Tag Archives: money

How I Grew My Networth from $15k to $1M in 15 Years

In 2005, I had about $5k to my name. By 2010, I had increased that amount to $88k while living in high cost of living (HCOL) area and earning an average salary of $56k for those first years out of college. Five years later, my networth hit a respectable $342.4k. I kept working at startups with decent-but-not-great pay (stock options are worthless) and lived relatively frugally over the years.

By 2017, I achieved my first goal of $500k — a bit milestone, as I wanted to have $500k in the bank before having my first child–and I made it! Thanks to finally switching to work in a public company (and that company performing stronger than the market), I’ve been able to dramatically increase my networth in a short amount of time… doubling it in under 2 years. I haven’t really spent time to appreciate that I actually doubled my networth in two years.

Do I think anyone can do this? No. I got lucky. Some of this lucky has to do with my working at a lot of different startups and building up a reputation for being good at one thing that ultimately got me the job I have now. Will I continue to make such a high salary? No — probably not. My income is largely dependent on my RSUs and after I vest the remaining two years of stock, I’ll be back to a lower (but still good) salary. I’ll need to leave my company and find a new job for a chance at making close to the same income. Hopefully by then my experience at this company will get me the ticket in the door at another company that pays well and will offer me a good compensation package.

I know a lot of people look at my income now and think–well, I’ll never make that much. And that’s probably true if you work in a different industry that doesn’t offer RSUs as part of your compensation package and you aren’t a highly skilled employee. But you can see you can still save quite a bit on a lower salary in your 20s if you are single and don’t have kids. Now, I admit I did not have college loans to pay pack (thanks to mom & dad) so you can fairly say that my total networth should be about $200k less than is now, or even less than that since I would have lost out on compound interest repaying a loan. So comparably to others who have loans, my networth today is about $800k and by the end of this year will be $1M or more.

I still have a long way to go to achieve my goals. I want to get to $2M before having my third child (whether or not I have a third child is dependent on achieving this milestone by the time I’m 38 or 39) and I want to buy a $1.7M house. Below, you can see my income, networth, and YoY growth for the last 15 years. I plan to continue tracking this for the rest of my career — subscribe to my blog to get updates and learn more about my path towards wealth. If it inspires you to save a little more each month — awesome! Remember, I live in a 800 square foot apartment with my 22 month old and husband and drive a used car built in 2011.

Year Income Networth $ Growth % Growth
2005 $15k n/a n/a n/a
2006 $35k n/a n/a n/a
2007 $50k $24.9k n/a n/a
2008 $60k $15.8k -$9.1k -37%
2009 $60k $32.7k  $16.9k 206%
2010 $120k $88.6k $55.9k 270%
2011 $90k $145k $56.4k 64%
2012 $100k $200k $55k 38%
2013 $110k $253k $53k 26%
2014 $125k $299.5k $46.5k 18%
2015 $160k $342.4k $42.9k 14%
2016 $190k $416k $73.6k 22%
2017 $130k $551.3k $135.3k 32%
 2018  $300k  $625k  $73.7k  13.3%
 2019  $400k  $1.05M  $425k  99.83%
 2020  $500k $1.3M Goal  $250k goal  23% goal

Saving for a Two Million Dollar Networth by March 2022

Life has been busy these days. I’ve been busy saving 2 million dollars. Well, not yet. But I’m shockingly well on the way to a family networth of $2M before I turn 40. This number seems ridiciously large AND small at the same time. It’s obviously large. If $1M seemed large, $2M seems much larger. It is an amount many people would consider “rich” — although not in the Bay Area.

I also don’t really consider my networth close to $2M, since I actually track everything on a post-tax basis. I map my investments to an allocation plan that my former CFP provided. I also have a chunk in cash (not seen below) because that’s for the downpayment of the house I will be buying soon (hopefully, house TBD.)

Screen Shot 2020-05-10 at 7.48.24 AM

The orange are areas where I’m underinvested. I’m quite over in large cap but that’s because of my probably too high concentration in company stock. My company has performed quite well (so well that I do kick myself for selling my RSUs at a fraction of the price it is today.) I’m glad I held on to a good chunk of my ESPPs (for now) as it is unwise to do this financially speaking (you get a discount up front you’re supposed to sell immediately and not take a risk on that money) but I decided to hold a little under 1000 shares and it definitely is helping get me closer to achieving my goal. I still have a significant chunk of RSUs and ESPP coming in the next two years… so that’s where I’m estimating my family will achieve $2M PRE TAX by the time I’m 38. Maybe we’ll get there post tax by the time I’m 40.

Do I feel rich? NO. But I do feel INCREDIBLY LUCKY to have a job that pays well, let alone a job at all right now. It feels weird and I’m looking for ways to give back. I donated $100 to a local food bank but that’s not enough, so I’m considering how to give more while also still staying on track to our goals. My donation plan was always to save as much during life, invest well, and then in your will put a % of your savings towards charity. That way if times get tough later in life you have the money if you need it, but you still have a plan to give back to the world. But right now the world clearly needs it, and I’m overwhelmed by trying to figure out where to give and how much. It is definitely on my mind — but so is buying a house and having a 12 month emergency fund and hopefully being able to work part time in a few years because…

I’m apparently pregnant.

