Another month in the books and the books are looking… lighter than before. Actually, our books weigh the same amount no matter how much money is in them.

February was a big month for me. I gave up alcohol completely and made great progress on a lot of my goals for 2022. I hope to post an update on those next week.

February started very badly. Everything that could go wrong seemed to go wrong. I got a tax bill for unemployment money that I never claimed. I read something like over 60% of Rhode Islanders had unemployment fraud. I can’t believe that’s true, but I’m too lazy to fact-check it. It doesn’t matter, because I was one. Fortunately, since it was so rampant reporting the fraud is easy. I got a tax penalty from the state of California because it physically takes the mail too long to get there and the processing time is two weeks. Fortunately, when the final payment of the penalty on the penalty of the penalty was 9 cents, they just forgave it. Unfortunately, it was still 3 hours of calls.

Also, our kitchen ceiling sprung a leak and they had to cut out a whole section of it. There were some other things, but I don’t want to go through all the misery of the month.

It wasn’t a good month for our ceiling.

Things got a lot better after that first week or so. I hit my 1000 day streak of learning languages on Duolingo. That’s a bit of a fraud because I missed plenty of days in there, but I had streak-freezes to save me. I usually do the bare minimum every night rotating between Spanish, French, and Japanese. I’ve had years of Spanish classes, so that’s a refresher. I’m not good at Japanese or French, but I feel that I’ve got a base to start from for later travel.

The weather got a little nicer so I took my dog on walks at the beach. It’s nice to let him off-leash. We couldn’t do that when he was younger, but now that he’s 13, he’s not a risk to run into the street.

Last year we did bumper boats on the ice. It was so much fun, we did it again this year. I don’t know if that’s something that’s in your neck of the woods, but if so, give it a shot.

That’s enough of the personal stuff… let’s start the Passive Income report. I used to call this the Alternative Income Report because some of this income has an active component to it. However, that idea isn’t catching on and everyone loves “passive income” better. If you are a new reader, you’re going to want to refer to my Alternative Income FAQ as you may have some questions about the math.

The way I calculate these numbers requires that little explanation – it isn’t intuitive. I do things a little differently to show the journey. For example, we don’t have real passive income from our rental properties right now. We still have mortgages to pay off. Instead, I calculate the percentage of equity we have to show where on that journey we are. Each month, you’ll see that the bank owns less and we own more. When we get to owning 100% there will be no mortgages and all that rental income can be used for living expenses. When it comes to calculating the percentage of rental income, I take the rent (minus estimated expenses) and multiply it by the portion of equity we own. Think of it like you and a friend owning a property 50/50. This would be how you’d handle it with each of you splitting the profits at the end 50/50.

Lazy Man’s Passive Income

I categorize our passive income into 3 main sources that are largely represented in my passive income pyramid. For this report, I ignore the bottom section, “career/job” – that’s not passive at all. (I do have some income in that area, but that’s not the focus of this report.) I combine dog-sitting and blogging into one section of “somewhat active” income. They are a little passive because I can make money even when I’m not immediately tending to them. For example, I’m writing this while boarding 2 dogs right now. I leave real estate and investment income as their separate main sources of very passive income. This way if you want to only count that you can do that.

1. Blogging + Dog Sitting Income

February was a very good month for dog sitting. The school vacation led to a lot of travel, so I got to take care of a lot of dogs. We didn’t have any significant dog boarding last January through March because vaccines weren’t widespread. We’ve got a great headstart this year compared to a year ago.

Blogging is always terrible in January. It starts to ramp up in February. This year is no different. It’s still early March, but it’s ramping up even more. Things are going great.

In January, “dogs and blogs” combined for a total of $2,397.56. In February, it was:

Total Blogging + Dog Sitting Income: $3,799.20

My kids help with the dog sitting. My 9-year old is extremely good with dogs at this point. He can feed them, let them out, and play with them in the yard. He’s spending more time in front of the clients as a helper. My 8-year-old was a little slower to dog skills, but he’s carved out a household niche of catering to the smaller dogs – he just loves them. This help means that I can pay them a legitimately earned income (a percentage of the overall dog-sitting income). Because the income is earned they can save money in their kid Roth IRAs and it will be money that they’ll never pay tax on. Learn why you should get started with a kid Roth IRA as soon as possible.

My kids are great with dogs… and dogs love my kids.

Someday, I want to get them more involved in blogging, taking pictures, and things like that. During school, they have too much to keep them busy. After school, there’s homework, becoming mini-ninjas, scouting, music, and sports fill up their days. Being a kid is hard work!

(Note: The blue line is the monthly number. The red line is a 3-month average which helps smooth the curve.)

2. Rental Property Income

The rental properties had about $20,000 in appreciation this month according to Zillow. That’s a great month! We also always pay down a couple of thousand dollars of mortgage debt each month. That’s a good combination. We obviously can’t expect this to happen every month.

We went from 72.92% to 73.77% ownership of the equity in our properties. That’s a tremendous gain for one month.

If we owned the rental properties with no mortgages (100% of the equity), I calculate that, after insurance, property taxes, condo fees, and estimated condo maintenance we’d make about $4,000 a month. The expected rents have gone up a lot. However, we aren’t getting those kinds of rents yet. We’re keeping them low for now. So I’m going to average what we could make and what we are making, which is about $3650. It seems like low-lying fruit that we could get there and our tenants would still be happy that they are getting a bargain.

If you multiply our expected net rent by $3,650 by the amount of equity we have (i.e. where we are on our journey to 100% equity ownership), 73.77%, you get $2,693 in estimated monthly passive income. That’s a gain of $30 from last month. Yes, this growth is pretty slow.

My wife watching our kids at the end of a bumping good time.

