Just when you thought the New Year would be different: Millennial Couple’s Net Worth Tumbles to +$7,000
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First 31 days, straight shenanigans!
After the most depressing New Year’s Ball drop on ABC, I really though the worst was behind us. However, just like a bad hang over from drinking too much Corona, 2021 started with weirdness and ended setting up the tone.
Here’s hoping, I am wrong about all of it. Never mind, crazy people stormed the capitol and Trump said he loved them. Two people died (thankfully) and a handful of people arrested. The Democrats are on a manhunt to impeach Trump for the 2nd time and a group of people got rich off of GameStop $GME stocks.
We really just started the year. This is like settling down toddlers before bedtime.
But we are back
Welcome back to a new year with TNFG’s monthly breakdowns. Our household’s 2020 Net Worth sped up by over $200,000, which proved that the first $100,000 is easily the toughest.
At this rate, it is best to stay the course with the goal of hitting half-million net worth this year and the millionaire mark by 2023. We are sharing the journey, frankly because we have never seen anyone that look like us shift from poor working class to millionaire status in one lifetime. Don’t let society fool you, the US is still one of few countries with upward mobility through the classes.
Roughly, 80 percent of millionaires in America are the first generation of their family to be rich. They did not inherit their wealth; they earned it. While I know, it sounds crazy but you can generate wealth in 4 ways: “Talent and Skill”, “Right Place and Time”, “Diligence and Effort”, and “Ingenuity”.
Although three out of the four are rare attributes, building your Financial Intelligence through diligence and effort is universal.
No Big Flex Changes
As you track our progress, know that we will not be changing up on you. So no big cars, no crazy home, and no private flights, no yachts and no exclusivity for us. We are just regular people working 9-5s and making the best of our income with a focus on staying grounded and faithful to the journey. We want a movement that is inclusive of everyone. I want you to seat with us.
While you might be thinking, “well I only make $40,000 per year.” Do not worry I made $23,000 before taxes back in 2012. I understand how hard and bleak it seems to start. You likely have over $60,000 worth of student loan debt. Well we had a combined $150,000 to start. All to say, there is no silver spoon here. No, get rich quick scenario, just day-to-day budgeting and money management while taking personal accountability to improve ourselves.
There is always a way to make some improvements in your life:
Your first moves for your first 90 days
While President Biden is focused on drafting every executive order on record like Light Yagamy, I want you to focus on your first 90 days of 2021.
Your action steps:
Economic recovery: Initiate a “Build Back Better Budget” where you start by analyzing your goals for the next 5-10-20 years. While it sounds silly, writing down your goals does help. Set the next weekend and block out the time. Follow up with opening a mint.com or personal capital account to track your net worth and your expenses FREE. Now start cutting back the junk food aka micro expenses that you do not need in your lifestyle. Released during the general election, the plan called for spending trillions on American-made products, health services and infrastructure updates, and
Repealing and Replacing: Stop following all these toxic celebrities and people who leave you feeling envious. Stop drinking and turns out even wine is drinking. Just go cold turkey for 3 months. Start to sleep on time. Start to exercise and get more energy and movement in your day.
CARES + Act extensions: Start moving toward a positive mindset by feeding your mind and spirit great content. Additionally, take action on everything you needed to do to change your life.
Do these steps and your life will improve!
We started out on a low note
Driving Back to the DMV and a St. Thomas Trip
My wife said, “I rather ask for forgiveness than permission.”
For my household, the goal for 2021 is to hit $500,000 by March 2021. With the collapse of January, I am pushing back this goal to April or June again. The market is choppy and likely headed towards an instability bubble that threatens to affect those who struggle most.
Pandemic cabin fever has set in, and we were feeling it too. I had to drive from Orlando to DC with a dislocated hip (I think), but like a true Marine, I made it look like it was easy. The pain kept me away for 12 hours.
The wife stayed behind to deal with the final pieces of the renovation in Tallahassee but she took a relaxing trip to St. Thomas. She ate seafood for days. Her words, “I rather ask for forgiveness than permission.” Translation, if left alone she will spend guilt-free. Hilariously, she blames me for her actions.
However, by January 30, we reunited in our humble home. There was about $7,000 worth of growth likely from our investment contributions and growth. At the peak of the month, our net worth hit $21,000 before the investor bros scared away all the December gains.
Largest spending category was Business services (i.e. investment property renovations) for $12,225. Followed by the travel category, which includes Orlando to DC, Orlando to Tallahassee (back and forth) as well as St. Thomas.
We definitely need to improve in the coming months now that we are back home and on stable ground. We are opting for less Wegmans and more Aldi’s.
We need more money quick…
In the end, our net worth went up by a 1.51% whimper – a cash value of $6,785. Definitely crazy but it is just the hangover from 2020, I am still shooting for a +20% year. Time in the market matters more than timing the market.
Looking at the Bright Side
We are pushing ourselves to be better stewards this year since we do not have to contend with wedding stuff. The crazy goal now is to pay off $100,000 of debt in 12 months.
1. Where were the bulk of the wins?
Investing surprisingly still grew. Growth for the month hit a $24k but settled for $12.5k. Volatility happens in the short run so we are laying low for the long run.
Not much movement in the student loan segment since we got the extension until October 2021. This effectively save my household about $6,000 since I am on the Public Service Loan Forgiveness (PSFL) plan. All non-payments in Federal forbearance since March 2020 count as long as you are employed. I am very happy we never switch to a private loan provider like SoFi.
Home mortgage did not move either since we made those payments late in December to maximize housing credits on our 2020 taxes. That is a cool little trick.
2. Where did we falter?
Stacking Debt to Repay in 2021. We paid a lot of debt in January up to $13,000 but we picked up the deposit for the renovation at $7,000. Barely any wriggle room for sure. However, it gets like that sometimes. Renovations are not easy and I might end up costing us about $1,000 in interest fees for the year.
Cash is dead. To ease the pressure from interest feels, I took out $1,500 from our emergency savings to pay for debts. It is better to reduce 8.99% APR than earn 0.01%.
3. What is the Next Step for Us?
Turns out, it is Valentine’s Day.
T’is the month where I have to do something special that will not break the bank. Fellas buy the card now and do not wait until the last minute. It falls on Sunday so make it a fund brunch with strawberries. No need to go crazy. If you are dating someone, you can easily drop a zoom date.
Beyond that, we are cooking with paying down debts and investing. The wife is working on her side hustle and I am writing more content and monetizing the website on the back end. Beyond that the overarching goals:
- Investing $1,500 per month in M1 Finance Brokerage focused on Growth and Dividend Income that generates at least $1,000 in passive income in 2021. Check out the portfolio in real time. If you like the platform and want to start investing, I have the $30 for $30 referral if you need it – https://m1.finance/SYdqDJ2SyADC. Offer only available until February 28, 2021, when it will revert to $10 for $10.
- Shooting for a sustained investment rate with the push for $500,000 net worth. To help monitor your savings, cash flow, net worth, investments, retirement and more FREE with Personal Capital! Sign up with my link & get $20 Amazon gift card. *Terms apply. https://pcap.rocks/lawrencegonz
- Build out Financial Literacy Workshops for 2021 – Setting new goals and pushing the community forward. Hopefully dropping Mid-February or early march. I’m tempted to start sooner but greatness takes time. Trust the process.
- Work on blog consistency while adding eBooks and eCommerce. Pushing to build out for the next 3 years until we hit $1,000,000 net worth valuation.
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