Shh, don’t tell anyone. It is top secret. It’s super early and only my husband knows. We started trying this month and thought it would take a while because last time I needed infertility treatment to get pregnant. Low and behold, boom, happened right away. I’m excited and scared and will write more about this later but clearly it shifts our financial picture. Before I was considering moving further from my office to have more space in case I had another kid, now I definitely am thinking about this option. We’re still talking about $1.5M homes, but they are much bigger and right now we want space and with another kid we will def want that space. We could still rent for a few years but I want to settle down in a neighborhood where my son can make friends  and we can meet other parents and just feel at home. I’ve been living semi frugally my whole life (we’re still in a 1 bedroom apartment even though we can clearly afford more) and I guess I’m ready to take the plunge.

I did run some numbers based on a more conservative house buying formula and found that we need the following amount in savings/cash before we buy a home for the following prices:

House Cost Cash Savings
$1.5M $436,542
$1.7M $494,000

I also determined that to have 30% of our networth be in home equity (and emergency fund) that we’d need approximately $1.95M in networth to buy a $1.6M home. (My gap analysis below) but clearly we’re not going to get there before we buy a home now, so I’m going to do my best to try to reduce the home cost while also buying something we can grow into. More on that later.

30.0% 43.0% 5.0% 27.0% 5.0% 12.0% 8.0%
23.1% 33.1% 3.8% 20.8% 3.8% 9.2% 6.2%
43.00% 5.00% 27.00% 5.00% 12.00% 8.00%
goal $450,000 $645,000 $75,000 $405,000 $75,000 $180,000 $120,000
gap $450,000 $284,705 $47,142 $252,465 $47,525 $160,066 $89,103

 

Right now my estimates have us at about $1.96M pre tax in March 2022. That’s so soon! If I can do this, it will be pretty incredible. I just have to keep my job. Through a pandemic. And a pregnancy. How hard can it be?

But the reality is I’m scared. Yes I have a lot in stocks I could sell to cover the mortgage for a while… and right now I have a job. But will I have a job in a year? Who knows. My company may need to have layoffs at some point. I really don’t understand how they would decide that and who would be laid off, but I definitely am not “safe.” So I have to assume that at any time I could lose my job, and at that point it would be hard to find a new one. I will just hold my breath through my vesting periods and pray (even though I don’t pray) that I can get through the next 19 months until I get most of my stock. That’s 8 months of pregnancy, 3 months of maternity leave, and 8 months of being exhausted and holding on for dear life.

Please, wish me luck. I’ll need it!

Financial Planning in the Age of Coronavirus

Like many of you, I’ve been trying to stay afloat–mentally–under stressors that appeared practically overnight. With the economy humming along somewhere through a very long bull market, it was clear the upward tick to the markets wouldn’t last forever. However, I don’t think anyone thought it would end so jarringly.

I sit here from my “shelter in place” apartment in one of the worst hit counties in California. My company went a little early in moving to WFH and I’ve been adjusting, but the last weeks have been a bit of a blur. On the Saturday before my company decided to move to a WFH policy, I felt I was coming down with something. I don’t think I had a fever, I just had mild aches, and my chest immediately felt impacted. I went to work on Monday (if I had a fever I definitely wouldn’t have) and waited for my company to make the call. It wasn’t far into the day Monday when whispers of the company going fully remote made their way around the office, then an email formalizing that we would no longer be coming into the office for the next few weeks.

My lungs tight and heavy managed to breathe a sigh of relief. All I wanted was to get home and keep my family safe. At the time my 76-year-old father-in-law who provides childcare was still coming to our house via the train. It made no sense. I feared for his health and safety. In those 24 hours our worlds changed. Grandpa no longer would take the train to provide childcare. But my husband and I would still continue working, albeit with both of us WFH, with no childcare.

Over the next days my lungs felt like they had a cool liquid pouring into them, a slight burning sensation, and I felt winded after walking or picking up around the house. With no fever, I didn’t want to be a hypochondriac, but I emailed my doctor and she said normally she’d have me come in to check out my symptoms (as they were concerning) but with coronavirus going around she couldn’t, so she’d just treat me for pneumonia–just in case that’s what I have. Coronavirus testing was out of the question since I hadn’t been to another country recently and had no known contact with another person who tested positive. I was put on a course of powerful antibiotics and provided an inhaler to help me breathe.

The next day, our entire region went on full lockdown.

Two weeks later, my lungs still hurt. I’m not sure if the antibiotics did anything. I’m not convinced I have coronavirus, but I’m also not convinced that I don’t. My husband had what appeared to be a bad stomach bug with a low fever the same week I first felt ill, and now coronavirus reports say that sometimes it starts with gasterontestinal issues. He too felt some tightening in his chest. Neither of us were coughing, though–so what we have could be pretty much anything. If it’s coronavirus, we’ll never know outside of suspicion. I know whatever is happening to my lungs, this cold fluid sensation and the tightness in the center of my chest, is new to me. Could it be crippling anxiety? Sure. But the cold fluid sensation is strange and I continue to have mild respiratory symptoms.

I think I’m ok. Physically I’m just trying to take it easy. Mentally, I’m a mess. I know way more than I ever wanted to know about pandemics and how they exponentially spread. I’ve spent countless hours trying to convince my boomer mother, stuck in her snowbird condo in Florida, to take this seriously–especially given she’s in an area with a lot of older people mixed with young tourists where things will likely get bad.

Then, there’s my portfolio. Down something like $200k, give or take, prob give quite a bit more in the coming weeks. I’m a buy-and-holder, and got my start in investing right before the 2008 downturn, so I believe in the power of investing when everything is going haywire and how the recovery is when wealth is made. Downturns are good for the market and give us a time to buy on sale. But this whole situation is unprecedented and things can get a lot worse than they are. It’s unlikely–given its fatality rate–that the economy will fail to recover once a vaccine is tested and brought to market. But I don’t know how the economy can handle everything shutting down for a while, especially if this goes on (or on and off and on again) for 18+ months.

