We added $200k to Our Annual Net Worth Again! Here's the Breakdown.

Lawrence Delva-Gonzalez, The Neighborhood Finance Guy writes about financial literacy topics which include but not limited to Personal Finance, Better Budgeting, Tax Efficient Money Management, Steady Growth Investment strategies, Retirement tips and Net Worth Tracking. The goal is to help you make effective decisions and set S.M.A.R.T+E.R. goals with your money. The information is free but the struggle is not sold separately.

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Student Loan Forbearance, Annual Raise, Bonuses and Back Pay

December 2021 was a wild month to end a very strange feeling year.

The Omicron variant turnt up for Christmas and New Years. Despite it all, forecasters undervalued spending resilience. Even with inflation at an all time high, sales are up.

As such, Investments surged.

Back in May, I said “buy less for a period of time and Invest more for growth over the loss.” I was right. The market hit all time highs 70 times and closed up 28%. In contrast, if you had your money in a savings account at the bank for 0.01% while inflation is at 6.8% for the year, it means you are losing Negative 6.79% of your hard earned money annually.

Try not to stand flatfooted on this one, people are winning with investments.

A Million More Celebrations, COVID TestS and Maskless people in December

Back to 2020 we go (aka 2022).

The White House tried as it may to redress public concerns but failed none the less. Misinformation was allowed to spread for far too long and now we are paying the price. We might need to go door-to-door and force people into getting the vaccine and the month-to-month boosters.

With that said, we will once again set our eyes for a restart after the Fourth of July. We can’t stop Americans going to epic COVID celebrations for too long. Maybe we get a grand reopening, Fall 2022.

Until then, “Sit tight and Assess.” Just in case you are bored, feel free to implement the month to month financial plan that can help you get rich quicker.

Now Back to the December Breakdown

This article will showcase the TNFG monthly Net Worth Breakdown for December 2021 where making money make sense. Additionally, there are always usable financial nuggets and aha moments that might help you along the way.

Overall, investments rallied. I basically gave up when I saw the Omarion take down in November.

Building Toward Our December Goals

Strategic Changes in December and Personal Capital Glitches

Beyond tightening the war chest (again), my wife is secretly pushing us to get a new home. Unfortunately for her, I have the will of a government auditor. We are cheap to the core. However, before we can get out of this place, we need to spend more money on repairs on the primary.

While we wait on those bills, our investments surged in December which help us close north of $39,510. There was a serious glitch with my wife’s 401k but that got resolved so the wave looks confusing. The quick summary provides a better representation on what happened.

Either way, we hit $661,254 net worth – adding another $200,000 this year.

This is enough for a victory lap. Hooray but I’m kinda exhausted with the market ups and down.

Here’s the Quick Summary:

What Happens Next!

The world is changing post vaccine. There is a rise of mental health issues and a slide back to poverty for a lot of people. The transition will be harder by May 2022. Until then, my family plans to keep our heads down and plan for the next international trip in 2022. This is what half Milly folks really do.

All in all +3.86% increase. The cash value growth shy of $25,000.

We will keep socking away money in the first QTR of 2022. American households should be weary and slow down the rate of spending post reopening since money is now worth less.

Our Expenses for December 2021

Food Prices are not Excessive, I give up!

I’ve talked about price inflation for months. And now, it’s worth. I foresee prices stabilizing down 20% but we have a new high that’s here to stay.

Our Food & Dining budget went from $500 to as high as $1000. That’s a 60% increase from 2019. No matter how we slice it, this is likely the new normal.

We’ve been doing a lot of micro shopping through Amazon for clothes and other things. And we were hit with a huge AMEX Platinum annual fee of $695.

Since we are going to front load our credit card for points, I expect to recoup the fees through cash back rewards.

The negative in Business Services is a good thing since my wife picked up her side hustle bringing in an extra $3,000 per month. We received a large reimbursement due to a banking issue in November.

We also paid the January mortgages in December for the extra tax break for 2021.

1. So Where were the December wins?

In order; Debt Repayments, Investments and Cash. It’s all about making money work effectively in our household.

Debt Repayment in 2021 went as well as expected

The goal for total debt repayment is $100k in 13 months. This month was a great push for $7.6k improvement. While student loans are in forbearance, this is the best time to work to pay off debts before they pop back up in May 2022. I’ve saved as much as $20,000 by not paying my student loans and all those count as payments under the PSLF.

Bumping road for investments

Total December growth almost hit $52k but that’s mainly because of a number glitch that shifted my wife’s 401k to other assets and back again. We took an active role at rebalancing our portfolio this year. I’m learning that this is an active game for sure.

My 401k gained over $32,785 in 2021 not including matching contributions. Investing is the missing piece to gaining wealth. If you need tips on how to set up a solid portfolio, read How to Build a Long-Term Investment Portfolio Earning 250%.

Cash holdings increased Slightly

We have to get that number back to $2,500. That’s our Acid net/max EF so that we invest more than keeping money in our savings at less than 1%. The net/max financial plan hasn’t failed me yet. One built in feature was a medical claims from the Health Savings Account (HSA).

Long story short, I have over $4,000 medical/dental claims pending. Since I paid for them out of pocket in the past, I am able to claim them at any time tax-free. HSAs are truly the ultimate Quadruple tax advantage asset. We closed out the year with about $2,000 in savings and carrying a balance of $3,500 per month.

I’m big on making sure we are covered.

2. Where did we falter?

Food and unintended expenses

As stated early, I can’t control food cost due to inflation, shipping costs, and global labor shortages. At this point, we are riding the wave like everyone else. If 2022 is anything like 2021, it’s another year of active investments.

We closed out the year with over $207,538 more in our net worth. You can read the full breakdown for the year of 2021, because we did it again.

Since we are striving to be millionaire during the first quarter of 2023, we need just one more +$250,000 year.

3. What is the Next Step for Us?

Still working on e-Books or other items for the website

Beyond that here’s our overarching goals for 2022:

Keeping our expenses where they should be. “So stop equating happiness and social acceptance based on the money you spend.“
Get to $75,000 in M1 Finance focusing on Growth and Dividend Income that generates at least $2,500 in passive income in 2022. Check out the portfolio in real time. If you like the platform and want to start investing, I have the $50 for $50 referral if you need it – https://m1.finance/SYdqDJ2SyADC.
Shooting for a sustained investment rate with the push for $1 Million net worth in 2 Years. 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

Disclosure: This post is brought to you by the Neighborhood Finance Guy. We highlight financial literacy information, resources, and more on your way to money management goals and personal wealth. Our goal is to help you make S.M.A.R.T decisions with our money. We do not give investment advice or encourage you to adopt a certain investment strategy. Your personal finance is up to you. If you take action based on one of our recommendations, we don’t earn a dime as of 12.2021. We operate independently.

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