Tag Archives: rsu

Holy Hell 2020: $850k Total Income (Can We Hit $1M Next Year?)

Ok, let me catch my breath here. Because. What? I just added up all our income for the past year and if my calculations are right (they are) we made $850k in ONE YEAR in actual income (not counting investment gains.) This figure makes me kind of numb. You would think I’d feel rich (because when you make $850k you are rich even if it’s temporary) yet… I’m blinking here and feeling like, wow, even if I never make this much again in one year, I’m shocked that I did this ever. 

  • Shocked because I’m a bipolar woman who can’t hold a job.
  • Shocked because I’m pregnant with my second kid and struggle to be a mom and a full time employee and I constantly feel like I’m going to be walked out the virtual door.
  • Shocked because a year ago my boss put me on a PIP and I was supposed to be fired in July, but I held on for dear life to make this year a reality.
  • Shocked because in Silicon Valley, it’s probably somewhat normal for 2 adults in a household to earn this much in a year ($750k of the $850k was my earnings, $100k was my husband.)
  • Shocked because I don’t deserve to make this much.
  • Shocked because many of my peers and superiors likely made 2-5x+ what I made, and are likely going to continue to do that.
  • Shocked because wealth makes no sense and while many people struggle and go hungry in this country, and I am trying to figure out my place in how to help people while also knowing that due to my mental health issues I need to save a bit more aggressively than the average person, as I could hit a wall and not be able to work at some point.

This income won’t be our income forever. 2021 could easily break this record if the stock market holds up, but in 2022 we’ll be back to about $300k (which is still crazy good compared to the average person, but not holy shit we earned almost $1M in a year good.)

For the record, this has been my income and net worth gains since 2005. Clearly this year is abnormal. (This doesn’t include my husband’s income/savings, which have remained largely flat. If I keep earning like this maybe he can actually quit his job and become a FT SAHD!)

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  $750k $1.6M  $550k  52.8%
2021 $750k 2.1M Goal $500k Goal 31.25% Goal

I’m still. Blinking. At my google spreadsheet. It is insane. Absolutely insane how much one can make a year if you hit the RSU lotto. And PLENTY of senior Silicon Valley execs make this every year of their working lives. And are married to people who also make this much. What do they do with all that money? I mean, if I could consistently make this much for even 10, maybe just 5 years I’d be set. Forever.

That would be nice.

My taxes are a nightmare but that was expected. We went safe harbor last year knowing we’d owe a lot. I was running these numbers to figure out how much “a lot” is and it looks like we owe about $50k for 2020. That’s ok, I have that set aside. What I don’t have so neatly set aside is 2021’s first quarterly payment. It’s going to be messy because if we go safe harbor (which we probably should) we have to do 110% of this year’s taxes owed.  Welp, that’s going to be $57k…

Typically, some of that would come out of salary. Now, some of it will come out of my RSU vesting and bonus (if I get one) as that will be paid out while I’m on maternity leave. But my maternity leave pay is much lower than typical pay and no tax is automatically paid on it. I know, boo hoo rich people problems — but we need to be careful because if we don’t pay enough estimated taxes next year we’ll have a huge penalty. The year after will be fine with my income dropping substantially. Next year is… well, basically in April we owe $100k in taxes. Hopefully no additional penalties there… I think we should be ok, as our CPA said we were doing fine on safe harbor as long as we paid 110% of last year (and we did automatically, since my total income went up so much.) But next year… it’s going to be rough if I lose my job at any point as we will be forced to massively overpay early on.

Again, rich people problems. Am I a rich person? Eh, I don’t feel like one. I guess I am? I did just buy a $1000 Roomba and a $35k bathroom remodel. But I still feel like I can’t afford a good kitchen table (we’ve never owned a good kitchen table.) So there’s that.

Next year–my wish is to break $1M income. It will be close. I’m going to have fun building a donor-advised trust as well. It might be wise to do that this year also, but I think I’m going to wait as I don’t have much of a mortgage deduction yet and I’m kind of scared about the tax situation so I need as much cash on hand as possible for the time being (plus who knows what random costs will come up for this house.) By the end of next year I should have a better idea of just how much I can/should put into a donor advised fund.

