Budgeting Early Retirement Journey Updates and Reports

Financial Update | March 2018

So the original objective of this blog was to help me track my journey because not too long after setting my budget, I started to lose interest in The Journey. It’s easy to be in awe by those who have achieved FIRE, but let me tell you, The Journey is not that exciting. For me especially because I am naturally inclined to structure and a set-it and forget-it approach to most things, budgeting and personal finance being at the top of that list.

One of my early idea before the blog was tracking my assets so to speak. I thought it would motivate me. The jury is still out on that.  At the very least, it accomplishes its basic function which is to track my progress. At the worst, it’s a little discouraging because progress is slow and it makes me second guess, question, and fiddle only to end up where I started.

Another point, just because I think the thought process is illuminating for those just beginning the journey. In the time since I started The Journey to now, I did re-read the prospectus that came with my 401k. Right now, I’m in a target date fund for somewhere around age 65 (so 2045?). I looked at the fees, and they charge 0.77% which by FIRE bloggers’ standards is astronomical. I was so keenly aware of this after learning more personal finance vocabulary, that I stared at the prospectus for 2 to 3 hours trying to think of a way to match the touted 0.1% fee of Vanguard customers.  What I boiled it down to was picking some funds that were between 0.15% and 0.5% management fees; I chose funds in a way to match an allocation similar to 80/20 stock/bond allocation. My current target date fund was 90% stocks and as I get more set on leaving the workforce in 10 years or less, I wanted a more conservative allocation.

So the thoughts swirling around after updating my Q2 spreadsheet were leaning towards making more conservative allocations and try my hand at more active investing by choosing funds myself with focus on funds with lower fees.  This was my notation in my notes for action items:

To do: Jun 3 2018
Target year:  2025
Asset allocation: 70/30 (stocks/bonds)
Goal: 150k
Roth IRA
Target year: default age 60, year 2044 (guidelines say age 59.5)
Asset: 90/10 (stocks/bonds)
Goal: 70k (by 2025)
Target year: 2035
Asset allocation: 80/20 (stocks/bonds)
Goal: $400k (by 2025)
On further reflection, and I mean about 14 days worth of back and forth, I (currently) have decided to make no changes come Jun 2018 (what I consider my Q2). I acknowledge my stance as a passive and very much a novice investor. And while I want to fully commit to leaving the workplace by 2025 (I know that’s less than 10 years) by having my allocations reflect that, I’d rather shoot for the moon (early retirement) and keep the default (age 65 retirement).  In common terms, I feel like FIRE and I just met, and we’re still getting to know each other. 😊
So without further ado, here is my 2018 Q1 update (dated March 3, 2018)
Bank: $31k (35%)
 –  Includes Checking/Savings
 –  Includes Safety Net
 – Total about 1 year’s budgeted expenses*
*This helped in the decision to keep the 90% stock allocation (very risky!)
Taxable Account:  $20k  (23%)
 – Includes Roth IRA
 401k:   $37k (41%)
Figures rounded to whole numbers.

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