Net Worth Update: September of 2016

 

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Top Secret:  Lottery Tickets = Incredible Wealth!

August has come and gone, and fall is right around the corner.  Our August paychecks (26¢!) finally made it to our checking account, and we’re a little sad.  Why?  August represents our final paychecks from our latest “crappy job.”  We still have health and dental insurance for one more month, but on October 1st we’re officially on our own.

We’ll certainly miss saving $9,500 a month, but we’ll also love the increased freedom brought on by our voluntary unemployment.  Here’s the recap:  In August, we once again funneled all of our income into our 457 and 403b accounts.  In fact, from January through August of 2016 my wife and I received only $2.08 of net pay.  Where did our money go?  Directly into our retirement accounts!  As a result of our hardcore savings via front-loading, we were able to max out our 457 accounts for 2016 ($48k = $24k for both of us).  We were also able to contribute over $27k to our 403b accounts.  (I’d love to hit the max on those 403b accounts, but I don’t want to take another job to do it.  Did I mention that we’re not funding our IRA’s for 2016?  That’s driving me crazy!  Old habits die hard.)

Our aggressive savings and frugal living have really helped us grow our net worth over the last two years. The rising stock market has also added to our net worth.  When you’re saving a lot, living on a little, and  investing in a rising stock market, your bottom line should grow.  From a financial perspective, we had a great two years at our jobs in Douglas, Georgia.  As a result our net worth has crossed over into 7-figure territory.  Here are our net worth numbers for September of 2016:

Net Worth for September of 2016
Assets$1,002, 389Liabilities$0
Checking$11,212
No Mortgage!
$0
Savings$233
No HELOC!
$0
Stocks$155
Credit Cards
$0
Mutual Funds$4,734
72T IRAs$589,003
Traditional IRAs$204,805
Roth IRAs$26,361
457 Accounts$89,187
HSA$33,571
ESA-529-UTMA$43,128NET WORTH$1,002, 389

A few days ago I logged into my Personal Capital account and was pleasantly surprised to see this:

Personal Capital Net Worth without Travel Hacking and Walmart Cards

(1-Day Change Above = Net Worth – Travel Hacking Monetary Value)

Woohoo, now that we’re part of the Double-Comma Club we can really ramp up our spending.  Uh, wrong!  We plan on living the same awesome, low-cost lifestyle that we’ve become accustomed to over the last five years.  We plan on driving our living expenses even lower with a long-term trip to Latin America later this fall.

Million Dollar Club

What does it feel like having $1 million in assets?  It feels great to finally pass the threshold, but, all in all, I still feel the same.  I envisioned getting a bigger charge from passing the 7-figure mark, but the truth is that I’ve felt financially secure for years.  The most exciting part of this financial journey is deciding what to do with our time and life energy now that money is a secondary issue.

For two reasons, I hereby declare ourselves FIRE’d (financially independent, retired early).  First, we’ve hit our goal of $1 million.  Since we will both receive teacher pensions at age 60, we have enough money to step away from work.  Second, we are no longer employed, and we are suddenly “time rich.”  We now have enough money and plenty of time to live our awesome, frugal lifestyle anywhere we choose.  I can’t lie, it’s pretty exciting.  In preparation for a year of adventure and freedom, we enrolled our son in a home school program in August.  So far, he seems to like the curriculum, so we’re planning on taking our show on the road this fall.  We haven’t decided on a location yet, but our short list includes:  Mexico, Argentina, Brazil, and Costa Rica.

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Money Wasted on Dad’s Lottery Tickets

Finally, if you thought that “lottery tickets = incredible wealth!” caption at the top was for real, you need to smack yourself or at least read a personal finance book.  Last month in Chattanooga, my Dad sent me out to buy a few lottery tickets for him.  I cannot overstate how much I hate gambling–it’s simply a tax on the innumerati.  But, I love my Dad, so I bought them for him…with HIS money of course.  You know the only thing worse than spending a dollar on a lottery ticket, right?  Drum roll please….spending a second buck on a lottery ticket.