I mean, if I have some horribly traumatic birth and end up disabled (or dead) things are going to change quite a bit. If I don’t… then it’s full-speed ahead to some serious wealth. People on this blog constantly ask why I stay in Silicon Valley. This is why. I want financial freedom. FAT Fire. This dream is being built here. It’s certainly not a sure thing. But it’s worth it, as I approach 40, to know that I’ll have hopefully a large chunk of my adult life when (earning and saving a lot of) money is no longer a concern. We could always pick up and retire elsewhere and live a life of luxury too, but we love it here, and I think there are still great things for me to accomplish with the right company/team. Businesses to build. Problems to solve. There are a lot of things I love about working in Silicon Valley. I don’t love the craziness behind how people change when they’re chasing their next vest date, or needing to white lie to a board to get that next round of funding. But I do love a lot of the energy here. The desire to always improve things. Never settle. I probably would get bored most anywhere else.

A Bruised Ego and Preparing to Move On

I wasn’t a good fit for the role. Not in an environment where my boss wants someone who leads by being aggressive and confident to the point no one else’s ideas matter. I don’t want that job anyway. My idea of leadership is meeting with different team members, understanding their needs, solving their problems. Maybe I didn’t do that well either, but I will never be the kind of leader she wants so it makes perfect sense she has replaced me with my coworker.

Is my ego bruised? Of course. It’s painful to fail. It’s painful to look back and think — “If only I…” which in this case is pretty much if only I focused on not fixing things in the weeds and building an engine but instead just focused on producing high impact stuff that got noticed then maybe I would still have my job/title. I’d still be struggling, though. My best bet is to take my learnings here and apply them elsewhere. The timing is bad to do that though, and for all of the bruised ego and feeling like despite doing some good work this year no one has noticed or cared, I have to say I am ridiculously fortunate to be in a place where I am about to be able to step away from work for a few months, have a kid, reset, and come back to a new role that clearly isn’t my “forever role” but one that I can likely hold onto for the rest of the year — if I can manage being shot in the gut daily with reminders of both my failure and how my overly confident work friend is basically going to leverage the engine I built (and got no credit for) to be hugely successful. If he maybe would make an effort to recognize this publicly it would feel a bit better but he won’t. And I have to bite my tongue and smile and pretend I’m ok with how everything has been handled, which I’m clearly not, but what does it matter?

I wish I was in a position to succeed with the new role, but it’s already a mess. I realized I need to basically—at all times—focus on “the next 30 days.” That is, in a marathon, or war zone for that matter, you can’t think that far out. So I have 30 days to survive and then another 30. I can plan a bit for the future but primarily I need to be heads down for these mini sprint battles. I need to give them no reason whatsoever to say I didn’t achieve my commitments. I need to deliver quality work but more importantly I need to deliver work on time. As I watch my friend build his empire and try to not be too jealous. Because at the end of the day he deserves the opportunity to grow in his career and even if I held onto the role for dear life it was never going to be a fit for me. Neither is “this” job, but I think from a pure survival mindset “this” job allows me to get through the next year, put out some decent work, and prepare to move on. It’s really a blessing in disguise. I need to focus on gratitude and not all of the other shit. So my coworker is basically taking the woman I hired and the system I built to make his plans successful without giving me any credit (though he has told me as much.) Why do I care? Should I care?

What hurts most is going from being a strategic leader on my team to being kept out of all planning. I don’t understand why I can’t be involved at all. I mean, I do — my boss clearly doesn’t like my ideas and thinks I would overcomplicate things — but this whole transition is so horribly unprofessional and petty I can’t help but be hurt a little. I’m sure in her mind she’s thinking I’m damn lucky to still have a job (true) but things like how I still don’t have a new job title (hasn’t even been mentioned) while my coworker is clearly getting promoted into my current title doesn’t sit well. I’m planning to not ask and just keep my title on public channels for as long as possible. It will help immensely when looking for a new job.

