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October 2017 Goals and Financial Update

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October 2017 Goals and Financial UpdateHappy Halloween! Do you have any big plans for Halloween this year? We’re skipping it entirely at the RB40 household. Well, I got a pumpkin and Mrs. RB40 carved it, but that’s about it. RB40Jr does not like dressing up and he’s too scared to go trick or treating. Even candy is not enticing enough to get him to enjoy Halloween. He says he can buy his own candy. That’s okay with us. I was never into the holiday either so it’s no big loss to me.

Anyway, I’m doing our October update a couple of days early because we’re heading down to Cancun, Mexico on November 1st. I didn’t plan on it, but we’ll be there for Dia de los Muertos. Heh heh, RB40Jr will jump out of the frying pan into a fire. Hopefully, he won’t get too scared by the costumes there. This trip shouldn’t be too expensive because we used reward points to pay for the flights and some hotel rooms. I’ll write up the trip when we get back. We haven’t been there and it should be a ton of fun. The beach looks really nice.

On the financial front, October was a good month for us. Our income was good and our expenses came in under budget, even though we spent more than usual due to the upcoming Cancun trip. Okay, let’s go over my 2017 goals first and then I’ll share the details of our cash flow.

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2017 Goals

Wow, the year is almost over and there are only two months left to accomplish our New Year Goals. The year is really flying by, but that’s how it is every year. Christmas will be here before we know it. That’s Mrs. RB40’s favorite holiday and we’re all looking forward to it.

Personally, I’ve been doing pretty well with most of my goals. The yearlong goals are on track. There are 2 goals that I won’t be able to accomplish this year and I gave up on those – Pinterest and site redesign. For the rest of 2017, I’ll focus on fitness, Toastmasters, and our international trip. Fitness will be the toughest one out of these 3. It’s always difficult to regularly workout when there are interruptions such as vacation and holidays.

Check out my goal tracking spreadsheet.

Financial Goals

  1. Save $50,000 in our tax advantaged account– We’re done with this one! We saved $50,180 in our tax advantaged accounts and still have two months left. Once again, it feels great to finish this one. Next year, I should challenge myself and push it up to $60,000.
  2. Dividend Income $11,500– I’ll update our passive income post next week and you can see the details there. In the first 10 months of 2017, we received $9,705 in dividend. We’re right on pace at 84%, that’s great! This goal should be completed by the end of the year.
  3. FI ratio > 78% – The FI ratio is passive income divided by expense. Currently, our FI ratio is 97%! That’s way ahead of our target and I’m quite happy with it. We’re doing much better than expected here.
  4. Net worth gain > VFORX– Our net worth gained 12% so far in 2017. That’s really good and I’m very satisfied with anything above 10% in 2017. However, it is 4% behind our benchmark. The VFORX (Vanguard’s 2040 fund) is up 16%. I’m not going to worry about it too much.
  5. Move RB40Jr’s 529 plan to Vanguard – Finished! You can read about our 529 plan transfer here.
  6. Move Mrs.RB40’s IRAs to Vanguard – Finished!

Blog Goals

  1. Online income > $36,000/year– My online income has been incredible this year and I made $58,263 so far. I met my online income goal at the end of June. I made more in 6 months than the whole 2016 blog income. Thank you all our readers. I’m really grateful for your support.
  2. Redesign ossite – I gave up on this one. It’s too much work. I’ll try to do a minor update in 2018 instead of a big redesign.
  3. Pinterest > 25,000 visits– I gave up on this one  because I haven’t been able to grow our Pinterest traffic. It’s just not my thing. Pinterest is not fun for me at all. Mrs. RB40 will take over our social media when she retires from her full time work.

Personal Goals

  1. Fitness – October was an uneven month for fitness. I took a week off to fix up our rental condo and also missed a few days due to various appointments. Fall seems to be a busy time for me. Overall it was okay and I give myself a C+ for October. I walked about 8,170 steps per day which is more than my goal of 7,000 steps per day, nice!
  2. Start a new site – I started a new site with a focus on fitness: Fit by 40. There isn’t much traffic, but that’s okay. I’m using it mostly for self motivation. It’s working really well and I’m much more active this year than in 2016. I don’t know why blogging helps so much, but it works for me. The site was on hiatus until school started. However, I’m finding it hard to get back to blogging about fitness. I’ll just blog every few weeks or so.
  3. Join Toastmasters – I plan to join Toastmasters in November after we come back from our Cancun vacation. I found a club near where we live so it should be easy to join up.
  4. RB40Jr’s after school programs –This fall, RB40Jr is on a soccer team. We really need to get him out of the house because he’d get too much screen time if he stays at home. Soccer is a great activity, but he doesn’t follow directions very well. Hopefully, he’ll get better soon.