When I started tracking this (January 2017), we only owned 36.4% of the properties and the properties had lower rents. The math worked out to $1,174 back then. So in 5+ years, we’ve seen that number grow tremendously to $2,693. The forced savings of 15-year mortgages is a very powerful force.

We reached an interesting milestone this month. If we sold our rental property with the most equity, we could use the money to pay off our primary residence and the other two properties. It would eliminate a $2700/mo. expense and create $2400/mo. income (since we wouldn’t have to pay those mortgages). It’s very tempting to do something that would give us $5,000/mo. ($60,000/yr.) in flexibility. However, holding and doing nothing has been working so far. It’s to know that’s an option if we need it.

In about 5 more years from now, the equity ownership will grow to 100% of that $3,650 rent. Since rent is inflation-resistant (we can raise rents as the cost of living goes up), we don’t have to factor in inflation like other investments.

So we can think of it as around $44,000/yr. of income in today’s dollars buying the same value in the future. That should be enough money for us to live on with our own home paid off (plus our solar panels, frugal shopping habits, and military healthcare.) Of course, that’s just one part of the plan as you can see.

In the previous report, the rental property income was $2,447.

Total Rental Property Income: $2,693

3. Dividend Income

For this section, I assume we will earn a 2.5% dividend yield on our holdings. That could be from a high-dividend ETF. For example, HDV is currently paying about a 4.04% yield. It could also come from simply holding strong companies that have a long history of dividend growth. There are some income investing ideas here. We can also look at making passive income with Dividend Kings. If we wanted to simply retire on this dividend income, I would get Sure Dividend’s newsletter to try to get a 5% average dividend yield. (That link to the newsletter has a special discount rate and in full disclosure, I make a few dollars if you sign up for it.)

Of course, we may not convert everything over to dividend income at all, it’s just a conservative way to think of our investment portfolio. If I used a 3.5% or 4% withdrawal rate, the numbers would be much bigger.

When you get older you get more freedom to roam.

The markets fell again in February. It’s getting to be a tough time for investors. There’s the Ukraine-Russia war leading to more inflation (higher oil and other goods) at a time that inflation is already sky-high. The federal reserve bank is going to raise interest rates, which will also hurt the markets (unless they’ve already priced it in.)

That said, the markets seem to be strong. The US market is down around 10-11% from its all-time highs and the international markets are down about 15-16%. Our investments are down about 8.5% from their highs. I’m not expecting great markets in 2022, but we’ll keep buying at these low prices.

We continue to get a profit-sharing check since I bought (a lot of) a company. The business was almost ideally positioned in this pandemic due to its virtual nature. The business was doing so well they had some extra money to send out before the end of the year, but I didn’t include that here. Maybe if this bonus is consistent they’ll up the profit-sharing and I’ll be able to add more into this report from that. The investment income from this is essentially the same as dividend income. It is taxed differently, but for this report, it makes sense to group all stock ownership in this bucket.

Total Dividend-ish Income: $3,616

Last month, it was $3,727, so we’re down $111.

At the beginning of last year, this number was $3,441, so at least we’re still up a bit for a year. We still have 14 years until we get to 59 and a half. There’s a lot of time to grow before we start to think about taking this money out.

When I started tracking this number in January of 2017 we were at $1,180/mo. So in five years, we’ve grown this potential monthly income by over $2,500!

Small habits over time can turn into great things.

Our money is working hard to multiply, especially because we aren’t adding much to the investments. Instead we’re focusing on saving money in cash for my wife to retire. Except that, now my wife got a new job and isn’t looking to retire. Her long journey to make the rank of Captain (O-6) seems so assured that people are whispering about her being on a path to Admiral. Though for some reason she thinks she won’t get promoted this year, but maybe next year. Whatever she wants to do is fine with me. For now, she’s very excited about the new job. It’s so much better than the last one. She’s had time to bring the kids to school and do some things like that.

Getting back to the monthly update, this monthly $3,616 would be over $43,000. As with the rental income number above (around $44,000) we should be able to live on this by itself (once we are mortgage-free in a few years). However, because most of our investments are in retirement accounts, we can’t use much of this potential income for now. (We can use the profit-sharing check as it goes straight to our checking account.) We’ve started to see an estate planning lawyer last year, but they gave us a lot of paperwork to do before we can move forward. I haven’t had the time to convert our spreadsheet summaries to something they can use.

Very Close to Passive Income

Our “very close to passive income” is a combination of rental property income and dividend income. If there were some royalty income from books, movies, or music, I’d include that as well. I’m too tone-deaf to have a rockstar music career, but I may write a book someday. This is important to separate from the dogs and blogs income at the beginning. That takes some active work to keep up. Rental property requires a little work, but not nearly as much.

We lost some of the gains here again this month. The stock market drop is too much for the real estate market to cover. We’re close to all-time highs though. I love having both types of income working together for us. With the stock market dropping recently, our real estate is saving our net worth from dropping further. I think everyone interested in FIRE should consider having stock market and real estate income streams. The diversification gives me great confidence that we’ll be better prepared than most FIRE folks in the case of an unfortunate economic event. We’ll still likely get rent checks if the stock market crashes. We’ll still get dividend checks if a tenant is late paying for a while. Of course a bad economy may impact both at the same time, but that’s what an emergency fund is for.

I used to have a section here where I did a COVID update. I will probably retire it after this unless something eventful happens. My kids and I have had COVID (my wife has avoided it thus far) and their school is now mask-optional. We went to a school play the other day – no masks and everyone is fine. It’s great that everyone can get together again. We’re going to Puerto Rico later this month and I’m so excited for the kids to experience a new culture.

