Tag Archives: net worth

End of the Month Check In: Progress and Stagnation

Well, it’s somehow (basically) June and closing in on the half-way point of 2021. Insanity, right? As the world slowly chugs back to normal-ish, I’m spending most of my time moving projects along and figuring out how on earth I will unpack my entire garage when I don’t have a closet (my family renter has the largest room with the walk-in-closet, which he uses as a library since he owns very little other than books.) So. I have to figure that out.

Despite my whining about work stuffs, I’m feeling pretty good about making it through the year as long I can keep chugging along. No hopes and dreams of getting a knockout performance review and being promoted or anything like that. I could stay at this company 10 years more and would probably never see a raise or title increase. Which is why I’m still, albeit less obsessively these days, thinking about what’s next.

But I also have realized that IF I can negotiate a WFH situation (not sure I can into next year) then it might make sense to stay for a bit longer. It’s definitely worth applying (and hopefully interviewing) starting around Feb next year, but I don’t have to jump to the next thing. This job, as stressful and frustrating as it can be at times, seems somewhat manageable for me. I have a sense for how to do it well, even with some of the newer things my new boss wants me to do, and I think I can sort those out too. Again, I’m kind of limited in going above and beyond since I seem to get penalized every time I offer any creative ideas to make things better or do more than is expected of me (which seems to be the requirement for a high performance review and promotion?!) BUT it’s kind of nice to, for once, have some sort of feeling that I can just stick it out, get the work done, try to fly by invisible, make people happy, and have time to maybe get healthy and maybe see my kids a bit before they’re off to school and such.

So I’ve got these 7 months left to get through with the best work I can do. I think it’s achievable as long as I tell my ego to shut the fruck up. I’m being treated horribly but no one cares when I’m making as much as I’m making this year and I get it, that’s fair, I don’t deserve to be treated with respect or anything. At least no one is yelling at my face. I also feel good(?) knowing some of my colleagues are leaving soon because the environment has gotten toxic, so I know it’s not all me. I think their leaving is a huge loss to the organization but doubt it will be enough for things to change. People don’t stay in jobs that long here anyway, you do your 4 years of vesting and then you move on or you can’t keep the same income. It’s sad that’s how it’s structured as companies don’t really care if they lose that knowledge and talent, but I guess it saves them money over time. Anyway. I can leave anytime between Jan 1, 2022 and April 1, 2023. I’ll be in no rush and just try to find the right next fit. The only rush I’m in is trying to get into a new company before I attempt to have my last baby. I don’t want to go through this company as the woman who took 3 maternity leaves, and I’d also like to find a company that covers IVF since I’ll be 39 (!,!,!,!??) when hopefully getting pregnant with my last kid.

Anyway, this month has been pretty flat for net worth growth because it went down then came back up. It’s kind of sad that I didn’t sell out of more of my company stock as it hasn’t come back up and my dreams of hitting $3M this year are no longer viable. That’s ok, though. I’ve got a solid plan to get to $3M in about 5 years. And I’ve decided one I get to $3M, which includes having $150k per 529 plan locked, loaded, and forgotten about, I can relax a bit when it comes to spending.

My plan is basically pay the mortgage a year in advance so I always have that safety net (won’t lose my house for a year) and just let it all roll. By 43 or so we should have $3M unless the stock market tanks. A lot of that increase will be gains on the current investments but it also includes still putting a lot of income to savings. Once we get to $3M, I don’t think I’ll need to save as much. We’ll still max out our retirement accounts, but I’ll feel good about where we are so we can spend more on home furnishings, maybe save for and add on to our house or even move to the town where I really want to live. I figure my in-law will probably live with us for 5 more years, and him putting money to us instead of rent helps too. So instead of our mortgage being $7k, it’s $5k a month, which includes about $2k going to principle, so we’re basically paying $3k a month to live here, which makes my brain feel better knowing we were paying $2.5k for a 1 bedroom apartment and now we have a house with a yard. I try to ignore the lost gains on the downpayment and principal.

Anyway…

Here is where we are start of June and updated stitch goals for the year. It’s unlikely we can be up another $450k this year (my estimated additional savings for us as of June 1 is about $200k after expenses (due to the remainder of my stock vesting and living fairly frugally for the rest of the year), so that would mean our total investments (1.78)  would have to increase by $250k or about 15% in 7 months — unlikely.)

GOAL Apr May Jun
Retirement $775.0 $521.5 $715.0 $715.7
Taxable $1,100.0 $804.5 $856.0 $822.1
Cash $0.1 $0.1 $0.1 $0.3
529 A $150.0 $91.6 $105.0 $106.2
529 B $150.0 $41.3 $73.0 $74.7
529 C $65.0 $63.7 $65.0 $65.5
Home Equity $260.0 $250.0 $257.0 $257.6
TOTAL $2,500 $1,773 $2,071 $2,042

I’d say more realistically we’re looking at closing the year out with $2.2M, maybe flat, but if flat then hopefully there will be a run up at some point where we’ll see increase in the stock market. Or it could all crash and we could close the year out at $1M. Who knows. That would suck. I want to get to the point where we have $3M in investments then I can just live life and not worry about saving a ton more and let those investments ride for years so they can go up and down and not bother me much. Then with $3M invested it will get to $5M eventually, especially if we continue to max out our retirement accounts but not add more to our savings otherwise. I’ll probably start a small UTMA for my kids once eligible for gifting them again (since we’re superfunding 529 this we can’t give them any gifts again for 5 years) – I figure I’ll start doing small contributions to UTMA in year 6 and then whenever they get their first jobs I’ll start matching their income so they can all start Roths. That should fall in line nicely with when I’ll have enough saved up to feel like I can do that without impacting our future. It also will be around the time when my mom will need money probably so I want to make sure I have enough saved where I can help her if needed and pay to fly out to visit her frequently when she can no longer travel (that hopefully will be in a bit longer, but good to know I have the money to do it so I don’t have to worry about spending a lot on flights to see her.)

What I feel best about is where the 529s are right now. My parents gave me the gift of my education and while I can never pay that back to them, I can pass that gift down to my kids. And I will. With $225k already saved in 529s, I’m well on my way to making sure my kid’s undergrad is covered in full — and if the market works for me it’s possible they can have grad school covered and/or their kid’s college education covered (and if I’m still alive by  the time my kids have kids — the I should be in a place financially where I can help put them through college too.)

I’m hoping I am alive that long as my health has been not the best lately, but I’m starting to feel a bit better with random “flares” of who knows what. I know everyone thinks my health issues are related to my having given birth earlier this year and maybe they are but the headaches seem possibly vaccine related (they got really bad after second shot then went away about 3 weeks after the shot) but the fatigue is concerning and my eye blurring issues (two episodes of my right eye vision going blurry for 15-30 minutes) still have me worried even though the eye doctor said she found a benign thing in there and that could explain it…

My neurologist offered and MRI and I’m so fucking claustrophobic that she said I really don’t need to do one now since it’s super unlikely based on my symptoms and her office testing that they’d find anything. She also seemed comfortable with the idea that the headaches were caused by the vaccine as she has heard that some people do get headaches for a few weeks after the vaccine (yet everything I read online about it says side effects should go away in 36 hours.) My allergy tests all came back negative so I don’t know what’s up. I think I’m going to make another appointment with my doctor once I finish my at-home 72 hour EKG as we’re seeing if anything is going on with my heart (though the weird chest spasms seem to have stopped — I doubt they’ll find anything.) Maybe that’s a good thing and I can just put this all behind me, which I’d like to do, except every once in a while I’ll feel incredibly fatigued, like my lungs are just weak, and no matter how much I breathe in I can’t get enough air. Maybe it’s just anxiety and panic attacks but I don’t know… even my initial EKG saw that my PR interval was slightly depressed but not enough to diagnose a heart block since my heart rate was low at the time. I’m really curious what this EKG will find, if anything. I just want to feel better. It’s taking too long to lose weight after baby and I’m still considered obese which I’m sure isn’t helping. I know it’s hard to lose weight while breastfeeding but still I have to get the weight down.