Now, I know my long-time readers think that it’s probably all me… and a lot of it is… but I often end up with bosses who don’t jive with how I work. I respect my boss for her ability to function like a machine and get lots of power and not care about people or what makes sense much so she can focus on the business stuff that matters and will help her survive and continue to move up. She is a beast. And I say that in a good way. Really. But I don’t like working for people like her. I like working for people who are inspiring and collaborative and who want to work together to achieve common goals. I hope to find that in my next role. Whatever that is. Whenever that is.

There is a slightly but growing possibility that I may make pre tax 700-900k next year. Which is absolutely insane. Now, I know you are thinking holy hell shut up and do you work whatever they ask of you even if that means standing on your head in a vat of horse shit for hours at a time. And, hey, I’m with you. Before this job the most I made was 190. Which is nothing to shake a stick at salary wise, but I never dreamed I would make 700k+, let alone in one year. Even after tax it’s an impressive number.

Knowing I am making that, possibly, I understand the not-so-nice behavior of my colleagues, esp those in more senior roles who are likely looking at 2M+ in one year. We are all in the boat of tight golden handcuffs. The difference between everyone else and me is that I want out, so while part of me is sad I’m not looking at $700k+ total comp in perpetuity, another part of me is ridiculously grateful that after bonus season in 2022 I won’t have a strong compelling reason to stay. I figured at that point I need to find a job that has at least 250-300 total comp to be equal (and less the following year as I vest the last of my early grants) — still a lot, but at that point, if I’ve really saved 300k+ after tax and after expenses this year, I feel like it’s a good time to take a step back, make a little less, and find a job that isn’t destroying my sanity for once. If such a job exists. This company and (past) role on my resume will likely open a fuck ton of doors that weren’t available to me years ago. I’m lucky. I’m in a good spot. I need to be happy for my friend who is moving up in his career, happy that it worked out (as planned) that I am somewhat protected for a few months through maternity leave towards my final vest date (even though I could get caught up in a mass layoff and that may happen and would be sad), happy that my boss sees value in this one area I’ve done well in, where I can “live out my dying days” making stuff people will probably like enough to not immediately fire me.

So. Yeay. Woohoo. I did it. Or I’m close to doing it. I’m 60 days (or less) and counting to maternity leave. I’m remodeling a bathroom. I’m hoping I don’t get COVID in the hospital. I’m staring at our nation’s leadership in bewildered terror that our president is trying to kill democracy, and he has his followers convinced the election  was a sham while presenting absolutely no proof of fraud. There are a lot of big problems going on in the world right now. People out of work. People going hungry. All my little petty shit above is nothing compared to what’s going on right now. I’m in a little stressful bubble but boy does that bubble pay well—and I keep reminding myself even if I make it through just half of next year, my earnings will be substantial, and I can take some time off and figure out what’s next. As long as I make it to mat leave I’m in a really good place. If I make it to end of next year, a really, really good place.

As my blog title notes — money can’t buy happiness, but it can buy freedom. It’s so true. Life is short. I don’t want to spend life constantly worried about paying for the basics. I like working. I want to work. But I want to do work that is meaningful. That I am proud of. That I wake up in the morning excited about. I hope I can find that. I know all jobs and careers  have these issues. But this one, after 15 years in it, is clearly not the right fit, despite how shockingly lucrative it has become.

Needless to say, if I make it to the end of the next year, I owe you all a drink.

 

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.

Figuring Out How Much House We Can Afford with RSUs

We are going to buy a house. It is not the most financially wise decision, but life isn’t about always being financially wise–sometimes you have to splurge (within reason) and take risks. I accept that buying a house will reduce our total networth in the future, and I’m ok with that. After all, what is the point of making money if you can’t enjoy it, and what would I enjoy more than having a home of my own to raise my kids in? Sure I’d love to take lots of international trips and such, but with a toddler and one on the way (and maybe one more in 2-3 years), that’s not happening for a while. My house will be my Paris and Prague and Tokyo.

