December 2024 Early Retirement Update – Year End Edition

Welcome back to another monthly update from Root of Good! Christmas and New Years celebrations are drifting away in the rearview mirror as we round the corner into 2025. We’ve enjoyed the winter holidays being at home with the really cold weather holding off until this week. 

Next weekend, we set out for another cruise for the remainder of January. We’ll be visiting several new ports along the way so it’s going to be a nice change of scenery compared to our normal Caribbean cruises. 

While at home this winter, I’ve tackled several small home maintenance tasks, read a few books, and caught up on my sorely neglected Netflix queue. You really have to stay focused if you’re going to make any progress on these important tasks. 

On to our financial progress. December was a mixed month for our finances. Our net worth crashed by $144,000 to end the month at $3,233,000. On the other hand, our December income of $33,691 was substantially higher than our modest spending of $2,101 for the month.  

Let’s jump into the details from last month.

Income

Investment income totaled $31,407 in December. Our equity index funds and ETFs pay dividends quarterly at the end of March, June, September, and December. And the year-end dividends paid in December are always the highest each year. As a result, we had a much larger than normal amount of investment income last month. Here’s more on our dividend investments.

Blog income totaled $751 for the month. This represents an average month of blog income. 

My early retirement lifestyle consulting income (“consulting”) was $544 last month. This represents three hours of consulting income. 

Tradeline sales income totaled $125 in December. A slow month but that comes on the heels of a couple of much better months. I ramped up my tradeline sales a few years ago and discussed it in a bit more detail in my October 2020 monthly post and in my July 2021 monthly post. During 2024 I made over $6,000 in exchange for lending out my stellar credit history from half a dozen credit cards. 

For last month, my “deposit income” was $0. I normally get some 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). But I didn’t cash out last month. 

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 (or more!). 

My bank and credit card bonuses totaled $1,132 last month. Of the total, $273 comes from the Chase Sapphire Reserve’s “Pay Yourself Back” feature. I get a 25% bonus when I redeem the Chase Ultimate Rewards points to reimburse for my purchases in select categories like utilities and insurance. Since I have a TON of Chase points, I have started cashing them out by placing my utility and insurance payments on my Chase Sapphire Reserve card and using the 25% bonus Pay Yourself Back redemptions. 

The remainder of the credit card bonus income was $816 from a new credit card sign up bonus and a $42 cash out from my Fidelity card that earns 2% cash back on all spending. 

Full Year 2024 Income

For the whole year, I had a total income of just over $100,000! Investment income represented the bulk of income at $72,367. Most of that income was paid inside IRAs and other tax-sheltered accounts, so I’m not actually withdrawing and spending those funds today. I leave those dividends and interest in their respective accounts to reinvest into new shares of ETFs. 

Other income sources were less than $10,000 per line item as shown in the graphic. The “earned income” of blog income plus consulting comes to roughly $13,000. That’s not a bad paycheck for “working” a day or two each month. 

I figured I would include the year-end summary of income since I always get requests for this chart when I post my final monthly update of the year. So here it is. Enjoy! 

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

Empower Personal Dashboard 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 Empower Personal Dashboard 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 Empower Personal Dashboard.

Expenses

Now let’s take a look at December expenses:

In total, we spent $2,101 during the month of December which is about $1,200 less than our regularly budgeted $3,333 per month (or $40,000 per year). Groceries and Utilities were the two largest categories from last month. 

Detailed breakdown of spending:

Groceries – $1,245:

Our grocery spending of $1,245 was much higher than normal. At least I think it was more than normal. We haven’t been home for a whole month since February of 2024 so I don’t exactly know what “normal” is any more. 

I know we spent more than normal because we had to prep for a big family gathering at our house on Christmas day. We also stocked up on some staples and replenished the pantry while we were at home for an extended period of time. 

Utilities – $312:

We spent $166 on our water/sewer/trash bill last month. 

The electric bill was $92 last month. 

The natural gas bill was $55 in December. This bill covers parts of October and November when we only needed to use the heat sparingly. The January and February bills will be much higher since temperatures are a lot lower. 

