Financial Freedom, Financial Journey, Financial Planning, Investment, Lifestyle, Retirement Planning

March 2017 Non-W2 Income Report and First Quarter Recap

April 26, 2017

You can go here to read about why we’re sharing our non-W2 incomes on the blog. And you can visit this link to see our past non-W2 income reports.

As anticipated, March was a very great month for us. We received a total of $5,249.31 in non-W2 income. Our international stocks (many of which pay out dividends in larger amounts once a quarter) were responsible for the big jump.

march 2017 non-w2 income report

This month’s number plus the January 2017 and February 2017 numbers have brought our first quarter non-W2 income total to $8,906.89. The monthly average is $2,968.96. With our monthly expenses being around $4,000, this monthly average covers about 74% of our expenses.

We anticipate this percentage will be a little higher by the end of the calendar year. Some of our investments have large dividends/interest payouts bi-annually or annually. Additionally, we continue to make new contributions to most of our accounts. We’ll see as we continue to track these numbers.

April’s chart will look slightly different as I recently did a 401(k) rollover.

We use Personal Capital, a free financial tool, to track our net worth, view our investment performance, analyze our asset allocations and project our retirement goals. I wrote a comprehensive review of Personal Capital in another post. I encourage you to check it out.

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Financial Freedom, Financial Journey, Financial Planning, Investment, Lifestyle, Retirement Planning

Money Makes Money: February 2017 Non-W2 Income Report

April 4, 2017

It’s already April and I just got around to sharing our February non-W2 incomes report. A lot has happened in my family in the past month. Some of the changes and adventures included giving my resignation letter to my previous employer and possibly forever saying goodbye to W-2 employment and taking a road trip across the country.

february 2017 non-w2 income

There are two great things I’ve came to love about non-W2 incomes; one being having incomes coming in to cover my expenses while on vacation and that, two, these incomes are location independent (e.g., I can be anywhere in the world and still continue to receive dividend/interest payments.).

You’ve probably noticed the few “$0”s on the table above. First, I was surprised we didn’t receive any dividends/interest payments on either one of our Roth accounts. Second, there was no financial coaching income for February. We were busy preparing for taxes and for the adventure across the country.

All things considered, the total for February was only couple hundred dollars lower than that of January. We are optimistic that the March total will be much higher. Many of our investments either pay dividends/interests quarterly or pay out higher amounts on the quarter mark. Come back to the blog to see the March report soon. You can view my previous non-W2 income reports here.

We use Personal Capital, a free financial tool, to track our net worth, view our investment performance, analyze our asset allocations and project our retirement goals. I wrote a comprehensive review of Personal Capital on another post. I encourage you to check it out.

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Money Psychology, On Investing, Women and Financial Literacy

My First Stock Purchases (at the Bottom of the Great Recession)

February 17, 2017

For those of you who are familiar with the stock market, do you remember the time when you first got introduced to it? What were some of your early associations with the stock market? At the time, were you anxious to get into it? Was the market something you swore to avoid?

first stock purchases

My Dad’s Warning Message (to me) on the Stock Market

My first impression of the stock market occurred right at the start of the Great Recession. One day, in November 2008, I was having dinner with my family. The news was on the television. I recall my dad telling my brother and I to never ever “gamble” in the stock market.

Yes, to him, participating in the stock market was a form of gamble, not a form of investment. This was coming from someone who had very limited exposure to the stock market other than what he saw and heard on television. However, not knowing any more of the stock market than my dad did at the time, I took his words to heart. The stock market was something to avoid.  

In the following weeks, the messages and images that kept showing up on mass media (covering the beginning of the Great Recession) just confirmed my dad’s belief of the stock market. Seeing and hearing stories of people jumping off buildings, losing their marriages, going into jail, becoming depressed and/or losing their children’s college savings and/or their own retirement savings—all due to steep drops in the stock market—just “proved” the evil side of “gambling”. Yes, the stock market was evil, I concluded.

The Man I was About to Meet and What He Taught Me About the Stock Market

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Behavioral Finance, Financial Independence, Financial Journey, Financial Planning, Lifestyle, Retirement Planning

Calculate How Much Money You Need to Retire: How Safe is the 4% Withdrawal Rule

February 13, 2017

For years, my husband and I didn’t know how much money we would need to retire (you can read about our financial journey in an earlier article I wrote by clicking here). We had our guesses, with numbers anywhere between $3 million to $5 million dollars. Our logic was that by the time we’re ready to retire, our primary residence home would worth $1 million dollars (all in equity). We would also have $2 million or so dollars invested in the stock market and the dividends and interest yields from these investments would be enough to cover our annual expenses.

In that article, I also mentioned about having learned about the financial independence movement in the middle of 2016. Since then, my husband and I’ve decided that we would reach financial independence once our net worth meets 33X our annual expenses. However, in that article, I didn’t mention how we came up with the number, 33 or why we chose this particular number.

4% withdrawal rule

In this article, I’m sharing with you the 4% safe withdrawal rule (SWR) and what this number means for my family’s situation. In the past several months, I’ve read many written documents on the 4% SWR (some of them were more technical than others). It took me a while to understand the different strategies behind this financial planning tool. Feel free to ask me questions on the comment section below and I’ll try my best to respond and/or refer you to further readings.  

The Origin of the 4% Safe Withdrawal Rule

After you’ve spent years saving toward retirement, how do you know how much money you can safely withdraw annually so that you will not outlive your money?

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Kids and Money

Having Money Conversations with My 2-Years-Old Toddler

February 10, 2017

What was your money story like growing up? What did your parents and/or grandparents teach you about money? What kind of conversations would you like to have with your child about money? When is a good time to start teaching your child(ren) about money?

My Story with Money

While growing up in China, my parents didn’t talk about money with me and I didn’t ask them questions related to money. I had no reason to. They took care of all my needs (I wasn’t aware of the concept of allowance until I was in my early 20s). There wasn’t much I wanted other than buying snacks at school.

I was 11-years-old when I first stepped inside a bank (with my aunt). That was shortly after I immigrated to the U.S. On that same day, my aunt gave me 37 cents so I could learn the U.S. currency. It was a very memorable experience for me. That 37 cents seemed like a lot of money at the time.

At the age of 13, I started working part-time. By the time I graduated from high school, I had over $4000 in savings. I used some of that money to buy myself a laptop and a camera for college.

When I finished my undergraduate studies, I saved over $10,000 in my bank account. I had scholarships to cover all my tuition, fees and living expenses. I also worked part-time. With that amount of money in my bank account at age 22, I felt rich!

money talk with my toddler

My Husband’s Story with Money

When I was a child, my father was a truck driver and my mother worked at a photo lab. Neither of them had a high paying job, but both tried hard to make sure my brothers and I were taken care of financially. 

Somehow, I learned to be mindful about money as a young child. I recall going to the grocery store with my father and brothers when I was about 6 years-old and paying attention to the unit price of items. I even took items out of the cart that my younger brothers put in and placed them back onto the shelves. When I was 10 years-old, I helped my father balance his checkbook.

At 13-years-old, I had my first part-time job. I worked throughout high school and college. When I was in middle school, my father told me I’d have to find my way to fund my college education. Since that day, I was determined to become the validictorian in my high school class. And I did. I received a full scholarship ride to attend college. Once I graduated from college, I secured a full-time position with the company at which I was working seasonally.

The Money Story I Hope My Daughter Will Have

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