Fun Goals

  1. See the total solar eclipse – We saw the eclipse from Newport Beach, OR. It was totally awesome.
  2. National Park – We visited Fort Vancouver National Monument over spring break. That’ll be it this year…
  3. International Trip – We are heading to Cancun this week! I booked our tickets with points and also booked our hotels last week. I’m so ready to go.

Net Worth (+12% YTD)

I’ve been tracking our net worth since 2006 and it is very motivating to see the progress we’ve made. For 2017, I’ll benchmark our progress with the Vanguard Target Retirement 2040 Fund, VFORX. Their current allocation is about 52% US equity, 35% international equity, and 13% bonds. I thought this was a good measuring stick and we should be able beat it. Now that we’re 3/4 of the way through 2017, we are way behind, about 4%. VFORX is really killing it this year.

Our net worth is up 12% so far in 2017. That’s really good at this stage of our lives and I’m happy for 10+% gains in 2017.

Recently, I’ve been nervous about the stock market. The valuation is getting too rich for me so I’m selling a few stocks and will try to sit on the cash for a while.

Here is the picture of our net worth from the beginning of 2017, on Personal Capital. It is somewhat distorted because of Zillow. They pumped up the estimates of our properties earlier this year and then dropped them down over the last 2 months. I haven’t changed my personal spreadsheet yet. Valuing real estate is always tough. If we don’t include real estate, then the graph would rise steadily throughout this year.

net worth

If you need help keeping track of your finances, try using Personal Capital to help manage your investment accounts. We have many accounts and Personal Capital shows me the big picture in just a few minutes. Also, I’m a huge fan of their retirement calculator. You can read my review here – The Best Free Retirement Calculator.

October 2017 Cash Flow

We had a pretty good month with our cash flow in October. Our income was solid and our expense was just under budget. All in all, no big surprises. Let’s go over the details.

October 2017 cash flowTake Home Income (target > $5,000)

Our take home income target is $5,000 and we came in above that at $8,070. This is a bit below average for 2017 due to slow online income. Everything else is in line with the average.

Mrs. RB40’s paycheck: $5,637. Mrs. RB40 is doing very well at her day job. She got a raise earlier this year and she is bringing home great income and benefits. That’s one reason why she isn’t ready to quit working full time yet. She also doesn’t want to deal with health insurance uncertainties at this point. Her employer sponsored health plan is working very well for us.

Rental income: $976.

Online Income: $4,222. My online income was below average in October, but it’s still very good. This year I’m focusing on increasing our income so Mrs. RB40 can retire sooner. I’m placing more affiliate links and focusing on writing relevant articles that will be helpful to investors. Here is how we generated online income last month.

  • Banner ads: $1,735. These are the banner ads you see on ossite. I hope to make about $1,500/month from these ads.
  • Affiliates: $2,765. These are referral fees from affiliate links. If a reader signs up for a service through our affiliate link, then we sometimes earn a referral fee. One example is the Personal Capital link at the net worth section above.
  • Expenses: -$278. Internet, hosting, email service, CDN, cell phone, meals, etc…

Starting a blog is a great way to build your brand and generate some extra income. You can see my tutorial here – How to Start A Blog and Why You Should. Check it out if you’re thinking about blogging. 

Dividend income: $1,080. You can see our dividend portfolio here.

Interest: $17.

Crowdfunding: $29.

  • P2P lending: $22. I’m slowing getting out of P2P lending. I just don’t think they will do well when the economy turns south.
  • Realty Shares: $7. I started investing with Realty Sharesearlier this year. So far, I’ve invested in 2 commercial properties and an apartment complex. I like RealtyShares and I’m planning to invest much more next year. See how I’m doing with real estate crowdfunding here.