Very Close to Passive Income: $6,309

This would be over ~$75,000 a year of passive-ish income. We wouldn’t need to touch the investments themselves. We wouldn’t have to sell stocks or have a “withdrawal rate” – just live off dividends. We wouldn’t have to get a reverse mortgage on our home or the investment properties. Property maintenance and property taxes for rental properties are already factored in. We would still have all the underlying assets (property, stocks, etc.) and be able to pass these on to the kids for them to build on – unless we choose to draw them down for more fun, charity, or other spending.

This “very close to passive income” has grown from $2,354/mo. in January 2017. So in 5+ years, we’ve added about $4,000 in monthly passive income – or $48,000 a year. That’s a lot more than the $34,000 I made as a software engineer out of college in 1998. This is one of the reasons why I went with the “Lazy” name, it shows that money investing can do more work (or somehow produce more value) than I did. It’s a crazy system and you can see that I’m doing my best to work within it.

It’s worth noting that, once again, these are fudged numbers that aren’t “real” yet (except for the profit-sharing check), because the money isn’t liquid. We can’t spend those retirement investments or the equity we have in properties. We don’t feel “rich” by any stretch of the word, even though we are relative to many people’s circumstances. We still have some day-to-day struggles with money. These are relatively minor compared to what most people experience I imagine. That’s why it might be nice to sell a rental property, pay off debt, and feel a little more financial freedom right now.

I used to wonder if we can get to $8,000/mo. in passive income by the start of 2025. A year ago, it was a stretch goal… now it feels likely – except that I don’t know how much more growth we’ll see from the markets.

Final Passive Income

When you add up “dogs and blogs” to the “very close to passive income” you get:

Passive-ish Income: $10,108.20

Last month it was $8,786.56. This is almost exactly what I averaged for 2021. That’s a good sign because dog boarding should ramp up a lot in the summer. I wonder if we can average $12,000/mo. a whole year.

The ~$10k+/mo. income is ~$120k a year (easy math this month). That (hypothetical) annual income for writing on a blog, taking care of dogs, and investing is very nice. If we manage 120K from all these sources we’d be doing quite well – given our necessary expenses for the next 45 years. Of course, those necessary expenses aren’t going to cover all our spending, but they are a large percentage of it.

None of the numbers here include my wife’s bread-winning day job as a pharmacist, her vested military pension (more passive income when she retires), or the freelance work I’ve been doing over the last few years (which isn’t passive at all). That’s the fuel that drives the passive income engine – it allows us to live well and invest. My income doesn’t match my wife’s, but the flexibility gives me the time to stretch almost every dollar in much of our spending. It also gives me the flexibility to bring the kids to school and after-school activities.

I love two things about the graph below. First, there’s a solid trend of the numbers staying high for several months now. Second, it doesn’t dip down too far. It seems like it should be at $8,000 going forward. I don’t want to see a big market collapse, it would hurt a lot of people, but I am curious how bulletproof all these sources of income are when they work together.

(Once again, the blue line is the monthly number. The red line is a 3-month average which helps smooth the curve.)

Net Worth Update

My net worth updates aren’t very exciting as I don’t share the exact numbers. That’s why it’s just a footnote here.

I truly believe that net worth is one of the most important numbers in personal finance so it is worth sharing in some way. Showing relative growth can be useful.

We saw our net worth fall .81% in January. Other bloggers seemed to have theirs fall more, but real estate helped us out. For 2022, our net worth is down 2.20%. It’s never good to see it go backward, but with the markets down so much this feels like a small drop in the bucket.

Recently for something new, I decided to share our liquid cash growth (or loss). I’ve been tracking it for some time, but never thought to share it. Many other bloggers break down their income and expenses in great detail. I’m too “Lazy” for all that, even if my credit cards reports can do a lot of it. Looking at our liquid cash is a way to roughly gauge the bottom line, income minus expenses. In the past, we haven’t focused much on this because we’ve been investing that money. However, our focus now is to build enough cash so my wife feels comfortable retiring. This month, we’ve lost around $3,000 as booked some trips and made some final payments on finishing our basement. We’ve been spending a lot of money recently, but we better get back to saving money soon. It probably won’t happen until after tax season – we want to make sure we max out our Roth contributions before the deadline.

It’s important to recognize that everyone is in a different place in their financial journey. I’ve been blogging about personal finance for almost 16 years. FIRE wasn’t a “thing” back in 2006. We naturally are further along in that journey than some younger readers who may be just starting. Some of those readers are saddled with huge student loans that we didn’t have to deal with. If you are one of these readers, I hope you won’t be discouraged by some of the numbers above. I didn’t start many of these graphs until year 10 of blogging and early retirement planning. Please try to use it as motivation for what may be possible (depending on your circumstances and market luck) over 15+ years.

There’s a big wild card in calculating our net worth. Now that my wife’s military pension is vested, it’s reasonable to ask whether we should include it in our net worth. I decided that it does make sense to include it. She could have earned more in immediate salary if she didn’t work for the government. That would have boosted all the numbers across the board. Calculating pension value is not easy, but here’s the best way to know what a pension is worth. However, like most of the money mentioned in this article, this isn’t money we can spend right now.

How was your month? Let me know in the comments.

We’ve got the results of the first month in. The stock market hasn’t been kind, but after all the gains from the previous years, it’s hard to complain.

The biggest news is that we had COVID through our house. It went through the second grade. Then it spread to me and then to our third grader. My fully-vaccinated second-grader had sniffles for a few hours (which is why I even thought to test him). Our fully-vaccinated third grader was completely asymptomatic. My boosted self had chills and nausea for about four hours. It took about a day to be back to 100%. It was so mild that when I tested negative and thought that it might be all in my head. It wasn’t until two days after that I tested positive and pieced the past together.

I was very happy when I learned that I was positive. Since I was completely fine by that time, it meant that I needed to quarantine for five days. I was excited to catch up on my writing and a bunch of other online stuff. For the first time in 10 years, I wouldn’t have any real daily responsibilities with the kids. Unfortunately, 12 hours later we got the news that my 3rd grader was positive, so it was more of a situation where my wife needed to stay away from us.

