{"id":4142,"date":"2022-04-13T23:39:32","date_gmt":"2022-04-14T05:39:32","guid":{"rendered":"https:\/\/modernfimily.com\/?p=4142"},"modified":"2022-04-10T23:11:11","modified_gmt":"2022-04-11T05:11:11","slug":"quarterly-net-worth-q1-2022","status":"publish","type":"post","link":"https:\/\/modernfimily.com\/quarterly-net-worth-q1-2022\/","title":{"rendered":"Quarterly Net Worth: Q1 2022 + Book Giveaway!"},"content":{"rendered":"
Hey hey everyone!\u00a0 We’re back with another quarterly life and net worth update.\u00a0 These are the posts I actually still enjoy writing these days. Big 3,000 word post so grab a cup of coffee or tea before digging in.<\/p>\n
We also have a book giveaway this quarter!\u00a0 We are excited to gift a copy of Andrew Hallam’s latest book, Balance<\/a>, out to a lucky reader!<\/p>\n <\/p>\n I came across this review of the book on Goodreads and it really resonated with my thoughts.<\/p>\n <\/p>\n This too is the third book of his I’ve read (the others being Millionaire Teacher and Millionaire Expat) and I found it a bit repetitive.\u00a0 While this book does cover some topics beyond money, I thought this was going to be mostly focused on the non-financial side of the equation.\u00a0 However, to me, this book read more like Millionaire Teacher 2.0.\u00a0 I am forever grateful for Millionaire Teacher as it has many easy to understand concepts and resonates with the FIRE community.\u00a0 Balance throws in some summaries of some behavioral science books, most of which I’ve read, so it was nothing new to me.<\/p>\n The fact that I’ve read three of his books showcases that he is a great writer.\u00a0 If you haven’t read any of his other material before it’s definitely a worthwhile read.\u00a0 If you have read his other books, you might not get as much out of it.<\/p>\n This contest is open to readers from Canada or the US.\u00a0 To enter, all you have to do is comment in the post below letting me know you’re interested.\u00a0 That’s it!\u00a0 Every person who comments will be entered to win and the winner will be selected in early May.<\/p>\n If you have read Balance already, I’m honestly very curious to hear what others who have read the book think about it so please comment below too (and let me know if you want to be entered or not)!<\/p>\n Enough of the small talk, let\u2019s dig into the numbers to see where we are at!<\/p>\n As noted in our recent post with\u00a0our updated FIRE goals\/numbers<\/a>, we are aiming to get to the ~$1.26M mark as our FatFIRE goal.\u00a0 When I took off on parental leave, my goal was to somehow reach this figure by the time my parental leave is up thanks to my 1\/2 year bonus for 2021 that I recently received in March + compounding doing its thing + our low spend allowing us to keep our capital preserved while living off EI (pay for parental leave) + CCB (Canada Child Benefit).\u00a0 In Q4 2021 we were sitting at $1,234,406 without the mortgage so $25,594 to go.\u00a0 So closeee!\u00a0 Let see how we compare with our goal.<\/p>\n Our current liquid portfolio is sitting at:<\/p>\n $1,253,476<\/p>\n We are iiiinnnnccccchhhhhiiinnnnnggggg<\/em> to the finale!<\/p>\n We do still have the mortgage in place on our home while renting out the paid off townhouse.\u00a0 While the passive income from our rental has been quite easy, we decided now’s the time to sell the townhouse.<\/p>\n Our real estate market has been relatively stagnant since we bought the unit in 2016 (we were actually trying to sell it for a loss in 2020 and couldn’t even do that!) and just over the past 6 months or so we’ve really started to see inventory dry up and prices come up.\u00a0 Not only are people moving to Cochrane (it’s the fastest growing community in Alberta and 11th fastest in Canada) but investors from BC and Ontario are starting to see the light and moving their investment money outside of their insanely over-priced provinces and are heading toward lower priced markets instead. (Ahem… FI Commune in Cochrane anyone?!?) I do feel genuinely bad for renters and first-time home buyers at this time as the housing crisis across Canada is getting insane.<\/p>\n We are meeting with our realtors in a few weeks to talk pricing\/strategy but are hopeful to sell in the $375,000 range.\u00a0 This is huge for us as we listed our townhouse in August 2020 for $311,000 and couldn’t sell it then – hence why we are renting it now.<\/p>\n While we will make a small profit on the sale, we’re talking ~$45,000 (after realtor fees) after 6 years of ownership. So about 2% annual returns.\u00a0 This is peanuts, but better than a loss.