I’m using this opportunity to rebalance my accounts, but not to sell for no reason. I’ve been doing some unrelated research regarding asset allocation including real estate, as well as what one should really have in cash for a home purchase. I’ll write another post about that eventually, but I’ve basically determined that 30% of my net worth should be held in real estate. I’m looking at 30% of my net worth including a downpayment, closing costs, and a conservative 12 month emergency fund. In order to afford a $1.7M house, we need $500k cash in the bank.

My CFP who I hired for a year (who is no longer my CFP) recommended putting my downpayment into municipal bond funds for the tax advantages over the low interest-paying savings accounts. Well, that plan went to shit in the last two weeks. Apparently muni bonds funds are usually super stable. But after I put $200k into them, they decided to become volatile in a way they haven’t been since 1987. So far I pulled out the $200k (down to $192k) and put it into a short term bond fund, to take the loss in the intermediate state muni. That hurt a bit. Will probably just move everything to cash soon. It seems like this will be the year to buy–that is, if I can keep my job!

On top of all of this I’m not questioning the timing of trying for my next child. Due to infertility issues (at least with my first kid) plus now my “advanced maternal age” of 36, I really don’t want to wait. I also really don’t want to be pregnant–with the weakened immune system that comes with that–in the middle of a global pandemic. If I do get pregnant, we also have to move, which isn’t horrible since I do think this will be the year to buy. But if we’re on a year-long shelter-in-place, I don’t know how we’d move. We couldn’t even look at houses–or rentals for that matter. I think we could manage a year with two kids in a one bedroom (we’d save a ton that way) but legally you’re not allowed more than 2 adults and one kid per one bedroom, so we’d be in a bad situation… if it gets to the point where I’m pregnant and we aren’t allowed to leave our homes except to get groceries and medical supplies.

My overall thoughts right now is:

  1. Make sure we have our downpayment fund (ideally $500k) secure in cash or cash equivalents by fall (we have about $363k right now if I sold the bonds, and if I needed to I could make up for the rest selling stocks, but I’d prefer to not have to do that.) Be ready to buy when no one else is buying.
  2. Try my best to keep my job. I’ve actually been making progress on my coaching plan and things seemed to be turning around. Then Corona hit and–who knows. I’d be on the chopping block if there were layoffs, probably. I’m hoping we don’t have layoffs coming, but I have to assume they are with the state of the world. If I assume they are, then buying a house sooner than later makes sense (kind of, I mean not having a job won’t be great after buying a house, but that’s why I’m making sure we have a 12 month emergency fund.)
  3. Just try to get pregnant and see what happens. Worst case, I’ll be giving birth while incubated with a shared ventilator wrapped around my head, with my husband waiting from home to hear if I’ve survived childbirth and coronavirus and if the baby is ok. Ok, that’s a pretty horrible worst case, but it’s a possible one. More likely if I were to get pregnant I’d get a different standard of care as the doctors would try to keep me out of the office as much as possible. Given my infertility situation, it’s still unlikely I’ll get pregnant naturally. I do worry about being able to get infertility treatment in the next year, especially if we need something beyond the medication-based treatment protocol we did to conceive baby #1… The good news is that I conceived baby #1 right after a 3 month in-between job break where I focused on my health, travel, and relaxing. This isn’t exactly the same scenerio–I’m working and stressed–but I think over time with this WFH situation, if I can manage to keep my job and be as productive as I know I can be WFH, I can really focus on making the most out of every hour in the day to eat healthy, exercise, sleep, and do the things that set my body up for the healthiest possible pregnancy.

Things sure are crazy for everyone these days. I know I’m not alone. I’m trying to figure out how to balance being a mom and working from home with no childcare and getting to that level of health I want–I ordered some new running shoes and plan to use them, while staying six feet away from the other residents of my neighborhood, to disconnect from the panic sensation that fills me daily and reconnect with the sounds of nature and the taste of spring air. I hope things go somewhat according to plan, but not counting on it.

 

 

 

 

Time Just Keeps On

There is something about turning 36 that feels different then turning anything prior to this. Maybe it’s because I’m now mom to a little monkey man who I must keep alive and nurture and support. The one thing I have the chance to do right in all the world is raise an emotionally healthy kid. I’m trying.

The money thing is getting old. By “the money thing,” I mean working a job that pays enough to provide the potential to maybe be able to afford a life that meets the expectations I’ve set for myself and my family.

You know, I thought when I saved $1M I’d feel some sort of–something. It’s a major milestone and I’m there, give or take, by end of this year. Yet, there’s just this emptiness. It isn’t enough to provide financial security, so it is really meaningless. But it’s also so much more than what most people have, so I also have guilt multiple by every dollar I’ve saved. My privilege made this all possible, and I don’t deserve any of it.

I really don’t know what I want–and it doesn’t matter any more. I want so much and so little. I want to pause time, revert time, swallow time whole, but of course, that’s not possible. It keeps ticking on and it always will. My saving grace will be giving up wanting anything at all. To silence my mind from spinning up a thousand scenarios and just see what’s good right in front of me, in the moment, that often doesn’t cost a damn cent.

The Job Downward Spiral: There’s a Physics to my Employment

Either I’ve done a better job overall this time around or things just move slower in public companies. I think it’s a mix of both. But now a year-and-a-half in and it’s clear I’m past the phase of newcomers victories and excitement and well into the phase of “I suck at this.”