Okay, we’ve got some planning and packing to do.  Just curious, where would you go if you had the time to take a 3-6 month trip?  I look forward to your suggestions, especially the exciting AND inexpensive ones.

Frugally yours,

Ed

 

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Investing:  The majority (90%+) of our money is invested at Vanguard.   If you know of a better low-cost option, please let me know.  Why Vanguard?
Net Worth Tracking:  We use Personal Capital to track our various accounts.  Personal Capital is an great way to aggregate all of your financial accounts at one easy-to-use website.
Banking:  We have used USAA for our checking and savings accounts since 1997.  We also have checking and savings accounts at three credit unions:   AlliantElements Financial, and Navy Federal.  Finally, we have an online checking account with Simple.
Health Savings Account:  We use Elements Financial to access commission-free, low-cost Vanguard ETFs at TD Ameritrade.
Phone Options:  My wife loves her $10 a month plan at Republic Wireless.  I had the same plan and liked it too, but unfortunately I broke my phone in Mexico.  I currently use a WiFi-enabled phone at a cost of $0 a month thanks to three Google apps: Voice, Hangouts, and Hangouts Dialer.  We also have a Skype subscription with its own number for unlimited U.S. calls ($80 a year).
Travel Hacking:  If you'd like to learn how to get "free" flights and hotel rooms, take the free course at Travel Miles 101.  When we slow travel, we use Airbnb to find low-cost, month-long rentals.  Whenever possible, we try to use Uber instead of taxis.
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34 Comments

  1. Miguel Laufenbergski

    Awesome!!! I’ve been following your progress since the 600K mark so congrats on hitting the target with over 2 bucks to spare!! Hope to see you guys in WI sometime soon. By the way now that you are a millionaire I will not be picking up any Dinner Checks!! Lol.

    • Querido Don Miguelito,
      Hey don’t forget we live within our “free money” limits because Sr. Tacaño here won’t be wasting his money on out-of-control taxation. I’ll be damned if I’m going to bump up to the 15% federal tax bracket! Actually, I can’t wait to go to Culver’s with you guys for an epic cheat day. Do they still serve beer in Wisconsin? If so, I might try one of those this time. I hope to see you soon brother. Eduardo el Magno

  2. Congratulations, double comma! Personally, a nice educational road trip for junior is what I would do. I’m celebrating my half million mark from a strong stock market, and my wife just became a teacher with me this school year (doubled our income). You are an inspiration and I’m staying my path to FIRE. Keep blogging your updates.

    • Joshua, thanks for the encouragement and the positive vibes. It sounds like you and your wife will catch us pretty soon. Doubling your income is a beautiful thing, and I’m sure you’ll make it count. When we make it out to Texas (we have family in Grapevine), I’d love to meet you guys. Until then keep hammering your plan. Ed

  3. That’s great Ed! Congrats on the double comma club and congrats on being time rich!

    I had a similar feeling when crossed the million threshold earlier in the year, eh, not much has changed.

    What a lifestyle change you’re planning by living abroad for a while! That is exciting and I look forward to hearing where you settle. Thanks for the update!

    • It’s a very exciting time for us for sure. Having some money is nice, but the sense of control and the free time is just as awesome. I look forward to checking out your blog; thanks for visiting. Ed

    • Thanks Ferv, South America interests us too. I’d love to go back to Argentina and Brazil; I also want to check out Uruguay, Colombia and Ecuador. We have the frequent flyer miles (thanks to travel hacking) and the time see a lot of sites, so this year will be exciting. I think our first stop will be Mexico because it’s such a short flight and we already know a few locales there. Then, we’ll take a look at South America. Hammer on, Ed

      • Hey Ed! Congrats on the milestone!

        Why don’t you join us in Ecuador? My wife and 2 kids are heading to Cuenca for a year to live and let the girls become fluent in Spanish (and me too since my wife is much better).

        I look forward to sharing adventure stories!

  4. Congrats dude! Can’t say it’s surprising getting to know you over the years, but it sure is insanely exciting!! Way to be an inspiration, man!