But one thing has been very difficult to figure out — how much we can afford. All home buying calculators assume you have a fairly consistent income that goes up by a consistent percentage every year. That isn’t reality for us. There are many ways to figure out how much you can afford, but one model that I’ve decided I like is 28% of pre-tax income (I’d prefer to do post-tax but if I do that I’ll never afford a home here.)

I worked out the chart below, which shows potential annual income (pre tax) with the amount of mortgage (PITI total) we can afford per month (on the right) and then on the let, I have the house price and the total amount of PITI with a 3.5% 30 year fixed loan. Our goal would be to afford a $1.7M home with an in-law, where my father-in-law would pay some rent. This means based on the chart below we need to make $320,000 per year, consistently, to afford a home at this price point. (*my insurance estimates are probably way off but I tried to figure out what home insurance would cost in California with earthquake insurance tacked on — if these numbers look wrong please let me know in a comment.)

Total Year Total Month Mortgage Max (28%) Total Monthly House Price Mortgage (3.5) Taxes Insurance Earthquake
$210,000 $17,500 $4,900 $4,872 $1,000,000 $3,412 $933 $167 $360
$255,000 $21,250 $5,950 $5,957 $1,200,000 $4,310 $1,120 $167 $360
$300,000 $25,000 $7,000 $6,862 $1,400,000 $5,029 $1,307 $167 $360
$320,000 $26,667 $7,467 $7,767 $1,600,000 $5,747 $1,493 $167 $360
$400,000 $33,333 $9,333 $9,936 $2,000,000 $7,543 $1,867 $167 $360
$500,000 $41,667 $11,667 $11,381 $2,200,000 $8,801 $2,053 $167 $360

 

Right now, I’m earning $170,000 in base income, and my husband makes $85,000. Based on our minimum income, that gets us to $1.2M of house… which isn’t enough here. To get to that $1.6M target (which is still a small house and a fixer upper), we need $320k in annual income. So either I need to consistently make $235k, or my husband needs to increase his income, or some combination of both.

What the above does not account for is that my annual bonus is $34,000. I have no idea if I will get a bonus this year or how much of it I will get. I have received my full bonus every year for the past 3 years BUT there is no guarantee I will receive a bonus in the future, or that future jobs will pay such a sizable amount in bonus. I’m not sure if I should include my bonus in my calculations or not. I’d rather not, because a bonus is nice to have for an extra vacation or gift for the kids vs worked into our planned home expenses. It would be nice if my base was $200k, so I could actually include that in the calculations. If I could get my base to $200k and my husband could figure out how to make $120k, we’d be in pretty good shape.

In addition to the base and bonus, I also receive a large amount of my income in RSUs. My refreshes have not been great, though. And if I lose my job, then I will not be able to obtain the same amount in RSU.

When I joined my company, my total compensation was as follows:

  • $165k (base)
  • $33 (bonus)
  • $56k (RSU/yr for 4 years) (*currently worth ~$350k+/yr)
  • TOTAL = ~$254k

My current compensation once I fully vest my first grant is:

  • $170k (base)
  • $34k (bonus)
  • $12k (RSU/yr)
  • TOTAL = $216k

So, that’s good, with bonus and RSU I’m still getting close to the $235k I need to make to afford a $1.6M home, but not quite, and that’s including bonus and RSU which are all variable.

What’s scarier is that if I lose this job, I have no idea if I will be able to do better than $150k salary with no bonus or RSU (I feel fairly confident I can find a job with $150k salary since before I started this job I had a few offers for that amount at startups that I turned down as they were way too low.) So do I base my home purchase off of $150k (me) + $85k (husband) = $235k/yr of income? Then we a afford a $1M house… so we can’t afford any house here and we’ll just continue renting. However, with my RSU growth, my income this year and next year are very high, and it “feels” like I should be able to afford more house. But can I?

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!