Gifts – $201:

Christmas gifts for various family members. 

Restaurants – $121:

We got takeout fried chicken and biscuits from Bojangles twice during December for $37 per order.

The remaining restaurant spending was a $47 visit to an old favorite from our college days 25 years ago. We went to Golden Dragon Chinese Restaurant in Raleigh near the NC State University campus. The food was good but nothing like it used to be. At least our kids got to enjoy the nostalgic taste (pun intended) of the good eats that sustained us through our days in undergrad.

Travel – $95:

The only travel spending last month was the $95 annual fee on the Wyndham Business credit card in my name. Mrs. Root of Good has this same card as well. 

In exchange for the $95 fee, we get 15,000 Wyndham hotel points and Wyndham Diamond status. In the past, I used this status to match to Caesars Diamond status and then match to other casinos and cruise lines for free cruises and comps. In 2025 the Caesars Diamond match goes away, so the utility of this card drops quite a bit.

I’ll keep the Wyndham Business card for one more year, then re-evaluate its value. The annual 15,000 Wyndham points are worth more than the $95 annual fee. We routinely booked $300+ hotel rooms for 13,500 Wyndham points during 2024. In effect, we’re buying a $300+ hotel night for under $95.

Our next hotel in Florida for our February cruise is a great example. Current discounted rates for this unremarkable La Quinta Inn in Fort Lauderdale are $295 for the night before our next cruise. I’m basically paying $95 for the hotel by paying the annual fee on this credit card. Nice exchange! 

 

Get free travel like us

If you are interested in getting free travel from your credit card like I do, consider the Chase Ink Preferred business card (my referral link). Right now, the Chase Ink Preferred business card offers an above average $900 worth of Chase Ultimate Rewards points that can be redeemed instantly for $900 in cash (or even more for travel!). I just signed up for another new Ink card to snag one of these great bonus offers.

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”. 

I use the 90,000 Chase Ultimate Rewards points by transferring them to my Chase Sapphire Reserve card (also offering a 60,000 point sign up bonus right now). With the Sapphire Reserve card, I can get 1.5x the points value by booking cruises, flights, hotels, or rental cars through their travel portal. For example, I used 165,000 Chase Ultimate Reward points to pay for the $2,475 in taxes, fees, and gratuities on two of my cruises. Or I can transfer those Ultimate rewards points to over a dozen travel partners’ airline/hotel programs like United, Southwest, or Hyatt. 

Capital One VentureX card

Another favorite travel card in my wallet is the Capital One Venture X card. The Venture X card is a “keeper” for me. First off, it comes with a $750 sign up bonus after spending $4,000 in the first three months. The bonus is paid in the form of 75,000 bonus points that you can redeem against any travel purchases from anywhere. Then you earn a solid 2 points per dollar spent forever! The other big perk is airport lounge access. You can get yourself plus unlimited guests into Priority Pass lounges. And you and two of your guests can get into Plaza Premium network lounges and Capital One Lounges. 

The Capital One Venture X card does have one catch – a $395 annual fee. But they reward you every year with an easy to use $300 travel discount plus $100 worth of points. Together, that makes $400 they give you annually which completely offsets the annual fee. Another benefit worth mentioning: you can add up to four authorized users for free, and they also get all the benefits of the Venture X card including the valuable airport lounge access. We used this perk to “gift” a pair of Venture X cards with airport lounge access to my brother in law and his wife to use on their family trip back home to Cambodia last April with their two young children. 

Since the annual fee is offset in full by travel credits each year, I personally plan on keeping the Venture X card forever since the card benefits are so great.

Healthcare/Medical/Dental – $37:

Our 2024 health insurance was free, as is our 2025 health insurance thanks to very generous Affordable Care Act subsidies that we receive due to our low ~$51,000 per year Adjusted Gross Income. 

Our 2024 dental insurance plan costs $37 in premiums per month. We picked a plan from Truassure through the healthcare.gov exchange. The dental insurance does a good job of covering routine cleanings, exams, and x-rays plus most of the cost of basic procedures like fillings. 

