September 2022 Early Retirement Update

Welcome back to another glimpse into my early retired lifestyle. In September, I enjoyed the slower pace of life at home in Raleigh after a busy summer traveling across Eastern Europe. We worked on some more travel planning for winter of 2022 and summer of 2023 (more on that below). And we spent a bunch of time relaxing and enjoying “doing nothing“. 

Our oldest two kids are half way through their fall semester of community college, and the youngest kid is doing well in his last year of elementary school. Each morning starts with our walk to school, and then us adults enjoy a peaceful, quiet day at home during the week until all the kids get home from school. 

Financially, September was a rough month for our net worth but a great month for our cash flow. Our net worth plummeted by a shocking $200,000 to end the month at $2,439,000. However, our income of $15,621 was substantially higher than our spending of $2,527 during September. 

Let’s jump into the details from last month.

Income

Investment income totaled $8,682 in September. Our equity index funds and ETFs pay dividends quarterly at the end of March, June, September, and December. As a result, we had a large amount of investment income last month. Here’s more on our dividend investments.

Blog income totaled $878 for the month. This is a pretty normal month for blog income. It is trending down over time as I spend less time on my blog. 

My early retirement lifestyle consulting income (“consulting”) was $490 in September. The consulting income represents three hours of consulting time. I suppose people might not want to talk about early retirement when they are watching their portfolios lose 5-10% in a single month. 

Tradeline sales income totaled $1,150 in September. This represents two months of tradeline sales. The August payment arrived on the first day of September so I got a double month (after receiving $0 in August). I ramped up my tradeline sales in 2020 and discussed it in a bit more detail in my October 2020 monthly post and in my July 2021 monthly post. 

For September, my “deposit income” totaled $49. Of this total, $21 of the “deposit income” comes 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. 

The remaining $28 of “deposit income” came from some old funds in my Ibotta app. I haven’t used Ibotta as much lately but it’s another decent cash back site that rewards you for your everyday shopping trips. 

September Youtube income totaled $150. Youtube only pays out when you exceed $100 in accumulated revenue. Recently, my Youtube earnings have been just under $100 per month on average, so I’ll be getting paid a bit under $200 every two months.

Here is the Youtube channel for the curious. It’s random travel videos, birds, kids, and a couple of DIY videos. There are only a few main videos that bring in most of the traffic (and revenue!).

I sold an item on ebay and brought in $32 for the “selling stuff” income category (net of shipping fees and ebay fees). 

Closing out the income from September: a huge $4,188 chunk of bank and credit card bonuses. Our Citibank IRA brokerage bonuses of $1,000 each posted in September ($2,000 total). I cashed out another $1,163 from my Citi Premier credit card I signed up for last year (then downgraded the card to avoid the $95 annual fee). And another two credit card bonuses of $500 and $525 posted during September for some US Bank Business credit cards. We don’t get anywhere near this much in bank/credit card bonuses in most months. But it’s nice to see all this “free money” showing up when the portfolio drops by $200,000. 

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 September expenses:

 

In total, we spent $2,527 during September which is about $800 less than our regularly budgeted $3,333 per month (or $40,000 per year). Travel expenses and groceries were the two highest categories of spending in September. 

Detailed breakdown of spending:

Travel – $1,080:

The single largest travel expense was $937 for cruises. We booked a nine night transatlantic cruise from Portugal to New York for December for $700 for the two of us. Transatlantic cruises in general are usually inexpensive.

We found a great deal where the balcony cabin was the same price as an inside cabin, so we jumped on the deal. I stacked the great cruise fare with an offer from American Express for $250 off of a $1,000 cruise purchase. I had to pre-pay $237 in gratuities to get the total cruise cost over $1,000 in order to get the $250 discount. 

In addition to the cruise, we are spending a week in Portugal before the cruise. I spent $54 for a prepaid (but fully refundable) rental car reservation for 3 days. Plus $50 for the taxes on the flights from Raleigh to Lisbon. I booked the flights with frequent flyer miles. For $25 per ticket plus 22,500 American Airlines miles each, we got a great flight schedule to Lisbon. 7.5 hours Raleigh to London, then a 5 hour layover in Heathrow at the Amex Centurion Lounge which I’ve heard is great. Then a short 2 hour hop to Lisbon. We opted for a 5 hour layover in London instead of the flights with a two hour layover so that we won’t have to rush to make our connection. And we get to enjoy more time in a nice lounge! 

The kids are staying at home (with grandma and grandpa) for this trip since they have school for most of our trip. 

We’ll pay the lodging costs at a later date, about a month before the trip. But everything is already reserved. We will end up spending between $30 and $50 per night in some pretty awesome looking apartments for 2 stays of three nights each, plus a one night stay in a hotel in Lisbon. 

I booked post-cruise flights home from New York using 8,500 frequent flyer points per person plus $5.60 in taxes each. The flights are non-stop, so it’ll be a very easy travel day for us. The Amex Centurion Lounge in New York is supposed to be pretty good as well, so we’ll take advantage of that amenity while we have an Amex Platinum card.

The last bit of travel spending was four one-way flights to Buenos Aires for summer of 2023. The flights were 22,000 frequent flyer miles each plus $5.60 in taxes. In total, 88,000 frequent flyer miles plus $23 in taxes. Not a bad start to our summer travel plans! 

I felt like a professional travel agent during September while booking all these trips. Fortunately, we were able to get about $3,000 in free flights for just a few dollars in taxes per ticket. 

