Andy Hough

September 2017 Net Worth Update

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penniesIn order to keep track of my financial progress or lack of progress I have decided to calculate my net worth a few times a year.

My net worth as of 09/3/2017 is as follows.

 

Assets
Cash – $3897
IRA – $27,177
Roth IRA – $1665
Solo 401k – $2825
Car/Stuff – $3300

Liabilities
Student Loan – $115,268
Credit Card – $0

Net Worth = $- 76,404

My net worth improved almost $2000  last month.   This was mainly due to receiving two paychecks from my full-time job. My student loan balance increased over $600 despite making a $450 payment during the month. That doesn’t seem correct, but every time I check their calculations for the year they’ve been correct.  The student loan is my only liability. With the way it accrues interest, it might be a liability forever. I’d like to get it refinanced, but I can’t get it done since my debt is so much bigger than my income.

I’ve been using Personal Capital (affiliate link) to help track my net worth. It keeps track of all of my financial accounts and my student loan making it pretty easy to calculate my net worth each month. It is free to sign up. If you would like to sign up I’d appreciate you using my link. All blog income, including affiliate income, goes to paying down my student loan.

Personal Capital

August Income – $2969.99

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Here is a breakdown of my income for August.

Interest $1.35
Amazon FBA $213.58
Cash Back $10.68
Online $0
Bank Bonus $200
Other Bonus $30.91
Job $2539.5
Total $2996.02

 

August’s income was pretty good. Most of the income was from my full-time job.  I made about $450 from my non-job sources of income. That isn’t too bad, but it is much less than I’d like it to be. I’m going to work on getting those numbers higher. September is a three paycheck month for me so the overall income total for this month will be up quite a bit.

 

August Expenses – $1661.87

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Here is a breakdown of my expenses for August.

Household $1240.81
Entertainment $13.03
Transportation $53.84
Food $238.25
Travel $0
Phone $29.97
Health $85.97
Total $1661.87

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August was not a great month for expenses. My expenses were way higher than normal and way over my $1000 target. The high expenses were due to my moving into a new apartment. Rent was high this month since there was some overlapping of rent for my new apartment and shared expenses I paid at my GF’s house. There was also about $300 spent on furniture and other stuff for the apartment.  For that $300 I got a futon, twin innerspring mattress , shelves, wi-fi router, pot and pan set, toaster oven, hot plate, plastic storage containers. cleaning supplies, paper towels, toilet paper, laundry detergent, hamper, dish towels, towel rack, toilet paper holder, shower massage, shelf liner, fabric storage drawers, and probably a few more items I can’t think of right now. I think I got pretty good value for my money.

I also spent $300 to have internet installed. This will allow me to have free internet for as long as I live in this apartment. That is a great deal. Electric and water are included in my apartment rent, so $435 a month will pay my rent and all utilities including internet.

Food was another bad expense category in August.  I ate out all but three days during the month. Some days I ate out more than once so I had about 30 restaurant meals for the month. That is bad for my budget and terrible for my health. I’ll be cutting way back on that this month.

This month food and household expense will be a lot lower. Health will be a bit higher since I have a dentist appointment and I’m getting new health insurance from work. Getting health insurance from work is supposed to be a benefit, but it is a detriment for me this year. The cost will be more than my marketplace insurance  and the deductible is considerably higher. Plus, I’d already met my deductible for my marketplace insurance and now have to start over meeting the deductible for my employer insurance. That will cost me some money. How much it costs me depends on how much health care I need the rest of the year.

I expect my other expense categories to remain roughly the same. I should at least get close to meeting my $1000 target this month.

 

How was your month?

114/132 Student Loan Strategy Shift

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My student loan payoff has stalled out the last few months. Due to the lack of income during my eight weeks off from my job I was unable to make any big payments on my student loan. I’ve made a couple of payments in the last couple of months, but they were just enough to cover the interest. Now that I’m back to work, I can finally start making progress on the loans again.

However, I’ve decided to hold off on making big payments towards the student loan for the rest of the year. The reason for that is I want to put as much money as possible in my retirement accounts. Doing that will reduce the amount of my taxable income. That should keep me from having to repay any of the advance premium tax credit I received and hopefully result in a large tax refund. Since tax is currently being withheld from my paychecks based on me making $48,000 a year, I’ll get most of that tax back if I manage to reduce my income to about $20,000.