I’ve been assigned a few larger projects to manage and after failing at one or two my boss was really hoping I could pull off the latest and greatest, but nope, I fell right on my face. Looking back I see a few areas where I could have improved, but overall I just feel lost. I don’t know how to help drive collaboration when I’m unsure what the expectations are. I did uncover these expectations along the way (and feel I could do a much better job managing a project like this next time) but the problem is I seem to keep missing the obvious and not getting what I’m supposed to be doing… which at my level, as my boss points out, is not acceptable. She used nicer words, but that’s what she meant.

The good(?) news is that I’ve been assigned a slew of projects that I HAVE been successful at. Unfortunately, these projects are one-off “do not make any sense on a future resume” type of projects. Maybe it’s time I stop caring so much about said future resume and just try to do what I do best–which is run with the punches and take on creative projects that no one else would have the foggiest how to manage versus trying to become a manager of cut-and-dry processes and failing time and again.

At 35, it’s no longer cute to fail or figure shit out. I should have it figured out by now and it’s clear I don’t. I’m scared because without resume-building projects I have no where to go after this. It’s hard to have that conversation with your boss because you aren’t supposed to be thinking about “after this.” And it’s less about moving up at this point and more about maintaining some semblance of a living wage once this job is no more. Maybe I’ll stay in this role until I retire with inflation-based raises, but that’s unlikely. I know my boss sees that I can do SOME things well (otherwise I’d be OUT already) but is that enough? I don’t want to be the easy to cut person in the organization and without adding clear value I’ll be cut sooner or later.

I just wish the last project didn’t end up the mess it was. I really don’t know how I could have done it all better. I still am not sure I could really do it better if I started over, which is the scary part. I don’t know how to get teams inspired to do great work, or to collaborate. Everyone seems to think I go off and come up with ideas on my own and decide everything without consulting others, but I keep asking everyone else what they want and I’m not getting any answers. I guess I’m not asking them in the right way. Or… they just hate me and don’t want to collaborate. I don’t know. My one co-lead on the project was super nice, but he also ended up driving things down a path that made it all more complicated and took away my control–which, funny enough, is what my boss wanted me to have… control to make the project great, but then also be collaborative and get everyone else’s input, but to lead. At the end of the day, I’m a shitty leader. But I’m not going to stay in a senior-level role without BEING a leader in my field. Independent contributor is not worth much and I’m way overpaid to be one right now. Good problem to have? I guess. It makes me feel like crap every day. I can’t even look my colleagues in the eye anymore.

I’ve set 7 time-based goals for myself to stay in the company and just try to survive. And by survive I mean do great work that keeps me employed, but also do not try to move up or gain resume-building experience… just do whatever my boss(es) want me to do and stop trying to do the things that would help me move up but do not come naturally to me. That’s 7 dates across 33 months that I need to survive and then, as long as there isn’t a major recession, I’ll have some sort of flexibility to figure out my next steps… I mean, not a ton of flexibility because if I have a mortgage and another kid, flexibility is out the window unless my husband is willing to move to a lower cost of living area and he isn’t.

It is just all so suffocating… I’m so fortunate for all I have and I know I’m in a much better spot than many others in this country, but I just can’t breathe. I don’t want to get caught in this self pity crap but I also don’t know how to be better. Once I start thinking this way it’s hard to focus and be productive. Every little thing I do I self doubt so much that I slow down my output and my output gets worse and worse until I inevitably get let go. Fired. Whatever. That’s what I do. It’s not funny. It’s not poetic. It’s just my life.

But with a toddler and wanting another child, it CAN’T be my life. I’m really fucking scared right now. I don’t know if I’ll ever see the day I have a. job where I’m not worried about getting fired. This is the best situation yet as the head of the department likes my work and has given me the opportunity to do projects seen by our senior leadership team, but that still doesn’t make me professionally immortal. And I know even if I can hold on for dear life these next 33 months, there’s still after that… if my resume has nothing on it other than weird projects that make no sense at another company, or would be comparable to what a much more junior person would do with a much lower salary, I don’t know what I’ll do —

I was talking to my husband and we agreed that our mortgage should be no more than $5000 with his father adding another $2000  in rent (basically $2500 for each of us per month plus $2000 for his father.) My husband really wants his mother to go in with us on the property but I’d prefer to buy separately and just have his father rent from us (his parents aren’t married, it’s complicated, but I am comfortable living with his dad if he is renting from us and it’s clean cut like that.) So we can put down $300k on a $1.5M property which is about $7k a month. That might be doable even if I lose my job, but it will be hard to maintain 30 years of a career that can support $2500 a month. And it’s going to be very hard if not impossible to find a place that costs $1.5M that has a good place for his father to live.

Ugh. When will my life not be a mess?

Why I want to be rich

When I was younger, being “rich” equated to buying stuff. Now that I’m older and wiser, I still want to be rich, but for different reasons. Sure, I still want to buy things, but the things I want to buy have changed substantially.

