Welcome to the LAST net worth update of 2020.
See ya later, 2020! Don’t let the door hit you on the way out!
For newer readers, every month I track my progress to a nearly $1 million net worth and an early exit from the working world. I’m currently 30 hoping to retire by age 35. Let’s see if I’m on pace!
*As always, nothing in this post or on this site should be considered investing or financial advice. I am not an expert, please do your own research.
Life Update: December 2020
The biggest life news in 2020 is that I finally got to see my immediate family for the first time since the pandemic started.
They live in Texas, and I live in Minnesota. Normally, 1,000 miles of distance is easy-peezy thanks to modern conveniences like air travel. But in case you haven’t heard, 2020 decided to throw out the modern conveniences in favor of grounded airplanes and bubonic plagues.
So, two negative COVID tests later, and I found myself driving 15 hours across the country to celebrate Christmas with my parents.
Surprisingly, this was actually much less of a battle than I imagined. Maybe the $13,000 Mazda 3 is just that comfortable. Or maybe I’m secretly destined to be a long haul trucker.
Either way, I made the trek in one sitting, as did The Money Pup. What a good boy!
Legs stiff, I was rewarded at the end with a fantastic 10 days with family to celebrate a Christmas/Thanksgiving combo holiday.
Back in Minnesota, I kept the holidays rolling. Lady Money Wizard and I got into the season with all the usual traditions, including Christmas-light touring, where this guy had my favorite decoration of this year:
Touche, good sir. You perfectly captured our collective spirit of the season.
Net Worth Update: December 2020
Not quite as ridiculous as November’s $50,000 gain, but $29,000 in a month is still insane!
You know we’re living in a bizzaro upside-down world when the worst year in over a decade actually saw the markets gain somewhere around 15% when it was all said and done.
But hey, that’s what $20 trillion of global stimulus spending will do. Toss in a promising COVID vaccine and mandatory work-from-home orders (which actually boost profitability for most big companies) and the market future is actually looking surprisingly rosy right now.
Who’d have thought?
For me, this whole roller-coast just proves yet again that taking a balanced index fund approach (and avoiding constant market drama) is really the best path for most of us.
I mean, in January 2020, people like yours truly might have been grumbling about an overpriced stock market (I wrote about it here) but even I was blind-sided by a virus fueled crash that led to an absolutely unprecedented 30% drop in the market, all in a matter of days.
At the same time, who would have guessed that same legendary crash would look like nothing more than a blip come year-end?
Yet here we are.
Just another lesson from Mr. Market. The patient investor, focused on the long term, does best. Sometimes (all the time?) it’s best to hold the course.
Speaking of which, here’s my current allocation, which is really the only “stock market news” I should care about:
Of course, I also have a handful of cryptocurrencies which I don’t report for security reasons. I’ll just throw out that anyone brave enough to jump into bitcoin when I wrote about it back in May has been rewarded handsomely – since that article, Bitcoin has quadrupled in price from $8,000 to a new all time high of $32,000.
If this continues, this crapshoot portion of my portfolio might become too large to ignore.
Checking Account: $18,383 (+$2,238)
Normally I’m not a fan of having this much cash on hand, but it will actually transition nicely into a fully maxed our Roth IRA as soon as possible in January.
From there, I plan on upping my automatic contributions to my after-tax vanguard account. I’m thinking I’ll set up anywhere from $1,000 to $2,000 per month to automatically transfer from my checking account and invested into VTSAX. (Vanguard makes this process super easy.)
Brokerage: $209,998 (+$10,774)
Pretty cool to see this cross $200K for the first time ever!
I did buy another $2,000 chunk of Gold/Silver ETFs, in order to get closer to my target of 1-2% gold in my portfolio.
Current breakdown is roughly:
- Vanguard Total Stock Market Index Fund (VTSAX): $135,000
- Vanguard Total Bond Market Index Fund (VBTLX): $29,000
- Vanguard Money Market Fund (VFFX): $14,000
- Gold & Silver ETFs: $4,000
401(k): $204,753 (+$13,003)
Another $200K milestone!
I max out my 401k ever year, and also receive a generous match from my employer. (About 7%) The result is that I dollar cost average around $2,000 into my retirement account each month, no matter what the market does.
The contributions are still broken down like this:
- 50% S&P 500 Index Fund
- 30% Small Cap Stocks Index Fund
- 20% International Stocks Index Fund
Roth IRA: $45,413 (+$1,422)
I contributed the $6,000 maximum to this back in the beginning of 2020, and I’m looking forward to doing the same again in 2021.
My Roth is mostly Vanguard’s REIT Index Fund (about $38,000 worth) and some of Vanguard’s Total International Stock Market index (almost $7,000 worth).
Rent Payable: $857 (+$27)
For newer readers, I split a mortgage for a house in Minneapolis that my fiance bought for $180,000 a few years ago. This “rent” covers my half of the mortgage, utilities, taxes, expected maintenance, etc.
Credit Cards Payable: $4,233 (+$873)
Always wildly inaccurate, since I pay it off every month and put lots of reimbursable stuff on the cards. Hence, the reason for my monthly spending report below.
Total December Spending: $2,007
As an aside, due to popular demand I just finished updating my spending spreadsheet (which used to be exclusive to numbers for iPhone) to also work for Microsoft Excel. I also made some really cool improvements to it – it now automatically tracks all my income and spending, calculates my savings rate, spits out pretty charts, etc.
If you want to make sure you get notified when I release it to the public, make sure you’re subscribed to the Money Wizard Newsletter!
Vehicle Expenses: $101
My usual $70 car monthly car insurance plus an oil change and tire rotation in preparation for the 15 hour trek from Minnesota to Texas.
It turns out that driving is a lot cheaper than flying, assuming you’re willing to burn a whole day each way. This cost was mostly the gas for the trip and a few miscellaneous expenses.
Wtf!? Pretty sure gyms are closed here, and I still got charged somehow. Gonna have to add an investigation onto next month’s to-do list…
Almost entirely Christmas presents for friends and family and some charity giving that’s become a holiday tradition for me.
How was your December?
And how happy are you to see 2020 end, haha!? Hope you all had a great holiday season, and I look forward to posting and talking with you all about 2021’s goals and plans over the next few posts!
PS – Want to track your net worth like this? Personal Capital is my favorite tool to do so. The free software is truly awesome, so just check it out already!