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 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.
Put A Fork In 2017
If you had asked me on 1/1/2017 what the year would look like from an investing standpoint, I would have told you this:
The S&P 500 will end the year lower.
Whoah, I couldn’t have been more wrong! Including dividend reinvestment, the S&P 500 was up almost 20%:
And my own set of stocks did even better. My top 5 holdings clobbered the S&P 500:
- Facebook ($261,000): 53%
- Amazon ($86,000): 56%
- Google ($82,000): 35%
- Berkshire Hathaway ($78,000): 22%
- Tesla ($57,000): 46%
I’m a big believer in index funds, so I don’t buy individual stocks much anymore. If I could move my stock holdings into an S&P 500 index fund and not pay capital gains, I’d swap out almost the whole portfolio immediately. However, taxes are real, so I’m slowly selling off these assets.
One thing I never try to do is time the markets. Regardless of market conditions, I’m always deploying money at the earliest opportunity. I do this for two reasons:
- Over the long term, the stock market goes up more than it goes down. I’m just putting my money on the right side of the odds.
- Even if market valuations are high (like right now), over the long term (I have decades of life left), corrections are just little blips. For example, if I cherry-pick the worst time period during the Great Recession, the picture is terrifying:
However, if you left the markets in 2009, you would have missed one of the greatest bull runs ever:
Over the long-term, the picture is even better:
Performance Update: December
Up up up the markets went and my holdings went along for the ride. My investment portfolio went from $1,518,363 to $1,527,701 for a gain of $9,338. My net worth went from to $1,983,363 to $1,992,701:
And 2017 was a magical year. My investment portfolio started at $1,257,128 and ended at $1,527,701 for a gain of $270,573. This includes $44,000 in 401(k) contributions and -$45,000 for a silly car purchase.
The $270,573 in all that we need to live very comfortably for 5-6 years. This feels good.
And my net worth went from $1,627,128 to $1,992,701 for a gain of $365,573. This gain is $100,000 more than the portfolio gain because of home appreciation and the car purchase.
Of course, the investment gain is on paper only. There will be years when I end lower too. However, I’m only 44. In a crazy sort of way, I feel like I’m just getting started. In the years to come, I’ll surely have returns that are much better than 2017. Never forget this:
The bigger the snowball gets, the bigger the snowball gets.
Life is good.
2017 (as of 12/31/2017)
- Days elapsed: 365
- 2017 gains: $270,573 (including 401(k) contributions**** of $44,000 and car purchase of -$45,000)
Since the start (1/1/2013)
- Days elapsed: 1825
- Investment portfolio value: $1,527,701
- Portfolio gains since 1/1/2013: $941,658
- Needed to quit work ($1,120,000 in investments): Mission accomplished!
- Net worth: $1,992,701 which includes:
The new year is here and markets continue to soar. They won’t do it forever though. Just like 2017, if you asked for my opinion, I’d guess that the S&P 500 will end the year lower. However, a guess is all that it would be. And if 2017 is any indication, I’m a crappy guesser.
*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 $60,000 in my first year of retirement. I’d stick way that number too because market valuations are ambitious. And I just don’t need to spend $60,000 per year.
**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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