If you are interested in getting free travel from your credit card like I do, consider the Chase Sapphire Preferred card (my referral link). Right now the Sapphire Preferred card offers 60,000 Chase Ultimate Rewards points that can be used to book $750 worth of travel. Or transfer the points to a ton of different airline frequent flyer programs and book a free trip to Europe. Or cash out the points for a $600 check and buy whatever you want! The card also has a lot of nice travel benefits as well.

Groceries – $643:

Our grocery spending is back above $600 per month. I don’t see it dropping below $600 on average unless inflation magically disappears. We actually spent a bit more than $643 if we include the Walmart gift cards that I got for free. 

We are buying a lot of imported Asian foods, the “good” rice (in 50 pound sacks, of course), steak, and plenty of other meats and cheeses. So maybe that monthly grocery price tag isn’t so bad after all. 

Taxes – $300:

Our quarterly estimated state taxes were $300.

Insurance – $281:

We added our daughter to the auto insurance policy for the remainder of the year. The extra premium was $281. It works out to about $81 per month to insure our teen driver. 

Utilities – $97:

The total utility spending was $97 last month.

We spent $79 for the water/sewer/trash bill. The natural gas bill, which provides heating and hot water, totaled $19 for last month. Since we were only in town part of the month, these bills were lower than normal. 

I paid the electric bill of $76 using some rewards cards from our health insurance company so I didn’t include it in the “utilities” spending total. 

Gas – $64:

Our daughter is driving to community college twice per week, so we consume more gas overall than we used to. And we went on a trip to the beach with extended family that used up about half of this month’s gasoline purchase. 

Healthcare/Medical/Dental – $40:

Our current 2022 health insurance is completely free thanks to very generous Affordable Care Act subsidies that we receive due to our low ~$45,000 per year Adjusted Gross Income. 

The “American Rescue Plan Act” passed in March 2021 makes the Affordable Care Act premiums even cheaper through 2022. Households with modified adjusted gross incomes (MAGI) below 150% of the federal poverty level get select silver-level health insurance plans completely free. 

For the adults in the household, we spend $20 per month ($240 per year) for a basic dental insurance plan for each of us (or $40 per month in total). Our routine dental exams and cleanings with the occasional x-ray have increased in price recently. The cost is now $125 (no x-ray) or $170 (with x-ray). 

With two routine visits per year, we will spend almost $300 per person. A $240 insurance plan provides those same services for free. And we get some minimal level of insurance if one of us needs a filling during the year. 

General Merchandise – $15:

Mrs. Root of Good printed a bunch of photos for our “photo wall”. It’s a true work of art, showcasing all the places we have traveled to over the years. 

Home Maintenance – $10:

A new $10 toilet fill valve to fix one of our toilets. A relatively easy plumbing repair that saved me $150 or more compared to calling a plumber. I’ve done this repair at least a half dozen times in my life as an amateur plumber. Eventually I’ll be an expert! 

Cable/Satellite/Internet – $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 “Affordable Connectivity Program”. 

Total Year-To-Date Spending for 2022

 

Our spending totaled $24,028 for the first nine months of 2022. This is about $6,000 less than the $30,000 we budgeted for nine months of spending in our $40,000 annual early retirement budget.

So far, our 2022 spending looks incredibly good, given the high inflation operating in the background. We are over our target on travel spending, but lower spending in other categories more than makes up for travel inflation. 

For the time being, we are all sharing one car. It’s not too much of a hassle since I have two feet and a bicycle and can get around town to a lot of places without a car. 

But we hope to buy a new used car soon. Used car prices are theoretically declining month after month at the wholesale level. But I can’t really tell by looking at the listings for used cars. I laugh every time the used car website emails me with “great deals that fit your search” and it’s just eight Ford Focuses that are all 10 years old and over 100,000 miles with five figure price tags.

I’m patient and I’ll keep waiting. But eventually I might have to face reality and just buy one of those used Ford Focuses for an outrageous price.

Monthly Expense Summary for 2022:

Summary of annual spending from all years of early retirement:

Net Worth: $2,439,000 (-$200,000)

Oh look, a $200,000 loss in one month! Those are pretty uncommon for us. I think the only other time this happened was in March 2020 when we experienced a painful $298,000 drop due to the initial panic at the start of the pandemic.

Fortunately, we are still $600,000 richer than we were at the end of March 2020, so times aren’t too tough for us. Even after adjusting our net worth to account for inflation, we still have about a quarter of a million dollars more than we did in March 2020 in real terms.

If we have a few more months of $200,000 monthly losses, I might start to worry. For now, these drops are just getting rid of the worry that we saved too much money for early retirement.

Right now, it looks like we saved just enough to insulate me against the fear of running out of money. 

For the curious, our net worth reported above includes our home value (which is fully paid off). However, please note that I don’t consider my home value as part of my portfolio for “4% rule” calculation purposes. I realize folks ask me about that every month so I just wanted to state that here for clarity.

Life update

After a slower paced September, we have a busier schedule through January. We have a 10 night cruise to the Caribbean in just a few days. Then a week in Portugal and nine more nights sailing across the Atlantic in November and December. Then in January, we have another 10 night Caribbean cruise.

Throw in the year-end holidays of Thanksgiving, Christmas, and New Year’s, and we will be busy busy busy until February. I don’t know how we ever found time to work! 

Maybe we’ll take it easy this spring and stay around home before we depart for our next big summer adventure. So far, it looks like we are going to Argentina for a month or two. Possibly stopping by some other countries on the way home. Or not. We don’t have any plans other than a flight down to Buenos Aires the day after our middle kid graduates from high school next June. The rest is yet-to-be-planned. 

Well, that’s it for me this month. See you again in another month! 

Has fall creeped into your weather forecast wherever you are? Are you looking forward to what I consider to be the best season ever?

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