Amazingly, my wife never tested positive. I wonder if she has some kind of natural resistence. If so, then the rest of us now have a combination of vaccines and previous infection immunity. It feels like we’re done with COVID for the next few months.

Other than that, My youngest turned 8. He had a small party with a few friends. He started skiing lessons for the year. He’s also playing indoor soccer. His 9-year-old brother is taking snowboard lessons. He’s also taking drum lessons and is on his way to becoming the next Phil Collins.

In other news, we finally finished finishing the basement. Well, we have to paint, but it’s an actual room we can do things in. It took a year and a half because we cleaned it out slowly. We outsourced the actual finishing, so it’s not some grand accomplishment like the people that do all the work themselves.

Before we could finish the basement we got a combination furnace/water heater to maximize the space in the basement.

That’s enough of the personal stuff… let’s start the Passive Income report. I used to call this the Alternative Income Report because some of this income has an active component to it. However, that idea isn’t catching on and everyone loves “passive income” better. If you are a new reader, you’re going to want to refer to my Alternative Income FAQ as you may have some questions about the math.

The way I calculate these numbers requires that little explanation – it isn’t intuitive. I do things a little differently to show the journey. For example, we don’t have real passive income from our rental properties right now. We still have mortgages to pay off. Instead, I calculate the percentage of equity we have to show where on that journey we are. Each month, you’ll see that the bank owns less and we own more. When we get to owning 100% there will be no mortgages and all that rental income can be used for living expenses. When it comes to calculating the percentage of rental income, I take the rent (minus estimated expenses) and multiply it by the portion of equity we own. Think of it like you and a friend owning a property 50/50. This would be how you’d handle it with each of you splitting the profits at the end 50/50.

Lazy Man’s Passive Income

I categorize our passive income into 3 main sources that are largely represented in my passive income pyramid. For this report, I ignore the bottom section, “career/job” – that’s not passive at all. (I do have some income in that area, but that’s not the focus of this report.) I combine dog-sitting and blogging into one section of “somewhat active” income. They are a little passive because I can make money even when I’m not immediately tending to them. For example, I’m writing this while boarding 2 dogs right now. I leave real estate and investment income as their separate main sources of very passive income. This way if you want to only count that you can do that.

1. Blogging + Dog Sitting Income

January is always a week month for boarding dogs. People get most of their travel during the December holidays. By January, many people are getting back to work. Their kids are back in school. When they aren’t traveling they don’t need their dogs boarded.

Fortunately, things are going very well to start the year. I’m getting a good client base of regulars. I’m doing about triple the business I was before COVID. I even had to turn away some business due to us catching COVID. This off-season is a great time to have triple the business.

The Bakugan gift from his older brother obviously went over very well.

Blogging is also always terrible in January. It seems that everyone is resetting budgets for the year. I hope things go up from here on the blogging front.

In December, “dogs and blogs” combined for a total of $3,256.03. In January, it was:

Total Blogging + Dog Sitting Income: $2,397.56

My kids help with the dog sitting. My 9-year old is extremely good with dogs at this point. He can feed them, let them out, and play with them in the yard. He’s spending more time in front of the clients as a helper. My 8-year-old was a little slower to dog skills, but he’s carved out a household niche of catering to the smaller dogs – he just loves them. This help means that I can pay them a legitimately earned income (a percentage of the overall dog-sitting income). Because the income is earned they can save money in their kid Roth IRAs and it will be money that they’ll never pay tax on.

Someday, I want to get them more involved in blogging, taking pictures, and things like that. During school, they have too much to keep them busy. After school, there’s homework, becoming mini-ninjas, scouting, and sports fill up their days. Being a kid is hard work!

(Note: The blue line is the monthly number. The red line is a 3-month average which helps smooth the curve.)

2. Rental Property Income

The rental properties had about $14,000 in appreciation this month according to Zillow. That’s great! We also always pay down a couple of thousand dollars of debt with mortgages. That’s a good combination.

We went from 72.25% to 72.92% ownership of the equity in our properties. That’s actually a big percentage gain for one month.

If we owned the rental properties with no mortgages (100% of the equity), I calculate that, after insurance, property taxes, condo fees, and estimated condo maintenance we’d make about $4,000 a month. The expected rents have gone up a lot. However, we aren’t getting those kinds of rents yet. We’re keeping them low for now. So I’m going to average what we could make and what we are actually making, which is about $3650. It seems like low-lying fruit that we could get there and our tenants would still be happy that they are getting a bargain.

The 18 inches of snow was a lot more than we are used to getting. There were some drifts that were up to my son’s waist.

If you multiply our expected net rent by $3,650 by the amount of equity we have (i.e. where we are on our journey to 100% equity ownership), 72.92%, you get $2,662 in estimated monthly passive income. That’s a gain of $215 from last month. Usually, the gains are smaller, but resetting the expected rent provided a big boost.

When I started tracking this (January 2017), we only owned 36.4% of the properties and the properties had lower rents. The math worked out to $1,174 back then. So in 5 years, we’ve seen that number grow tremendously to $2,662. That’s the power of 15-year mortgages.

In about 5 more years from now, the ratio will grow to 100% of that $3,650 rent. Since rent is inflation-resistant (we can raise rents as the cost of living go up), we don’t have to factor in inflation like other investments.

So we can think of it as around $44,000/yr. of income in today’s dollars buying the same value in the future. That should be enough money for us to live on with our own home paid off (plus our solar panels, frugal shopping habits, and military healthcare.) Of course, that’s just one part of the plan as you can see.

In the previous report, the rental property income was $2,447.

