My Financial Journey

Our nestegg grew this month slightly but our investments trailed the SP500 significantly for the 2nd straight month. Well I have now maxed out both my wife and my Roth IRAs for 2014. We will now focus on building up our our taxable investment accounts as well as finding ways to save in the cost of constructing our new house. I’m trying to convince my wife that despite me having zero woodworking experience that I can build use kitchen cabinets, tables, and other things for our house. So far I have not been so convincing.

Taxable Account – $5,996.60 (-3.23%)
Traditional Rollover IRA – $32,506.79 (-0.97%)
My Roth IRA – $115,261.35 (-1.05%)
Wife Roth IRA – $67,767.15 (+4.71%)
Traditional 401k – $202,558.56 (+2.27%)

Roth/Traditional % = 43.39% (tax free)

Total Retirement Nest Egg $424,090.45 (+1.54%)

Monthly Contributions $758.84 (401k) $2500 Wife Roth IRA
SPY Performance 2.36%
My Monthly Investment Performance +0.76% (-1.60)% vs SP500)
My Monthly Individual Stocks Performance -0.25% (-2.61% vs SP500)

Well this month my nestegg shrunk and my investments under performed the SP500 index. I have a few more contributions to make to max out my wife’s Roth IRA and then I am going to start working on increasing my taxable account. I have not maxed out my 401k in a number of years and just put the bare minimum in to get my employers matching money.

While my individual stocks that I invest in my IRAs and taxable accounts are much more volatile it has been impressive how much they have outperformed my 401k which is primarily invested in index funds. On top of having more control I do at some point want to access my retirement nestegg to say retire and that will hopefully be long before age 59.5 so growing up a sizable taxable account will give them ability to make that jump when the time comes.

Anyway here is the report.

Taxable Account – $6,196.92(+4.08%)
Traditional Rollover IRA – $32,194.30 (-5.42%)
My Roth IRA – $116,482.53 (-2.76%)
Wife Roth IRA – $64,717.58 (-3.72%)
Traditional 401k – $198,055.40 (-2.19%)

Roth/Traditional % = 43.39% (tax free)

Total Retirement Nest Egg $417,646.73 (-2.76%)

Monthly Contributions $758.84 (401k) $1000 Wife Roth IRA
SPY Performance -1.55%
My Monthly Investment Performance -3.17% (-1.62% vs SP500)
My Monthly Individual Stocks Performance -3.70% (-2.15% vs SP500)

Well another new all time high for my retirement nestegg and good performance by my portfolio. It’s amazing the growth of my nestegg the last few years and this has been an amazing time to have a good chunk of money invested in the stock market. I really wish I had more invested 🙂

Taxable Account – $5,953.96(+2.16%)
Traditional Rollover IRA – $ 34,038.64 (5.66%)
My Roth IRA – $119,793.68 (+8.54%)
Wife Roth IRA – $$67,215.02 (+8.24%)
Traditional 401k – $202,494.53 (+4.22%)

Roth/Traditional % = 42.60% (tax free)

Total Retirement Nest Egg $429,495.83 (+6.10%)

Monthly Contributions $1,138.26 (401k) $2500 Roth IRA
SPY Performance 3.77%
My Monthly Investment Performance +5.20% (+1.43% vs SP500)
My Monthly Individual Stocks Performance +6.65% (+2.88% vs SP500)

Taxable Account – $5,828.28(+6.15%)
Traditional Rollover IRA – $32,215.25 (-7.11%)
My Roth IRA – $110,364.18 (-1.51%)
Wife Roth IRA – $62,098.14 (-0.23%)
Traditional 401k – $194,298.56 (-1.90%)

Roth/Traditional % = 42.60% (tax free)

Total Retirement Nest Egg $404,804.41 (-1.87%)

Monthly Contributions $758.84 (401k)
SPY Performance -1.51%
My Monthly Investment Performance -2.05% (-0.54% vs SP500)
My Monthly Individual Stocks Performance -1.85% (-0.34% vs SP500)

Well a pretty good month for me. My investments crushed the SP 500 index and my retirement nestegg grew by almost $25k in just one month which I think is a record for me and is more than my retirement nestegg was worth when I started this blog in December of 2005 and did my first nestegg report. Compound interest is a beautiful thing.