Based on my calculations, I’ll be eligible for the company 401k starting the next pay period. Since I turn 50 next month I’m eligible to contribute 100% of my pay to the 401k. My allowed employee contribution would be $24,000. I can also put $6500 in an IRA. There is no way I’ll be able to max both of those out, but I’m going to put in as much as possible. I’ll also be eligible to open a Health Savings Account next month. Since I’ve already got more savings capacity than I can use I’m going to put off opening an HSA until next year.

In 2018 I’ll switch my 401k contribution percentage to 4%. Just enough to get the full company match. That will leave me plenty of money to use towards paying my student loan.

I’m considering not re-certifying my income based repayment plan which will result in my student loan switching to the standard 10-year repayment plan. I think my monthly payment on the 10-year plan would be about $1300 which is about the same amount as my paycheck. That would give me one paycheck for the student loan and one paycheck for everything else. That might motivate me to make more money and figure out a way to pay the loan off faster. I’m not sure if that is a good idea or not. What do you think?

My Tiny $435 a Month Apartment

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apt closet view Last Sunday I moved into this tiny apartment. The landlord stated that it that measures about 150 square feet and I think that is probably about right. It is definitely a small apartment. I’m posting a couple of pictures to show how small it is. The first picture was taken while standing in the bathroom area and viewing the kitchen/bedroom/living room area. The apartment is still a mess in these pictures. I don’t own very much stuff, but it still took quite a while to get it organized and squared away in this tiny apartment.

The apartment is a bargain at $435 a month including utilities. The only thing I will have to pay for in addition to the rent is internet.  The city I live in has a good deal, where you pay a $300 installation fee and then have free 100mb internet for life. Even if I only stay in the apartment a year that will only be $25 a month. If I stay longer the internet gets to be more and more of a bargain. The drawback to the free internet is that customer service is lacking and they don’t appear to be in any hurry to get my internet installed or even tell me when it might be installed. I haven’t been posting much the last few months, but this month I have a reasonable excuse for not posting too much.  Once the internet is installed I plan to post on a more regular basis and hopefully revive the blog a little bit.

The apartment is a great bargain. You can’t find an apartment close to that cheap in this area of Kansas City. Of course, the apartment being that cheap means there are a few drawbacks to the apartment. The size would probably be the biggest drawback for most people. I’m okay with the size. I actually like living in small spaces. The biggest drawback for me is that it is a basement apartment which leads to it smelling musty and having more insects than I like.  I’m working on both of those problems. I’ve got some air fresheners to help the place smell better. I’m cleaning which will hopefully lead to fewer bugs. I think some of the bugs are here due to the last tenant being messy. The apartment was sprayed before I moved in which I think did significantly reduce the bugs. It appears the bugs were probably much worse before I moved in. If insects continue to be a problem after I have the apartment cleaned and squared away I’ll have it sprayed again. Although I’m complaining about the insects they aren’t that bad. It isn’t like the apartment is infested with cockroaches. There are just a few random, little insects coming into the apartment each day.

bathroom view

Another drawback is that the apartment doesn’t have a real kitchen. It just has a sink, cabinets, and a refrigerator. I’ve bought a hot plate and toaster oven and I think that will make it enough of a kitchen for me. It doesn’t have a lot of cabinet, but it is plenty for the few dishes I have.

The second picture shows the bathroom area. It has a vanity in the middle, a shower stall on the right, and there is a little toilet cubby on the left side out of view. The toilet cubby does not have a door which could be awkward if I ever had anyone over to the apartment. It did have a curtain rod across the entryway which I hung a shower curtain on so if anyone does come over and need to use the toilet they can have some privacy.

Although this apartment is a bargain it will end up costing me about the same as I was paying my GF for expenses while living in her house. Before anyone asks I will go ahead and say that my GF and I are still together.  Moving out has strained the relationship a bit. It might not have been the smartest move on my part. Time will tell. That is about all I have to say for now. If you have any questions about the apartment ask me in the comments.