. I’m jealous of your schedule, which probably makes it a little easier to hit the gym. 😉
Mrs. Picky Pincher recently posted…When You Hate Your Job
A ceramic lama?? It’s a fiberglass apatosaurus!
Our taxes did go up, but property taxes are cheap here in Colorado, so it wasn’t a big hit.
And yeah, going part-time is the only way I have time to workout as much as I want. I’m already finding that I still don’t have enough time though!
Hey, glad things are going well this week. Sounds like getting rid of some of the work days and finishing the house has already given you some really good energy. I’ve definitely been enjoying hearing more from you here on the blog.
I’ve recently found a volunteer gig that is both helping and hurting the energy level. It helps because I really needed a connection to the community and people, but hey, one more thing, you know?
We’ll see how things play out – Chris O.
Thanks Chris for the kind comments!
“Sounds like getting rid of some of the work days and finishing the house has already given you some really good energy. ”
Funny you mention that. Today, I had to run some errands and I remember exactly where the car was in the parking lot every time. This never happens!
Nice work on volunteering! I hope to do the same sometime soon.
Oh, and I forgot to mention – this might not apply to you, but when I started eating a significant amount of vegetables at every meal, I dropped 10 pounds of fat. Think: a cup of spinach in my eggs, two servings of vegetables at lunch, stir fry at dinner.
Granted, we have totally different situations (not to mention bodies!), but I thought I’d bring it up since it was super easy once I got into the habit.
Thanks for the advice! After a couple weeks of eating mostly vegetables, I’m starting to turn a corner. I notice my cravings for crap food are diminishing. December will be difficult with the holidays, but I think I can still finish the month at a lower weight.
You guys are really killing it! And congrats on the weight loss. I know that feeling of seeing photos are wanting to make a change. I expect that to happen this holiday season, unless I successfully manage to avoid the camera 😉
Thanks Kate!
Wow that’s awesome!! Congrats on the house appraisal and the weightloss!! Also, you guys did an amazing job on the house! It looks completely different!!
Thanks Ning!
The transformation is breathtaking (I’m talking about the house, not you. You still have a ways to go). You guys did a stellar job and earned that huge bump in equity.
I’ve P90X-ed one time in my life. Though it was actually a P60X – didn’t make it all the way through. It was the fittest I’ve ever been, though 60 days in I _still_ couldn’t do a single goddamn pull up. I have wet noodles for arms.
Mrs. BITA recently posted…Why I Need to Be A Dolphin
Ha ha, maybe I should have put myself before the house instead? The bump in equity came with a bump to my gut.
P90X is pure hell. There should be a P45X just to get you in shape for the real thing. I usually feel like I’m going to toss my cookies for about 30 minutes after the workout is done.
Actually, there is already a prelude series of videos to P90X. P90X is meant to be a successor to the Power 90 program. For those who are interested, here’s a very good review of the Power 90 program: http://www.allworkoutroutines.com/power-90-workout-reviews
That renovation just blows me away. We put 30k into our current home reno over the last 4 years, but haven’t really touched the front of the house. Mr. Mt would love new siding (and the house could use it) but I’m burnt out on projects. Unless it’s broke, I don’t want to fix it in 2017. I want to focus on creating some additional self employment income so we can start a solo 401k of our own. =)
Ms. Montana recently posted…Toy Gift Guide
A solo 401(k) is wonderful! Let me know if you have any questions!
You’ve done a wonderful job on your house! In our market it’d probably go for at least 2 million. Not even kidding! Vancouver real estate is bonkers.
As for your weight, it’ts obvious from your structure that there’s a decent amount of muscle under there, looks mostly like a bloated gut. It should be no problem losing the weight you want, plus you’ve already lost 7lbs! That’s amazing. Tremendous work!
Vancouver Vanessa, I’ve heard about the market in your part of the world! Sounds like a great place to be a renter, yikes!
Thanks for the kind comments about my pasty white body. Hopefully, next month’s pictures are easier to swallow…
Wow, you guys did an absolutely incredible job on that remodel. I didn’t think the house looked so bad on the ‘before’ picture, but wow, what a transformation. Well done, and you guys deserve every bit of the sweat equity in that house. Congrats!
Thanks GM!
Ha! Those pics with the mask are awesome!!!!
I had some massive appreciation on my rental properties but so far haven’t added that into my net worth numbers. It’s all on paper anyway since I don’t plan on selling them.
ESI Money recently posted…Considering Giving
CO is hot, hot, hot. I wish I would have bought more in 2013…
I stick to my previous assessment of: “most beautiful house in all the land!” It’s really impressive! Well done! And nice work on the increase of the net worth and the decrease of the flesh portfolio (too much?).
Thanks Maggie!
You guys are absolutely killin’ it over there. Your house looks freaking beautiful.
Steve @ Think Save Retire recently posted…Why I refused to take a sabbatical and quit instead
Thanks Steve, life is good. Very good! Hope to meet up with you in 2017.
Awesome update. Nicely done! I’m with you on the weight loss. It happens quick. Thanks for the motivation on all fronts!
Thanks Heidi! Yeah, when you eat right and run a little, the weight melts off. I’m thankful for my fast metabolism…
Nice job on the house Carl! Looking nice. Do I understand correctly that you put in $100k in improvements and it’s now appraising $100k higher? How many years was the remodel?
Nice bump in net worth too. My portfolio seems to have done the exact opposite of yours after the election. I wasn’t very tech heavy (tech seemed overvalued to me), so I managed some really nice capital gains for the month. Up over 20% for the year.
We bought it for 175, put 100K into it and now it appraises for 460, so almost 300K higher. The remodel took 40 months. Without kids, it would have been less than a year. Despite all of the gains, I’m not sure it was worth it.
Love the house, and glad the purchase/remodel worked out so well! I’m sure it’s gratifying that all that work paid off in the end. And now you can kick back and enjoy the results!
Broccoli:
Preheat oven to 450 degrees F.
Toss the broccoli florets with the olive oil, garlic, salt, and pepper on a baking sheet. Spread them out and then roast, without stirring, until the edges are crispy and the stems are crisp tender, about 20 minutes or more. Depends on your desired crispiness.
I live in Broomfield. As light rail opens up and more businesses move to the north side of Denver you can just expect those housing prices to keep moving on up.
The house looks so much better. Great job! We plan to move into our rental home soon and start putting in more sweat equity… It will be a ton of work, but should pay off in the long run.
Good luck with getting fitter. I’m working on that too and I’m not looking forward to taking pictures of myself…
Good for you for starting now on your weight loss, instead of waiting until Jan. 1st. I’m right there with you.
I discovered this really good piece on periodic fasting that you might be interested in:
https://www.youtube.com/watch?v=VWtaLLjJzn4
Great numbers this year as a whole. Any predictions for the coming year in the stock market? Also did you have any plan updates to factor in for health insurance if you do retire soon?
The Dreamers recently posted…Dream Progress: November Financial Update