January 2023 Early Retirement Update

Welcome back to the life and times of the Root of Good household. We had another busy month during January. Mrs. Root of Good and I went on a ten night cruise out of Charleston, South Carolina. During the cruise we visited five Caribbean islands and enjoyed a brief respite from the “harsh” North Carolina winter. 

Now that we are back home, we have been busy planning our summer trip to South America. We have a slow springtime planned. So far, we have zero trips to anywhere between February and the commencement of our summer trip in mid-June! 

January was a bonanza month for our finances. Our net worth skyrocketed by $162,000 to end January at $2,788,000. Our income totaled $1,839, while our spending was a bit higher at $3,423 for the entire month of January. 

Let’s jump into the details from last month.

Income

Investment income totaled $66 in January. Our equity index funds and ETFs pay dividends quarterly at the end of March, June, September, and December. As a result, we had a small amount of investment income last month. Here’s more on our dividend investments.

Blog income totaled $1,062 for the month. This level of income is slightly higher than recent averages. 

My early retirement lifestyle consulting income (“consulting”) was $0 in January. I didn’t have any new inquiries during the month. Maybe people aren’t feeling as wealthy these days? So they aren’t calling me to figure out how to retire early? I’m not sure but I’ll give it a few more months before writing off this line of income. 

Tradeline sales income totaled $0 in January as well. Tradeline sales were very slow in the last quarter of 2022. Perhaps higher interest rates led to fewer people needing credit. And therefore, fewer people needing to buy tradelines to repair their credit. I really don’t know for sure. However, January tradeline sales picked up in a huge way. I expect February and March tradeline income to be much higher than $0.00! 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 January, my “deposit income” totaled $10. This “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. 

January Youtube income was $0. 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 only get paid every other month. 

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!).

Closing out the income from January: a $700 payment came from a US Bank Leverage Business credit card sign up bonus. 

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 January expenses:

 

In total, we spent $3,423 during January which is about $100 more than our regularly budgeted $3,333 per month (or $40,000 per year). Taxes and groceries were the two highest categories of spending in January.

Detailed breakdown of spending:

Taxes – $2,374:

Our annual property tax for our primary residence is due in January of each year. We paid $2,074 for our annual property tax bill. 

The remaining $300 of tax expense comes from our quarterly estimated tax payment to the State of North Carolina. We typically owe $1,200 per year in state income taxes and we pay these quarterly using a credit card (for the points/miles of course!). 

Groceries – $517:

Another modest month of grocery spending at $517 for the whole month. Mrs. Root of Good and I spent almost half the month on a cruise so there were two less mouths to feed for part of the month.

I am still surprised that the total grocery spending isn’t higher given the fact that so many products we buy are 50-100% more expensive than they used to be a few years ago. 

Utilities – $198:

The total utility spending was $198 last month. That doesn’t include the $83 for the electricity bill and another $130 for the water/sewer/trash bill.  I paid those costs with a promotional Visa gift card from our health insurance company. 

Of the $198 utilities that we paid with “real” money, we spent $10 for the water/sewer/trash bill.

The natural gas bill, which provides heating and hot water, totaled $188 for last month. This bill covers the month of December’s usage. It is typically coldest here in December and January so that might be the largest natural gas bill we see all year. 

Travel – $181:

Our January cruise to the Caribbean was prepaid several months ago. The only costs we had to pay for this vacation was a pair of one-way rental cars from Raleigh to Charleston and back home 10 days later. The rental cars totaled $130. Gas for the cars was another $45. 

Since parking would have been $210 at the Charleston cruise port, we still came out way ahead financially by renting cars instead of driving our own car down there and parking at the pier. 

We spent a few bucks on a local bus in St. Maarten to get from downtown to the airport for some oceanfront plane-watching. 2 round trip tickets totaled $8 in cash. I don’t usually record our cash spending unless I’m pulling money from an ATM. In this case, I treat a tiny cash expense as “rounding error” in our overall spending. It’s just not worth keeping track of $5 or $10 a few times per year in my opinion. 

The remaining $6 in travel spending came from the 2% convenience fee that our state imposes on estimated tax payments made with a credit card. It’s worth it to pay the fee to get the extra credit card spending because it earns us tons of points and miles to cover our travel spending throughout the year.