So outside of keeping my job and saving as much as possible this year towards my $2.5M goal, my other main goal is getting back to the “overweight” and not obese BMI category. I’m not going to get to a healthy BMI this year but I can inch closer. If I want to even consider having a third kid… and getting pregnant in 1.5 years (!) especially with IVF I need to drop the weight. And I don’t want to feel like this for the rest of my life. At least doctors will treat me better if I’m a healthy weight.

I’m also wondering about if I want to stay sober for good. I never considered myself an alcoholic but at this point in my life I can look back and see that of all the moments in my life I regret about 90% of them occurred when I was drinking. I was a binge drinker and it was hard for me to stop at one drink when socializing. I had a lot of fun being a drunk idiot too, don’t get me wrong, but I just am not the right kind of person when I’m drinking. I think I can manage a glass of wine with dinner when I go out on a date, but I don’t want to to do the social drinking that has led to me being an idiot and saying shit I can never take back. I’d say the other 10% of things I regret are due to my likely undiagnosed bipolar disorder as I can definitely see periods of my life where I was manic and I’m scared of who I was then and just hate myself for it, but I’ve decided I have to just close the book on that and move on and try really hard to focus on knowing when I’m in a phase like that so I can just stop myself from saying whatever it is I’m thinking at the time because it’s not real and it’s not me. My therapists never believe me that I’m bipolar but I know I am. Drinking while manic is the worst for me. Though it’s not exactly good while depressed either. :/ So, yea, I’m going to try to reduce my drinking. Really cut myself off at 1-2 drinks if I do decide to drink. I haven’t had a drink in over a year (due to being pregnant and breastfeeding) and I don’t see why I can’t continue on this way. It’s rough as I’m so socially anxious and I really do find it easier to engage with other humans after a drink… or two. But I’m old now and a mom and I don’t really want to be social like that anymore. I’m worried I’ve fucked my liver with my occasional binge drinking through the years. It was not frequent, but it was still pretty bad when it happened. Plus, not drinking saves $$… though I’ve been putting that to overpriced tea at Starbucks and Peets. At least that’s a bit healthier for me. Oh, and I’m trying to cut out caffeine as well outside of green tea and matcha. That mostly means not having the occasional latte and especially not having Coke Zero an Diet Pepsi which is horrible for me anyway.

So if I can get to the end of this year mentally stable, with my kids thriving, with $2.5M (or $2.3M) in the bank, with my job intact, etc etc, and alive, I’ll call it a win. Really I’m considering this job my $2.5M job so I’d like to stay in it until I get to $2.5M, but we’ll see about that. This job is my $2.5M job and the next job needs to be my $3M job so I have to find the right fit and right salary to make it worth a move. The only thing I can do is just try to go the best I can at this job and stop going to get overpriced tea so much. But it’s my one self care pleasure in life so I allow myself that.

 

2021 Net Worth Goals Update

A month ago I posted my 2021 net worth goals. Checking in to see how things are going…

  • Retirement: $614,629 ($521.5k then)
    • Current: $715k (cool, already beating my goal, guess I should raise it!)
  • Taxable Investment: $822.5k ($804.5k then)
    • Current: $856k (also hit goal already nice, need new goal)
  • Emergency Fund: $60k ($60k then)
    • $62k (still good)
  • IVF Fund: $65k ($65k then)
    • ok this is $0 because I didn’t want it sitting and I moved it to my investments. But I can sell some investments when/if we decide to do IVF.  Going to remove this goal.
  • 2 Yr old 529: $196k ($91.6k then)
    • $105k (need $91k more but might reduce this goal)
  • 0 Yr old 529: $151k ($41.3k then)
    • $73k (need $78k more but might reduce this goal)
  • -3 Yr old 529: $63.7k ($63.7k then)
    • $65k (good)

New 2021 Goals…

GOAL Apr May Jun Jul Aug Sep Oct Nov Dec REM
Retirement $800.0 $521.5 $715.0 $85.0
Taxable $900.0 $804.5 $856.0 $44.0
Cash $0.1 $0.1 $0.1 $0.0
529 A $150.0 $91.6 $105.0 $45.0
529 B $150.0 $41.3 $73.0 $77.0
529 C $65.0 $63.7 $65.0 $0.0
Home Equity $270.0 $250.0 $257.0 $13.0
savings needed:
$264.0

Will check in again each month to see how I’m progressing towards these new goals!

From Now to Rich in 3 Years.

What does “rich” mean? There was a huge debate on if having $1M makes you rich in one of my Facebook groups the other week. My argument was — no, $1M does not make you rich. It certainly doesn’t make you poor either, but it’s not what I’d consider wealthy.

Wealth, to me, is having enough in savings that with reasonable diversification and YoY growth, you never have to save another dime to support your future lifestyle. Your income, which can be passive or active if you feel confident you can maintain active employment and want to maintain active employment, should cover all of your bills and expenses until you age into one of your retirement buckets. You may only have one retirement bucket (i.e. age 67) or you may have multiple buckets (I have an early retirement bucket set for age 45, and another bucket at normal retirement age.

Wealth, to me, is being able to buy things like… a minivan… new… and a trip to Hawaii with a stay at a non-budget hotel… without worrying about it impacting my retirement goals. It’s flying my sister and mom to Hawaii and getting them their own room at the hotel for a week. It’s being able to pay to get my mother an in-home aide (or at least contribute to it) when she needs it, maybe even moving her across the country when she’s older, to be closer to us so she isn’t alone (if that’s what she wants.) It’s being able to spend like my father did–always offering to pay for meals for friends and family and tipping generously–but with the actual life savings that can withstand such spending, a life savings that accounts for potential fluctuations of the market and future healthcare and long-term care costs.

While I could do a better job honing these estimates, I feel good about my FAT Fire number. It seems to align with what I’ve seen others say — around $10M — to really reach the kind of wealth where your money continuously works for you. I figure if I ever get to $5M that’s when I can start dabbling in more complex investments like real estate. For now, it’s heads down with (mostly) index funds and a few individual stocks. This year is really the make-or-break year for my plan (though there may be future make-or-break years, but it will be difficult to encounter one in the near future where I have the chance to earn close to $1M in income for the year.)

Below, is a table on my current estimates per savings bucket. I am estimating a 6% YoY growth over time, which may be too high or too low, but as I get closer to retirement I can adjust down for more safety once I see how the years go. The current value column is approximately how much was saved in each bucket at the end of 2020. With 6% YoY until each bucket is accessed, I note the GAP in total amount needed for my final goal (ie retirement goal is $5M, if I didn’t touch my money at all and got 6% YoY now, I’d be $1.6M short. The cool thing is I’d have $3.3M, which doesn’t account for my taxable funds, and also is at age 65-ish, which doesn’t account for additional growth after age 65 since I won’t pull all the money out up front and will hopefully live much longer.

My “pre retirement” FIRE bucket is more or less my “Coast FIRE” bucket, which gets me to career freedom by 45. if I have $3M by 45 I can move into a lower-paid career (and/or take a few years off) and maintain the lifestyle I would like to have. If growth is stronger than 6% year over year we can also invest in building on to our current home, or move to a city that I prefer that we couldn’t currently afford.

