Financial Independence – September 2018

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Hi everyone! Here is my FI update for September 2018 end of 2018Q3. A month late is better than no update, right?

  • My FI goals are outlined here!
  • Last FI update as at 2018Q2 here!

For 2018Q3, we didn’t have any extra large expenditures. We spent some time in Germany but those flights had been booked earlier in the year, and we stayed with Mrs FN’s family, so there wasn’t a whole lot of vacation expense.

My year-end goal was to attain $150K in net worth. As at September 30, 2018, we were at $146,430 making my goal seem easily attainable with 3 months remaining.

However, I know we have some major Wedding expenditures coming up (or have occurred in October) which will deplete some of our cash position. At this time, we also know markets have taken a DIVE that will impact our TFSA and RRSP accounts!

With the market now heading into correction territory (20% drop or more) I won’t be budging. On average, bear markets tend to last 367 days, dropping 30.2%, followed by returns of 30.9% and 12.3% in the following 2 years respectively.

All that being said, here’s my update:

Observations

  1. Debt?
    • No change here. We have a 2012 Toyota Yaris with a small balance remaining that I net off the car resale value from. This yields a big fat goose egg.
  2. TFSA down -11%
    • This is primarily due to me switching jobs. I had to repay a signing bonus that I received back in January 2018. As markets were at an all-time high, it seemed like a reasonable idea to cash out some of those TFSA gains and use it to repay that signing bonus.
  1. RRSP  up +7%
    • This is simply due to automatic withdrawals every paycheque and fluctuations in the market.
    • I invest in low cost funds offered by my employer and get exposure to equities in Canada, US, developed markets, and emerging markets.
  2. Cash up +137%
    • At this time, I still had my ‘signing bonus TFSA transfer’ sitting in my savings account.
    • Besides this, we are saving up for our Wedding next year. Part of this is accumulation for said Wedding costs. I am not investing this as the investment period would be less than a year and the event is certain! Because of this, I’m maintaining our Wedding fund in a Tangerine savings account that is earning me a small return of 1.1%.
  3. Overall, we’ve boosted our net worth by $15,053 or +11% over 3 months. Unfortunately with the repayment of the signing bonus, downturn in markets, and some budgeted Wedding costs coming in Q4, I do not anticipate hitting the $150K mark. However:
    • My new job will pay me significantly more and we will be able to make up that lost signing bonus in no time.
    • Most of our investments are long-term, so I have no problem with the current downturn. My RRSPs will continue to purchase the same $ amount of equities which will result in purchasing more units at these discounted prices.
    • Wedding costs were budgeted for! The Wedding was seen as an opportunity cost worth taking!

2 thoughts on “Financial Independence – September 2018

  1. Pingback: Financial Independence – December 2018 | The Frugal North

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