How to Kick-Off Your Wealth for the New Year
Kick-Off Season, The 1st 31 days
Coming back from the absolute joy that is Brazil. To be fair, Argentina is dealing with incredible hardship due to high inflation. However, I can say that people are still holding strong with hopes of changes to come in 2024. America or better yet the United States is one of the few places that is isolated in regards to global perspectives. As such, I highly recommend that you tune into international news to see more pertinent info vs the latest rap beef.
With the loss of Carl Weathers, this should be a reminder to do the most with the time you are given. The world is changing daily, soon the Millennials will be the new Boomers.
Stocks skyrocketed in January against the Bears. The DOW gained 1.22% in January. The S&P 500 continued its gains from December and rose another 1.59% and the tech-heavy NASDAQ nabbed another 1.02%. The Feds aka the Federal Reserve is expected to hold interest rates through Summer 2024, based on the 60-minute interview with Fed Chair Jerome Power.
Economists and investing experts believe that we will skip the recession and should recover post-election. Investors are cautioned to ease back from being too overly optimistic in the interim since the retail folks are driving losses and gains daily.
As such, the TNFG household was stuck in the happy middle. Our portfolio went up by nearly $34,000. This is still a better start than 2020 or 2021. Read the recap of our $50,000 tumble.
“We can now say I think for the first time,” he said, “that the disinflationary process has started,” said Jerome Powell. For investors, we do hang by every word that this guy says. One thing is for sure, he is pragmatic. So far consumer spending is still too high, while household debt is soaring to new heights. It’s too soon for rate cuts.
Table of Contents
Welcome Back! New Season, and More Information
Welcome back to a new year with TNFG’s monthly breakdowns. Our household’s 2023 Net Worth crossed the $1 million mark and now we set our sights on $2 million. My wife and I also hit over $500,000 investment portfolio which is always amazing since this is where compounding interest starts carrying its load.
I call it “Critical Mass”, the moment that all your uphill efforts allow for better views and great capital gain returns.
This is like having a toddler help you with groceries. It’s progress. Imagine this. Even if we don’t invest another dime, our investments would be worth over $2.5 million by 2040. After all the taxes are taken out, we’d be COAST FIRE ready.
This entire journey is proving that “Building wealth is cheaper and easier than advertised.“
Although the Net Worth jumped up, It’s Important to Stick to the Plan
One thing to note, we are very aggressive when it comes to our cash flow. Because of that, we can maximize the yield of 90 percent of the dollars we earn. With our next goal of a $1M portfolio by Year-End 2025, we will have to re-balance and reassess our investments in Q1. Low performers have to go in favor of quality companies. On top of that, we will have to put $15,000 into our Acid Emergency Savings Plan.
It’s a lot to consider but it’s doable. I recommend going bold with your ideas while keeping them feasible. After that, imagine what you need to do to make those big ideas work. It all starts with a financial plan.
When we started, we started at the bottom too. That’s where all good stories start. Sharing the journey is important because we have never seen anyone who looks like us, shift from the poor working class to millionaire status in one lifetime.
The US is still one of the few countries with an incredible upward mobility social class slope if you do it correctly. Building your Financial Intelligence through diligence and effort is the golden ticket.
Kick-Off Your Best Year with SMART+ER Objectives for the First 90 Days
Wealth comes down to three easy steps; 1. Decrease your expenses, 2. Increase your income and 3. Invest in the Difference. However, before you get there, create a 3-year vision and construct the plan. Be specific; the plan should have objectives and can be evaluated in 12-week intervals.
This will improve your life by 400%. If you aren’t addressing your smarter goals, you are merely working backward. Here are TNFG’s top three books to alter your life toward wealth.
Happy to See Our Net Worth Start Off Strong this Year
Our net worth went up 2.74% – a cash value of $31,391. There is always a bit of discrepancy between the last-day number and the first-day numbers slightly fluctuating. Or there are late banking adjustments.
We were saved by the broad growth across the market, particularly tech (NASDAQ). Since we are overweight in that sector, we will be looking to offset this with more healthcare and consumer staples throughout the year.
Apple $APPLE and Google earnings came in lower but that I was expecting. Increasing our overall dividend yield is fun. And it seems that quality companies are at a discount. Read through the Fidelity Quarterly Outlook – Q1 2023 for ideas.
Travel, Healthcare, Groceries, and More Fees
My wife is always wondering, “When will we feel rich?” The answer is that we are rich together. But the real answer is, never! Just kidding. After that, she pouts again. Our household goal for 2024 is to close out with $1,250,000 by December 2024 (+$5,000 or -$15,000).
The market is always a bit fickle. Beyond that, we have healthcare costs, travel, and a new nephew to see. It’s going to bananas. We are estimating $22,500 in total travel costs for the year to cover 2 international and at least three domestic. We haven’t even addressed the new car bodywork issues due to 2 thefts in 2024 and the home renovations of over $30,000 (estimated).
There’s a lot of work to do. We are going to cut down and strategize how to reign Amazon deliveries and groceries.
Our January Net Worth Running Back – Investments
Our investment went on a run in January. While we were down 19% in 2022, we recouped nearly 35% through January 31, 2024. We aren’t out of the fire just yet. We expect a correction in Q2 2024. For now, we gotta restructure our investments. See the graph below.
Expect extreme volatility through 2025. The rebound spared us for this month but retail investors will find a way to mess things up. They always do.
For the average American, it’s an unequal recovery. We are extremely aware of this. However, if you aren’t investing today, you are compounding your issues for tomorrow. Most Americans are experiencing a reversion to the means, which simply explains why prices are sticky.
This uneasy and perpetual struggle is what the majority of the world lives with. It’s not new. At this rate, Americans will have to learn to fight for every inch of a better life.
Savings Rates Stalling with Debt Climbing
Back in 2022, we opted to lower our interest fees by withdrawing $4,500 from our basic savings account (earning 0.01%) to pay off credit cards. We stalled out since. This year we are building back our savings account to $5,000.
We will have to pay off debt the good old-fashioned way. One dollar at a time. Our goal is to keep investing since it earns our future while simultaneously keeping our interest fees as low as possible.
How will TNFG Ride This Solid Kick-Off?
First, we have to look out for false stock positives. Can’t get too over-optimistic.
Time to readjust away from low-performing stocks and stock up 10% dry powder for the next low. That’s our strategy moving forward.
Beyond that, we are paying down debts and investing:
- Even though financial resources are low, Investing at least $833.33 per month in M1 Finance Brokerage focused on Growth and Dividend Income that generates at least $1,000 per month in passive income in 2025, is still the goal.
- Check out the portfolio in real-time. If you like the platform and want to start investing, I have the $10 for $10 referral if you need it – https://m1.finance/SYdqDJ2SyADC.
- Shooting for a sustained investment rate of $7,167 per month.
- To help monitor your savings, cash flow, net worth, investments, retirement, and freer with Personal Capital! Sign up with my link & get a $20 Amazon gift card. *Terms apply. https://pcap.rocks/lawrencegonz
- Hitting 10,000 followers on IG.
- Work on blog consistency while adding eBooks (at some point).
- Pushing to build out for the next year until we hit a $2,000,000 net worth as of December 2026.
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