With 965 days left to reach my goal, I think I’ll cruise past the halfway mark of $250,000 this month!
December was a doozy. The markets rallied, I had over a week off to rest, and had my first Christmas in my new house in Oklahoma.
I’m still reeling from November and feeling a little whiplash at dropping $24,000 and then bouncing back over $30,000 in the last month of the year.
On top of all that, I started adding money to savings again and on January 1, went ahead and maxed out my Roth IRA with a $6,000 contribution. 💥 I was waiting to let that settle before I posted this update.
In my new office. The house is coming along nicely
In my January 2021 update, my net worth was $173K. This month, it’s $247K. If I can manage a $73K increase in one year, then I’ll shoot to have a $100K increase this year and be at $347K by January 2023. 😛
January 2022 Freedom update
Now that the year is done, I’ll assess what happened and set new goals for 2022. I’m back to filling up my savings account (this year’s goal is $30K again) and then will add everything else to my taxable brokerage account. I just made my first mortgage payment and am still getting into the swing of the new house.
In 2022, I want to:
- Save $30,000 in savings accounts
- Get to $25,000 invested in my taxable brokerage account
- Max out my 401k again
- Shoot for a $350K net worth by year end
View from my kitchen window with my son in the foreground
I’ll do that by:
- Hopefully getting a raise at my current job (just hit my one year anniversary, so I’m due for a review)
- Continuing my freelance writing for Business Insider and NextAdvisor
- Blogging here on Out and Out more
- Letting time in the market do its magic ⚡️
Basically, I’ll just stick to the same playbook that got me to this point. 😛
Rebuild savings
I depleted my savings with the down payment on the house. And I kinda want to buy an investment property next. I’d also like to have savings for emergencies.
Either way you slice it, saving $30,000 is my primary goal and what I’ll tackle first. I’m currently at $6,113.
Assembling furniture with my curious, helpful boy
Then I’d like to get up to $25,000 invested in my taxable brokerage account. These items alone should handily carry me into 2023.
Roth IRA is already maxed
The reason my savings dipped last month is because I sent cash to Fidelity to max out my Roth IRA. The first thing I did when I woke up on January 1 was buy $6,000 worth of FSKAX. And then went back to bed.
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I’ve been setting up Roth IRAs for my friends and family and telling them to just buy FSKAX and let it sit, which is the exact same strategy I use. I recommend Fidelity, Schwab, or Vanguard and to buy whatever their Total Market Index fund is.
Can’t go wrong with a Total Market Index Fund
Low-cost, broad-market index funds are what I’m invested in.
By the numbers
Instead of keeping my 401k on one line, I broke it into my contributions and overall balance to provide a little more detail there since I’m regularly contributing every two weeks.
I’m also putting a little money into an FSA account, and would like to purchase more crypto this year. Those are part of my “overall investments” even though I don’t break those out in this table (yet).
| Current | Last month | Change | 2022 Goal | ||
|---|---|---|---|---|---|
| ASSETS | |||||
| Overall investments | $217,160 | $196,110 | +$20,050 | As much as possible | |
| 401k (contributions only) | $0 | xx | xx | $20,500 | |
| 401k (overall balance) | $22,958 | xx | xx | As much as possible | |
| Traditional IRA | $122,427 | $116,002 | +$6,425 | xx (can't contribute) | |
| Roth IRA | $55,829 | $47,250 | +$8,579 | $6,000 (in contributions) | COMPLETE! |
| Taxable brokerage | $10,250 | $9,554 | +$696 | $25,000 (total invested) | |
| Savings | $6,113 | $9,812 | -$3,699 | $30,000 | |
| Primary home equity + appreciation | $15,591 | xx | xx | $20,000 | |
| Net worth in Personal Capital | $247,214 | $215,765 | +$31,449 | $500,000 (overall goal) | Track your net worth with Personal Capital |
If you don’t already use Personal Capital, it’s a fantastic tool for tracking net worth. I like how it puts your number right at the top for easy tracking. I log in pretty often and really like the interface a lot.
For the home equity and appreciation row in the table, I’m calculating that figure as the Zillow estimate minus my mortgage. I knowwww it’s all relative and isn’t exact and all that, but I want to include my primary home as an asset for net worth purposes, mostly because a HELOC or refinance might be a tool for me in the future. And it’s actually shockingly accurate for my area.
Sooo close to halfway
Anywho, that’s how my net worth went up over $30K last month. I get more amazed each month as the snowball gets bigger and starts to grow on its own. Before I know it, I’ll have $300K invested (!).
January 2022 Freedom update bottom line
In the last 30 days:
- I maxed out my Roth IRA
- Started adding money to savings again
- Made my first mortgage payment
- Am up $31,000 and nearly halfway to my goal
- Do you have a tiny pause after every bullet point like I do?
I usually have more to say, but I’ll keep it short and sweet this month and save it for when I’m officially halfway to my goal. As y’all know, brevity is a challenge for me. But life is good and I’m getting to spend so much quality time with my son these days. A two-year-old is a particular type of tiring – one I’m grateful to have because time is moving entirely too fast already.
Thank you to everyone who reads these updates. It means the world to me. 🌌
Stay safe and scrappy out there! ✨
-H.
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I assume you want to increase your 2022 goal for your 401k contributions. The new limit for this year is $20,500…
Great catch! Updated the table to make that the goal – thank you!
Appreciate your sharing your personal data.
Of course everyone has their own investment strategy. I retired early and after 8 years I am still living on savings as I am not old enough to collect SS or pensions yet.
I read many books and tried many strategies until I settled on the dividend growth strategy. Like you, I hate paying fees of any sort so I don’t buy any funds. I research individual stocks and assemble my own no fee fund by buying dividend growth stocks with some speculative growth stocks.
Before they eliminated transaction fees I used to buy funds, but now, for me, it makes sense to buy enough individual stocks to be diversified like a fund.
This is in no way a criticism of how you or anyone else does it. You have a great strategy. I’m only sharing what’s right for me.
I’ve heard of a few people doing it that way with great results. It’s more hands-on, but the people who do it seem to get a lot of enjoyment from it. So I say rock on! That sounds like a great strategy – thank you for sharing!
Amazing, woow, do you think the beginning of a new year is a good time to invest or is better to invest after month 4? Well I’d like to know what is the best time to invest money in a new year
This is awesome!!!! So happy for you Harlan!!!! Rooting for you! I read another blog post where you can hold $500k in cash at Arkansas treasury in Little Rock and thought of that upon reading this post. lol.
Based on your below list, I am assuming you need a Fidelity account to buy their index funds and the same holds true with Schwab? While you can buy VTI and ITOT with any brokerage? Are you suggesting just buy one of these index funds or buy a little of everything?
1️⃣ FSKAX (Fidelity – .015%)
2️⃣ VTI (Vanguard – .03%)
3️⃣ ITOT (iShares – .03%)
4️⃣ SWTSX (Schwab – .03%)
5️⃣ FZROX (Fidelity – FREE)
I read a lot of books and tried a lot of different strategies before settling on the dividend growth strategy. I, like you, despise paying fees of any kind, so I don’t invest in mutual funds. I research individual stocks and create my own no-fee fund by combining dividend growth and speculative growth stocks.