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T’is the start of my favorite FIRE money season. Bustling New Budgets and Money Managing Changes to Close out the year.

Welcome to TNFG’s monthly Net worth Breakdown, where I’m reviewing my household’s August 2020 money management wins and epic failures. If you haven’t been keeping up, this is the fourth article in this series. You have plenty of time to check out:

The Network Calculation Breakdown,
The Mid 2020 Full Wrap Up since I started this in July, and
The FIRE-at-work July 2020 Wrap Up

Before we get started, much respect to those who keep the embers of glory burning. Most men would attest that we are merely unfinished without them. They carry our secrets, our fears, our tears, and our hearts. Rest in Power.

Taylor Simone Ledward and Chadwick Boseman attending the Screen Actors Guild Awards in January 2019. Sarah Morris/Getty Images

In the vein of BudgetAreSexy.com by J-Money, this is a brief synopsis of our household’s assets and liabilities. If you haven’t heard of the FIRE Movement a term that I’m using a ton for these SEOs; it stand for Financial Independence, Retire Early. Besides throwing in great tidbits like how we funded our M1 portfolio, the biggest questions that you will see every month:

What went well?
What didn’t go so well? Because there is always something.
What are we working toward for the rest of 2020?

Here goes nothing for Fall 2020.

“No matter the season, someone is always making money”.

While the general economy seems doom and gloom and testing for a vast majority of Americans, those invested are banking a whole bunch of money. “It’s up to you to always be on the receiving end of the money.” Serge Rodriguez, Haitian Heritage Museum Co-Founder

Our household income follow the model investments first.

We live in a condo right outside of DC which saves us on housing costs. With the excess, we contribute to the maximum in our 401ks for the tax avoidance, ROTH IRAs, and Health Savings Accounts (HSA) which we use sparingly for tax-free medical and dental work. This year we started to invest in our M1 Finance account and finally hit our contribution goal of $10,000.

Our net worth went up a solid 8.98%, a cash value of $31,000+ accounting for contributions and collective gains. We are on track to beat my highest estimate for the year of $355,000 Net Worth. At this rate, we might break the $400,000 mark around February 2021.

1. Did we stick the landing?

Cash and Emergency Funds

First small tweak to the math from July, our total starting cash position was $10,776 with $1,500 in Emergency Funds. I don’t think it’s wise to keep more than half of our monthly expenses in savings since it’s earning about 0.3%. That amount should be criminal. But we did increase it to $2,500 in cash reserves.

I’ll likely boost this up by $2,500 per future kid. This is just my random gut instinct. If need be that amount will start being a quick buy-the-dip moment for future investments.

There is a big social movement to tell people to invest but most of it is flawed if you don’t keep some level of cash reserves. You just never know.

*I’m using Personal Capital to track these numbers by the way. It adds up all the money we have in checking and savings indiscriminately. Our Net/max budget ratio keeps a a reserve equal to next month’s estimated expenses of $3,000. Think of it as a self hack, so that we always have enough to cover the following month.

Investments and Passive Income

With the extra funds, we pressed the gas on investing. We only need to invest an additional $1,500 one of the ROTH IRAs and shift about $21,000 from a very passive ROTH IRA to a more active and engaged Dividend Income Fidelity IRA for 2021.

The main goal was to balance out the AT&T monthly bill of $80 by buying about $15,000 worth of shares at $30 each. Every little bit helps. Additionally, I took steps to divest from indexes in the fiancée’s Traditional IRA to more active investments in Apple shares which split. Now we own about 90 shares of Apple.

One new client was secured for the 8-months financial literacy education special of $750. Regular price is back up to $1,000 for 6 months. We get started as of early September. Excited to see new challenges and wins for others. I don’t like picking up a ton on clients so I rather work with a very select group of people to really bring them up to money management speed.

Debt Repayment

We are taking the opportunity of student loan payments in deferment to make huge strides within the credit card side. Dropping a clean almost $6.5k.

The APR was still 0% until March 2021 but it was still good to knock off as much as possible. Chase also dropped the APR from 24.99% to 8.99% until March 2021. We are going to take full advantage of the reward points generation.

2. What didn’t go so well this month?

Food costs are up

For just two people, we are averaging about $475+ per month buying from Wegmans. I definitely need to step up and commit to the drive to Aldi’s instead. It’s not a big deal but it’s not like we are eating steak either. I guess we could shoot for $400 but not sure if the wifey will go for that. No more Tuscany Garlic bread for me.

Over spending on that Amazon Prime

Not sure what we are stocking up for but we spent about $800 in August on stuff. But we did get the TVs mounted for another $500.

Upstairs leak (update)

Two claims were put in; the upstairs mitigation by AllState offered a measly $1,547 to keep my mouth shut but at least my insurance Geico’s (albeit it slow and unresponsive for the whole month) estimate finally came in at $2,650.

It was originally $4,100 but there is a $1,000 deductible (whatever that is) and a $450 reimbursable that I would have to show proof of. So here goes the way in September and fixes in October? Either way, we are putting that on the credit cards for the points. Hey I do what I must.

Rental Woes

Whelp, COVID strikes again. No tenants for the rental unit for Fall 2020 so far but I guess we will see. I had to refund $1,050 and there is still some clean up that needs to happen. I put in for some utilities and working on securing a proxy manager. All while paying the mortgage and HOA for $1,100.

In the end, since we live well below our means we aren’t hurting but working towards spring 2021.

3. What are we working toward?

September and Wedding months!!!

Working on investing more than $10,000 in M1 Finance Brokerage focused on Dividend Income that generates at least $1,000 in passive Income for starters in 2021. Check out the portfolio in real time. If you like the platform and want to start investing, I have the $20 for $20 referral if you need it – https://m1.finance/SYdqDJ2SyADC.
Hopefully doing one full workshop on Investing 101 and maybe one on Tax Planning to glow up the community.
Getting back to shape – HIIT Mornings. Running, and biking just pushing out effort.
Focusing – Back to writing more articles and finishing work stuff. The Sister-in-Laws are coming so the sisters will be going wild. It’s always wild when they link up. I want to get in a Hike and some home chores.

Last Rounds

Set audacious goals and work on them constantly. That’s how you change yourself and that’s how you win. If you want to know more about our technique, check out the Net Max Financial Plan for Couples. We are up 8.98% so it’s not too bad and up about $100,000+ for the year in Net worth.

We are all tired of 2020 but the last couple months set up your 2021 wins.