My main goal was 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 last year and my 1500 Days are over, but in the interest of openness, I’ll continue to share my numbers.
Our 7-year-old is very expressive. Here she is eating Costco pizza. I admit that the pizza isn’t that great, but from the look on her face, you’d think that we were feeding her rat poison:
She is also expressive in her art:
I didn’t know this about rhinos:
A couple week ago, she presented Mrs. 1500 and I with this piece:
- Me: What is this?
- Child: It’s beer! You and mommy like to drink beer!
- Me: Oh, ok, thanks?!??
- Child: Are you going to hang it up on your office wall with my other art?
- Me: Ummmmmm….
First, we don’t drink beer out of a glass that looks like that. Our child calls all adult beverages beer. Her art was a picture of one of Mrs. 1500’s wine glasses.
But that is one small detail. The real issue is this:
Let’s back up a minute…
Before I left my job, I led a disciplined life. Some of my rules:
- No alcohol Sunday – Thursday: I wanted to be in top form for my job.
- Regular exercise: I’d workout at least 3 days a week. I’d alternate between running, biking and P90x.
- Semi-normal bedtime: I’d try to have the lights out my 9 or 10. I wasn’t very good at this one.
And I only thought my routine would get better when I left my job in April. I had big dreams:
- I’ll get myself in the best shape of my life!
- I’ll have loads of time to read!
- I’ll have the lights out at 9pm every night.
It didn’t quite work out like that.
Events related to early retirement conspired against my plans.
First, I went on a lot of trips:
- I went to Wisconsin.
- Then on to Florida.
- Wisconsin again.
- And then over two weeks in Minnesota, Michigan and Wisconsin again.
On vacation, I tend to let my routine slip. And slip it did.
And then my freedom allowed for more social gatherings. Many of these took place at local microbreweries.
The fun came to a head on the 4th of July at our friends’ annual party. I decided to copy a local restaurant and make beeritas. A beerita is a margarita plus beer. I forgot to take a picture of one of my creations, but here is one at the restaurant:
By now, you probably think that I have no liver. It’s not that bad. On most days, I have zero drinks. But I’ve been having more than I had when I was working.
I fell off the discipline-wagon and landed on the beerwagon.
Now, it’s time to get back to a healthier place.
More biking, less beering.
More P90x, less pizza.
More kettlebells, less kettle chips.
You get the picture.
Except for that trip next month to see the Mad Fientist…
— Mad Fientist (@madfientist) June 23, 2017
Performance Update: June
June was a down month. Our portfolio started at $1,405,617 and ended at $1,404,233 for a small loss:
Down ~$1,000? This is the most boring performance update ever:
Earnings season is upon us, so next month’s update should be more exciting. I believe in indexing now, but my portfolio is still a throwback to my days as a stock-picker:
Because I have so much money in individual stocks, my portfolio is volatile. Earnings season is a roller coaster.
2017 (as of 7/1/2017)
- Days elapsed: 181
- 2017 gains: $147,105 (including 401(k) contributions of $44,000 and car purchase of -$45,000)
Since the start (1/1/2013)
- Days elapsed: 1641
- Portfolio gains since 1/1/2013: $818,190
- Needed to quit work ($1,120,000 in investments): Mission accomplished!
- Net worth: $1,859,233 which includes:
Diversification through Real Estate
We now have a $364,671.23 in private loans ($314,671.23) and syndication ($50,000).
Private loans: The $314,671 in private money is comprised of 4 loans. They bring in $2,525/month or $30,300/year. Three of these loans are 1 year in term at 10%. The other is longer term and we earn 8%. I love these numbers and these loans. We’re going to close on another private loan soon.
My long term goal is to have my money evenly split between real estate and index funds. This will allow me to have some fun reallocating money. For example, if the stock market took a drop of 50%, I’d direct more money to VTSAX.
As conditions stand now, I’m throwing money at private loans as fast as I’m offered them:
Syndication: I have invested $50,000 in one syndication deal. The return is variable, but if projections are on target, I’ll earn over 10%. While this investment is young, it’s outperforming so far. I plan on investing another $50,000 in a separate syndication deal later this year.
All of these investments are funded through my self-directed solo 401(k), a tax sheltered account.
Discipline Equals Freedom
We’re halfway done with the year and it’s time to get back on track. No more screwing around. I’m giving myself until the end of the year to:
- Get my body fat down to under 15%: I’m somewhere between 20 and 25% now (5’11” at 166 pounds). I found a place near me that measures body fat percentage with water displacement (the most accurate method). Stay tuned for a titillating update in a future post before the end of the year.
- 50 push-ups: I used to be able to do this.
- 20 pull-ups: I’m up to 7.
Sorry, but in the name of transparency, there will be pictures. Sensitive readers, avert your eyes now:
- Finish decluttering: We moved from a 4500 square foot home into 1850. And we brought all of our stuff with us. We’re about halfway through a massive decluttering effort. My main enemy is the garage which despite what it looks like below, is light years ahead of where it was two months ago:
I look forward to getting life back in order. I don’t look forward to showing you more pictures of my skinny white torso, but I do it for you. Hey, stop laughing!
2017 is halfway in the bag. Where did the year go?
- Did you make resolutions and if so, how are they going?
- How would you rate your 2017 so far?
- Do you have any big goals to complete in the next 6 months?
*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. 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.
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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.
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