Having just hit the $1M milestone with my husband (with almost 90% of it being my savings), I am not rich yet, but feel finally on our way. Rich, to me, is having $10M in assets. This is what I would do if I was rich:

  • own a home outright and be able to comfortably afford taxes and maintenance on investments/interest (i.e. in Bay Area a $2M home)
  • easily afford college for all kids in full and leftover $ to help them get started out (but not to the point where they become lazy)
  • pass down some wealth to my children–enough to help them but not enough so they do not know the value of a dollar
  • “treat” friends and family to meals out, buy them nice gifts, even take them on vacations and pay for the trip
  • donate to causes that matter and/or put $ into trust for later donation after it grows to more substantial amount.
  • take time off to spend with family and travel
  • afford IVF if needed to have 2nd + 3rd kid
  • pay for kid’s extracurriculars, camps, pre college programs, etc, without worrying about $
  • have enough financial stability to start my own business (or non-profit) and it not impacting long term financial goals
  • not worry about retirement or long-term care or unexpected disability
  • hire household help to cook healthy meals, clean, personal trainer, etc, esp while working
  • buy my mother a home and make sure her financial future is stable
  • help future grandkids out as needed
  • take classes in art and photography, focus some time on my hobbies and see if I can get any better at them
  • write books or at least have the time to write them

I don’t think I’ll be “rich” ever but if I do get to $10M it will be after many years of working and I’ll likely be on my deathbed! But it’s good to have goals!

Will this be my $1M year? One million is just the start.

Screen Shot 2019-07-04 at 8.51.32 AM

It’s crazy how one turn of good luck (or perhaps a series of turns) can make such a huge difference in your net worth. As you can see from the chart above, my net worth has been gaining steadily since 2007 — but suddenly in the last year it has jumped from $625k in Dec 2018 to $884k in July 2019. That’s kind of insane.

How did my networth increase $259k in 6 months?

Well, it’s mostly paper gains at this point — and given we’re likely headed to a recession, I see the blip up evening out over time. Still, $259k in 6 months — seems impossible, except I have the data to prove it actually happened.

Between the stock market doing well overall and my company stock doing even better, I’m achieving some major milestones faster than I ever though I would. My goal of reaching $1M by 40 now seems like it might be achieved THIS YEAR. It’s possible, depending on when a recession hits. I estimate by the end of the year, I should have another $100k in my various workplace stock plans, which, if the market doesn’t drop, gets me to $984k. That’s close enough that I could hit $1M by the end of 2019 or even before my 36th birthday.

If you add in my husband’s accounts, our overall networth looks even better. Currently, our total net worth (we do not own real estate so this is cash/stocks/bonds only) is 130k (his) + 884k (mine) = $1.01M!!!

So, while I don’t count my husband’s $ in my net worth, if I did, this actually IS the month we crossed the $1M threshold. I feel like I should celebrate or something. I wish my husband was as excited as I am.

It’s funny because when I was 21, I thought $1M was completely unachievable. I also haven’t increased my lifestyle that much. After all, I’m still living in a one bedroom apartment with my husband and 1 year old.

Once my own networth hits $1M, I think I might be willing to move into a larger space. I’d like to get to $1.5M (doable in the next 3 years) before I purchase property. This way if I own a home worth $1.8M, I know I have the $ to pay it off (mostly) if I had to… that’s what financial security is to me. I don’t mind debt, as long as I have the money to cover it available and the debt has very low interest rates. Or, maybe we’ll buy sooner. I think once I get pregnant with #2 it will speed up the process. For now, we like our apartment a lot, and it’s hard to think about moving. Maybe an extra room would give us more quality of life, but it probably would just become a storage room (however, I would like if my husband moved his office/gaming computer out of our bedroom!)

Anyway, I’m celebrating our $1M here because my husband doesn’t care and it’s a pretty big deal. I certainly don’t feel rich at all, but I feel like we’ve achieved the first major milestone to wealth. Wealth to me is not buying things you don’t need or designer crap, but it is being able to spend freely on your friends and family without worrying about running out of money now or in retirement. I think about $10M is the amount needed for true wealth based on what I could ever want to spend in life (assuming its invested and about $2M of it is in a home and another $1M or so is paying for my mother’s home and life, since I do want to pay her back for all my parents gave me in my life and hoping I can do this before she gets too old!)

Well, we’re a long way off from $10M, but I finally feel like we’re on our way.

New Goal: $1.3M Networth by 2022 (age 38)

In 2008 or so, I had $29k in total net worth. Ten years later, my net worth closed out the year at $625k. Ten years ago I couldn’t fathom having more than $100k in a bank account. At age 24, I was just getting started in my career, making very little, and wondering how on earth to save money.

I started out ahead of many–a college degree with no loans. I’m not sure I’d be where I am today or even close to it if I had massive loans to pay back, because that would have not only cut into my savings, but also likely prevented me from taking some of the risks I’ve taken over the last 10 years that helped me save so aggressively. But, I do try to take a few moments to be grateful for what I have, and how much I’ve been able to save–despite not being able to afford the high cost of living in the Bay Area.

Today, I’m especially grateful that my current path has not only enabled me to hit my goal of saving $500,000 before giving birth to my first child, but also is looking to possibly support my second goal of saving $1M before my second–which was a long shot just years ago.

Screen Shot 2019-05-11 at 9.26.43 AM

The last few months have been especially fruitful, thanks to vesting stock–my first stock vesting period working for a public company–and selling it off immediately. I do not include any unvested stock in my networth calculations since if I lose my job that $ isn’t real. But it’s hard not to fantasize about it being real–even with it being not that much once taxes are taken out–it’s still a substantial amount and can be life-altering given my whole financial strategy is save as much as possible as fast as possible… not for FIRE, but for financial freedom (working PT, consulting, or pursing more risky opportunities, or those that don’t pay as well, in order to help others and/or just spend more time with my family.) And I won’t give up a decent lifestyle today to assume that I’ll have enough money for a frugal one “tomorrow” that doesn’t require working. I want to LIVE today but support a future where I’m not worried about money and can afford a decent lifestyle with a family.