2020 Goal Yrs Current Value Growth Rate “Real Value” GAP
Retirement $5,000,000 28 $651,000 1.06 $3,327,708 $1,672,292
Pre-Retirement $3,000,000 13 $833,074 1.06 $1,776,887 $1,223,113
College $600,000 17 $133,607 1.06 $359,773 $240,227
Home $2,000,000 28 $195,483 1.03 $447,251 $1,552,749
$1,813,164 total: $5,911,619 $4,688,381

2021, which is now THIS YEAR, represents a huge opportunity to get much closer to my goals. Even if I have failed to tap into the actual earnings potential I should have had at this company (my raises and refreshes have not kept up with my market value or initial grant offer), I’m still in a very, very good place if I can just hold out and remain employed until the end of this year. While anything can happen, and my mental health post baby may get the best of me, I’m really focused on surviving this year. (*note, the above doesn’t count total home value, which would be higher in 28 years since the mortgage would mostly be paid off then.)

This is why:

2021 Goal Yrs 2021 Value Growth Rate “Real Value” GAP
Retirement $5,000,000 27 $786,060 1.06 $3,790,653 $1,209,347
Pre-Retirement $3,000,000 12 $1,140,598 1.06 $2,295,108 $704,892
College $600,000 16 $261,623 1.06 $664,615 -$64,615
Home $2,000,000 27 $231,212 1.03 $513,589 $1,486,411
$2,419,494 total: $7,263,966 $3,336,034

 

By the end of 2021, if I can keep my job, and the stock markets don’t tank (ie we don’t have a civil war this year), I get much closer to my goals. Not 100%, but close enough that I really am already approaching Fat FIRE territory if I didn’t have such aggressive savings plans.

2022 I plan to switch jobs, so my income will go down quite a bit. At the moment I’m thinking I will try my best to stay until I get get the full $58k into my retirement for the year as well as max out the first ESPP period for the year, which ends in March. I’ll have to leave some money on the table at some point (unless I leave in March/April which is probably the ideal time to move to a new role), but I’m now looking at a transition around June. This assumes I make $200k total in 2022, including expected bonus that comes in February before I leave my current job. I’m kind of considering this part of 2021 plan, but since the actual receipt of income falls in 2022 it hits my 2022 goal plan:

2022 Goal Yrs 2022 Value Growth Rate Value GAP
Retirement $5,000,000 26 $929,224 1.06 $4,227,394 $772,606
Pre-Retirement $3,000,000 11 $1,314,116 1.06 $2,494,584 $505,416
College $600,000 15 $277,321 1.06 $664,615 -$64,615
Home $2,000,000 26 $269,085 1.03 $580,306 $1,419,694
$2,789,745 $7,966,899 $2,633,101

As you can see from the numbers above, with 6% YoY return expected, by the end of 2022 I’m SO CLOSE to my FIRE goals. I’m close enough that if I needed to I could stop working and probably be fine.

If I adjust to 10% YoY returns (unlikely but an easy switch in my spreadsheet), things start looking pretty crazy good. Fun to dream, right? If 10% YoY is in the cards, by 2022 I’m set.

2022 Goal Yrs 2022 Value Growth Rate Value GAP
Retirement $5,000,000 26 $989,310 1.10 $11,790,771 -$6,790,771
Pre-Retirement $3,000,000 11 $1,396,395 1.10 $3,984,077 -$984,077
College $600,000 15 $293,664 1.10 $1,226,709 -$626,709
Home $2,000,000 26 $286,934 1.03 $618,800 $1,381,200
$2,966,304 $17,620,358 -$7,020,358

 

Actually, things look really good already… with 10% YoY the total value of my current assets is $13.3M at time of use. Not bad.

2020 Goal Yrs Current Value Growth Rate Value GAP
Retirement $5,000,000 28 $651,000 1.10 $9,388,067 -$4,388,067
Pre-Retirement $3,000,000 13 $833,074 1.10 $2,875,997 $124,003
College $600,000 17 $133,607 1.10 $675,313 -$75,313
Home $2,000,000 28 $195,483 1.03 $447,251 $1,552,749
$1,813,164 $13,386,628 -$2,786,628

 

Of course I’m not going to bank on seeing 10% YoY. I probably should stick to 4-5% to be conservative and leave room for unexpected growth, versus the other way around. Either way, I’m really getting excited about these next 14 months. The next 14 months to a whole different level of living. I’m not going to change my spending immediately, and I don’t plan to ever actually stop working, but I can stop forcing myself into roles that aren’t a fit and that make me miserable. I can maybe start my own company or work for a non-profit or just do work that matters.

Even with 4% YoY growth the numbers don’t look horrible in 2022 if I hold fort. Sure, I don’t have $5M in retirement or $3M in pre-retirement at 45, but I’m at $1.9M in pre-retirement and $2.5M in retirement and nearly $500k in college for my kids. So this is all great news, if I can just survive a year with two kids, including a newborn and given lack of sleep, and a company that seems to want to set me up to fail and to get rid of me. 

2022 Goal Yrs 2022 Value Growth Rate Value GAP
Retirement $5,000,000 26 $899,962 1.04 $2,495,116 $2,504,884
Pre-Retirement $3,000,000 11 $1,273,976 1.04 $1,961,227 $1,038,773
College $600,000 15 $269,309 1.04 $485,011 $114,989
Home $2,000,000 26 $260,394 1.03 $561,564 $1,438,436
$2,703,641 $5,502,919 $5,097,081

This year is everything.

2021 Net Worth Goals by Bucket ($2.5M Total)

Next year COULD be a really big year for us. I’m estimating we can take our net worth from $2.2M to $2.75M by the end of the year. I would love to see us go to $3M, but I think $2.5M-$3M is within striking distance if I keep my job until Jan 1, 2022.

If you haven’t been following — the majority of this expected growth is from company stock which has increased a lot since I started the job. I am in my final year of vesting and each quarter I should get a chunk of change (and then some) which is the only reason I’m able to save so much next year. If I lose my job all bets are off. I’m trying really really hard to not lose my job.

These net worth goals are now family net worth goals. I continue to track my “own” net worth for comparison to my numbers since I started blogging in 2006, but the numbers presented here are family net worth numbers. When I refer to my “own” numbers I consider cash in my personal checking account, my IRA/401k, the full value of 529 (since I fund this directly), and half of the value of home on sale (even though I pay a larger percentage of the mortgage.)

I’ll be blogging my $500k-$1M net worth growth over the next year, so if you’re interested in seeing if we can hit these goals follow me at @everycentcounts on Twitter.

Numbers Below = [2020][2021]

  • Emergency Fund (Cash) [$65k][$72k]
  • FIRE Bucket 1 (2030) [$1.1M][$1.4M]
  • FIRE Bucket 2 (2050) [$428k][$746k]
  • 529 (2-3 Kids) [$99k][$249k]
  • Home Value (On Sale*) [$493k][$505k]

Total Networth (Pre Tax):

  • 2020: $2.2M ($4.4M age of use value**)
  • 2021: $2.7M ($5.2M age of use value)

* house value on sale = value of house – 10% of house value (realtor and fixing up fees) – what is owed to bank – any taxes owed (actual cash in hand estimate after sale)
**age of use value = I focus on “age of use value” in my net worth calculations, which is the value of each bucket * 5% YoY interest growth for my interest-earnings accounts and 3% for home value, for expected length of ownership. Ie the 529 accounts are considered 17 yr average investments (and each year that goes down a year.)

The day we surpassed $2M in networth. Can I buy a Roomba now?

Holy hell. Personal capital shows our family networth crossed the $2M threshold. This was my goal for 2020, yet it felt so far away earlier this year. A bump in my company stock was really all it took, but it was far from guaranteed. Even with deducting $100k from the cost to sell our home (which I have set up as a liability in personal capital) we’re across that $2M mark. Insane!

