My Financial Journey

Another down month for my retirement nestegg and another month of underperformance by my investments. My nestegg however is still up over 60% YTD, so I think I will be ok. This has been my best year ever on every metric and volatility is to be expected. Long term the trajectory looks great.

Fidelity Taxable – $5,117.72(+0.87%)
Taxable Account- $202,311.18(-8.18%)
Private Stock $82,500(+0.00%)
Traditional Rollover IRA – $77,484.52(-6.34%)
My Roth IRA – $695,775.93(-7.36%)
Wife Roth IRA – $394,484.57(-7.46%)
Wife 401k – $4,874.69(-1.90%)
Traditional 401k – $580,366.73(-2.51%)

Roth/(Traditional+Taxable) % = 55.37% (tax free)

Total Retirement Nest Egg $2,042,915.34(-5.78%)
Retirement Salary (4%) $81,716

Monthly Contributions $1,400.76(401k)
SP500 Performance -2.77%
My Monthly Investment Performance -5.85% (-3.08% vs SP500)
My Monthly Individual Stocks Performance -7.45% (-4.68% vs SP500)

Well after last months insane month I should not be surprised at all to see my accounts dip a little bit this month. Ironically my first month back to work and my net worth dropped by over $150k, while the 3 previous months where I was not earning income my net worth increased by over $828k.

This means nothing per say especially in those types of short term freak occurrence time frames, but it does put into perspective that I’ve put myself in a situation where working for money is trivial compared to the massive snowball of previously saved and invested dollars that are going to work for me every single day regardless of what I decide to do when I get out of bed.

That part is the incredibly powerful part and was the whole point of everything and I think it’s still something that I am having trouble coming to grasp with as to just what a powerful and meaningful force that is and how to best use it to make my life better.

Big numbers are big and sometimes I don’t fully grasp what my nestegg is worth and capable of. In a relatively non eventful month we just lost a years worth of working salary. In the prior 3 months we gained over 5 years of working salary. That’s insane and what’s really insane is that it’s only going to continue to get more and more insane as time goes on.

Fidelity Taxable – $5,073.72(+3.76%)
Taxable Account- $220,327.48(-10.76%)
Private Stock $82,500(+0.00%)
Traditional Rollover IRA – $82,729.94(-2.33%)
My Roth IRA – $751,045.35(-9.11%)
Wife Roth IRA – $426,286.63(-7.38%)
Wife 401k – $4,968.88(-4.80%)
Traditional 401k – $595,324.03(-2.86%)

Roth/(Traditional+Taxable) % = 55.37% (tax free)

Total Retirement Nest Egg $2,168,256.03(-6.69%)
Retirement Salary (4%) $86,730

Monthly Contributions $531.12(401k)
SP500 Performance -3.92%
My Monthly Investment Performance -6.69% (-2.77% vs SP500)
My Monthly Individual Stocks Performance -8.51% (-4.59% vs SP500)

Well an all-time record month for our retirement nestegg in every single category. Our nestegg hit an all time high north of $2.3M which was an increase of over $430k over last months all-time high. Our nestegg grew by 23.41% and our individual stock holdings grew by 31.33% compared to the market returns of 7.01% just this month. This now puts our investment gains north of over $1M year to date.

All of this is mind blowing and I don’t even know what to think. This is a combination of us living significantly below our means for our entire lives, investing that money, and then more recently getting incredibly lucky with the small allocation that we had dedicated to individual stocks.

As far as the path forward I very much am aware of the easy come easy go – especially in the short term, especially with the meteoric rise of Tesla which now accounts for 1/3 of our retirement nestegg. Things will be volatile and I do expect I will be writing reports at lower values than this one. Luckily for me I’m playing a long term game so I don’t have to worry about timing the market like an idiot

What I will work on though is increasing the amount of money I can use for early retirement. I have a unique problem of having enough money to retire, but it is currently kind of in the wrong buckets. Most of it is held in my 401k and IRA accounts which I cannot touch for the next 18 years without paying penalties and taxes. I am going to withdraw the $100k or so of contributions that we made to our Roth IRAs and put it into a taxable account to hopefully grow our taxable account to a figure large enough to live off of for the next 18 years.