I’m still uncertain what my “number” is. At last estimate it was about $4M-$6M, including a house worth about $1.8M. I still don’t think I’ll EVER get there, but as I set new financial goals for myself along the way, it helps to keep focused on these mini wins towards this major goal. Even if $4M is my “goal” that’s far off.

I had said I wanted to hit $1M by 40. Right now, I’ve sped up that goal to 38 (I’m 35 and a half now.) Within the next 3 years, I’d like to get to that $1M mark. A lot will depend on the volatile markets — if we have a crash, there is no way I’ll get there. If they stay stable or keep growing, there’s a good chance…

  • April net worth: $847k
  • Remaining 2019 stock value after tax: ~$92k
  • 2020 stock value after tax: ~$123k

With saving my stock amounts, and with the markets staying stable, it’s quite possible I’ll get to $1M even earlier… by 37… which actually is my goal since I want my second kid by 37 and I would like to get to $1M before I give birth. I won’t feel any richer for it, but I think with $1M in the bank I’ll start feeling ok about taking a few more risks when it comes to buying a house. Ideally I’d have $1M in the bank (investments) plus enough for downpayment and closing fees in cash. Perhaps I can get there in 3 years. That requires saving $500k in 3 years, or $150k per year.

  • 2019 (35): $92k (stock) + $25k (interest) + $35k (income savings) = $152k
  • 2020 (36): $123k (stock) + $25k (interest) + $35k (income savings) – $50k (IVF) = $123k
  • 2021 (37): $123k (stock) + $25k (interest) + $35k (income savings) – $20k (preschool) = $153k

Total end of 2021: $1.275M. Not quite $1.3M, but close. Close enough where at that point I’d be willing to put $300k down on a $1.5M house and have $1M in the bank as a safety net.

Past 2021, my savings will go down again… my stock will be vested and it’s unlikely I will find another job where I make anywhere near this much. If I can keep this job until the end of 2021, I just realized… I’ll be really close to my goal–my new goal– $1.3M by the end of 2021.

BUT – big but here – is that to do that, we need to stay living in our 800 square foot one bedroom apartment rental for the next 3 years/until I have my second child. Maybe that’s crazy–but it won’t be that bad. If it means in 3 years we can buy a house and feel financially stable (ish) then it’s worth it, right?

Never Enough Money But Always Too Much of It

Meeting with CFPs feels very adult and yet very depressing at the same time. Too much shit has gone on in the last few months to handle, and on top of all that I’m turning 35 next month which seems like a substantial age which no longer has the veneer of youth on it at all. Thirty-five is, if you live to 70, middle age.

I’ve spent the last decade-and-a-half obsessing over money in somewhat nonproductive ways. Twice a month I’ve typed my networth calculations into my trusted google spreadsheet that goes back to my early 20s when I had about $20,000 or less to my name (that’s now over $600,000.) I know I spend too much on things I don’t need still, but spending is the only thing that makes me feel in any control in this crazy world. Of course that sense of control is not real and fleeting.

My question du jour is if I should pay a CFP $5000 a year or ~1% of my portfolio ($6k and growing) to help manage my family’s finances, or if I can (and should) do this on my own. I feel like even though I’m probably much more fiscally literate than most people my age, I’ve gotten to the point it’s time to bring in the experts. No more randomly buying Vanguard funds and individual stocks… I don’t even know if I’ve beat or lost to the S&P 500. And I don’t have life insurance. Or a will. Or an estate plan. Or an open dialogue with my husband about money.

The keeping our finances separate plan works well until it doesn’t. I realize that right now as the person who makes more money he’s allowing me without guilt to spend as I wish with the money I earn–but one day the tables may turn and I may choose to or no longer be able to work… what then? Perhaps I can save enough to “early retire” but in reality that doesn’t seem possible. I mean–maybe, if his family really contributes $1M to our joint housing in the near future–and we find a cost-effective duplex for something like $1.5M, and I pay the mortgage off as quickly as possible so our fixed expenses are very low… then, perhaps my expertise in my industry can garner me a few freelance contracts a year that will cover maintaining my lifestyle and also getting my car fixed every once in a while.

I just hate this suffocating feeling of locking myself into anything financially. I called a loan agent at a bank to learn more about mortgages and get a sense what we’d qualify for. He went through some basic questions and when he got to the part about debt he didn’t believe me that we have no debts. He asked me about 10 times… “you sure you don’t have any debts” and he was shocked. I told him there’s about $1000 on the credit cards and that gets paid off monthly. We drive used cars, paid in cash. Our credit scores are 755 and 800+. I guess we’ve had the privilege to avoid debt and beyond that neither of us believes in spending more than we have.

So why, after 35 years of that working, change that now?

I’m not so sure. In theory, owning property and not having to pay for a chunk of it (since his mother WANTS to gift us that money and she’ll be living there as well) is smart financially. Even with her $1M in cash we can’t get a place for all of us… we’ll need to spend $1.5M to $2M. And the $1.5M options will likely require either a lot of work, a huge commute, or both.

I go back and forth on what to do. My latest and greatest idea is to rent a house or townhouse with his father that’s much closer to my work. We pay $2400 a month for our one bedroom and his father pays $1800 for his tiny apartment, so together we’d have $4200 without changing what we’re paying to rent a house. There isn’t much you can get for $4200 that would work for us, but bump that up to $5000 a month and there are some reasonably nice houses near my office that we can rent. The price will go up annually, and we’ll lose our rent control, but realistically how long can we last in our one bedroom apartment with a child anyway? The plan was one year…  but I’m starting to think six months, max.

