Happy New Year everyone! I hope you had a nice winter vacation. We went to visit families near Palm Springs and had a great time. It was nice and sunny there. I don’t know how many more bleak Pacific Northwest winters I can endure. We will likely move to California after the RB40Jr finishes high school. Mrs. RB40’s parents are getting older and need more help. I also think the cost of living in the deserts of California is actually cheaper than in Portland. Our property tax is 6 times my father-in-law’s! He has a half acre and we can build something in the back when we move to California. However, this would likely increase your property tax significantly. We’ll figure something out. Maybe I’ll just get the Airstream. He already has a big concrete pad there.
Well, let’s wrap up 2024. The RB40 family had a great year financially. Our net worth has reached a new high, thanks to the stock market. Our spending was also very low. The only obstacle was the income aspect. Unfortunately, my active income continued to decline. However, I’m not too worried. This is part of the transition to full retirement. In 5 years, I probably won’t have any active income at all. We will withdraw from our retirement accounts as needed. Our investment should be able to support a comfortable retirement.
Well, I’ll share with you what I did with my goals for 2024. Next, I’ll talk about our net worth and cash flow. Let’s go!
2024 goals
Here’s my goals spreadsheet for 2024. It works well. Try it if you can’t keep up with your goals for the new year. The key is to review the spreadsheet monthly to track your progress. This way, you can see which goals need more attention and work toward them.
I achieved most of my goals in 2024. Check it out.
Financial goals
FI ratio > 100%
The FI ratio is passive income divided by expenses. If you can generate enough passive income to cover your expenses, then you’re set. For 2024, it lowered that goal to 100%. We are getting older and can spend more.
The result was 121%. This is really good, but there will be big changes in the coming years. I will write a detailed blog post about it soon.
*phi ratio = Passive income/expenses
3% rule
Everyone is familiar with the 4% retirement withdrawal rule, right? Basically, you should have a successful retirement if you withdraw less than 4% of your investable assets annually. Let’s see if we can spend less than 3% in 2024. This is a good way to test how prepared you are for retirement.
In 2024, we spent much less than 3%. This will be even more important in the coming years as our passive and active income declines.
Track net worth and hope +10%
I’ve been tracking our net worth since 2006. It’s great to see the progress. For 2024, I was hoping for a 10% gain. At this point, the gains are completely dependent on the stock market and there is not much I can do to influence this target. I’m just going to track it down and keep my fingers crossed.
Our net worth is up 20.1% this year! This is much better than expected. Last year, I thought the market was too hot and wouldn’t do well. That’s why you have to keep investing. Again, it was good to be an investor.
Health goals
Exercise 3 times a week
Now that I’m 50, health is job number one. I need to exercise constantly so that I can stay healthy longer. I joined a gym and plan to exercise at least 3 times a week. Unfortunately, my elbow developed joint pain after several months of exercise. I can’t exercise like my younger self anymore. Getting old is bad.
I modified my exercises, but the pain didn’t completely go away. Finally, I took a whole month off in December. The extended vacation period helped tremendously. Now, I’m ready to get back in the gym. This time, I’ll try to avoid putting pressure on my elbows. Getting fit after the age of 50 is difficult!
Health checks
Equally important is checking with doctors. In this day and age, we have more maintenance and preventative care to deal with. You’ve accomplished everything on the list.
- Colonoscopy. finished!
- Annual physical. finished!
- Dental examination. finished!
- Vision examination. finished!
- Immunization. Tdap booster and flu and covid vaccine. finished!
Fun goals
International flight
The RB40 turned 50 and wanted to go on a fun and memorable trip. We visited Japan for 3 weeks. It was great. I would love to live there for a year or so.
Happiness level > 8
2024 has been a great year. The only bout of unhappiness was when I got shingles. This sucked. If you’re over 50, get the shingles vaccine.
Other than that, life was great. The secret to happiness is to stay busy with activities you enjoy and be healthy.