<\/p>\n Mortgage Balance Remaining: -$302,054<\/p>\n Net Portfolio: $951,422<\/p>\n I ripped the bandaid and sold off our ARK funds.\u00a0 Definitely took a loss there and lesson learned to ignore any sort of noise that arises.\u00a0 Definitely easier said than done.<\/p>\n We opened up an informal trust account for each kid and put $5,000 into Parker’s and $6,750 into Finn’s (to account for 10% gains over the past 3 years since we didn’t start it when she was born) as their \u201cCoastFI\u201d inheritance.\u00a0 If you haven\u2019t read Chrissy\u2019s post on The Ultimate Guide To Informal Trusts For Canadians<\/a> \u2013 get on it!\u00a0 We decided to go with VEQT with these accounts to keep everything simple.\u00a0 This is not the most “optimized” fund choice but we are learning that simplicity really does count for something.<\/p>\n We do not include our kids RESPs and ITFs in our figures so that wiped out $16,750 of our cash this quarter ($11,750 into the informal trusts and $5,000 into the RESPs).<\/p>\n Oh boy, my bonus.\u00a0 Last year I wrote about the largest bonus I have ever received from work<\/a>.\u00a0 Well in March, I received my bonus from 2021.<\/p>\n Let’s back track for a second.<\/p>\n In 2021, I worked part-time for 6 months from January – June before taking off on parental leave.\u00a0 I work shift work so that came out to 36 12-hour shifts over a 6 month stint.\u00a0 With me?\u00a0 Our team had another crazy good year and I was hoping for a bonus around $50,000 which would be around $30,000 after taxes (which is wild to me!).\u00a0 This would equate to around half of what I received last year (where I was in the full 12 months).<\/p>\n Well.\u00a0 Are you ready for this…? (I sure wasn’t.)<\/p>\n $178,810….!?!?!?…..<\/p>\n For working 36 shifts…. I still am in shock.\u00a0 Complete. Utter. Shock.<\/p>\n That’s like getting a $413\/hour raise on top of my $63\/hour salary.<\/p>\n This means if I worked part time for all of 2021 and didn’t take off on parental leave, I would have received a bonus north of $300,000 for a PART TIME job.\u00a0 Absolutely INSANEEE!!! Never ever ever did I think this is what my pay would look like.\u00a0 (For those who are curious and unaware, I am an energy trader.)<\/p>\n Now of course I did not see $178k enter my bank account.\u00a0 Of that, $114k was cash and the rest is RSUs (registered stock units) which vest over a 3 year period (1\/3 in March 2023, 1\/3 in 2024, and 1\/3 in 2025).\u00a0 So if I decide not to return, that would all be gone.\u00a0 Of the $114k cash, $86k was deposited after tax was withheld.\u00a0 $86k!! I still cannot believe it.<\/p>\n So that is why the markets have dipped this quarter but our portfolio remains relatively unchanged even without any work happening from our end.<\/p>\n The complete cherry on top to all of this is that I read the email with all of this information on my birthday.\u00a0 Happy birthday to me!<\/p>\n Once we FIRE, any taxable income\/dividends we receive from our taxable account we plan to withdraw, rather than drip right back into the non-registered account, with the purpose to shuffle over to our TFSA instead for some tax sheltering.\u00a0 We will also withdraw from our RRSPs first up to the federal basic amount (accounting for any dividends, rental income, earned income, etc) to shift over into our taxable accounts for tax purposes as we drain the cash wedge down to 1-2 years of cash.<\/p>\n Stocks\/Bonds\/Cash Allocation:<\/p>\n We’re sitting heavier than we want in cash right now thanks to the recent bonus payout.\u00a0 Will be shuffling a good chunk of the bonus money into our taxable account.<\/p>\n We\u2019re currently sitting at a 66\/34 USD\/CAD split.\u00a0 With the USD\/CAD exchange rate sitting at 1.26 our liquid portfolio fully converted into CAD is $1,467,856.<\/p>\n Let\u2019s see what this means when it comes time to withdraw.\u00a0 I like looking at a few different scenarios as we can cut down our spending if need-be in hard times (market tanks).\u00a0 I also like looking at what our withdrawal rate looks like with Canada Child Benefit (CCB) factored in since it is such a juicy benefit that we will be receiving for the first ~15 years. As previously mentioned, we do NOT rely on\u00a0any<\/b> external support in our FIRE figures (CCB, CPP\/SS, OAS) and view them as icing on the cake or to account for any future unexpected medical expenses we may encounter in old age.<\/p>\nHow Do We Stand<\/b><\/h2>\n
Townhouse Update<\/h2>\n
Changes This Quarter<\/h2>\n
My Bonus<\/h2>\n
Portfolio Details<\/h2>\n
\n
Withdrawal Rates<\/b><\/h2>\n