I don’t know. I want someone to come in and provide all the answers. My father seemed like the type of person who would do that in my life, but we never talked about money. He didn’t understand how I managed my money, or why I chose to rent a small apartment, or perhaps he didn’t care. All he cared about was me getting married and having children… and not needing him to fund my life, I guess. I’d like to ask him what to do still, but he’s gone, and I know I never could ask him about finances because he’d make some snide comment and make me uncomfortable–either saying I’m rich and expect me to pay for everything and judge my semi frugal lifestyle choices, or he’d be concerned about my finances and offer to provide support even though, as I now know, he didn’t have the resources to provide at all. But, I wish I had a father who I could talk to about money, especially since that’s what he did for a living. I thought about telling him what I had in the bank… I wanted, more than anything, for him to be proud of how well I’ve saved, how smart I was with my money… but he’d just think I was a failure for not being able to afford a home, or a failure for being able to afford a home and choosing not to.

It doesn’t matter now since he’s gone, dead to cardiac arrest and a host of suspicious medical decisions and actions and non-actions that will haunt me and fill me with guilt until the day I die. One day I need to write all that out, but it’s much too painful right now, and I’m spent. I’m petrified of this horrid negotiation with HR and my boss about my maternity leave that has gone on far too long, I’m reeling in PPD-tinged grief and a lifetime of depression raging through my veins and causing daily meltdowns, gasping for air and unable to find any in a fully-oxygenated room.

And I try to tell myself, hey, dad lived to 67, that’s really good–that so many people lose their lives much younger. That tsunamis and mass shootings and disease take so many far too soon. He lived his life and made many decisions that led to his passing, though it’s unclear if he could have lived longer if the doctors didn’t completely mess up and fail to communicate or provide him proper care.. but how can one cry over 67 when so many fail to make it that far?

Still… I cry. I mourn the loss of my father, as confused and complicated as our relationship was, and how sad I was for him as he lived his life with so much anxiety and feeling like he could never fully provide for a wife and family that overspent left and right. I keep thinking this is just a nightmare and I’ll wake up and he’ll still be there, and we’ll still be figuring out how to navigate the healthcare system and get him the care he needs all while he makes it through one delirious episode after the next, and we wonder how far gone is his, but surely he’s not all gone.

He is. And that’s life. I sit in my rocking chair and stare at the little person I’ve created now 8 weeks old and am in awe of how fast he’s grown. I know the coming years will storm by and I’ll be left on the other side of them, wrinkled and grey, still wondering what happened. I can’t believe how slow childhood goes and how fast adulthood shoots by. I’m fighting my mind that wants time to disappear so everything hurt less and my heart that wants everything to slow down even if it hurts more.

So here I am, on extended disability leave and counting the days until I have to go back to work… to a job I don’t feel confident in (though I actually like, mostly)… to one I must keep in order to provide for my family. I understand what my father must have felt like as the breadwinner although as a woman and one who has a husband who has a job I’m not in this all alone–but still alone in being capable of earning enough income to create the life I want for my family (although to be fair my husband’s future inheritance is maybe worth equal or more than what I’m capable of earning in my lifetime.) Still, that’s a long time off and today I’m looking at this life and wondering what it is I want, because it’s becoming more clear with the passing of my father, the birth of my child, and my own aging officially to my mid 30s. I know I want a sizable family–2 to 3 kids–and a home large enough to accommodate us all, and the funds to travel on occasion to trips to local camping grounds and distant adventures. And I want time–which seems to contradict all of that–time to see my family and not have the years pass by and before I know it I’ve afforded a decent house and a few vacations and other than that I’ve never seen my kids (that’s what life was like for my dad… maybe he liked it that way… but I don’t want a life like that.)

I’m continuously terrified of trying to make this work. I am a mom now and that’s really all that matters. Time will disappear if I let it, or if I don’t, but maybe I can grasp it tightly and try to slow it down a bit–cherish every day, every moment, every baby freakout and future temper tantrum and teenage meltdown… and the sweet moments as well. I’ll try to avoid this crippling anxiety… the spinning in circles about every what if even if one may eventually be the what if that pans out. And, I’ll see what I can do about making the money situation be ok… enough ok that it won’t be a disaster for my family if I lose my job or just can’t work due to my mental state. I’ve got a long way to go, but I think I at least know the road I ought to take.

 

A World of Changes, Loss and Life

I haven’t written on this blog in quite some time because I’ve been very, very busy. I gave birth to my first child a little under two months ago, and shortly after that lost my father, and it’s been a whirlwind since. I have a ton to write about regarding finances, but just haven’t found the time.

Money is top of mind right now as a new mom and as a daughter trying to help her mother navigate her own finances as a widow, all while processing a massive amount of grief and joy in such a short time. I’m an emotional mess and trying to hold it together for my son.

One thing that helps me hold it together is having a somewhat stable financial situation for myself. My goal of having $500k in savings/investments before having a child was hit and then some… I made it to a little over $600k before giving birth. Even though I don’t feel financially secure, I still feel better than I would if I had no or very little savings. I’ve been able to pay for my mother to stay in hotel and visit us, and am paying for my sister to fly across the country to meet her nephew. I’m even paying for my mother to get therapy because she needs it right now and her access to liquid capital is quite limited — I can write a thousand posts on that situation and may at some point (or a book) but in the meantime, my own financial story is ever shifting.