Clothing/shoes – $32:

A new pair of shoes for $32 from a Cyber Monday sale. 

Cable/Satellite/Internet – $25:

We usually pay $25 per month for a local reduced rate package due to having a lower income and having kids. 50 mbit/s download, 10 mbit/s upload. 

General Merchandise – $19:

We spent $19 on phone cases for our new phones. 

Gas – $18:

A tank of gas for our fuel-sipping Hyundai Accent. Our daughter drives this car to her university in Raleigh four days per week. It’s a 13 mile round trip. 

Spending for Full Year of 2024

We spent $40,286 for the entire twelve months of 2024. This annual spending is a mere $286 more than our $40,000 annual early retirement budget. I haven’t increased our annual budget for inflation in a decade, however it’s probably time to do so in the near future since we were over budget this year by a small amount. 

The overage was caused in part by a higher than average medical/dental expense during 2024. However some form of large, lumpy big spending occurs in most years. The real culprit of higher spending these past few years is inflation. We see it in grocery prices, medical/dental expenses, insurance, travel, and basically every expense category across the board. 

Inflation has been a significant force over the last decade, with everything (on average) 35% more expensive than it was in 2013 when I retired. I did bump up our budget from $32,000 per year to the current $40,000 per year soon after retiring once I felt more secure in our ability to fund this level of annual spending. 

At our current asset level of approximately $3 million in investments, we could spend roughly $100,000 per year using a conservative 3.25% to 3.5% withdrawal rate. Our current spending of just over $40,000 per year is well within a reasonable level of spending. 

Monthly Expense Summary for 2024:

• January – $1,828
• February – $1,746
• March – $3,525
• April – $1,719
• May – $1,875
• June – $5,889
• July – $3,735
• August – $3,348
• September – $1,768
• October – $1,570
• November – $11,184
• December – $2,101

Summary of annual spending from more than a decade of my early retirement:

• 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 – $37,865
• 2024 – $40,286 (finalized spending for 2024)

Net Worth: $3,233,000 (-$144,000)

Wow, a huge drop at the end of the year! The $144,000 decline in December set us back to net worth levels last seen in July 2024.  

Not to worry, as these six figure fluctuations happen almost every month it seems. Long term I’m confident we’ll see good growth in the investment portfolio, even if we just saw six months of investment gains erased during a one month period. 

For the curious, our net worth reported above includes our home value (which is fully paid off). I value the house at $300,000, which is probably what we would net after sales expenses. 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.

Closing thoughts

Another year of a successful early retirement is in the books. Where did the time go?

Last year was our busiest year ever in terms of travel. We spent almost five months on vacation between April and November, just about evenly split between half a dozen cruises and an extended road trip around Poland. 

Was all that travel exhausting? At times. Was it always comfortable? Not really. Do I regret a single trip? Definitely not. Overall we were incredibly lucky that nothing really bad happened on any of our trips. I’d like to think that it was my careful planning that stacked the deck in our favor. That’s probably half of the reason. The other is pure dumb luck I am sure. 

So far we don’t have nearly as many trips planned for 2025. We don’t even know what we’ll be doing for our summertime travels. Both of our daughters are graduating college this year (in May and July) and we still don’t know what their work schedule will be over the summer (assuming they find permanent jobs). As a result, we are struggling to firm up travel plans without knowing who will be able to travel with us and when. 

 We’re tentatively planning on a cruise in June and a cruise in August with whoever can go with us. And possibly a 3-to-6 week trip in July and August to somewhere in Europe (Ireland, Scotland, Slovenia, and/or Italy???) with our 12 year old. As you can see indecision has taken over but that is okay.

We’ll end up having a good time with whatever we choose to do this summer. 

Well folks, that’s it for me this month. See you in February once I get back from my next cruise! 

Anybody enjoying the bitter winter cold? I’m ready for spring!

Want to get the latest posts from Root of Good? Make sure to subscribe on Facebook, Twitter, or by email (in the box at the top of the page) or RSS feed reader.