Misc: $0

Pre-tax savings: -$3,890. I sent $1,500 to my solo 401k. Mrs. RB40 saved $1,390 in her retirement account. We also added $1,000 to RB40Jr’s 529 account.

Expense (target < $4,500)

Our monthly expense target is $4,500 per month and we went over a little bit in October. The Cancun trip was the main reason why we almost busted our budget. We paid for 5 nights of hotel and took out some cash for this upcoming trip. Our clothing expense was higher than usual as well. It got cooler in Portland and we found that RB40Jr outgrew all of his cold weather clothes from last year. I needed some new clothes too so we went shopping. Other expenses were normal.

Housing: $2,289. This includes the mortgage, HOA, and property tax. Housing is a huge part of our monthly expense. We may have to move to a cheaper location to reduce this expense.

Cash Allowance: $0

Groceries: $465. Our grocery bill was average last month.

Transportation: $77. This is for gasoline and parking. We share one car and usually don’t drive much.

Pet: $0.

Kid: $42. RB40Jr attended some birthday parties last month and we got the kids some gifts.

Bills: $212. Electricity and insurance (auto, home, term life, and umbrella).

Healthcare/Medical: $110. We had a few routine visits to the doctor office.

Entertainment: $243. Mrs. RB40 got 2 tickets for The Book of Mormon. She also went out of town on anther business trip and met up with some friends. This category also covers my gym membership and eating out.

Travel: $861. I paid for 5 nights of hotel, airport transfer, and took out $500 cash for the Cancun trip. We probably will take out another $500 to spend on a tour and eating out when we’re there. I’ll write up the trip when we get back.

Clothing: $193. We got some new pants and long sleeve shirts for RB40Jr. My clothes were disintegrating too so I picked up some cold weather clothes while we were shopping.

Misc: $0.

YTD Extra Savings: $58,169

October was a good month and we saved $3,577 in addition to our tax advantaged savings. Our income is doing really well this year. So far in 2017, we saved $58,169 extra. This is much better than 2016. What did I do with the extra money?

  • I stashed $30,000 in VNQI. This fund will be cashed out when Mrs. RB40 retires.
  • invested $18,000 with Realty Shares. This is working well so far and I’m planning to ramp it up much more next year.
  • The rest is in our savings account for now. My online income is much higher than last year and we’ll have to pay more taxes next April, at least $5,000.

Can Mrs. RB40 retire?

This is a new section I added for 2017. I want to see what happens if Mrs. RB40 stops working full-time. Basically, I will remove Mrs. RB40’s income from our spreadsheet and stop contributing to our tax-advantaged accounts.

Drum roll please … for October 2017, Mrs. RB40 could retire early! We had another good month and it looks like we should be able to keep this up for the rest of 2017.

If we remove Mrs. RB40’s income from the spreadsheet, we’d still be ahead $1,831 in October! My online income is strong this year so this challenge has been a bit too easy. Online income could be fickle, though. Last year’s online income was much lower than 2017.

October 2017 wrap up

October 2017 was another solid month at the RB40 household. My online income was lower than average, but still really good compared to 2016. Our expense came in right under budget even with our upcoming Cancun trip. That’s good news. Everything is just going really great this year. We haven’t had a nice streak like this in a long time so we feel good. Usually, our finances has more ups and downs.

The next two months will probably slow down a bit because of Thanksgiving and Christmas. A lot of people will take time off to be with family and friends. The blog traffic will probably slow down a bit, but hopefully we can maintain the same level of income. Oh, we have a big expense coming up, though. Our 1960s era HVAC system hasn’t worked for about 5 years and I kept putting it off. We’ll get a new system soon and that will cost around $7,500. Ugh, being a homeowner can be a pain sometimes.

Did you have a good October? Do you have any vacation plans next month? It’s a great time to go on vacation because there are so many days off at school. We’ll be gone for 10 days, but our kid will only miss 4 days of school. Pretty good timing, right?

{ 34 comments… add one }
  • Lily @ The Frugal Gene October 30, 2017, 7:02 am

    I’m such a perv for online income reports and traffic reports – it’s terrible 🙂 I should stop prying but blog income just looks so magical to me. I have no idea how it’s pulled off.