Total Rental Property Income: $2,662

3. Dividend Income

For this section, I assume we will earn a 2.5% dividend yield on our holdings. That could be from a high-dividend ETF. For example, HDV is currently paying about a 4.04% yield. It could also come from simply holding strong companies that have a long history of dividend growth. There are some income investing ideas here. We can also look at making passive income with Dividend Kings. If we wanted to simply retire on this dividend income, I would get Sure Dividend’s newsletter to try to get a 5% average dividend yield. (That link to the newsletter has a special discount rate and in full disclosure, I make a few dollars if you sign up for it.)

Of course, we may not convert everything over to dividend income at all, it’s just a conservative way to think of our investment portfolio. If I used a 3.5% or 4% withdrawal rate, the numbers would be much bigger.

The markets fell in January. I think all the bloggers I follow lost money. That’s okay, it wasn’t a big drop and usually, things come back next month. I have a feeling that the markets may not be too favorable in 2022. Inflation looks like it might drive up interest rates. If the market goes down, I guess we’ll just be buying more shares at a cheaper price until it recovers. That’s a great silver lining since we aren’t going to be using this money for a long time.

There’s only one ski hill in Rhode Island and we were fortunate enough to win a spot in the lottery to get lessons. This is the bunny hill and my son is at the top.

We continue to get a profit-sharing check since I bought (a lot of) a company. The business was almost ideally positioned in this pandemic due to its virtual nature. The business was doing so well they had some extra money to send out before the end of the year, but I didn’t include that here. Maybe if this bonus is consistent they’ll up the profit-sharing and I’ll be able to add more into this report from that. The investment income from this is essentially the same as dividend income. It is taxed differently, but for this report, it makes sense to group all stock ownership in this bucket.

Total Dividend-ish Income: $3,727

Last month, it was $3,838, so we’re down $111. We’re still behind the all-time of $3,945. That’s about 5% behind – not too bad.

At the beginning of last year, this number was $3,441, so we’re still up nicely in passive income for a year. We still have 14 years until we get to 59 and a half. There’s a lot of time to grow before we start to think about taking this money out.

When I started tracking this number in January of 2017 we were at $1,180/mo. So in five years, we’ve grown this potential monthly income by over $2,500!

Our money is working hard to multiply, especially because we aren’t adding much to the investments. Instead we’re focusing on saving money for my wife to retire. Except that, now my wife got a new job and isn’t looking to retire. Her long journey to make the rank of Captain (O-6) seems so assured that people are whispering about her being on a path to Admiral. Though for some reason she thinks she won’t get promoted this year, but maybe next year. Whatever she wants to do is fine with me. For now, she’s very excited about the new job. It’s so much better than the last one.

Last month, I added a secret word in here. Congratulations to Andy H. who was the first top spot the word and email it to me. He won $10. This month the first person to contact me and send the words “KidWealth.com Rocks!” in the email will earn $10. (See what I did there with KidWealth?) Make sure to leave your Paypal address so I can send you money. If you don’t have Paypal, sorry, you can’t participate in this giveaway.

Getting back to the monthly update, this monthly $3,727 would be almost $45K. As with the rental income number above (around $44,000) we should be able to live on this by itself (once we are mortgage-free in a few years). However, because most of our investments are in retirement accounts, we can’t use much of this potential income for now. (We can use the profit-sharing check as it goes straight to our checking account.) We’ll have to see if we want to tap it at age 59.5 or let it continue until we are required to take some of it at age 72. We’ve started to see an estate planning lawyer, but I have a lot of paperwork to do with that before I can move forward. We may look at tax and financial professionals soon.

Very Close to Passive Income

Our “very close to passive income” is a combination of rental property income and dividend income. If there were some royalty income from books, movies, or music, I’d include that as well. I’m too tone-deaf to have a rockstar music career, but I may write a book someday. This is important to separate from the dogs and blogs income at the beginning. That takes some active work to keep up. Rental property requires a little work, but not nearly as much.

We aren’t back to all-time highs as the stock market drop is too much for the real estate market to cover. We’re getting very close though. I love having both types of income working together for us. With the stock market dropping recently, I noticed that our real estate saved our net worth from dropping further. I think everyone interested in FIRE should have stocks and real estate income streams. The diversification gives me great confidence that we’ll be better prepared than most FIRE folks in the case of an unfortunate economic event. We’ll still likely get rent checks if the stock market crashes. We’ll still get dividend checks if a tenant is late paying for a while. Of course a bad economy may impact both at the same time, but that’s what an emergency fund is for.

My 8-year-old’s soccer starts about 15 minutes after we get back from skiing. We didn’t the schedule when we signed up, but I guess we’re lucky they weren’t at the same time. I think we are both happy that skiing is over, because the two of them back-to-back was exhausting.

Break: This month in COVID

I think I’m getting near the end of giving COVID its own section. Hopefully, we’ll only need one or two more.

The omicron spike seems to be over. We are still seeing a lot of hospitalizations and deaths, but they are lagging indicators. I’m optimistic about where we are at with vaccines, herd immunity, a more mild variant of COVID, and better treatments for those who are hospitalized. We’ll be getting better weather soon too.

The only bad news is that kids who are younger than 5 have to wait longer for their vaccines.

Now… back to the month in passive income.

Very Close to Passive Income: $6,388

Last month it was $6,281, so this is a very good gain. This would be over ~$76,500 a year of passive-ish income. We wouldn’t need to touch the investments themselves. We wouldn’t have to sell stocks or have a “withdrawal rate.” We wouldn’t have to get a reverse mortgage on our home or the investment properties. Property maintenance and property taxes for rental properties are already factored in. We would still have all the underlying assets (property, stocks, etc.) and be able to pass these on to the kids for them to build on – unless we choose to draw them down for more fun, charity, or other spending.