Fidelity Taxable – $4,889.74(-13.43%)
Taxable Account- $246,889.41(+55.42%)
Private Stock $82,500(+14.58%)
Traditional Rollover IRA – $84,706.37(+9.06%)
My Roth IRA – $826,305.88(+31.36%)
Wife Roth IRA – $460,263.23(+26.88%)
Wife 401k – $5,219.59(+7.38%)
Traditional 401k – $612,867.58(+7.14%)

Roth/(Traditional+Taxable) % = 55.37% (tax free)

Total Retirement Nest Egg $2,323,641.80(+23.41%)
Retirement Salary (4%) $92,945

Monthly Contributions $5000(Taxable)
SP500 Performance +7.01%
My Monthly Investment Performance +23.41% (+16.40% vs SP500)
My Monthly Individual Stocks Performance +31.33% (+24.32% vs SP500)

Well another banner month for our retirement nestegg with us hitting four different $100k milestones in a single month including punching through the multi-million dollar mark.

Things are obviously down a bit from that all time high, but hard to get upset at all about putting on over $200k in a single month and have now put on $634k YTD. Our individual stocks have returned just under 100% YTD and things are coming together better than I ever could have expected. My original goal was to hit $1M by age 40 and we actually hit the $2M mark.

Life is good.

Fidelity Taxable – $5,648.33(+7.36%)
Taxable Account- $158,850.64(+23.21%)
Private Stock $72,000 (+0.00%)
Traditional Rollover IRA – $77,667.94 (+13.28%)
My Roth IRA – $629,034.16(+18.34%)
Wife Roth IRA – $362,755.12(+14.91%)
Wife 401k – $4,860.75(+5.61%)
Traditional 401k – $572,019.27(+5.00%)

Roth/(Traditional+Taxable) % = 50.69% (tax free)

Total Retirement Nest Egg $1,882,836.21(+12.65%)
Retirement Salary (4%) $75,313

Monthly Contributions $466.92(401k)
SP500 Performance +5.51%
My Monthly Investment Performance +12.62% (+7.11% vs SP500)
My Monthly Individual Stocks Performance +17.57% (+12.06% vs SP500)

Well today our nestegg hit $2M about 30 minutes into a new trading day where just the prior day it had just hit $1.9M.

This was a direct result of TSLA continuing its meteoric climb. This has been very rewarding as there has never been a stock where I had a stronger conviction on. There have been many bumps in the road and lots of naysayers – just like all there have been with all of our big winners (Netflix, Amazon, etc), but it is very rewarding (mentally and financially) to take the long term view and ignore all of the nonesense that has zero affect on the long term picture.

Now that we have hit the $2M milestone and the fact that these $100k milestones are now hit on a daily basis I will no longer update things mid month with interim financial reports and will just do my normal monthly reports going forward.

Taxable Account Ally- $186,598.38
Taxable Fidelity – $5,653.53
Private Stock $72,000
Traditional Rollover IRA – $79,594.95
My Roth IRA – $697,754.08
Wife Roth IRA – $398,426.82
Wife 401k – $4,647.64
Traditional 401k – $560,862.98

Roth/Traditional % = 54.66% (tax free)

Total Retirement Nest Egg $2,005,538.38
Retirement Salary (4%) $80,221

$100,000 NestEgg Milestones

Date	DOW Jones Value	MFJ Nestegg	Time to Achieve
Oct 2008	10,000	$ 69,300	29 years 2 months
Oct 2009	10,000 (+0%)	$100,000 (+44%)	30 years 2 months
Feb 2012	13,000 (+30%)	$200,000 (+100%)	2 years 5 months
Jul 2013	15,423 (+19%)	$300,000 (+50%)	1 years 5 months
Feb 2014	16,395.88 (+6.3%)	$400,000 (+33%)	7 months
April 2015	18,084.48 (+10.30%)	$500,000 (+25%)	1 year 2 months
August 2016	18,636.05 (+3.05%)	$600,000 (+20%)	1 year 4 months
January 2017	20,068.51 (+7.69%)	$700,000 (+17%)	5 months
June 2017	$21,182.53 (+5.56%)	$800,000 (+14%)	5 months
January 2018	$25,484.72(+20.31%)	$900,000 (+12.5%)	7 months
May 2018	$24,667.78(-3.21%)	$1,000,000 (+11.1%)	4 months
April 2019	$26,234.34 (+2.94%)	$1,100,000 (+10.0%)	11 months
December 2019	$28,331.20 (+7.99%)	$1,200,000 (+9.1%)	8 months
January 2020	$28,885.42(+1.96%)	$1,300,000 (+8.3%)	0 months 28 days
February 2020	$28,399.81(-1.68%)	$1,400,000 (+7.7%)	0 months 21 days
February 2020	$29,308.80(+3.20%)	$1,500,000 (+7.14%)	0 months 15 days
June 2020	$27,049.00(-7.71%)	$1,600,000 (+6.67%)	3 months 22 days
July 2020	$25,884.15(-4.31%)	$1,700,000 (+6.25%)	0 months 21 days
July 2020	$26,209.81(+1.26%)	$1,800,000 (+5.88%)	0 months 5 days
July 2020	$26,075.30(-0.51%)	$1,900,000 (+5.56%)	0 months 4 days
July 2020	$26,365.23(+1.11%)	$2,000,000 (+5.26%)	0 months 1 day

I’m not even sure what to say anymore. I don’t think I could have imagined what has happened this year in my wildest dreams. My nestegg has put on just under $660,000 in value this year while there is a global pandemic and the market indexes as a whole are down for the year.

