January 2023 FIRE Update

Hey everyone! January was a nice month, wasn’t it? The stock market did quite well. Inflation seems to be taming. The job market is still strong. Things are looking up. Our net worth increased along with the stock market and it’s recovering nicely. If all goes well, we might get back to our all-time high this year. What can I say? I’m an optimist.

This week, I’m heading back to the US after 10 weeks in Chiang Mai. It was quite nice because the weather was perfect. But now, it’s heating up and the air quality is horrible. The burning season starts in February and continues until April. The air is full of fine particulate matter (PM 2.5). It’s a good time to leave town. Also, my mom is stable so I feel better about spending so much time here. When I arrived, she was in really bad shape. You can read more about my very long trip back home here – Travel isn’t as fun when you’re older.  

Alright, I’ll share how I’m doing with my 2023 New Year goals. Then, I’ll go over our monthly cash flow and net worth. Let’s go.

2023 Goals

Here is my 2023 goal spreadsheet. It works really well. Try it out if you can’t keep up with your New Year goals. The key is to go over the spreadsheet at least once a month to track your progress. That way, you can see which goals need extra attention and work on them.

Last year, I failed to accomplish about half of my goals. It was a rough year. I’m optimistic this year, though. Let’s go!

Financial Goals

• Invest in Real Estate Crowdfunding. I plan to invest in at least one RE crowdfunding project this year. One of the older projects had a capital call and I sent them $3,000. That’s a start. I’ll invest more when we accumulate some money. My projects on on CrowdStreet have been doing quite well so I plan to invest more over the next few years. It’s a great way to generate passive income.
• FI Ratio > 120%. This is my main goal for 2023. The FI ratio is passive income divided by expense. This shows us we can maintain our lifestyle with our passive income. We’re doing well so far at 164%. It’ll come down next month, though. We have a couple of large expenses coming our way.
• Net worth back to all-time high. This one is completely dependent on our investment. I don’t have a lot of control over it, but I want to track this. Things are looking good so far in 2023. Our net worth has recovered 46% already, almost halfway. Our lowest point was in October 2022.

Health Goals

• 7,500 steps per day. Wow, this goal will be tough to accomplish. In January, I averaged 8098 steps per day. I walked a lot in Chiang Mai, though. When I’m back in Portland, I seriously doubt I can get this many steps in. I’ll give it a go.
• 1 vegetarian or pescatarian meals per week. I want to cook a healthier meal at least once per week. While I’m on the road, I’ll occasionally eat out at healthier places. That’s pretty easy in Chiang Mai. I had 2 sushi meals and 4 vegetarian meals.

Personal Goals

• Disneyland, zipline, or hot air balloon ride. WIP

• Happiness > 8. January was pretty good. My mom is still in the hospital, but she is stable now. I’m happy to spend the last 10 weeks with my parents. I gave it a 7.5 because the circumstance could be better.
• Get rid of Awebber. WIP. This is one of my biggest business expenses and it doesn’t seem that useful. I’ll try another alternative.

Net Worth (+5.8%)

Oh wow, January was a good month for the stock market. It looks like inflation is calming down and the job market is still strong. We might not even have a recession this year. The Fed raised the interest by just a quarter of a point. That’s great news! They might be done pretty soon. We’ll have to wait and see how it goes.

I’ve been tracking our net worth since 2006. Usually, it is very motivating to see the progress. The power of compounding is unbelievable. However, 2022 was demoralizing. I’m just glad it’s over. So far, 2023 is looking a lot better than last year.  

***Important*** My best advice is to stay the course. Do not stop investing. You need to keep investing when the stock market is down. Eventually, the stock market will recover and you will do very well as long as you keep investing through the downturn.

Here is a chart of our net worth from Personal Capital. Sign up for a free account at Personal Capital to help manage your net worth and investment accounts. I log in almost every day to check on our accounts. It’s a great site for DIY investors.

2023 Passive Income: $4,526 YTD

Here is a quick summary of our passive income. You can see the details on my Passive Income page.

Passive income is great so far.

*FI ratio = passive income/expense

2023 Cash Flow

I removed Mrs. RB40’s income from this cash flow chart. This will make it easier to see how we will do after she retires. January was a pretty good month. We didn’t spend much money. Most of the travel stuff was paid for already.

Here is the Sankey diagram of our cash flow. You can get a quick overview from the diagram and see the details below.

FIRE Income: $4,264

Our FIRE income is pretty low, but passive income can be lumpy. Last year, our passive income was over $82,000! Hopefully, we’ll hit at least $60,000 this year.

• Real estate crowdfunding: $1,650. Our real estate crowdfunding income is doing quite well. You can read more on the RE Crowdfunding Passive Income page.
• Dividend Income: $851. January was a good month for dividends.  
• Rental income: $840. I increased the rent a bit this year. The extra income should be enough to cover a few maintenance issues. 
• Blog income: $923. My blog income is decreasing. I need to find a new side gig soon.

Spending: $2,757

In 2023, I plan to spend about $50,000. That’s the same budget as 2022. However, we won’t travel as much so our annual spending should be lower than last year. If inflation continues to fall, then we should meet this goal.

Here are the details. Actually, I’ll only focus on a few categories to keep it simpler.  

• Housing: $1,209. This category includes mortgage, home insurance, HOA fees, property taxes, utilities, home improvement, repair, and furnishing. We live in a duplex so our housing cost is lower than many households.
• Travel: $292. This is pretty low because I already paid for my tickets and room last year.  
• Groceries: $350. We usually spend a lot more than this, but I’m not home so the grocery bill was lower than usual.
• Kid: $529. This is for RB40Jr’s Wushu class.   
• Taxes and Saving: $1,507

January 2023 wrap up

Alright, January was a very good month on all fronts. Things are looking up after a long pandemic. Hopefully, the rest of the year will be just as good. FYI, I probably will skip posting on Thursday because I’ll be jet-lagged.

All right, that’s it today. Did you have a good January? Are you optimistic for the rest of 2023?

Passive income is the key to early retirement. These days, I’m investing in commercial properties with CrowdStreet. They have many projects across the United States. Go check them out!

Disclosure: We may receive a referral fee if you signup for a service through the links on this page.

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Joe started Retire by 40 in 2010 to figure out how to retire early. After 16 years of investing and saving, he achieved financial independence and retired at 38.

Passive income is the key to early retirement. This year, Joe is investing in commercial real estate with CrowdStreet. They have many projects across the USA so check them out!

Joe also highly recommends Personal Capital for DIY investors. They have many useful tools that will help you reach financial independence.

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