May 2021 Early Retirement Update

It was another busy month here in the Root of Good household. We have been busy with final preparations for our seven week road trip across the USA. I think we are ready to go. Two of our kids are completely done with school for the year. Our third kid will be logging into class from the road for a few days (if the cell signal holds up!)

This May brought us the best North Carolina weather I can remember in a long time. Very mild days, with some chilly temps mixed in. We got to enjoy the outdoors in comfort! The humidity just showed up in the past couple of days, so that’s a sign it’s time for us to head out of town for the summer. 

Before we hit the road, here is a look at our finances over the past month. Net worth continued its upward climb with a $46,000 increase in May. Our net worth ended the month at $2,713,000. Income during the month totaled $2,290, which was slightly lower than our $2,418 spending during the month. 

Let’s jump into the details from last month.

Income

Investment income totaled $85 in May. Our equity index funds and ETFs pay dividends quarterly at the end of March, June, September, and December. As a result, we had a relatively modest month of investment income last month. Here’s more on our dividend investments.

Blog income totaled $1,056 for the month which was lower than my average blog income. Lower income is the price of posting less frequently I guess. 

My early retirement lifestyle consulting income (“consulting”) dropped to $297 for May after a record breaking $2,000+ month in April. This slower pace is fine with me since we were pretty busy in May and we will be even busier in June and July! 

Tradeline sales income was $475 in May. I ramped up my tradeline sales last year and discussed it in a bit more detail in my October 2020 monthly post. 

The “deposit income” totaled $109 in May. I received $67 from the Ibotta app (accumulated over the past several months). I also received $31 from a Google Pay promotion. 

The other $11 in “deposit income” came from cash back and incentive bonuses from the Rakuten.com and Mrrebates.com online shopping portals (some of which was earned from you readers signing up through these links). 

If you sign up for Rakuten through this link and make a qualifying $25 purchase through Rakuten, you’ll get a $10 sign up bonus. 

I managed to sell another old video game on Ebay and net $22. I bought this game used for $15 back in 1999, played it a ton, then managed to flip it for a small profit 22 years later. 

My Youtube earnings totaled $244 last month. Here is the channel for the curious. It’s random travel videos, birds, kids, and a couple of DIY videos. Somehow through the magic of the internet hundreds of thousands of people watch the vids and we get paid for it. 

If you’re interested in tracking your income and expenses like I do, then check out Personal Capital (it’s free!). All of our savings and spending accounts (including checking, money market, and five credit cards) are all linked and updated in real time through Personal Capital. We have accounts all over the place, and Personal Capital makes it really easy to check on everything at one time.

Personal Capital is also a solid tool for investment management. Keeping track of our entire investment portfolio takes two clicks. If you haven’t signed up for the free Personal Capital service, check it out today (review here).

Tracking spending was one of the critical steps I took that allowed me to retire at 33. And it’s now easier than ever with Personal Capital.

Expenses

Now let’s take a look at May expenses:

 

In total, we spent $2,418 during May which is about $900 less than our regularly budgeted $3,333 per month (or $40,000 per year). Insurance and clothing/shoes topped the spending categories in May.

Detailed breakdown of spending:

Insurance – $955:

Our annual home insurance premium was $671 and our six month auto policy premium was $259. We also pay $25 per year for membership in Farm Bureau which lets us get these cheap insurance rates. 

Clothing/Shoes – $479:

Inflation? Tariffs on overseas goods? Or deferred clothes-buying because we weren’t going anywhere the past 16 months? Who knows. We went on a shopping spree for “summer trip” and “back to school” clothes. And picked up a couple pairs of shoes too. 

Groceries – $436:

Grocery expenses of $436 are a little lower than our $500-600 average grocery spend. We had to buy some supplies for our trip but have otherwise been cleaning out the fridge and freezer so we can leave them mostly empty while we’re gone this summer. 

 

General Merchandise – $301:

We bought a new queen size mattress for our daughter for $285. It’s working well so far! She calls it a “tofu mattress” because it is big and soft. 

The other $16 in general merchandise spending was bird food. 

Utilities – $198:

We paid $93 for the water/sewer/trash bill. Our electricity bill was $70 for the month. The natural gas bill, which covers our heating and hot water, was $36 in May (although we didn’t use the heat much at all).

Restaurants – $44:

The biggest part of restaurant spending was a $50 Domino’s Pizza gift card that cost $42.50. We’ll probably get pizza several times during our summer road trip and this will cover that cost. 

I also spent another $1.50 on a few orders from local places using coupons that resulted in our food order being mostly free. 