In the last year, we went from $5,526 to $6,388, a gain of $862 a month in passive income. That’s over $10,000 a year. That can cover a lot of expenses, such as our groceries and a few restaurant visits.

This “very close to passive income” has grown from $2,354/mo. in January 2017. So in 5 years, we’ve added about $4,000 in monthly passive income – or $48,000 a year. That’s a lot more than the $34,000 I made as a software engineer out of college in 1998. This is one of the reasons why I went with the “Lazy” name, it shows that money investing can do more work (or somehow produce more value) than I did. It’s a crazy system and you can see that I’m doing my best to work within it.

It’s worth noting that, once again, these are fudged numbers that aren’t “real” yet (except for the profit-sharing check), because the money isn’t liquid. We don’t feel “rich” by any stretch of the word, even though we are relative to many people’s circumstances. I used to wonder if we can get to $8,000/mo. in passive income by the start of 2025. A year ago, it was a stretch goal… now it feels likely – except that I don’t know how much more growth we’ll see from the markets.

Final Passive Income

When you add up “dogs and blogs” to the “very close to passive income” you get:

Passive Income: $8,786.56

Last month it was $9,536.03. I don’t like to go backward, but January is always seasonal. Since we are halfway through February, I can see that we’re already going to be in a better position. I might be back to chasing an annual $10,000 for this number. Last year, I averaged over $10,000. This year, I’m going to try to average over $11,000. I think that’s reasonable. Going to $12,000/mo. would just be too much.

This ~$8,700/mo. income is over ~$105,000 a year. That (hypothetical) annual income for writing on a blog, taking care of dogs, and investing is very nice. I’m not sure I want to do as much dog sitting year round – it makes it hard to travel. If we can manage 100K from all these sources we’d be doing quite well – given our necessary expenses for the next 45 years. Of course, those necessary expenses aren’t going to cover all our spending, but they are a large percentage of it.

None of the numbers here include my wife’s day job of bread-winning pharmacist income, her vested military pension (more passive income when she retires), or the freelance work I’ve been doing over the last few years (which isn’t passive at all). That’s the fuel that drives the passive income engine – it allows us to live well and invest. My income doesn’t match my wife’s, but the flexibility gives me the time to stretch almost every dollar in much of our spending. It also gives me the flexibility to bring the kids to school and after-school activities. Fortunately, my wife’s new job is less strict with clock-watching, so I don’t need this flexibility as much.

I love two things about the graph below. First, there’s a solid trend of the numbers staying high for several months now. Second, it doesn’t dip down too far. It’s been above $6,000 for a while now. It seems like $7,500 or $8,000 should be considered the new floor. It would be nice if that floor is $10,000 by next January.

(Once again, the blue line is the monthly number. The red line is a 3-month average which helps smooth the curve.)

Net Worth Update

My net worth updates aren’t very exciting as I don’t share the exact numbers. That’s why it’s just a footnote here.

I truly believe that net worth is one of the most important numbers in personal finance so it is worth sharing in some way. Showing relative growth can be useful.

We saw our net worth fall 1.08% in January. Other bloggers seemed to have theirs fall more, but real estate helped us out. For 2022, our net worth is down 1.40%. It’s never good to see it go backward, but the US markets are down around 8%, so I’m doing better than that.

Recently for something new, I decided to share our liquid cash growth (or loss). I’ve been tracking it for some time, but never thought to share it. Many other bloggers break down their income and expenses in great detail. I’m too “Lazy” for all that, even if my credit cards reports can do a lot of it. Looking at our liquid cash is a way to roughly gauge the bottom line, income minus expenses. In the past, we haven’t focused much on this because we’ve been investing that money. However, our focus now is to build enough cash so my wife feels comfortable retiring. This month, we’ve lost around $11,533 as we had some more payments to make on finishing our basement. That is a lot of money, but adding ~200 sq. ft. of living space is life-changing. We better get back to saving money soon.

It’s important to recognize that everyone is in a different place in their financial journey. I’ve been blogging about personal finance for almost 16 years. FIRE wasn’t a “thing” back in 2006. We naturally are further along in that journey than some younger readers who may be just starting. Some of those readers are saddled with huge student loans that we didn’t have to deal with. If you are one of these readers, I hope you won’t be discouraged by some of the numbers above. I didn’t start many of these graphs until year 10 of blogging and early retirement planning. Please try to use it as motivation for what may be possible (depending on your circumstances and market luck) over 15+ years.

There’s a big wild card in calculating our net worth. Now that my wife’s military pension is vested, it’s reasonable to ask whether we should include it in our net worth. I decided that it does make sense to include it. She could have earned more in immediate salary if she didn’t work for the government. That would have boosted all the numbers across the board. Calculating pension value is not easy, but here’s the best way to know what a pension is worth. However, like most of the money mentioned in this article, this isn’t money we can spend right now.

How was your month? Let me know in the comments.

It’s a brand new year, but there’s still time left to reflect on 2021.

Our December was a blur. My wife was deployed until the 18th and then we rushed to get Christmas going. The turnaround to my youngest’s 8th birthday is quick, so we scrambled through that as well. We’ve got house renovations going on and it looks like that will be the story of January as well. (It’s not that the renovations will go on that long, but that we can start to move to other projects when this one is done.)

At the start of the month we did a beach clean-up with the Cub Scouts. There was just one problem? The beach was extremely clean already. No one had seen anything like it. Nonetheless, each scout got a couple pieces. I took the kids to a great playground afterwards. We don’t usually go there, but since it was close it was on my mind.

We went to a few Christmas displays and a parade where Santa lights the town tree. Santa also makes a trip down our street before Christmas, which is fun for the kids to see. We got some very good sledding in, too. We watched the traditional claymation Rankin Bass Christmas movies as well as the requisite Yogi’s First Christmas and ‘Twas the Night Before Christmas (cartoon with the mice that is also Rankin Bass). It’s hard to squeeze Christmas into a week, so we certainly missed some classics this year.