    My husband and I are not taking any days off in October, he was supposed to but a project was delayed and things are more stressed than ever. I always reflect back to your post about why you quit your job as an engineer. It’s happening to Jared and the stress is painful to watch from a loved one. Oh wells! More fuel for that FIRE 🙂

    Is RB40 Jr good at soccer? He’s so young, my husband had soccer practice too but he started much later – age 5 and on.

    • retirebyforty October 30, 2017, 1:40 pm

      You need some traffic to generate blog income. I’m sure you’ll get there at some point. AirBnb is probably a good affiliate for you.
      Sorry to hear about the pressure. It’s tough when there is a deadline. You can deal with extra work and stress when you’re young, but it’s much harder when you have other priorities.
      RB40Jr isn’t that great at soccer. He started at 6 so it’s about the right age.

    • Mr. Tako October 30, 2017, 11:04 pm

      I totally agree Lily, that incredible blog income that Joe has is some kind of amazing black magic! Hell, I’m happy if ads cover my monthly hosting fees!

      Great October btw Joe, you guys are really killing it! Can’t wait to see some photos from your Cancun trip. We just got back into town tonight after a month in Japan. It was an incredible trip, and I wrote a ton of blog posts on it!

  • Steve @ familyonfire.org October 30, 2017, 7:30 am

    Another great month. Have fun in Cancun.

    • retirebyforty October 30, 2017, 1:40 pm

      Thanks! I’m sure we’ll enjoy Cancun. The beach looks great.

  • [email protected] October 30, 2017, 7:35 am

    I agree with Lily. The blog income is amazing! I find it very motivating. Hopefully one day I’ll generate some income from my blog. For now, I’m just happy knowing that I’m helping out my readers. Congrats on such as successful year thus far. With the market’s success, this has been a good year for many of us. The difference for you is that you are accomplishing your financial goals without working for the man. Thanks for showing us all that it’s possible.

    • retirebyforty October 30, 2017, 1:40 pm

      Good luck with your blog! Keep working on it and I’m sure it will improve.

  • Ms. Frugal Asian Finance October 30, 2017, 7:36 am

    Congrats on a successful month of net worth gain and blog income increase! It’s awesome to see that your blog income in 2017 has almost doubled that in 2016. WOW!

    After Mr. FAF started working, we started to max out our 401(k) too. I plugged in the numbers in the Vanguard calculator and just couldn’t believe what it will do to our future networth when we’re 60. @[email protected]

    I hope you and your family will have a great trip to Cancun! Sounds like fun! ^.^

    • retirebyforty October 30, 2017, 1:41 pm

      Thanks! I hope I can maintain this level of blog income for a few years. It tend to deteriorate, though. Then I need to find a different way to generate income.

  • GYM October 30, 2017, 7:43 am

    Your family is totally rocking it! Your monthly blog expenses are also really low too, which is great. Cancun sounds really great, perfect time to go away since it gets pretty cold in the PNW soon. Any luck with your rental yet (eg sell or find a tenant).

    • retirebyforty October 30, 2017, 1:42 pm

      We haven’t found a tenant yet so I’m putting it on the market this week. We’ll see how it goes. Thanks.

  • Anita October 30, 2017, 8:30 am

    Just reading your updates continues to provide me with an incentive to continually review where I am financially. I retired 2 years ago and now I have more time to pay attention to the details of where my $$$ are going. Have a great trip!

    • retirebyforty October 30, 2017, 1:42 pm

      It’s great that you’re paying more attention to your finance. Showing up is half the battle.

  • [email protected] October 30, 2017, 8:54 am

    Congratulations Joe on another great month! Your online income is really good so far, what are your main affiliates programs? Noticed you still had rental income, did you find new tenants? Have fun in Cancun

    • retirebyforty October 30, 2017, 1:43 pm

      The main affiliate programs are Personal Capital and RealtyShares. The rental income is from our duplex. That’s pretty stable right now.

  • Dash2Retire October 30, 2017, 10:08 am

    Wow – great job with the blogging income! We’re invested in the Vanguard Target Retirement 2030 (not much different than the allocations in the 2040 fund) and we’re pretty happy with the returns from this year too!

    • retirebyforty October 30, 2017, 1:44 pm

      The target funds are doing great this year. It’s so simple and it works really well.

  • The Grounded Engineer October 30, 2017, 10:13 am

    Great work, Joe! I love these updates. Now you need to put the hard sell on Mrs. RB40 to retire!!!