Healthcare/Medical/Dental – $5:

Initially, our 2021 healthcare premiums were $135 per month thanks to very generous Affordable Care Act subsidies that we received due to our low ~$45,000 per year Adjusted Gross Income. The benefit of being “poor” on our tax return. 

But wait, it gets better! The “American Rescue Plan” passed in March 2021 makes the Affordable Care Act premiums even cheaper. Households with modified adjusted gross incomes (MAGI) below 150% of the federal poverty level get some silver-level health insurance plans completely free. We opted for a slightly more expensive silver plan that comes with $1,000 in cash back incentive rewards. Our total cost is just over $1 per month now! 

We prepaid the health insurance for the entire summer which totaled $5. 

 

Travel – $2:

Our summer trip was pretty much already booked during April, with a lot of hotel reservations set up as “pay when you check in”. 

We also booked 18 nights in hotels for free using 243,500 hotel points spread across the Choice Privileges, Marriott, and Hilton loyalty programs. 

If you want to get in on the travel hacking points and miles game, and you have a small business you can get $750+ in cash back bonus or travel with a new Chase Ink business card. No business? You can still get a Chase Freedom personal card with $200 in cash back when you spend $500. 

The $2 in travel spending for the month of May came from booking a timed entry ticket to the Bear Lake hiking trail and the Rocky Mountain National Park. This year, they have capacity limits to control severe overcrowding. I feel like $2 is a very fair price to pay to eliminate the hordes of tourists that pack into some of these parks. Assuming I’m always able to get the time slots I want! 

Cable/Satellite – $0:

We generally pay $18 per month for a local reduced rate package due to having a lower income and having kids. 30 mbit/s download, 4 mbit/s upload. Right now the cost of the internet service is temporarily reduced to $0 due to the “Emergency Broadband Benefit”. 

Gas – $0:

No gas for another month! We did fill up in early June so that we can leave for our road trip with a full tank. And we will be spending quite a bit more on gas in June and July to cover the 7,000+ mile journey to the west coast and back. 

Total Spending for 2021 – Year to Date

Our spending totaled $9,877 for the first five months of the year. This is almost $7,000 less than the $16,667 we budgeted for five months of spending in our $40,000 annual early retirement budget.

We are on track to finish the year well under our $40,000 year budget. However we’ll have a good bit of spending coming up. In June and July, we’ll have a lot of dining out expenses, gas, and over $1,000 in lodging expenses for our summer road trip. 

In the intermediate term over the next 6 to 24 months, we’ll have to buy a second car and start paying for college. It’s looking like college bills won’t be so bad due to a combo of financial aid and kids doing AP classes, college transfer classes, and community college for a year before university. Some more thoughts on college spending here. 

Monthly Expense Summary for 2021:

Summary of annual spending from all years of early retirement:

Net Worth: $2,713,000 (+$46,000)

This stock market is pretty crazy. Does it only go up? Thanks to generous market gains, we added another $46,000 to our net worth, bringing the total to $2,713,000. 

We are up more than a million dollars from the March 2020 lows. I don’t think anyone thought we would see this strong of a recovery this fast. It’s just another reminder that the market is smarter than you and timing the market is incredibly hard. 

Life update

What can I say? Life is good! The stock market is on fire, we had a great month financially (and otherwise), and we’re about to set out on yet another “trip of a lifetime” after a 2020 travel hiatus. 

It feels like life is getting back to normal. At the end of May I attended CampFI Midatlantic in Virginia (about 2.5 hours north of Raleigh). Pretty much everyone was fully vaccinated, so nobody wore masks and it really felt “normal” and safe. Modern science, medicine, and technology is pretty great if you ask me! 

I’m hoping this feeling of normality extends to our summer trip across 20+ states. All the stats and policies I’ve seen look pretty decent so far. I took a quick poll of the breakfast options at the four Marriott-branded hotels we’re staying at on the first leg of the trip out to Colorado. Three of the four hotels have returned to serving hot breakfasts!

And I’ve heard Costco and Sam’s Club are back to serving free samples (or will be very very soon).

Feels like normal is back, right?

Let’s hope so.

I think we are all ready to get back to normal as much as possible. For us, that means taking a long summer trip somewhere interesting. In the fall it means all the kids go back to school in person. Us parents get our 8:30 am to 2:30 pm daily quiet time back. It means more time to hang out with family and friends. And going out more without restrictions. 

Normal is good. We’ll never take normal for granted again.

And with that, I wish a safe and happy summer to you all. See you in a month when we’ll be thousands of miles away from home somewhere on the west coast! 

How are your summer plans shaping up?

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