I can’t talk to you about money right now

Radio Silence

Things have been quiet over here. Ever since I wrote about my frustration with net worth updates, my brain has been distracted by other things. I couldn’t find the mind to write.

The biggest reason behind my mental block… My sister is getting divorced.

This isn’t my life, but it might as well be. It feels a bit like the next door neighbor’s house burned down. My life is continuing as normal, but the landscape has changed dramatically and the family is trying to recover together.

The circumstances around the divorce are ugly. There has been a lot of trauma over the last 6 months. Car accidents, cops, emergency rooms, psychiatric holds, treatment facilities, poorly kept secrets, and new girlfriends are the top of the list. I wish that was the whole list, but its not. I hope everything is smooth sailing from here, but who knows. All I can continue to do is hold my breath.

In addition to the emotional trauma, her financial trauma is pretty overwhelming. The divorce is way more expensive than it should be. It has been another reason for me to understand why people hate lawyers. This shouldn’t be this expensive and it’s breaking my heart. Somehow, my sister is keeping it together, at least on the outside, for now.

The best thing that’s come out of this is an open dialogue about money in the family. We have to talk about it. She was on the verge of disaster. She was in a disaster and now she’s on her own.

Personal finance is what I know and love. I’ve been gentle and provided what I can. After years of never reading the same book, let alone being on the same page, I’m so proud of the conversations we’ve had. While this whole experience is horrible, maybe there is a silver lining and she’s ready for financial change. She’s open to suggestions. She’s open to guidance. I offered to give her the Total Money Makeover book as a gift and she eagerly accepted. Last I heard, she was actually reading it.

I’m doing everything I can to support her emotionally, prepare her financially and learn from the whole experience. Holy shit, alcoholics are a firestorm and lawyers are expensive. I’m so excited for her for this to be over and for calmer seas.

Limited Unchanged

Yesterday, the IRS announced that the 401(k) contribution limit is staying put at $18,000. Earlier, they released that the IRA limit isn’t changing either. The 2017 limits are set.

I found out when my co-worker sent out an email (she works with benefits) alerting us. She threw in the offhand comment, “like that will ever happen” along with the new limits. I got a good chuckle from that.

I’m right here! Can’t you feel the savings?

Maggie could feel it.

After the chuckle, the reality of an unchanged goal amount started to sink in. The only emotion that came through was… Oh thank God!

It wasn’t until this point that I realized that I might be pushing too much to save.

I was striving to pay off my loans.

I immediately transitioned to plowing all that cash into saving for a house.

While doing that, I reach reach reached to get to Super Max.

For our little family, 2 401ks and 2 IRAs has been a lot to contribute so soon. Today, we are set to reach that. We have been for a few months.*

I’m so proud of us that we’ve gone from buckets of debt to Super Max in 3 years. Now that we’re maxing, I want to continue to max from now until forever more.

Having just reached this accomplishment, the thought of having to reach just a little bit further to a higher max as soon as January was an obstacle I was not ready to conquer just yet.

I want to settle in to our cash flow and I’m thankful that we’ll be able to do that.

* Due to Hubs’ late start to maxing this year, his per check contribution is more than what he’ll need to max, but he won’t max this year. Next year🙂

Let’s talk about Net Worth Updates

One of my favorite things for the last year or so has been watching my net worth numbers climb. I’ve posted about it every month since I started tracking it. It has been incredibly motivating to see how far I’ve come each month and to look back on where I was 1, 2 and sometimes 3 years before hand.

With that said, I’m planning to stop posting them or at least significantly alter how I present the numbers.

Here are my reasons why.

I selectively track my accounts

I decided to start tracking and posting my net worth as I was nearing the end of my loans. I enjoyed tracking my student loan balance and I wanted to keep tracking something to keep going. The primary goal of my tracking was to see how I was doing now compared to how I was doing when I was knee deep in debt. To reflect the shift, I only tracked the accounts where my newly available money would go. Where did the money go? It mainly went to my 401k, IRA, and House Fund, so I track those accounts.

I threw in my car loan and car value because I am technically still in debt, but I have an asset to cover it. The car is a depreciating asset, but it’s depreciating slower that I am paying off the loan balance.  I also track a fund I created to pay for car expenses.

I have a taxable account and I wanted to be aware of what that account was doing, so I track that. I’m also building my HSA account, so I track that.

There are a lot of accounts missing from here. I don’t track my emergency fund or my travel fund. I intentionally chose not to track these accounts because they are planned spending accounts. I spend the travel fund frequently and I hope to never spend the emergency fund. I don’t want to feel punished with a lower net worth if and when I use these accounts.

I also don’t track my checking accounts. That money is there to be spent or to buffer. It seemed like more of a hassle than it was worth to keep an eye on those accounts. Sometimes I have more cash, sometimes I have less. With paychecks hitting at different times than autopay, the account balances don’t tell you anything.

These accounts aren’t the whole story

Hubs and I have joint finances. One thing that is glaringly missing from my net worth posts is anything about him. I track his accounts, but I don’t post anything about them here. Those are his numbers, not mine, and I don’t feel comfortable sharing them.

We only have one pool of money and things get complicated because he contributes to the House Fund.  Earlier in 2016, he significantly increased his 401k contributions after I canceled the race. By increasing his contributions, there is less money to go to the House Fund and my monthly tracked progress slowed.

My progress also slowed over the summer as I increased our travel fund contributions to pre-pay for our Australia trip.

By not tracking the whole story, and I don’t want to track the whole story, I feel like I’m posting an inaccurate albeit consistent report.

We’re on cruise control

My 401k and IRA are set to max. I contribute a set amount per month. The only thing that changes is if I throw in a little extra to max out my IRA early. Everything else is left to the market. If it’s a good market month, my accounts will be up. If it’s a bad market month, my monthly growth will diminish or eventually get wiped out by market fluctuations. Soon will come the days when the market moves my account more than my contributions!

My car loan only has a 1% interest rate. I’m committed to only paying the minimum until its done. That provides for a really exciting update. It’s either down $377 or $376. Maybe soon it will be down $378! My car fund goes up $50 each month. Every few months I add $1 to account for interest.

I don’t contribute to my Taxable account. I get dividends twice per year and a statement at that time to update my progress. The account does what it does.

My HSA goes up by a set amount each month, plus a tiny influx with the market. Any medical bills come out of it.

The only real mover or shaker is the House Fund. Sometimes it’s up $3000. Lately, I’ve only been able to contribute a few hundred bucks. (Stupid Koalas. Being so cute and luring me down under). Once we buy a house, what will I show you?

Do I want to put it all out there?

I hate to contribute to keeping finances under wraps, but I’m not sure that I want to contribute to the post it all online movement much longer. These are my real account balances and it gets a more and more unnerving to post them the larger the balances grow.

I’ve thought about shifting to a percentage base system or posts graphs without numbers, but those thoughts are still bouncing around in my head. I’m not quite sure how I would do that.

My purpose here was to show that you can tackle a big bucket of debt and use the momentum to build a strong financial foundation. I feel like I’ve done that. I don’t want this to be a brag fest and sometimes it feels that way, as much as I try for it to not be.

What do you think? Any  tips on where things should go from here?