Help RB40Jr start a YouTube channel
We have given up on this. RB40 Junior I lost interest.
Net worth (+20.1%)
I have been tracking our net worth since 2006. It is very motivating to see the progress we have made. The strength of the installation is incredible. In 2024, our net worth increased by 20.1% and far exceeded our earnings. That’s why you have to invest.
***important*** My best advice is to stay the course. Don’t stop investing. You should continue to invest whether the stock market is going up or down. You may think stocks are very expensive, but in 10 years they will look cheap. Keep investing and you will achieve financial independence one day. Don’t try to time the market.
This is a chart of Empower’s net worth. (Personal Capital is now Empower.) Sign up for a free Empower account to help manage your net worth and investment accounts. I log in often to check our net worth and use their free tools. It is a good site for DIY investors.
I’m not sure why the chart looks like this. The update interval in August and September may have been messed up.
2024 fiery cash flow
The FIRE Cash Flow Chart includes my online income, side gigs, and taxable passive income. Ms. RB40’s income and our retirement accounts are not included here.
Overall, 2024 was a good year. Our spending was at target, less than $65,000. This is very reasonable for a family of 3 on the West Coast. FIRE’s income streams have also performed relatively well.
2024 fire income: $62,001
- Real estate crowdfunding: $15,278. Real estate crowdfunding was great in 2024. One project came out successfully and made a good profit. You can read more on RE Crowdfunding’s passive income page.
- Dividend income: $15,286. Dividend income was also good.
- Rental income: $7,260. I had a good year with rentals. We did not make any major repairs and the tenants paid on time. This will change next year. One of our tenants is moving out and I am planning to sell the rental apartment.
- Blog income: $12,028. My blog income has dropped again. Within a few years, it will likely be zero. Oh, well, I had a good trip.
- Odd jobs: $4803. I deliver food orders several times a week. It kept me busy. This income stream will decline over the next few years as well.
- last: $4,632. Tax refunds and other random stuff.
- interest: $2,714.
Spending: $63,087
In 2024, I plan to spend about $65,000. This was the amount we spent the previous year. We succeeded! However, I did not start any redesign this year. Next year, we will have a lot of repairs and maintenance to do.
- He travels: $16,631. Travel was our biggest expense in 2024. We visited Japan, Thailand, and California. It was great. I think travel is going to be a big category while we’re healthy.
- Housing: $15,480. This includes mortgage, utilities, furniture, repairs and maintenance. Our housing expenses are lower than most families because we live in a duplex. We split many expenses with our tenant.
- communications: $4,632. Gas, insurance and maintenance. Our old Mazda5 still runs well and should last another 4-5 years. I don’t want to buy a nicer car now because we’re parked on the street. The cars here are all banged up.
- grocery: $5,711. We spent about $500 a month on groceries. This is very reasonable for a family of 3.
- health: $3,513.
- child: $8,680. Wow, that’s true. Children are more expensive as they get older. RB40Jr needed braces and participated in various activities.
- entertainment: $3,497.
- subjective: $1,983.
Savings:-$1,086
2024 summary
Well, let’s wrap it up. Overall, 2024 was a great year. We’ve done very well financially. Our net worth reached a new high and we spent less than 3% of it. My active income has decreased, but that’s just part of my gradual retirement. Ms. RB40 continues to work, but thinks about retirement often. She will probably retire when our son graduates high school. However, the extra year syndrome is strong with it. I don’t know when you will retire.
I’m grateful for 2024. We had a great year. I hope 2024 is great for you too.
2024 It’s all over. Did you have a good year?
Passive income is the key to early retirement. These days, I invest in commercial real estate with… Crowd Street. They have many projects all over the United States. Go check them out!
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Passive income is the key to early retirement. This year, Joe is investing in commercial real estate with CrowdStreet. They have many projects all over the USA so check them out!
Joe also highly recommends Personal Capital to DIY investors. They have many useful tools that will help you reach financial independence.
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