Taxable Account – $5,490.86 (+7.68%)
Traditional Rollover IRA – $34,681.76 (+13.71%)
My Roth IRA – $112,056.67 (+8.44%)
Wife Roth IRA – $62,243.25 (+9.60%)
Traditional 401k – $198,046.80 (+3.17%)

Roth/Traditional % = 42.25% (tax free)

Total Retirement Nest Egg $412,519.34 (+6.41%)

Monthly Contributions $1000 (Wife Roth IRA) $758.84 (401k)
SPY Performance +1.91%
My Monthly Investment Performance +5.95% (+4.04% vs SP500)
My Monthly Individual Stocks Performance +9.07% (+7.16% vs SP500)

Well nothing too exciting this month – I gained some of the lost ground to the SP500 the last few months and I made $4000 in contributions to our Roth IRA accounts. The good news is I didn’t have any five or six figure purchases this month so I feel a little bit more frugal than I did last month 🙂

Taxable Account – $5,099.04 (+2.99%)
Traditional Rollover IRA – $30,500.70 (-1.23%)
My Roth IRA – $103,334.94 (+7.92%)
Wife Roth IRA – $56,790.05 (+5.32%)
Traditional 401k – $191,961.67 (+2.52%)

Roth/Traditional % = 41.30% (tax free)

Total Retirement Nest Egg $387,686.40 (+4.01%)

Monthly Contributions $3000 (My Roth IRA) $1000 (Wife Roth IRA) $753.77 (401k)
SPY Performance +2.10%
My Monthly Investment Performance +2.74% (+0.64% vs SP500)
My Monthly Individual Stocks Performance +3.37% (+1.27% vs SP500)

Ouch a very rough month for my retirement nestegg and for the 2nd month in a row my portfolio badly underperformed the SP500. To top it off I also finally made a land purchase so $131,000 came out of my savings account and went to buying some dirt. Also last month we purchased a new minivan for $15,000 so cash savings is flying out the door and my investment accounts are dropping as fast as they went up. Bottom line is I feel a lot poorer this month than I did last month.

In the grand scheme of things the investment fluctuations mean nothing. I have a pretty volatile stock portfolio and so when the market is up I usually greatly outperform it and when it is down well yeah I greatly under perform it. I guess the good news is the stock market is up a lot more than its down so in the long run this should benefit me.

Regarding the extra $150,000 in discretionary spending the last two months. Well yeah that part is probably not the most financially smart use of that money – clearly if I had put that money to work in my nestegg the last 5 or so years that I had been saving it I’d probably have a retirement nestegg in the 3/4 of a million dollar range. I also expect that the crazy spending will not end for a bit here as we actually build a house on the land and make use of the 15 acres of land that we purchased. However life is all about balance and while I may be “living it up” now I made dang sure that when I was in my 20s I put myself in a very good spot when it came to my financial situation and have even said that the foresight to take care of those things when I was young and get compound interest on my side early on will allow me to act like an idiot when I am older should I so choose and not screw up my retirement.

Now granted I could retire much earlier had I just set that as my sole goal, but again I am not dooming myself for the rest of my life I don’t think. While we likely will take on some debt with the new house – all of our purchases for the land, new van, etc were all done in cash and we still have a cash cushion of about $40k as well as about another $50-60k in equity in our existing house and we have no other debt other than our student loans so I am confident that even this wildly exorbitant spending regarding our new house will still allow us to pay off our mortgage, student loans, save for kids education and have a retirement nestegg well in 7 figures by the time we hit 50 (next 15 years).

Anyway here is my monthly report

Taxable Account – $4,950.85 (-7.23%)
Traditional Rollover IRA – $30,879.84 (-6.10%)
My Roth IRA – $95,751.56 (-7.79%)
Wife Roth IRA – $53,893.27 (-6.38%)
Traditional 401k – $187,250.21 (-0.16%)

Roth/Traditional % = 44.59% (tax free)

Total Retirement Nest Egg $372,725.73 (-3.73%)

Monthly Contributions $753.77 (401k)
SPY Performance +0.62%
My Monthly Investment Performance -3.93% (-4.55% vs SP500)
My Monthly Individual Stocks Performance -7.08% (-7.70% vs SP500)