    (And PS: I’d totally jump in an RV and roam around the country if I had 3-6 months free… and remember to bring J$ some beer when I crossed his path :))

    • Thanks for the love J$. It’s amazing what you can get when you combine debt avoidance + hardcore savings + prudent investing + frugal living. We’ll just keep the low-on-the-hog living going and enjoy our free time together as a family. If we ever take jobs again, we’ll use our top-secret 100% savings rate maneuver on our push to $1 trillion.

      The RV idea did not appeal to us until about two weeks ago. The parent of a former student posted an RV on Facebook with an asking price of $12k. Sure, it was older, but it was in awesome condition. Plus, it was more than roomy enough for the three of us. That did get my wheels turning. As for the beer, I’d love to break my low-carb protocol and drink some good stout beer with you. I’d also like to get another shot another at an Indian buffet like the one in Charlotte…that triggered my eating gene. Unfortunately, it won’t be at FinCon this year due to our busy fall schedule.

      I’m glad you found a little inspiration from our journey to $1 million. To be honest, the feedback I’m getting from about thirty readers makes all my blogging worthwhile. It’s awesome when someone writes that I helped them “see the financial light.” As I read the gems to my wife, we’re always shocked and humbled that a blog post can help someone get their financial life on track. Thanks for all your help and support over the last couple of years, Ed

  5. Hi Ed,

    Congratulations. You’ve got a brand new life to live. Enjoy it!

    Now that you are part of the club, I would like to invite you to the interview serie “the single advice of the men/women who did it”. Are you in?

    Cheers from CH.
    MP

    PS: keep blogging even though you’re retired, it’s inspiring for us who are still on the journey

  6. Congrats on the FI, retirement, and two comma club. Give us hope to the rest of teachers. I still have a few hundred thousand to go….but hope to be there by 50. Congrats again.

    • Thanks Jason, glad you found some inspiration from our journey. It’s great that your working your own plan; I wish more educators would take advantage of the opportunities they have. Good luck on your journey. Ed

  7. I’m digging all the ZEROS in your liability column! Wonderful. I just paid down $15,000 of mortgage debt today. Feels so good. I’m a man on a mission again.

    It’s funny how reaching the double comma club doesn’t really change things yeah? Let’s hope this bull market stays healthy!

    Sam

    • Financial Samurai, congrats on slaying $15k of debt. It’s no secret that I hate debt, but it took me a while to get those three zeros in that right column. It’s nice finally having our financial situation in order. If, or when, the market dips I’ll get a chance to buy low; I’m currently sitting on too much cash. Good luck on your financial goals and keep on hammering that mortgage. Ed

    • Penny, I look forward to helping your become a millionaire. It’s so lonely here at the top and I miss the little people. HSA’s are awesome; I assume that you have a HDHP, right?

      I’m flattered that you draw inspiration from my blog and unconventional ideas. My goals is to get more teachers to realize what great financial opportunities that they already have: two retirement plans (403b & 457), a pension, IRA plans, HSA, ESA, 529…so many possiblilities, but no one sees it!
      Fire away with you questions whenever you need my take. Ed

  8. But the lottery proceeds help funds college scholarships (add sarcasm). It’s awesome to read your story it’s the opposite of the teacher in “Rich Dad Poor Dad.”

    Regarding health insurance, our family joined a health-sharing ministry this year as the Tennessee premiums were crazy expensive. I’m assuming you already have a plan, but, just thought I would throw it out there.

  9. Joseph

    Awesome news, Ed!!

    How do you factor in your pension into your retirement planning? Do you assume it is just gravy on top? I am hoping to FIRE in my late 30s – at that time, I’ll have 20 years in with Georgia and about 22 years until I hit the 60 year retirement mark.

    • Thanks Joseph. We plan on taking our pensions at age 60. As you already know, that’t the earliest we can get them without the 25 years normally required for an early pension in GA. I plan on earning $24k a year and my wife will earn $18k. That $42k a year on top of our retirement savings and any other earnings, so we believe that we’ll have enough for us. Having a pension at 60 allows us to be almost 100% in stocks. (However, we do have enough cash to get us to 60.)

      Plus, we can always jump into a teaching job and save 100% of our salaries. I honestly view any teaching job as an a way to save at least $50k a year. If my wife joins me in the fun, it’s another $50k. All for 9 months work!

