Retire by 35: June Results

Sorry for the delay in providing these results.  It’s been a busy month, but I’m happy to say that June was my best month yet!

It’s probably better to describe it qualitatively than quantitatively, since so much went on and the numbers may not accurately reflect my progress.

In June I sold my car, moved half-way across the country, and down-sized my house. No more McMansion with huge mortgage payments, huge electric bills, and that damned money-pit we called a pool. No more 15 mile drives to work to a job I had long outgrown.

Now we live in a beautiful part of Colorado, with a view of Pikes Peak from my back porch. We downsized significantly, from a $400K, 3100 square foot house to a $200K, 1800 square foot house. The house is 3.5 miles from my office, which I will likely go to 4 days a week mostly by bicycle. I will work from home 1-2 days per week. And the real kicker is that we really like our house and neighborhood. When I bought the McMansion I was a 26 year old fool with confused ideals. The neighborhood and the neighbors never fit our desires. Here, after just 3 weeks in the house, we’ve already made more friends than we did in 7 years in my old neighborhood.

OK, enough of my happiness, let’s sober up with the numbers.

Expenses: $3777

Mortgage: $0 (this is because I purchased the home in late May)
Relocation: $2042 (I’m not including this in the overall numbers because I will be reimbursed)
Auto Service: $921
Fuel: $165
Auto Insurance: $51
Groceries: $673
Restaurants: $75
Fast Food: $42
General Shopping (Amazon): $226
Clothing: $55
Bicycle Stuff: $43
Books: $10
Utilities: $214
Student Loan: $143
Cash: $142
Doctor: $95
Pharmacy: $22
Gym: $14
Entertainment: $40
ATM Fee: $2.50

I have mixed feelings about my expenses this month. My target is $3000, which I’m over even without my future $870 mortgage payment. On the other hand, we had a $900 car issue after driving up to Colorado, so if you cancel those out then I would only be about $750 over my goal.

Groceries are still too high, so I’ve made a plan for this. For the next month, I will do the grocery shopping instead of my wife, and I’ll do it all by bicycle (about 1.5 miles away). That should reduce how much we spend. I also intend to further analyze our expenses on Amazon. I thought my wife mostly bought diapers from there, but I don’t think we go through that much between 2 kids, one of which is mostly potty trained.

I’m also taking out too much in cash. That’s totally me, not my wife. I’m looking to improve that this month.

The good news is that this will be my last gym payment, I cancelled in May. Utilities were down, and I expect them to go lower in this small house. Auto-insurance is down with only one car, and so was fuel. I’ve only put in $13 of gas into my motorcycle in 5 weeks!

Income: $11378

Salary: $10411
Adsense: $16
Dividends $951

I’m going to start tracking my passive income (Dividends, Adsense, real estate, and LendingClub.com) as a way to see when that consistently surpasses my expenses. That may not be the same point that I achieve a 3% SWR (safe withdrawel rate), but it will certainly be a cool point to cross.

Assets: $959,000

Cash: $112K
Taxable stocks: $485K
401K/IRA: $349K
LendingClub.com: $5K

Savings rate: 67%
Months to retirement at current expenses: 112
Months to retire at $3000/month expenses: 70

I’m dissapointed that it’s still 70 months of work after if I get down to $3000/month. Previously, I had been counting my IRA/401K in my calculations and now I’ve decided to remove that since I’m only 33.

My primary source of encouragement is that at 4% SWR and $3000 in expenses, that number would be a much more attractive 34 months. And if I continue to make $500/month online when I “retire”, it’s only 16 months. Now that I like.

[UPDATE] Using the 72(t) tax rule, I am now going to include my 401K/IRA in my early retirement calculations.


3 Responses to Retire by 35: June Results

  1. Hey there,
    It’s not that difficult to make $500/month online. I bet you’ll hit it pretty soon.
    Why don’t you put your income into earned and passive category? Online income is still earned income. You can call it side income like many other bloggers. I followed you with Google reader and want to wish you good luck! It’s great that you can save such a huge amount of your income.

    • Thanks for stopping by.  

      I like your idea of splitting up earned and passive income.  I’ve been doing that in my head, but it’s another good way to document it.  I tend to crunch the numbers many ways as I get so close to my end goal of early retirement.

  2. Sherrie Rose says:

    Could you please explain what exception you are using to access your 401(k) without the 10% penalty? Is it 72(t)(2)(A)(iv)? I am reading this blog in 2015 so I am assuming that you have been withdrawing for a few years now. How has this worked for you?

    Curious in Reno,
    Sherrie

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