We still live in a one bedroom apartment rented for now $2400 a month (split 50/50.) I’m close to obtaining my first year RSUs which means that this year I will earn by far the most I’ve ever earned in my life (over $300k plus my husband’s consulting income of $80k), which feels good, although not as great as it could. I still feel lost in terms of how to create a stable life for myself and get to the point where I’m not afraid to spend money on big important purchases like buying a house. I’m also feeling guilty in knowing that the only way we can afford to buy is to go in with my husband’s mother who has about $1M in cash saved up apparently — due to her frugality and hatred of capitalism. We’re starting to look for a duplex or single family home with in law unit, where we could all live together — my husband, myself, my son, his mother and his father. I’m forcing myself to get over this feeling that living with his parents (and accepting the money to make buying possible) is a sign of personal failure–that I can’t afford to provide for my own family. But then I look at what we could afford to buy if we were to just use our own volatile income and it doesn’t look pretty, so I give up. I’ll take the feeling of failure and the guilt in order to provide a stable life for my child(ren.)

Speaking of child(ren), I’ve decided I really want to have three. I always wanted three, but it seemed like a bad idea–but since my father passed away I realized how important it is for me to have a sizable family. I’ll focus on having my second in a year and see how that goes first, of course–and since that means I’l be giving birth to my second at 37 chances are I won’t be able to have a third anyway–but I think I want to try. I may get my embryos frozen next summer ($$$$) in order to make it possible to have a third (and potentially to ensure that I can have a second.) My age is really hitting me smack in the face as being 35 and having kids not only means my biological clock is ticking and running out, but also that my father ran out of time entirely and my mother is an older grandmother and when my kids are in their teens she’ll be in her 80s, if she lives that long. And I’ll be in my 50s(!) — someone should have smacked me in the face when I was 20 and shared the little secret that it’s nice to have everyone be younger when your kids are growing up. The guilt I have that my father will never get to spend time with his grandson will never leave me. On a more positive note, I feel very committed to ensuring my son gets to spend time with his remaining grandparents, even my annoying, neurotic mother, and that means putting money and time behind getting us to the east coast to see her and helping her afford to visit us in between her summers at the pool and winters in her Florida condo… at. the pool.

Life is just hitting me so hard right now and I’m struggling a lot. I’m on extended disability for PPD and find myself crying every day and having some suicidal thoughts, though I’ve been through depression enough to know they’ll pass. I love my son, and find joy and meaning in being a mother. I don’t know how long that will last as he grows up and decides he disagrees with everything I say–but for now, as he starts to realize I’m his mom, and as we get this breastfeeding thing down, I feel a deep sense of things being right as he sleeps across my chest, and an urge to make a good life for him, to provide him with a family of siblings, and to love him more than anything in the world.

I’m so scared of going back to work. I’m scared my boss will hate me and already does since I’ve taken an extended leave due to the PPD. I’m scared every moment I request more time off I’m entitled to (or should be) and I’m scared I’ll go back to work FT and not be able to keep up because even before I had a child I struggled with my role and career. Now I really need the money and I’m going to do my best to hold it together and survive the next 3.5 years at least until I’ve collected the income from my stock and perhaps have had my second child and succeeded at hitting $1M in networth. I don’t know what that means anymore, but it’s still a goal that seems good to have. I won’t be able to track my networth cleanly once we buy house with my husband’s parents–but I’m now considering our going household networth to be $750k, and still want to see us cross that $1M threshold by the time I’m 38. I think, too, if I can have kid #2 at 37 then when I turn 38 we can decide to try for a third child…

Goals:

Before Child #1 Born: $500k in stocks/savings (done)
Before Child #2 Born: $1M in stocks/savings
Before Child #3 Born: $1M+ in stocks/savings + own $1.7M-$2M home with husband’s parents

2018 – child #1 (age 34) – $700k networth
2019 – (age 35) – $800k networth
2020 – (age 36) – $900k networth
2021 – child #2 (age 37) – $1M networth
2022 – (age 38) – $1M networth + purchase home
2023 – (age 39) – move to part-time work, pregnant with child #3?
2024 – child #3?? (age 40) … family networth, including home = $2M

Of course, this plan assumes I would be pregnant at age 39 and giving birth to my third child at 40. I’m not sure that’s possible or a good idea. But in order to have three kids, this really is the only way it would work “safely” as I’m supposed to wait 18 months between giving birth and getting pregnant again. I don’t have to, but it’s more risky if I don’t. My doctor said a year should be ok. So, I could try for the following…

(assuming I suddenly become very fertile — unlikely but this would be the best plan for actually having 3 kids…) 

2018 (August) – child #1 @ 34
2019 (August) – pregnant, child #2 @35
2020 (May) – child #2 @36
2021 (May) – pregnant, child #3 @37
2022 (Feb) – child #3 @38

But that plan would be very, very hard with my career and networth goals. I just don’t want to regret not having the family I want because I was too focused on money. Even if the above schedule pushes out until I’m giving birth at 39 for kid #3, that’s probably better than 40 (and I should be more likely to get pregnant when I’m 38) — it’s still hard to plan since with pregnancy esp at this age I’m at higher risk for all sorts of issues, miscarriage, defects, etc… who knows if I’ll even make it to having a second kid. I don’t want to feel rushed into having kid #2, but I do think I’m going to start officially trying for my second after my son turns 1 year old. If I happen to get pregnant right away, I’ll take that as a sign I’m meant to keep trying for a larger family. If not, I’ll keep going until hopefully I get pregnant with my second. Who knows how long it will take–if I got lucky this time (with fertility meds) or if I can get pregnant again pretty quickly. The one thing I know now is I want to focus on getting healthy in the next year to set myself up for the best pregnancy possible, and hopefully not gain as much weight next time.

In short, I feel old and overwhelmed, but that’s life and that’s what it’s like to turn 35…