2 million networth

It feels especially weird given the state of the world, with so many people struggling. While living in a HCOL area with 2 kids and hopes for one more, I can’t start throwing heaps of money at charity as I’d like to yet, I’m looking into doing a donor-advised fund next year, as well as where we can help locally at food banks and such. I’m a little nervous about next year as the breadwinner of the family who happens to be about to go into labor any day now (and who has to hold down a $7k a month Bay Area mortgage), so want to be smart about giving strategies, but it’s time to think seriously about that. I just feel overwhelmed as so many people need help right now. I feel guilty for having “so much money” and yet, so many people have a lot more $ here too. And many are struggling to put food on the table. I feel weird being one of the people benefiting from the state of the world as I have a lot of stock, but at the same time proud of myself for being frugal and investing in my 20s, and also landing this job and seeing the potential in this company a few years ago.

Sure, the stock market could crash overnight or my company could go belly up — and at this point I’m holding way too much stock in my company despite selling along the way. It’s about 25% of our net worth, which is way too risky. But I also want to hold off on cap gains until AFTER next year, since I’ll likely go back to a normal income once I vest my final year of my initial grant. But that’s super risky. Yes,  I can and should sell my new RSU vest now, and I probably will (it’s down a bit so holding until 2021 to either take a loss next year to offset potential short term gains later in the year or just take a gain if it goes up again.) I’ve held on to most of my ESPP against the wisdom of finance professionals everywhere, which has proven to be quite a lucrative bet. Those get taxed at a mix of income and cap gains, and my cap gains right now in CA is basically the same as my income tax rate, so it feels prudent to hold just a year longer even if they could end up being worth nothing. I’ve decided that in order to build wealth there is some truth to needing to do stupid things and take risks that aren’t wise. Men do this often. Many of my male colleagues haven’t sold one share of their stock even though they know it’s super risky and you know what, they’ve made a fortune in holding. Sure, they could lose it all as well, but so far I know some of my coworkers are set to retire tomorrow, all because they are men who take on too much risk.

Maybe risk is ok. The more money you have, the more risk you can take. It’s not quite putting it all on red. But I would not have $2M now if I hadn’t ignored my CFP’s advice and sold all of my ESPP up front. Instead, I have over 1000 shares I’m holding now, with the total value hovering around $500k. Is that stupid? Maybe. They say don’t hold your company shares as you have too much riding on the success of your company already just with your employment. That’s probably true. And RSU has no reason to hold since they’re taxed as income on vest and you should treat as a bonus (and you likely wouldn’t go and buy your company stock with a bonus – also true.) ESPP is a little more complicated. In typical slow-growth companies these give you the benefit when you make a purchase, a small 15% discount on shares, plus any growth within a lock back period. But holding you can pay cap gains tax on any growth, which can be substantial in a fast-growth company. So I’m holding. Maybe I’ll regret it. So far, doing this has catapulted us to our $2M net worth goal.

Looking ahead to next year, I see $3M as a possibility. It’s unlikely we can go from $2M to $3M, but it could happen. Right now I’m estimating about $2.5M-$2.75M by the end of next year if the market holds. If it goes up, we could get to 3. There is something about that $3M number… it’s equal to about $1M in 1981.. so hitting $3M, esp in a HCOL area, is when you actually feel like a “millionaire.” It seems like a shit ton of money (and it is) but when you have $3M in net worth, I think your world changes a bit. It definitely changed for me at $100k and $500k and $1M, but $3M is the beginning of a new chapter. It’s when you cross the threshold from upper middle class to entry-level wealthy. At least in the Bay Area — $1M, $2M, $3M, $5M, $10M are these levels of wealth. $5M is realistic for a family with 2 tech workers who are each making $250k a year. Since my family is 1 tech worker, it’s still possible if I can have a few home runs with RSUs (ie make 500k-1M per year a few times in my lifetime.) If you don’t work in tech, or settle for whatever a company decides your level is worth without convincing them you’re worth more, then it’s really hard to get there.

I still have my eyes on the prize ($5M net worth) but when we get to $3M, I’ll loosen up a bit. I’ll fly my mom out twice a year and put her up in an AirBnB for a few weeks so she can spend time with her grandkids. I’ll send my sister that TV and other random gifts she keeps asking for (actually maybe I will do that this year.) I’ll take my family on some nice vacations and pay for my kids to take enrichment classes that cost too much but it won’t actually hurt our retirement goals so why not? And I’ll seriously look at how to build the donor-advised fund I’m going to likely start next year so we can be quite generous with charity in the years ahead, which I haven’t made a priority in the past.

I’ll do a full recount of 2020 networth once the year is over as there are still a few paychecks coming in and expenses going out. I’ve spent way too much on fixing up my new house and it isn’t done yet. Next year I’ll prob spend too much buying furniture for the house (to be fair, we’ve moved from an 800 sq ft one bedroom where we were still using mostly craigslist furniture or IKEA stuff I bought when I was 22) to a nearly 2000 sq ft house… we don’t even have a kitchen table right now or any place to sit outside in our yard except our camping chairs. So I’m going to splurge because life is now and we are in a good place to buy things to increase our quality of life without going overboard. I’m not talking luxury items but thing that will make us happy because we spend most of our time in this house (well pretty much all of our time now) so…

My boss’s boss (my former boss) even liked a small project I did this week, which made me quite happy. I know I’ll never be able to be good enough for this company, but if I can keep turning in quality work I can survive through the end of next year, which means $3M net worth is no longer a pipe dream. And once you hit $3M, theoretically you can make 10% on that YoY and get to $5M in 6 years. Yea, 10% YoY gains six years in a row after a bull market is quite unlikely (might see 6% YoY losses) but being this close of striking range to the $5M net worth goal is… just… well, I don’t even know what to think about it. If I can get to $5M by age 40, that would be a whole other level of crazy. And if I’m going to do it, that’s on me. My husband brings in a stable $90k a year, and that certainly helps, but I’ve got to lean into the crazy that is RSU growth in Silicon Valley’s top-performing companies, negotiate well for my next gig, and just hold on for dear life. I have no interest in being a VP anymore — I just want to FAT FIRE (well FIOR – financial independence, optional retirement.) $3M gets us close. $5M gets us all the way. Can I get to $5M by 40? Even by my calculations that’s highly unlikely. But a few years ago $2M by 37 was also very unlikely. So anything is possible. And when I set my mind to something, well, either I ADHD space out and it never happens. Or I ADHD super focus on it and I get there.

To my readers out there, thanks for your support along the way. I hope it is as fun for you to watch my nutty progress as it is to live it on my end. Right now my biggest focus is on NOT getting coronavirus, surviving childbirth, having a healthy baby, and getting myself healthy in the year ahead. It’s ALL possible. The world SUCKS right now and it’s hard to stay positive, but at least for me, good things are happening. I don’t deserve these good things any more or less than the next person. I am grateful and in awe of how the world works in such mysterious ways.

And I like that my couch fits so nicely in my family room. And I want a kitchen table.

Some Real Numbers and Planning a Real Career Change

I slept last night so had some rather clarifying revelations  this morning:

  1. I need some actual financial targets that are meaningful. They may be scary, but at least then I can actually feel like I’m making progress towards a real objective and financial security vs an arbitrary number.
  2. I need a career change. I know what I want to do. I’ve wanted to change into this career since I was 22. It will require a much lower salary for a while and some additional education… a master’s degree would be helpful but it’s also possible to get a certificate and spend time teaching myself. It means I need to plan for this as well to figure out how / when I can afford that pay cut and not mess with my retirement goal.

To start, and to make the career change palatable, I need to figure out that retirement goal number.