The 9-year-old got his green belt in karate, while the 8-year-old got his blue belt. Maybe they’ll be black belts by 11 or 12? I don’t know how the progression goes, but I love watching the journey.

Among quite a few gifts, we got an Oculus Quest and it is amazing. You won’t see any pictures of it here, because it 2D pictures of virtual reality doesn’t make sense. I think it would be fair to say that the Oculus is my top $300 or less purchase in the last 3 or 4 years.

That’s enough of the personal stuff… let’s start the Passive Income report. I used to call this the Alternative Income Report because some of this income has an active component to it. However, that idea isn’t catching on and everyone loves “passive income” better. If you are a new reader, you’re going to want to refer to my Alternative Income FAQ as you may have some questions about the math.

The way I calculate these numbers requires that little explanation – it isn’t intuitive. I do things a little differently to show the journey. For example, we don’t have real passive income from our rental properties right now. We still have mortgages to pay off. Instead, I calculate the percentage of equity we have to show where on that journey we are. Each month, you’ll see that the bank owns less and we own more. When we get to owning 100% there will be no mortgages and all that rental income can be used for living expenses. When it comes to calculating the percentage of rental income, I take the rent (minus estimated expenses) and multiply it by the portion of equity we own. Think of it like you and a friend owning a property 50/50. This would be how you’d handle it with each of you splitting the profits at the end 50/50.

Lazy Man’s Passive Income

I categorize our passive income into 3 main sources that are largely represented in my passive income pyramid. For this report, I ignore the bottom section, “career/job” – that’s not passive at all. (I do have some income in that area, but that’s not the focus of this report.) I combine dog-sitting and blogging into one section of “somewhat active” income. They are a little passive because I can make money even when I’m not immediately tending to them. For example, I’m writing this while boarding 2 dogs right now. I leave real estate and investment income as their separate main sources of very passive income. This way if you want to only count that you can do that.

1. Blogging + Dog Sitting Income

December was a quieter month for boarding dogs. We had a short vacation planned for before Christmas. We ended up canceling it to be able to have a Christmas. I still kept my status as away. It was too last minute to get any meaningful dog bookings anyway. We also limited the dogs we took over Christmas to two that we knew and trusted wouldn’t create havoc. In some ways, we missed a third of the month of dog sitting.

The good news is that dog sitting has become much more passive lately. There are few dogs and fewer meet and greets to schedule. It’s nice to have regular customers.

Cruella de Vil has 99 problems, because she’s missing these two. My son has no problems at all working so, so hard to make sure they enjoy their stay.

Blogging was going fairly badly for most of the month. Then around Christmas the advertiser that ghosted me last month came back and actually paid his debt. It was a good one-time windfall and turned the whole month around.

In November, “dogs and blogs” combined for a total of $5,286.62. In December, it was:

Total Blogging + Dog Sitting Income: $3,256.03

That’s below average for the year, but I don’t mind at all. It’s still three times more than I did last December.

My kids help with the dog sitting. My 9-year old is extremely good with dogs at this point. He can feed them, let them out, and play with them in the yard. He’s spending more time in front of the clients as a helper. My 8-year-old was a little slower to dog skills, but he’s carved out a household niche of catering to the smaller dogs – he just loves them. This help means that I can pay them a legitimately earned income (a percentage of the overall dog-sitting income). Because the income is earned they can save money in their kid Roth IRAs and it will be money that they’ll never pay tax on.

Someday, I want to get them more involved in blogging, taking pictures, and things like that. During school, they have too much to keep them busy. After school, there’s homework, becoming mini-ninjas, scouting, and sports fill up their days. Being a kid is hard work!

(Note: The blue line is the monthly number. The red line is a 3-month average which helps smooth the curve.)

2. Rental Property Income

The rental properties had about $5,000 in appreciation this month according to Zillow. That’s very good. We always pay down a couple thousand of debt with mortgages. That’s a good combination

We went from 71.82% to 72.25% ownership of the equity in our properties. These tiny percentage gains add up month after month, year over year.

If we owned the rental properties with no mortgages (100% of the equity), I calculate that, after insurance, property taxes, condo fees, and estimated condo maintenance we’d make about $3,400 a month. That number represents our net gain.

My 9-year-old used his dollar store freebie (I give the a dollar to spend at the dollar store on whatever they want) to buy silly string. He had never seen it. “R.I.P. chore chart.”

If you multiply our expected net rent by $3,400 by the amount of equity we have (i.e. where we are on our journey to 100% equity ownership), 72.25%, you get $2,447 in estimated monthly passive income. That’s a gain of $5 from last month, which isn’t much.

When I started tracking this (January 2017), we only owned 36.4% of the properties and the properties had lower rents. The math worked out to $1,174 back then. So in 5 years, we’ve seen that number more than double to 2,447. That’s the power of 15-year mortgages.

In about 5 more years from now, the ratio will grow to 100% of that $3,400 rent. Well, hopefully that rent will be closer to $3700 in the next year – our properties are way below market. Since rent is inflation-resistant (we can raise rents as costs of living go up), we don’t have to factor in inflation like other investments. So we can think of it as around $40,000/yr. of income in today’s dollars buying the same value in the future. That should be enough money for us to live on with our own home paid off (plus our solar panels, frugal shopping habits, and military healthcare.) Of course, that’s just part of the plan as you can see.

In the previous report, the rental property income was $2,442.

Total Rental Property Income: $2,447

3. Dividend Income

For this section, I assume we will earn a 2.5% dividend yield on our holdings. That could be from a high-dividend ETF. For example, HDV is currently paying about a 4.04% yield. It could also come from simply holding strong companies that have a long history of dividend growth. There are some income investing ideas here. We can also look at making passive income with Dividend Kings. If we wanted to simply retire on this dividend income, I would get Sure Dividend’s newsletter to try to get a 5% average dividend yield. (That link to the newsletter has a special discount rate and in full disclosure, I make a few dollars if you sign up for it.)