      I look forward to watching you work your FIRE plan. Good luck and hammer on, Ed

  10. Pete

    Congratulations Ed. I’m impressed and very proud of you and your wife. For the remainder of your lives, you now get to wake up, ask yourself what sounds like the most fulfilling use of your time, and then go do that thing. What a great gift to give yourselves.

    I’ve been following for 2 years now. You’ve got me completely on board and we are two years into hardcore savings mode. Now 33 and NW of 300k with my wife…both teachers.

    We think that 2017 can be the first year that we can potentially fill both 403’s, both 457’s, and both Roth IRA’s, so (83k), and still have enough left over to pay the bills. I’d have thought this completely crazy/impossible two years ago. And if once we can do it once, with annual pay raises, it should just get easier and easier to do indefinitely. So, give us a few years, and we plan to be meeting up with you guys on a beach/fun adventure, haha!

    Again, well done and congratulations, this blog and others like it are an inspiration and an education at the same time.

    • Pete, thanks for making my morning! Once you get the savings habit rolling, it’s amazing how easy it is to save large sums of money. Plus, it sure helps keep your taxes in check. It is very good to know that some readers are seeing the financial light and pursuing FIRE. Keep me posted on you progress and hammer on! Ed

    • Thanks TFR. We decided to go with A Beka Academy for our son’s homeschooling. So far, he’s been very busy with his classes; it seems to be very rigorous. Our son seems to be able to make friends wherever he goes, and now he is able to see his cousins with more regularity. Before we were so swamped with work and school, we hardly had any time to visit my family in north Georgia. That won’t be a problem for us now. As for activities, we plan on getting him back into karate once we settle in somewhere.

  11. Junaid

    Hi Ed,

    Congrats from Beijing! I moved overseas as an expat teacher and have been checking in on your blog from time to time. I’m really impressed with what you’ve accomplished and stories like yours are inspiring my journey. My wife and I are at $60k net starting from zero 18 months ago and it’s been awesome. We will continue to draw inspiration from your story! Anytime you’re in China drop us a line!

    • Greetings Junaid! You’re doing a great job growing your net worth. Isn’t a great feeling knowing that you have a little money behind you? Good luck as you race to $100k and beyond. See you in Trillionaireville. Ed

  12. Chris

    Congrats Ed and Edwina!

    The double comma is quite an accomplishment for anyone especially teachers! Before I ran into your blog I thought our family was the only educator family crazy enough to pull this off? I can’t tell you how great it is to run into another teacher who has been working hard toward similar goals!

    For us it started out with $23k/year job at a little fishing village on the coast of WA state. My wife and I just got married and she did daycare and raised our kids. With a little budgeting help from Dave Ramsey’s 1st edition of Financial Peace, lots of extended time, coaching, master degree, National board, and great advice from books and blogs such Early Retirement Extreme, Dividend Mantra, Rich Dad Poor Dad, and Millionaire Next Door, Mad Fientist, Curry Cracker, Rockstar Finance and your blog we are almost there too. Should make it by this fall. Then it’s sabbatical time for a test run on retirement!

    I look forward to hearing about your travels and home schooling! Perhaps we can meet somewhere warm to share stories of life in the trenches while our kids play in the water?

    Until then I will crack one open and toast your success!

    Until then thanks for sharing!

    • Chris,
      Thanks and nicely done yourself! I remember my beginning salary on a provisional teaching certificate was $18,500 and I thought I was rich. Pay certainly came up in Georgia, glad I saved most of it along the way.
      We’re currently in Progreso, Mexico for one more week. Then we’ll be back in States to visit ailing family members. So far, homeschooling is a mixed bag: good curriculum but takes a ton of time and pits son against Mom in student-teacher battles to the death. A year in a Mexican private school is starting to look like a real possibility. Stay tuned…that is if I ever recapture my blogging juice.

      Please keep in touch with me; I’d love for our families to hook up. Ed

      • Chris

        I will keep in touch. I am looking forward to hearing about your travels and the homeschool adventure. Thanks

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