  • Set a retirement goal: My (family) goal is to have 10k per month (inflation adjusted) in after-tax retirement income at age 65 (assuming my house is paid off or I use proceeds from my house to buy another lower-cost home in cash.)
  • Determine 4% rule amount: how much do I need for withdrawals of my accounts at age 65 through age 100? So I’ve read you need 2.5M today to afford 100k/yr expenses in retirement. With inflation of 3% for 35 years, that is a total of 7M needed to retire (when I’m 65.)
  • Calculate my current totals:
    • IRA Pre-Tax: 523.9 (366.7 post tax)
    • IRA Post-Tax: 96.9
    • Total 2020: 463.6
    • Total 2055 @ 5% Returns = 2.5M
    • GAP: 4.5M
    • (I need about 1.3M today w/ 35 years to grow 5% / yr to hit goal if I never touch it) or about 836k in additional savings today in my retirement accounts

Now, do we really need 10k a month of retirement spending (in today’s dollars?) I don’t know. Maybe we could live on less. Assuming we want to retire in a HCOL area and travel and pay for my kids to travel with us and pass on some inheritance, I’d like to at least aim for that. I have 35 years to make it happen. If I can make it happen WITH a career change, that’s even better. If the career change will get in the way of that 7M at age 65 goal, then I just want to understand what that means for expectations when I retire. (*Note I’m not including social security because who knows if it will exist in 35 years.)

Right now, we can save about 100k per year in retirement accounts. Some of this is actually going to be Roth, but for the sake of simplicity I am going to count this as all pre-tax (70% of value) to figure out what we will have in retirement when. Once I change jobs, or if my husband gets a FT job, we may have less opportunity to invest in retirement accounts. (*Note, at the moment I’m not including my taxable accounts in this calculation — only retirement accounts. The taxable accounts do change the picture substantially, but the moment I am not counting those as they are basically my house payment put into the markets vs into paying off house.)

  • Calculate my future totals (2022):
    • IRA Pre-Tax: 723.9 (506.73 post tax)
    • IRA Post-Tax: 96.9
    • Total 2022: 603.6
    • Total 2055 @ 5% Returns = 3M
    • GAP: 4M

I need to spend some more time with these numbers because right now, even with the ability to put 100k to retirement accounts for the next 2 years (which is also unlikely as I’m probably going to change jobs in early 2022 and/or go to school so will have a gap in savings) then I don’t see how we’re going to hit the 7M goal at 5% per year return.

The picture looks very different if we can secure 8% YoY return with dividends reinvested as well. With 603k invested at 8% YoY for 33 years (assuming after 2022 we don’t invest a dollar more in retirement) we would have 7.6M(!!!) when we retire (and it would be more because a chunk of that is pre-tax.)

This tells me that it’s very important to hit goal of having 603k in my total retirement accounts by 2022. It also tells me I need to then hire a good CFP/CPA to figure out a strategy for future investments and conversions–because too much of my retirement money is tied up in pre-tax. I want to work it out where if I go to get a master’s degree for 2 years I can do some conversions then (when we have very low income) so that at the end of the day we actually are cancelling out the loss of income through low-tax conversions.

That said, I do want a third kid, so chances are I will be working in my same career (although a different company) through the birth of my third child and at least the first year of their life. Then school? I don’t know. That’s going to be a while. But it also means the opportunity to continue to contribute to my retirement accounts. Phew, this is looking a bit better if 8% is realistic (is it?)

  • 2020/36: 436k
  • 2021/37: 506k (baby 2)
  • 2022/38: 603.5k
  • 2023/39: 633k (baby 3)
  • 2024/40: 660k

At 40 or before, I do a major career change and feel like I’m in a good place for retirement, right? Or not. 660k with 25 years left to retirement is just 4.5M in retirement. I guess that’s because I’m not including actual gains on the account over five years, only contributions. The initial 436k should gain 200k at 8k. Which would put me at 880k at age 40 (including total family contributions) which still only gets me to 6M at age 65. Ugh I wish I was better at math! Well, 6M at 65 sounds pretty good too, considering I’m not counting social security or any of my taxable savings, which should also be substantial at that point. I feel pretty ok with the plan above, assuming growth to 880k of these accounts (or something like that) by the time I turn 40.

Since I’m going that post tax, let’s say I need 1M in my retirement accounts before I feel like I’m “safe” for retirement (i.e. money I’m not going to touch until I’m 65) and then I’m in a really good place for a career change. Or I pull the plug earlier, but I do think getting through my third and last child while having good insurance and a stable career (if you can call my career stable lol) is a lot smarter than switching now. That doesn’t mean I have to wait until then to take a class or two or prep for my career change. It just means I have a real goal to save for retirement. Once I get to that safety net in my retirement accounts — aiming for 6M-7M when I’m 65 without adding another dollar to my retirement accounts — then I’ll feel a lot better. Then all I need to do is be able to afford my expenses between “now” and age 65. I can do that with my taxable investments/savings and income. My family’s lifestyle will be dependent on my ability to move up in my new field as well as gains on my taxable investments (which are 757k today and should be about 1M by the end of next year if I can hang on to this job for dear life and the stock market doesn’t crash. Knock on all the wood.)

Perhaps I should splurge and buy a new computer with a functional “4” key (yes this is why I am not using the dollar sign in any of my posts… I have “4” as my clipboard paste item but I can’t have that and the dollar sign. I should probably reprogram some key I don’t use to the the “4” — or I should buy a new computer? Hah.

Ok, this makes me feel a little better. I do want to figure out the “37-65” annual income vs living off savings and where I can dip into savings for a career change without having to take a major lifestyle cut. And I like to spend money, so I’d like to be able spend as well… especially on fixing up my house (a major addition, at some point, or moving to a nicer place in an area I want to live) and travel while paying for my sister to come with us. And helping my mom out when she runs out of money because she probably will.

In any case, once I have enough in “retirement” accounts I’m just going to feel a lot better. I have to catch up since I didn’t have access to a 401k in my 20s and my husband started his retirement contributions in his 30s as well.

Shorter term, since 2022 seems SO far away, here are some realistic goals for the end of next year:

Calculate my future totals (2021 End):

    • IRA Pre-Tax: 623.9 (436k post tax) + 5% = 654k
    • IRA Post-Tax: 96.9 = 101.7k
    • Total 2021 (Pre Tax): ~750k

Total End 2021 Goals:

    • Home Debt: -900k (300k equity + 1.2M loan)
    • Taxable Accounts: 1M
    • 529 Kid 1 = 75k
    • 529 Kid 2 = 75k
    • 529 future Kid 3 (my account) = 50k
    • Retirement (Mostly Pre Tax) = 750k

Actual Earnings 2021 Goals:

    • Income: 250,000
    • Vested Stock (Sold Pre Tax Value): 500k
    • Other Benefits: 30k (ESPP growth), 4k (401k match)
    • Total Income: 784k (very approx)

This would be an incredibly positive total income next year and end to 2021. That’s only 13 months away. It’s going to be a crazy 13 months with a lot in the air. If I can get the above set by end of 2021 (leading into getting pregnant with my third kid) I think I’ll be in good shape.

I need to do a better job of running these numbers. If I can hit the above goals, I’m going to hire a good CFP to help me figure out my strategy for the years ahead.

What Comes Next? Vesting and Career Investing

It’s funny. I filled out my performance review this year and in tabulating all of my contributions since last January, including ones that arguably delivered (significant) quantifiable ROI, I feel jolted into a sense of satisfaction meets unease—pride paired perfectly with the PTSD of being constantly reminded by my boss that I am not a leader, that I’m bad at running meetings, and that people generally don’t like me.

