One of the main purposes of this blog is for me to track my progress to financial independence which I am well on my way to achieving. May was a month that came in with higher than average personal and rental expenses. On the personal expenses front our old car needed two tires as they were nearly bald, plus auto insurance renewed (Geico) as well as vehicle registration. We also decided to paint our house and install a new exterior door that isn’t hollow as well as installed dead bolts. The painting isn’t done yet, but the house looks great so far. This is the first time we have been able to spend some time on the outside of our house after buying a foreclosure three years ago. Finally, we had some remaining expenses from our affordable vacation to Hawaii.
This time of year is always a busy time with the rentals while for the remainder of the year I usually am collecting checks (or now automated ACH!!!). This year was no different. We are having both sides of the duplex turnover and since the tenants were moving out much earlier in the month we decided to take advantage of the opportunity. Because you can get work done while having the unit empty (or mostly) you can forego having to have the unit vacant in the future due to repairs that have to be done. Even if you have to pay someone to do some work that you would otherwise do yourself due to the time crunch, the math usually works out in your favor.
We put in some thick vinyl flooring (~$400 for 400 sq ft.) and the install set us back $450. This covered a kitchen, a landing, entryway and bathroom and the results are fantastic. I have never considered vinyl flooring in the past and we’ll see how it holds up, but I really like the way it turned out. Another tip: ask the installer if you can save money by doing the prep work. By taking off the baseboard/trim, island, and removing the toilet we were able to cut down on the install cost. These are all very easy things to do yourself.
I also installed 7 new light fixtures. Most of these I had purchased over the last year on sale, but I did buy one more light that I needed. Out with the gold, in with the nickel! There were a few other minor items we needed to buy to get the place ready for the new tenants.
While this month certainly was an expensive month these expenses come up when you own rental properties. The trick is to try and deal with them as efficiently as possible and certainly in my experience having a nice unit is well worth it in the tenants you attract and how they take care of the home. Now onto our net worth report.
Note: if you’re just joining us you can view my most recent net worth update here.
Mr.QCI Net Worth
P2P Lending: $23,248 (+$186)
401k: $28,395 (+$2397)
Vanguard Rollover IRA: $67,798 (+$1043)
Vanguard Roth: $24,225.37 (+$422)
Vanguard Taxable: $63,023 (+$180)
Individual Stocks/Other Investments: $2222 (-$624)
HSA (amount invested only): $8,636 (+$634)
Total Investments: $217,547 (+$4238)
Assets (Zillow estimated): $403,794 (+$2197)
Liabilities (3 Mortgages): -$256ish (I plan to update this every 6 months or so, but I pay down about $6,000 of debt every year)
Net Worth: $369,341 (+$6435)
I don’t necessarily trust Zillow estimates, but this is what I am reporting for now. I continue to make minimum payments on all of my mortgages. You can see my real estate holdings here.
Miss QCI Net Worth
401k: $41,554 (+$2461)
Vanguard Roth IRA: $23,985 (+$300)
Rollover IRA: $3633 (+$63)
Vanguard Taxable: $52,028 (+$1731)
Total Investments: $121,200 (+$4555)
Net Worth: $124,200 (+$4555)
Miss QCI, my wonderful significant other continues to crush it as well. She puts 50% of her income into 401k (the max allowed by the company) and still has room to invest in a taxable account – amazing! Since the rentals are owned solely by me (although she helps me immensely), her investment contributions remained solid in May.
Investments (what really matters): $338,747 (+$8,793)
Projected retirement income (assuming 4% rule): $13,549
Net Worth: $493,541 (+$10,990)
It’s amazing how a month of higher expenses still can result in significant investment contributions. This is mainly due to our high savings rate. Seeing this has helped me with the frustration of not being able to invest in a taxable account as my HSA and 401k contributions continue in the background.
Once we get through the next few days, the picture I’ve featured on this post depicts our focus for the summer: lake time. Focusing on the now, even while I invest for the future is a hurdle I think many people struggle with and it scales to both extremes. There is the “you don’t know if you are going to die tomorrow” crowd who don’t save a dime and the obsessive frugality at-all-costs that can be detrimental to your lifestyle and emotional health. It is a battle to find your happy medium and I have been increasingly trying to enjoy the now and journey to FI while still planning about the future. You can read more on this subject in a great post from the Mad Fientist who gives his perspective in a guest post on Frugalwoods.