Financial Independence Progress Report for December 2018

December is done….and I realized that November was done before that and I did not update my monthly report! Too late now. I was extremely busy with unsuccessful house hunting. But lets get on with December.

This is the last month I will have passive income for a while….I have sold all my investments and plan to prioritize buying a home for the family. Based on how that purchase goes through, I will re-enter the market with whatever money is left. This was a tough call but in the face of lots of uncertainties, this is the only reasonable path I see. I think I will again become a beginner in dividend investing….lets see how things go the second time around!!

How much closer did I get to my financial independence targets in December? Lets look at the numbers for December and find out.

1/06/2019
Emergency Fund 28.41% 80.07%
College Fund 55.37% 55.46%
Passive Income (2017 vs 2018) $939.90(12/2017) $1387.59 (12/2018)
Retirement Fund 85.72% 86.30%
Roof for our Family($750K) 00.00%
Medical Fund (via HSA) 12.36% 12.56%
Life Insurance Done (term life insurance policy)

Main Takeaways this month

  • Passive Income Stream
    • My passive Income for Dec 2018 was $1387.59.
    • Compared to this time last year, the total dividends this year through end of December is 32.69% more than 2017.
    • My first year of developing passive income streams was 2014. December dividends in Dec 2017 was $297.68. It has been a good ride with lots of lessons learnt along the way.
  • Additional Investments
    • Investments in taxable accounts
      • Sold some more investments to tax-loss-harvest some gains.
      • Using the proceeds, I continued to rebuild my emergency fund.
    • Investments in tax-deferred account (IRA)
      • Was forced to liquidate some holdings because the 401K plan offerings changed.
      • Invested back into three buckets
        • US Intermediate bond funds
        • International Equity funds
        • US Equity funds
        • Money market fund
          • Building a cash fund because I am seeing a lot of red here.
          • Time to invest more and dollar cost average down the investments will be here soon!!
  • Miscellaneous
    • I was walking through all my investment categories and I am seeing red in many of them.
      • Investments in the  GREEN
        • US Equities :
          • VDIGX
      • Investments in the RED
        • International equities:
          • VIHAX, VTIAX, VEMAX
        • REITs:
          • VGSLX, VGRLX
        • Investment Grade Bonds:
          • VFSTX and VFICX
        • Bonds:
          • VTABX
    • In my experience, when I see such broad declines across many investing categories and across many geographies, then it usually indicates that a storm is gathering. The entire world is connected in many ways and non-performing markets (like emerging markets) have a way of spreading fast.
    • It is time to shift focus on how to not only prepare for a downturn but also how to benefit from a downturn.
      • If you have time, you can read this post I wrote a while back.
      • How to prepare for the next recession?
      • Since I have have been house hunting, it is amazing how similar the scenarios I wrote in 2015 are in comparison to today!!
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