The reality is we are both right. I have a long way to go to be able to take the quality of my work and have a presence to match. And maybe I made a bunch of poor strategic choices this past year, but it’s hard to say when the only objectives my boss set for me was to hit deadlines (I was doing ok at this until one big project slipped) and make people like me (well, I don’t think I made major inroads in becoming queen popular this year while holed up inside my bedroom working in my PJs—though non interaction seemed to solve for this over a chunk of the year when people probably forgot I existed until I put out some decent work.

My issue 100% is consistency—which in a creative role is a massive challenge for me. The end product is usually good but the path to get there never clear. When I’m off on my own doing creative work and/or managing an agency I can GSD effectively. But throw in the kitchen sink of stakeholders / opinions, especially in an environment where I’m told my opinion doesn’t actually hold the same weight as everyone else’s, and I can’t seem to move things forward as I should. If I was just a project manager, I could do it. But as project manager and creator I find myself so often stuck. I know better than to stay stuck, and if anything it is best to just push forward and put out something vs drown in the sea of trying to make everyone happy and making no one happy.

But to be fair to myself, I was also put in a hard to win situation. My boss wanted me to lead, but her idea of leadership is somewhat incompatible with the processes designed to be collaborative. She made comments on how I brought too many people into the process (probably true) and yet in the end this collaboration was actually one of the most positive feedback notes received during the review of what went well and what didn’t.

What didn’t go well is not knowing how to guide people to my strategic vision and instead trying to execute on “theirs,” however conflicting it all was. My boss was not involved much—she just wants the person in this specific role to lead and figure out what to do and get buy in, but she has little interest in participating in determine what any of that is. She wants someone who will list be excellent. Trusted. Smart. Influential. Charismatic. Assertive.

She, apparently, wants my coworker. I mean, to do this. She put him into my temporary role and moved me out of it without clear communication to either of us. As she was, it seems, prodding him to step up and lead and equipping him with a career path to taking over my role, she was quietly plotting to move me out of it. I’ll never know if I still have a job because I am pregnant or if the leadership team actually sees value in me and wants me to stay (perhaps a little of both) but I’ve been put into a role where success is even more unlikely given again I have no control over the work I’m doing, only put in a position where I’m expected to both drive projects forward and make everyone happy.

I’ll do my best.

What is most challenging right now is that I’m being tasked to come up with a strategic plan for next year, yet I can’t move forward with this until other planning I am not involved in is done, yet I go out on maternity leave in less than two months and there isn’t much time remaining to move forward on a plan let alone create a plan. I take one step forward and two or twenty back. If I don’t plan, I am told I am not making enough progress. When I try to move things forward, I’m told I’m moving too fast and I need to wait. Somehow, no matter what I do, my former boss (now boss’s boss) seems to find fault with it. Luckily I have a few projects to take me through mat leave, and I’m hopeful they won’t ask me to leave between now and then with so much that needs to be wrapped up. But upon my return from baby 2 this spring, I acknowledge my days are numbered. The question is how long can I produce good enough work assigned to me and never miss a deadline so their argument to throw me out becomes one of documenting every last word choice made in emails and meetings and not one of failed project delivery. That won’t save me forever, but it’s possible with the right focus I can make it to the end of next year. I really hope I can.

But I also realize that there is no where to to here but down. I’m seen as a mediocre performer at best, saved by occasional delivery of projects that make my team look good. I want a job where people respect me for my strategy and results, not random output that has no greater value. So maybe I can find that next. This job, despite its ups and downs, has truly been life changing for me. Financially, I will be walking away from a few years of stock appreciation mostly sold and now safely in my bank account and diversified across index funds (and a new house.) While I’m sure had I been an A+ player I’d have even greater wealth due to rates and large stock refreshers I did not get, it all works out in the end as there are no golden handcuffs after next year, and it’s much easier to seek out a new role with a comparable package since this company has made it clear they don’t care if I stay (and clearly prefer that I don’t.) But I also take with me a solid chunk of time at a respected company that is not a startup no one has heard of. And while my role may be shrinking into oblivion, my resume has grown enough to at least land me interviews (or I assume it would) vs what life looked like job hunting prior to this role. This is not to say I’ll easily get hired anywhere, but I do think I have a shot at being high on the list of who to call when I submit my applications.

The real question is — how do I make it through next year? The amount of money on the table is non trivial and losing any of it would feel like taking a winning lottery ticket and dropping it onto subway tracks with a train coming at full speed, instantaneously blowing it away as if it never existed. So. I have my personal marching orders. Survival. Survival in the hard months upon returning from maternity leave when sleep is practically non existent. If I am able to continue to WFH due to covid this may help—but it also may prove challenging as partially the return to an office last time enabled a mental split from mom life to work life, and my occasional naps in the breastfeeding room out of sheer exhaustion were not interrupted by a toddler screaming out the alphabet for the nine thousandth time in a row. So this will be interesting, to say the least. An interesting year of being good enough that they won’t fire me. Or at least that they will wait until performance reviews next year to do so, giving me a few months of safety upon my return to work. It’s all possible. I think I can deliver on what is expected as long as I do not over commit and I hide as much as possible. I say little, in meetings or otherwise. My only objective is driving positive sentiment about interactions with me. Everyone should say how easy I was to work with, how they felt heard in meetings, and how I helped them deliver on their vision. If I can do this, barring any major unexpected layoffs, I should be safe. Unless I’m already on the chopping block.

But I don’t think I am. It would be in poor taste (and with questionable legal standing) to fire me a few weeks out from maternity leave with the delivery of a number of successful projects in the recent past. It would be equally questionable for them, within 3-6 months of returning from maternity leave to fire a woman who is performing at least at moderate levels. I never try to contribute anything less than exceptional work, but the reality is after you have a baby (and I hear after you have a second one) sleep is non existent and it’s hard to perform at the same level for a little while, until baby starts to sleep through the night and isn’t waking you up to nurse every few hours.

So on one hand, I feel good about where I am. Two months out from maternity leave, if that, with a clear line of sight to half of the remaining vesting periods. I can’t (and wouldn’t) slack off at this point, but I it feels very possible to make it through that, in the least. Then, I have my 6-12 months of holding on for dear life. And figuring out what’s next. I’d love for my company to acknowledge my contributions and fight for me to stay, but that clearly isn’t going to happen. I’ll be lucky if I see any sort of raise this year (I received a <2% COL adjustment last year with a tiny stock refresh valued under 10k a year compared to my initial grant of 50k+ a year) so I’m clearly in the bucket of employees who are good enough to stay but not good enough to fight to keep.

Would I feel blissful if my company suddenly gave me a massive stock refresh this year as thanks for what I’ve contributed? Sure. That would be nice. It’s not happening. I probably am making more than my new boss right now with my total package, at least should I ever get a refresh bringing me back to where I started. It’s not happening. I don’t even have a title right now. They put someone into my role and moved me into a new role and didn’t have the respect to clarify what my new title is, or to even make it clear that my colleague is stepping into the role I was performing (outside of just organically allowing it to happen.) The whole situation is just unprofessional and unsettling, but who am I to complain when I’m looking at my stock vesting account and see the amount I may receive next year? I really can’t complain. I’m so grateful. And I want to stay and stay not just because HR is saying something about keeping me until legally I’m no longer protected, but because I actually am doing good work. If I am going to leave in early 2022, which is the plan, I want to leave on a very high note.

While it seems like a very long time between now and March 2022, it really isn’t. Especially not in returning to the first year of motherhood. It will feel long and yet also fly by in a blur. I need to have a plan for what’s next since I’m the breadwinner and carry the insurance. I can’t just take time off. I’ll have to be on the top of my game when kiddo #2 turns 1.