My individual stocks driven by Tesla, Shopify, Netflix, and Amazon are just absolutely crushing the market as a whole. My individual stocks are currently up 106.85% YTD meanwhile the SP 500 is currently at -1.41% YTD for a market outperformance of over 108% in just over 6 months.

I have put the majority of my money in my vanguard index funds and yet my individual stocks have performed so well that they now account for over 70% of my portfolio and the 4 stocks that I listed above as crushing it now account for almost 52% of my retirement nestegg. Clearly this opens me up for some extreme volatility and so far this year its been the good kind of volatility which is exacerbating the “problem”.

Like I mentioned before when it comes time to rely solely on my investments for livable income the vast majority of my money will be rebalanced into index funds, but for now I will continue to let it ride knowing full well that a half a million dollars or more could easily be wiped off in a short period of time, but I am still ok with that.

I feel like I have done the right thing with asset allocation and my only mistake has been that I was too good/lucky with the smaller portion that I allocated to individual stocks. I just went and calculated and over the last 14.5 years that I’ve been investing in individual stocks my annualized return currently sits at 19.23%. Now granted this year has helped this tremendously but all along it’s been outpacing the market enough to make me think it was worthwhile in my specific case.

19.23% annualized returns or even touching an individual stock is not at all necessary for early retirement. In fact I would argue that in 90%+ of cases it will result in you getting to retirement much slower, but in my case I just got extremely lucky.

Taxable Account Ally- $167,917.55
Taxable Fidelity – $5,716.76
Private Stock $72,000
Traditional Rollover IRA – $77,126.62
My Roth IRA – $650,714.27
Wife Roth IRA – $375,381.24
Wife 401k – $4,647.64
Traditional 401k – $554,649.92

Roth/Traditional % = 53.77% (tax free)

Total Retirement Nest Egg $1,908,154.00
Retirement Salary (4%) $76,326

$100,000 NestEgg Milestones

Date	DOW Jones Value	MFJ Nestegg	Time to Achieve
Oct 2008	10,000	$ 69,300	29 years 2 months
Oct 2009	10,000 (+0%)	$100,000 (+44%)	30 years 2 months
Feb 2012	13,000 (+30%)	$200,000 (+100%)	2 years 5 months
Jul 2013	15,423 (+19%)	$300,000 (+50%)	1 years 5 months
Feb 2014	16,395.88 (+6.3%)	$400,000 (+33%)	7 months
April 2015	18,084.48 (+10.30%)	$500,000 (+25%)	1 year 2 months
August 2016	18,636.05 (+3.05%)	$600,000 (+20%)	1 year 4 months
January 2017	20,068.51 (+7.69%)	$700,000 (+17%)	5 months
June 2017	$21,182.53 (+5.56%)	$800,000 (+14%)	5 months
January 2018	$25,484.72(+20.31%)	$900,000 (+12.5%)	7 months
May 2018	$24,667.78(-3.21%)	$1,000,000 (+11.1%)	4 months
April 2019	$26,234.34 (+2.94%)	$1,100,000 (+10.0%)	11 months
December 2019	$28,331.20 (+7.99%)	$1,200,000 (+9.1%)	8 months
January 2020	$28,885.42(+1.96%)	$1,300,000 (+8.3%)	0 months 28 days
February 2020	$28,399.81(-1.68%)	$1,400,000 (+7.7%)	0 months 21 days
February 2020	$29,308.80(+3.20%)	$1,500,000 (+7.14%)	0 months 15 days
June 2020	$27,049.00(-7.71%)	$1,600,000 (+6.67%)	3 months 22 days
July 2020	$25,884.15(-4.31%)	$1,700,000 (+6.25%)	0 months 21 days
July 2020	$26,209.81(+1.26%)	$1,800,000 (+5.88%)	0 months 5 days
July 2020	$26,075.30(-0.51%)	$1,900,000 (+5.56%)	0 months 4 days