If you are interested in getting free travel from your credit card like I do, consider the Chase Ink Unlimited or Chase Ink Cash business cards (my referral link). Right now the Chase Ink business cards offer 90,000 Chase Ultimate Rewards points that can be redeemed instantly for $900 in cash. And if you have a Chase Sapphire Preferred or Chase Sapphire Reserve card, those 90,000 Ultimate Rewards points are worth $1,125 or $1,350 (respectively) towards travel reservations. This is the highest offer ever on the Chase Ink Unlimited/Cash cards and may not last too much longer. Mrs. Root of Good and I each received our new Chase Ink Unlimited cards during December. 

Chase is pretty liberal when it comes to “what is a business”. If you sell stuff on eBay or Craigslist or do some odd jobs occasionally then you have a business and could get a credit card as a “sole proprietor”. 

Education – $90:

The bulk of January’s education spending came from a $70 textbook purchase for our daughter’s community college coursework. Our two college students already had all the other books they needed for the spring semester. Or their professor indicated the required books weren’t really necessary for their section of the class. In any event, the textbook spending came in much less than expected.

The remaining $20 of education spending covered the cost of a yearbook for our elementary school student. 

Healthcare/Medical/Dental – $35:

Our current 2023 health insurance costs $18 per month, thanks to very generous Affordable Care Act subsidies that we receive due to our low ~$45,000 per year Adjusted Gross Income. We didn’t have to pay the premium in December (for coverage during January) because we paid it in November. 

We signed up for 2023 dental insurance plans and paid a total of $17 in premiums during January. The payment for my insurance posted in February so I’ll have a double payment next month.

I chose a very basic plan for $9 per month for me that covers most preventive care but no fillings. Mrs. Root of Good has a different set of dental needs than I do so we kept the more comprehensive $17 per month plan for her (same as 2022’s plan).

By buying insurance, we should save a couple hundred dollars on my dental care. For Mrs. Root of Good, we will still save a few dollars compared to paying cash for the preventive dentist visits throughout the year.

Gas – $31:

A half tank of gas for $31. 

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”. 

Spending Summary During Ten Years of Early Retirement:

We have shockingly never spent more than our $40,000 per year early retirement budget. Take a look: 

• 2014 – $34,352
• 2015 – $23,802
• 2016 – $38,991
• 2017 – $31,708
• 2018 – $29,058
• 2019 – $25,630
• 2020 – $28,466
• 2021 – $31,740
• 2022 – $29,449
• 2023 – $3,423 (Year to Date through January 31, 2023)

Net Worth: $2,788,000 (+$162,000)

January was a hugely positive month in the stock market and our investment portfolio really loved it. After $162,000 in gains during January, our overall net worth closed the month at $2,788,000. We are very close to our all time high net worth from a year and a half ago. 

At 90% equities, we take advantage of almost all of the upward movement in stocks but suffer when the market performs poorly. Long term, I expect the stock market to beat inflation by an adequately large margin to compensate me for the month-to-month volatility. 

January reiterates the value of long term, buy and hold investing. In late December there was nothing but negative news, both economic and geopolitical. Not a lot has changed it seems, but here we are almost 10% higher in the stock market.

Without lifting a finger, we’ve made five years worth of minimum wage labor in the United States. Not a bad month! Especially considering we were afloat somewhere in the Caribbean Sea for half of the month while our money worked for us. 

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

Ahhhhhh… finally some time to prop my feet up, do nothing, and relax for a bit. We have nothing planned between now and mid-June. It’s a great feeling after a busy summer, fall, and winter travel schedule. 

Lately, we are keeping busy with planning our trip to South America from June through August, 2023. We’ll spend the summer mostly in Argentina, with a couple of weeks in Brazil and Chile.

First, we have a month in Buenos Aires to eat a lot of empanadas and steak and revisit our favorite spots around the city with two of our kids that are still young enough to travel with us. 

Then we head south to Puerto Madryn, Argentina for some whale watching (we hope!). 

After that we fly 1,400 miles north to the far northeastern extent of Argentina to Iguazu Falls for a week. We will stay on the Brazilian side of the falls. We’ll check out the Iguazu waterfall, Itaipu Dam, and enjoy our first visit to Brazil. 

From there, we fly to Santiago, Chile for ten days. 

That’s the plan so far. We have most of the lodging booked plus the big flights down to South America in June and back home in August. But we still have a lot of details to hammer out before the plans are finalized. 

Well folks, that’s it for me for this month. See you next month! 

Are things warming up where you are? Ready to bid adieu to winter weather? 

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