It is time for the monthly airing of my private financial laundry. I hope maintaining a journal of my savings will help provide additional motivation and allow me to spot trends. The theory is that if my savings are not behaving as expected, I will drill down and figure out what happened.
I posted a couple of prior updates in this journal. All of these are available on the Savings Diary page. The first, I’m Just Saving…Personal Finance Diary kind of sets the table for the series.
A few years ago, when I first got more serious about saving, I did use budgets. I think of budgeting like a diet. It’s a good kick-start, but the more lasting benefits are going to come from lifestyle changes that become automatic (and require less sustained willpower). I use Mint to closely track my spending, so its not like I don’t have a grip on where my dollars are going.
I also try to use tax incentives as motivation. My wife and I have access to a number of tax advantaged accounts. If we were able to contribute the max to all of these accounts we would be able to place roughly $60,000 per annum into tax advantaged space (and that’s not even using our allotment of I Bonds).
This month I restarted contributions to the 457 plan. I suspended them after the birth of my son in order to build a cash buffer for baby/daycare expenses and just adjust to the new, larger family.
Let’s see how we did this month:
In our last episode (end of April) I had worked up to about $180,000. As a reminder, I only include liquid investments in these monthly figures as I don’t think it is very helpful to start marking my real estate and other illiquid assets monthly.
As of the end of May, I am up to a little over $184,000 in investments. So, I made a little progress last month. I added about $3,100 in contributions to investment accounts. The (very meager) remaining increase is attributable to dividends, interest, and price appreciation.
I was down a few thousand bucks in quoted value one day this month(!), when the “Quitaly” stuff was in full bloom. I’ve got about 50% of my total investments allocated to foreign (ex-U.S.) investments. See Media Pin of the Week – More GMO, Weekly Media Pin – Grantham on Graham, Best Foreign Value Factor ETFs, Resource Roundup: More CAPE, and Foreign Value Factor ETFs Update. Most of this is in EAFE. None of these investments are currency hedged so the strength in the dollar has also been impactful.
In June, my portfolio should take a step back as I am planning a fairly large expenditure. It is my 10th wedding anniversary. I’m planning on helping my wife get a nice new (to her…hopefully) vehicle. She’s due for one and it was probably either that or jewelry, so when I frame it like that, I am making the practical choice. I will probably give her ~$10K for our 10th anniversary or something like that.
Due to this nonrecurring expense, I am going to defer commencement of the Tesla Tithe. Elon said he doesn’t need the money now in any case.