Mrs. Vigilante and I started off 2017 with about $10,000 in our assets on FIRE – those defined contribution retirement plans which directly fund our early retirement goals. We quickly upped that to about $25,000 through correction of some poor planning, as readers know from my Net Worth 1Q 2017 post.
As for the climax of the year: We’re closing in on $70,000! We’e been slowed a bit because contributions to our traditional IRAs have been light, but we have excess cash waiting for deposit and more cash quickly on the way. We need to keep it around in case of baby-related expenses early in 2018, but we will be maxing both of our 2017 traditional IRAs by April. Here’s where we stand today:
Vigilante Net Worth 4Q 2017
|Total Liabilities: $347,880.43|
The extraordinary growth of our defined contribution plans in 2017 was helped along by an extraordinary 26.83% investment gains. Included is a measly little $100 profit from the ultra high-fee Bitcoin Investment Trust (GBTC) in about a 24-hour period, when I dared myself to test my mettle as a speculator. I truly learned something: While I’m completely comfortable with the high risk of 90-100% equities at this early stage of my career and life, the thought of possibly losing 90% or more of an investment that might never recover is about my limit. I watched that number rise and fall constantly, ultimately selling for a small gain. No thanks!
More importantly, this growth was prodded by personal action: investment in working hard and earning larger bonuses! Finding more work, billing more hours, and generating more revenue for my firm resulted in a hefty raise…and some favorable attention from competitors. Net worth was further bolstered a bit by a yard sale, babysitting, credit card reward gaming, and a teensy bit of unexpected blog revenue – including some due to my first ever Rockstar Finance feature!
A particularly observant reader might notice that we suddenly have well over $0 net worth because Mrs. Vigilante’s pension has surged in value since 3Q 2017. That’s not a typo! Mrs. Vigilante finally amassed enough time with her current employer to allow her to generate a statement that helps me play actuary and determine the actual net present value of her pension, rather than using the meaningless balance! Previously, the balance was the best estimate I could give of the value – and all the value that she could receive had she left her employment. Now, she has enough readily available information to estimate what her pension’s net present value is if she leaves employment at the 10 year mark, as planned, and collects the pension at her employer’s set retirement age of 65. Huge artificial/theoretical boost to our net worth this quarter, I guess!
What’s to come in 2018?
Assuming nothing too drastic happens, the biggest financial change for us in 2018 will be the dreaded, looming expense of daycare. By the time our 1Q 2018 net worth post rolls around, our baby girl will probably be doing some rolling, too. (Ok, she is a Vigilante; she might do more than rolling. Historically, we use our extraordinary physical prowess to hunt bears during infancy.)
So we’re going to see a new monthly expense of about $1,200 in April or May. Scary? Sure. Worth it? I dunno, we’ll have to see how much we like this baby. But there’s also some definite good news for 2018, too!
Big Changes: A Negotiated Raise
Less than one year after getting the biggest percentage raise in my law firm’s history, I beat my own record! I had offers from multiple local law firms, but since I was happy in my current situation I demanded much larger compensation than is reasonable for an attorney of my age and experience. One firm followed through, and I ended up with a fantastic offer, both in terms of money and intangibles…but my current employer beat it!
I’m happy to stay put in a nearly ideal situation: I live close to work, I’m fairly compensated and appreciated for what I do, and I’m respected by driven and likeable coworkers and bosses. I don’t expect as large of a raise ever again unless I change firms or careers – but I’m really grateful, for FIRE purposes, to be on par with far more experienced attorneys because I’m lucky enough to work in a firm that rewards production and results rather than just seniority!
We also find ourselves unexpectedly able to save a bit more money than we expected thanks to changes in the tax code,1 a slight decrease in my health insurance costs, and cashing in some credit card rewards.
I had been saving up massive American Express signing bonuses and referral bonuses for travel – often the best way to spend them, in terms of points per dollar – but when we realized we would not be travelling with an infant,2 we took a second look at spending our rewards on more practical needs.
Turns out, American Express was having a special deal on gift cards at two locations where we were already registered for baby-related things, and the deal happened to make each card almost as good of a point-per-dollar deal as travel rewards! We knew we would be spending our hard-earned money to buy baby registry items at a discount after Mrs. Vigilante’s baby shower, so I cashed in $500 worth of gift cards for things we’d definitely buy retail, anyway. Now, we’re buying those things with free money, a registry discount, and, in some cases, coupons. Basically, as I’ve told our parents to their great entertainment: We get a free baby!
Side note: I highly recommend having an Amex card or two on hand. Right now, they have a very generous rewards program that has really worked out for us. If you are looking for a new card, please check out the American Express Gold Card – and use this link to help me earn another gift card for more baby supplies!
- Without commentary on whether they’re good or bad for the country, I can honestly say they’re great for us right now! We even get to claim the child tax credit again, adding $2,000 to our income next year!
- And when some of our best friends moved back to the east coast from San Francisco, which was one of our top destinations!