Every last ounce of me is determined to make it happen. I am not going to be a superstar or anything close to it, but I’m going to make it through to the day I receive all the stock offered when I joined. And I’m going to surprise no one when I put in my notice, but I’m going to do so after a long period of consistent, high-quality work and everyone feeling good about whatever it is I’ve done, so in the years to come people will remember the positive about my contributions and maybe forget about how socially awkward I am and horrible at communicating. I’ll say as little as possible and hope that gets me across the finish line.

We Got the Keys! And 10 Other Happy Things.

It’s time for a positivity roundup.

  1. A Home of Our Own: Yesterday, we got the keys to our house. We met our realtor after a month-long seller rent back, and she handed they keys over, and we finally were able to say goodbye to her and stay in the ouse on our own for a while without masks. It didn’t really feel likes ours yet, but it was / is ours. And even though it’s not perfect, it IS a perfect *cough*1.6M*cough* starter home. I really like the neighborhood and standing outside and watching families in houses a few blocks down and thinking about how one day my kids will have friends in the neighborhood made my heart all warm and fuzzy.
  2. Family Connections: My father-in-law, who is in his late 70s, loves spending time with my son and is helping us out a lot with him now through a very busy work period for my husband and myself. While not having to spend on childcare is very much an added bonus, it also is so great that my kid gets to bond with one set of grandparents. I hope my next kid also gets to bond with grandpa as well–and next kid should because grandpa will be living with us!
  3. Presidential Hope: While this election is a train wreck fueled by a president who thinks democracy = not counting all legally cast votes, it looks like Biden might win by winning GA and PA, even if AZ falls back to Trump. The loss of the senate is a shame, as it will give Biden little power to do much of anything, but at the very least we’ll have an adult in office again–which is really fucking important through a global pandemic. I don’t care what side of the donkey-elephant fence you’re on, having a commander-in-chief who throws temper tantrums daily on twitter and who hob nobs with dictators and makes enemies out of our top global allies will be pretty great. Knock on wood, he takes GA and PA and after realizing you can’t actually throw out legally-cast votes, he concedes and GTFO of the WH.
  4. So Far: A Healthy Baby. My pregnancy has gone relatively smoothly (knock on wood.) Sure, it’s 2am and I’m always awake these days at 2am with some sort of allergic reaction to my apartment, wide awake. But I’m healthy, I’ve made it to nearly 29 weeks now, and even if I have my baby right now its chances of survival are above 90 percent.
  5. Stocking it Up. I hit the RSU lotto at work. After years of working for startups and getting “stock options” which ultimately resulted in no value (or loss of value since one has to actually buy them when leaving the company in order to keep them), I finally was able to get hired at a fast-growth public company at just the right time for my initial stock grant to grow about 10x. While I vested a bunch before it hit this milestone (and sold along the way), I still have made a good chunk of change. If I can bite my tongue and hold out for 13 more months, I should make another 350k after tax at a minimum, not counting any saving from income/bonus/etc. This is pretty amazing in terms of a bump in my journey to FatFIRE. And it could be closer to 600k, depending on how the markets do.
  6. Career Path Fun: While my new role at work (that I had no say in) is a little scary from the long-term perspective (it will be hard to get a similar job that pays anywhere near as well at another company, which means I will need to pick up some new skills over the next year then quickly move on to maintain any sort of reasonable salary growth (and non shrinkage), I have to say my current position is kind of, well, fun. It’s not easy by any means, and I have a lot to learn, but I get to focus on one area and might actually be able to do a good job for a while. It also feels like a position I can do when I return from maternity leave without constantly feeling like I’m about to fail and be fired, so that’s good.
  7. Husband is Still Husband: I married the sweetest guy in the world and he hasn’t changed. Sure, our marriage isn’t perfect, but at the end of the day I get butterflies around hubby because he is just such a good, kind, and gentle person. He reminds me of the type of person I aspire to be. I know it’s easy to take one’s spouse for granted, and I need to put more work into my marriage esp when I have the energy to. do that again, but I’m so lucky to have found a really really good partner.
  8. Not Dead from Corona Yet: As far as I know, I haven’t had COVID yet, and no one in my family or friends circle has had it. I’m terrified and sad about the loss of certain freedoms and socialization, but the COVID world has also done some wonderful things for me. I’ve realized just how much my social anxiety negatively impacted my life by seeing what life is like when I don’t have to interact with people outside of my immediate family. I do miss friends, but I don’t miss the horrible anxiety that goes into every moment I spend time with other people, especially at work.
  9. Net Worth Growth Overall: my after tax, don’t have to touch it until I retire family net worth is about 1M. Although that isn’t enough to retire on today or for a while, it is more than most people have at my age–or any age. At my current savings rates, the next few years should be very interesting in terms of setting my middle-aged years for a lower-stress life (no more constantly worrying about what happens if I lose my job!)
  10. This Blog, and My Readers: I still get giddy when people leave me comments on here–while there’s the occasional troll, for the most part people leave incredibly helpful and thoughtful comments which help me advance and grow in many areas. I’ve been writing on this blog now for (gasp) over 15 years and it has really helped guide me towards my north start of being financially responsible and at a very good financial place going into my (gasp) late 30s. Because of that, I don’t feel that scared about bringing a second kid into the world, and a third child (something I’ve always wanted despite coming from a family of 2 and being married to an only child) is definitely still a potential reality if my body will cooperate at 39. It also may not happen, and I’m also very happy with a family of 2 kids, and I just can’t wait for my toddler can meet his little sibling and to watch them grow together, especially after this past year of my son not being able to socialize with other kids at all. It is the absolute cutest thing when he points to my belly and goes “baby growing!” I’m not sure exactly what he thinks about it, but I tell him baby is going to come live with us soon, and he seems to get it at least somewhat. So many precious memories ahead if I can just get through childbirth safely without any additional trauma (atheist g-d willing.) I am feeling really good about this upcoming birth, despite the state of everything.

So there you go, 10 things I’m super grateful for and happy about. I rarely talk about them here because I come here to complain or talk about my frustrations and concerns around all things money related, but there is a lot to celebrate here heading into 2021. By the end of 2021, my net worth should have a significant increase, I should have a healthy baby that is approaching 1 years old (and preparing my body in the healthiest way possible to conceive my third and final kiddo), and maybe even feeling at home in the house we bought. Maybe life is going better than I ever imagined it could be and I just don’t know how to handle being so damn #blessed. Yes, I said it. I hash tagged it. But it’s true. I am grateful. I have some guilt for my privilege that led me here, but it certainly wasn’t easy. I have to fight the good fight every day to not let my mental health challenges get the best of me. And, despite a few breakdowns here and there, and a few manic periods I’d really like to forget, I seem to be doing it–surviving… and thriving even. I should try to celebrate all this good while it lasts. I know nothing good lasts forever. But right now, all signs point to–hey life isn’t that bad. It’s ok. It’s good. As good as life can be after losing a parent and never being able to go back to before all that. It’s just good for what it is. For where I am. And I hope next year continues on this trend line. Maybe soon I’ll remember what it feels like to be happy again.

Coast FIRE sounds good to me.

I’m digging the idea of Coast FIRE–which is basically what my goal has been for a while, I just haven’t had a name for it. By “Coast FIRE-ing,” basically you save enough that you no longer have to keep saving. You just work to pay expenses and your savings grow to support your expenses forever. I like the sound of that.

One of my commenters reminded me that at two million in savings, I might already be there. But then I realized I don’t actually have two million in savings. So I need to figure out how much savings I need to Coast FIRE and then focus on getting there, versus some meaningless arbitrary number that sounds good (like five million, though that still sounds good.)

