Financial Independence Progress Report for September 2015

09/30/2015
Emergency Fund ($72K) 100.0% 100.0%
College Fund (80K) 33.77% 33.94%
Passive Income Streams ($4000 pm) $178.58 pm (08/2014)% $439.96 pm (08/2015)
Retirement Fund ($900K) 54.66% 54.62%
Roof for our Family($1 mil) 00.00%
Medical Fund 00.00%
Life Insurance Done (term life insurance payments initiated)

Main Takeaways

Markets are continuing the roller-coaster ride…the DOW Jones index lost more than 200 points more than once this month. I did take advantage of this down market (another post on this coming up on how).
I expected a downturn and planned for it (here)…but, that did not soften the blow much. At the end of August, my portfolio had taken a beating….so, how did September do?

  • September was a much better month for markets than August.
    • College fund stayed even
    • Retirement funds stayed even.
  • Passive income for September 2015 continued the winning trend vs last year.
    • I compute Passive Income per month as (total passive income in this year) / number of months completed this year.
    • Total passive income is a sum of dividends + capital gains distributions.
    • September Passive Income = (total passive income in this year) / 9 == $439.96 pm.
    • Doing it this way keeps the monthly passive income more realistic because I can instantly know which of my monthly expenses are covered by this amount. I keep a separate tracker for this which I will write about at a later date.
  • I did take advantage of the down markets and added to my investment in VDIGX and VTMFX. Both these investments dipped to their 52 month lows when the DOW Jones index dropped more than 200 points. These new investments will contribute towards dollar cost averaging my holdings. Yeah for that!
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2 thoughts on “Financial Independence Progress Report for September 2015

  1. Hello, I found your blog recently, and I wish you luck on the road to financial independence. I have also increased my investing and made it more regular to try to attain my own financial independence. Until I was recently laid off, my thoughts of current income investments were for retirement, which I assumed would be after 65. I have a good chunk saved for an emergency, and I was able to get a new job fairly quickly, But it made me think about how it could happen again, and what I could do about it.

    I had a couple of thoughts about your passive income plan. You have listed which funds you have, but what percent of your portfolio is each one? Are you equally invested in each one, or did you decide on different percentages for each?

    Also, $4000 per month seems like a far away goal when it is presented as a single number, and it may be discouraging to see it as a single lone goal. Maybe in addition to the total amount you could make up a list of budget items. Making a budget also helps you to identify what you are spending money on and see areas where you can cut to bring your goal closer. Also, as your passive income rises it gives you mini-goals or achievements to accomplish along the way, like a game.

    Like

    • Thanks for dropping by and more thanks for the kind words. Until I got “enlightened” about financial independence *before* retirement, I was exactly like you. In fact, I was worse off…I never thought about income in retirement too. It was too far away in time for me. And then I myself went through a series of bad events (forced job changes included) that brought me to the doorsteps of FIRE….and my initial reaction was pure anger. How could I not have seen this before? Anyways, it is better late than never right 🙂 I am happy that you have realized this path as well and my very best wishes for a successful journey towards freedom.

      Now, let me try to answer your questions.

      1.
      I am not equally invested in my accounts. When I started my journey, we were a two income family. So, tax efficiency was very important to me. So, I funded the MUNI fund (VCAIX and VTMFX) at a much higher %. In fact, these were the only two funds I started with initially and then added on other streams according to a design plan. The design is detailed at https://humblefi.com/2014/10/19/implementation-of-passive-income-streams/.

      2.
      Regarding mini goals before $4000, I can only say this: Great minds think alike 🙂 For the past 2 years, I have been maintaining a separate tracker on which of my expenses are covered by the monthly passive income. If you look at my Progress Reports, you will see this sentence:

      >>Doing it this way keeps the monthly passive income more realistic because I can instantly know which >>of my monthly expenses are covered by this amount. I keep a separate tracker for this which I will >>write about at a later date.

      Whenever I cross off one item from the list of expenses, I feel overjoyed and this provides an immense boost of motivation to keep going and attack the next target on the expense sheet. I have been hesitant about writing about this because I felt that the expenses in my HCOL (high cost of living) area may not apply to others who do not understand the cost of living in a HCOL area. But, I personally have found it to be an awesome tool to keep motivated. Let me use your words as motivation to write about this…perhaps others can benefit from it just as I did.

      Thanks once again for dropping by. And welcome to the journey of FIRE.

      Like

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