    • retirebyforty October 30, 2017, 1:44 pm

      I’ll let Mrs. RB40 make her own decision. 🙂 Life is too good right now to throw in a big change. We’ll cross that bridge when we get there.

  • Angela @ Tread Lightly, Retire Early October 30, 2017, 11:05 am

    Incredible job on crushing your finance goals! I agree, you need to up these next year so they can really be a stretch to get to 😉 I wonder where you would be now if your goal had been $60,000 saved this year? Would you have done anything differently?

    I’m finally buckling down and looking at all of our expenses line by line instead of just “saving money.” My goal for 2018 is to save 50% of our income, which is a pretty lofty goal since we were at 22% last year. I figure even if I come short, we’ll still be way ahead.

    • retirebyforty October 30, 2017, 1:46 pm

      I like making achievable goals, but I’ll try stretching myself next year. I don’t think it’s going to make much difference when it comes to saving. We’re already saving as much as we could. Good luck with your saving goal too. 50% is very good.

  • FullTimeFinance October 30, 2017, 11:17 am

    Man your really hitting your goals. I’m on a gauntlet of vacation and work travel next month. The vacation itself was totally unexpected. The benefits of living below our means is we could jump on an opportunity on a whim.

    • retirebyforty October 30, 2017, 1:46 pm

      Thanks! Have a great time on your vacation.

  • [email protected] October 30, 2017, 11:22 am

    Do trick or treaters usually come to your house? What does RB40 Jr do? My son likes Halloween but hopefully there aren’t any scary costumes cause he scares pretty easily! Good job with the blog income, that’s a big jump!

    • retirebyforty October 30, 2017, 1:46 pm

      We don’t have trick or treaters. That’s too bad..

  • [email protected] October 30, 2017, 11:22 am

    Another great month Joe. The blog income is amazing! Have fun in Cancun

  • Katherine October 30, 2017, 1:44 pm

    Another amazing month Joe! You continue to inspire me every day. It’s been hard keeping up with posts and getting words out about my website. Looks like there aren’t too many blog readers nowadays. I’m trying hard to use bullet points and less words but I just blab on way too much. Thank you for sharing Joe, this post is giving me a lot of motivation. Make sure you bring lots of dollar bills for tipping. People there seems to live on tips.

  • Brad - MaximizeYourMoney.com October 30, 2017, 2:49 pm

    Congrats on the positive momentum! And the blog income is awesome – good job!

  • Wes October 30, 2017, 5:09 pm

    Awesome month! I hope to be as successful as you one day!

    Enjoy the hard earned vacay!

  • David @iretiredyoung October 30, 2017, 10:53 pm

    Hi Joe
    I really look forward to your posts, tons of interesting stuff, and they’re easy to relate to as they come across as written by the type of guy who could live next door (albeit the young successful guy who somehow doesn’t need a job!).
    Seems that 2017 is going really well for you, for sure you’ve earned the Cancun vacation, and a bonus that it’s not costing too much either.
    Interesting that you’re getting out of some shares and into cash. I’ve got some cash to invest now and have decided to bite the bullet and put it into some Vanguard funds. I think I might have some short or medium term pain with that, but as I can leave it there for 10+ years it will hopefully be OK in the end. My timing always sucks!
    Have a great vacation.
    David

  • Turning Point Money October 31, 2017, 5:17 am

    Congrats on 12% YTD gains on net worth. Always good to see it going in the correct direction.

    Enjoy some fun in the sun!

  • Tom @ Dividends Diversify October 31, 2017, 7:53 am

    Funny, my wife and I are not into Halloween much either. I feel like such a grinch since it is such a popular holiday and not just for kids. Great job on your blog income. So impressive and inspirational for a new blogger trying to find his way. Have a great trip. Tom

  • Kris October 31, 2017, 3:56 pm

    Congrats on the blog income increase, you are racking it in.
    Have fun in Cancun with the family!

  • Joe October 31, 2017, 8:34 pm

    Amazing blog income. Loved reading your blog, one of the top three for me for personal finance. Surprised your properties’ values went down on Zillow, thought most housing markets have rising prices still. Zillow doesn’t seem that accurate sometimes but still a useful site. Overall, you guys are doing great. Enjoy your vacation.

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