  • Cash – 185k
  • Home Equity (After Sale) – 226k
  • Taxable – 508k (726k at 30% tax)
  • IRA – 211k (353k at 40% tax)
  • Roth – 103k
  • 529 – 90k

Total Actual Family Networth: 1.3M
Minus home equity and 529 = 984k

So… we’re not really at 2M. I think where I’m going is that we need to get to 2M after tax, not including home equity and 529, to be Coast FIRE. I need to run some more numbers, but the above is a more realistic breakdown of our actual family net worth.

It can definitely grow over the next year with my vesting a chunk of company stock, but it will be a while before we hit 2M… and even then I’ll have to make enough income to afford about 12k a month in expenses for the next 30 years without any savings on top of that. I guess if we get to 2M after-tax net worth (minus our home equity and 529 funds), then we have to earn 250k a year together to cover 12k a month in expenses. If my husband makes 90k, that means I need to make 160k to Coast FIRE, once we’ve saved 2M.

Is $2.5M next year realistic?

When I think about numbers like $2M (or look at my family personal capital net worth tracker and see it show $1.9M in net worth) I get a strange feeling. Just 17 years ago, I was a fresh-out-of-college gal with pretty much nothing to my name, struggling to pay $400 a month for a tiny room in a Bay Area apartment (it was more like a closet) and afford gas for my car to get to my internship, where I earned $50 an article the newspaper published.

I didn’t know what I was doing with my life (spoiler alert: I still don’t!) but I knew I couldn’t fail. I couldn’t ask my parents for help. My father had quite an interesting financial philosophy of being overly giving through college but then you’re cut off. I’m grateful for the no college loans, but in hindsight find the strategy unwise overall versus instilling a sense of understanding the value of money.

I had to learn that on my own.

But I’m also glad I did. It worked out for me, while my younger sister is still struggling. I made a choice to be self sustaining. I realized than meant no kids until a decent nest egg was built (I loosely set a goal of $500k in savings before kid #1.) I didn’t want to marry for money and I didn’t feel comfortable dating career-minded men. Due to my mental health challenges it was important to find a partner who would be emotionally there for me and our family. I wanted a guy who I could see being a dad to my children. Granted, when I fell in love with my now husband at 22, I thought he may eventually be motivated to earn more income. It turns out people don’t change. But I’m ok with that. It works for us.

Sometimes I realize that lots of my peers at work (especially women) are married to partners who make equal to what they do, or more. Men overall tend to make more, so those married to SAHMs or “business owners” who barely break even are generally in a more stable boat overall, with earnings of at least 300k per year if not much more. But I also exist in a bubble, where you have a bunch of people who make 500k a year per household and then the rest of everyone who is making like 100-200k (as a family) and actually struggling to get by. We exist in this weird in between.

Saving and investing is the only reason we can stay here and make this work. I’m working with my husband to have him catch up on his retirement accounts (since he is self employed he can put a good chunk into his 401k each year.) I am trying my best to max out my own tax advantaged accounts, which now include 57k with a backdoor Roth through work. As we approach $2M, I feel little sense of stability or satisfaction. It’s a HUGE number, but it didn’t financial security. It’s better than the 10k I had 17 years ago or 100k 5 or so years after that. But it doesn’t make me feel good—yet.

My whole money mentality is broken, though, due to growing up with parents who earned enough for a good life but failed to budget or save effectively (case in point a $200k HELOC on a $500k home that was basically paid off when they were in mid 50s and empty nesters to ADD on to their home—my mom at 67 is just beginning to pay that down.) There were other bad choices and sad errors that led to losing about 100k overall. I’ll write about them one day.

But I grew up not worrying about money. We didn’t have a luxurious lifestyle by any means, but we were solidly middle class. And while I definitely do not expect or want any further money from my family, it is terrifying to me to lose that sense of security, however false or ill-conceived it was. I want to get to a point where I can send my kids to summer camp… or take the family on a nice vacation… without worrying I ought to put that money in the stock market instead. I want to get to the point where I don’t feel like every $1 I spend today is $20 30 years from now invested. Where I can step back and say, ok, we have enough and we just don’t need more even if we can save more.

Right now that number seems to be $5M. The sooner I get to that, the better. Again, it’s another arbitrary number I’ve picked out of thin-ish air, but it just seems right. My goal is to be able to focus on working to pay annual expenses but no longer having to save at that point. If I can no longer work for some reason, the $5M, spent and invested wisely, can last quite a while. I don’t have any desire to keep going and make $10M or whatever—what is the point? Who needs that much money? At $5M I could help my mom out, pay my expense, help my sister, pass on enough to my kids, and even comfortably pay down my 30 year fixed mortgage.

I just really want to get to the point where I can work because I enjoy it. To say fruck you to the golden handcuffs and do my own thing. Start a business. Start a non-profit. Build a company that helps people. Write books or screenplays or direct documentary films or who knows what else. Spend time with my kids because clearly they grow up way too fast. Spend time with my family because they won’t be around forever.

I am not quite sure how we get to $5M. In 10 years at 10% YoY if I don’t touch the 2M that’s 5 right there. I don’t know if 5 will feel enough then, but it will be close. Imagine, $5M when my kids are 12, 10, (and 8??)—what that would mean for the rest on my life. And their lives. I’ll be 46, which is old in that is likely half of my life if not more than that, sadly, but still if I am at 46 with $5M my family is in a really, really good spot. My mom, hopefully healthy and well, will be 76. I can finally feel like I am in a financially safe enough place to pay her back for college and my wedding, through helping her out if she needs it or treating her to massages and other gifts on the regular. I can help my sister buy a house, or buy one and rent it to her at below market (in her lower cost area.) I can finally be free of worry (almost—I’m sure I’ll fear total market collapse and never truly feel secure.) I can donate chunks of money and also buy some frivolous things just because. Like nice furniture. And lots of experiences to create the most valuable asset of all—memories.

This next year will be life-altering for me, and yet even with its income potential it still feels like baby steps towards my goal. I’m so impatient. But next year, as long as the market doesn’t totally crash and I keep my job, I should make $650,000 at a minimum. My husband will bring in about $100k on top of that. So after tax we will be bringing home about $350k, or nearly 30k a month. We should easily be able to save $20k a month for the year, which adds $250k to our net worth. It’s kind of crazy how big the income seems and how many people would kill to be able to save $250k per year and yet that’s just one year. If we could make $650k consistently for 10 years and save $2.5M on that alone, that would be one thing. But this is a special year. After that we go back to about $300k in income, and likely $2k-$3k  a month or so in savings. Back to reality.

So the trick is figuring out how to obtain a series of high-paid (due to stock) jobs for the next 10 years. If I can make 300k per year on my own and my husband can reliably do 100k we will be in a pretty good place. Of course that’s not easy — before this job my highest income was 190 and before that 170. It may be impossible to find another job that pays well. And staying in my current role doesn’t help—due to minimal stock refreshes, by 2022 my annual income will be around 200k WITH bonus. So I’ll need to move on (target date April 1, 2022) in order to have a shot at hitting my goal. April 1, 2022 is actually very soon! But right now I’m trying not to think about that. I have to keep my current job for 18 more months. That’s 3 months of work, 5 months maternity leave, and another 10 months of kicking ass and taking names (or, you know, just meeting deadlines and following through on plans) to remain gainfully employed and win the lottery where I am already holding a winning ticket.

So I can’t focus on $5M now. I have to focus on $2M and really $2.5M. How fast can we get to $2.5? Well, my husband promised me if we have 2.5 we can try for a 3rd kid. Given I’ll be 37 this month(!!!) I don’t have a lot of time left to make that happen. And I’m more than incentivized. It will happen. Somehow.