Of course, we may not convert everything over to dividend income at all, it’s just a conservative way to think of our investment portfolio. If I used a 3.5% or 4% withdrawal rate, the numbers would be much bigger.

99.9999% of the time they want to kill each other. This seems like a touching moment, but in reality my 9-year-old is trying to use the back-and-forth motion of a Snoopy hat to lightly bonk my 8-year-old on the head. What a microcosm!

The markets fell on January 5th when I make my net worth spreadsheet. I try to wait for the rent checks to get in and mortgages to get paid out. Fortunately, my wife was busy on the 5th and I couldn’t get information on her accounts until the 7th. By that time, the markets bounced back a bit. I had a little spare cash from year-end dividends and used that Jan 5th drop as a mini-buying opportunity. That was more about my own psychology than it was any meaningful portfolio change.

We continue to get a profit-sharing check since I bought (a lot of) a company. The business was almost ideally positioned in this pandameic due to its virtual nature. In fact, the business was doing so well they had some extra money to send out before the end of the year, but I didn’t include that here. Maybe if this bonus is consistent they’ll up the profit-sharing and I’ll be able to add more into this report from that. The investment income from this is essentially the same as dividend income. It is taxed differently, but for this report, it makes sense to group all stock ownership in this bucket.

Total Dividend-ish Income: $3,833

Last month, it was $3,767, so we’re back to heading in the right direction. We’re still a little below the all-time of $3,945. Who knows what the markets for 2022 will be, but we’re fairly diversified.

At the start of 2021, this number was $3,441, so we added nearly $400/mo. in passive income. That’s good for $4,705.42 a year. We still have 14 years until we get to 59 and a half. We can’t possibly have this kind of growth for 14 more years, but maybe we’ll get to $8,000. The biggest question may be if I’ll still be blogging in 14 years. I plan to be, but a lot can happen over that time.

When I started tracking this number in January of 2017 we were at $1,180/mo. So in exactly 5 years we’ve grown this potential monthly income by $2,653. That’s a lot of growth.

I guess this should be in January’s update, but Google Photos says it is December. Happy New Year!

Our money is working hard to multiply, especially because we aren’t adding much to the investments. Instead we’re focusing on saving money for my wife to retire. Except that, as of last month, my wife got a new job and isn’t looking to retire. Her long journey to make the rank of Captain (O-6) seems so assured that people are whispering about her being on a path to Admiral. Whatever she wants to do is fine with me. For now, she’s very excited about the new job.

Also, the first person to contact me and send the word “Rumpelstiltskin” in the subject will earn $10. Make sure to leave your Paypal address so I can send you money. If you don’t have Paypal, sorry, you can’t participate in this one. (I’m going to try to put more Easter Eggs like this into my articles in 2022.)

Giveaway over – we have our winner.

Annualized, this monthly $3,833 would be $46K. Like the rent number above of around $40,000, we should be able to live on this by itself (once mortgage free in a few years). However, because most of our investments are in retirement accounts, we can’t use much of this potential income for now. (We can use the profit-sharing check as it goes straight to our checking account.) We’ll have to see if we want to tap it at age 59.5 or let it continue until we are required to take some of it at age 72. We’ve started to see an estate planning lawyer, but I have a lot of paperwork to do with that before I can move forward. We may look at tax and financial professionals soon.

Very Close to Passive Income

Our “very close to passive income” is a combination of rental property income and dividend income. If there were some royalty income from books, movies, or music, I’d include that as well. I’m too tone-deaf to have a rockstar music career, but I may write a book someday. This is important to separate from the dogs and blogs income at the beginning that takes some active work to keep up.

Remember when they closed playgrounds early on in the pandemic? Go crazy kids!

We aren’t back to all-time highs as the stock market drop is too much for the real estate market to cover. That’s okay. I love having both types of income working together for us. I think everyone interested in FIRE should have stocks and real estate income streams. The diversification gives me great confidence that we’ll be better prepared than most FIRE folks in the case of an unfortunate economic event. We’ll still likely get rent checks if the stock market crashes. We’ll still get dividend checks if a tenant is late paying for a while. Of course a bad economy may impact both at the same time, but that’s what an emergency fund is for.

Break: This month in COVID

COVID has gotten it’s own section. I threw it in here, because it doesn’t fit in very well in its own monthly article. It does impact a lot of our plans.

Last month, I celebrated my kids getting vaccinated. This proved to be helpful for keeping them in school the last few days. They’ve been close contacts. However, fully vaccinated students without symptoms can still go to school while we wait for the PCR tests. The unvaccinated students have to stay home. Vaccinated kids at age 8 and 9 like mine are very protected.

With Climate Change doing its thing, we’ll jump at the chance to sled at any snow we get. This was actually an action shot and he’s running and jumping onto the sled, but it looks like a normal run.

Also, last month I announced that we were going to Puerto Rico in March. One of the reasons was that they didn’t have much COVID there. Well that changed very quickly. We still have our reservation, but that’s up in the air as things change every day.

When I was writing my last update on December 5th, Omicron hadn’t spread very far in the US. Obviously that’s changed. It’s almost like each variant is its own different beast. The initial COVID was bad, we didn’t have vaccines to protect us. The Delta variant was bad, it spread a lot more easily and many people weren’t vaccinated. Now we’ve got Omicron which spreads like a California wildfire :(, but it it appears to not be as harmful. Hospitalizations and death numbers are rising, but if you are vaccinated it’s mostly an annoyance of getting tested a lot and some services not running. Of course, there are some people who can’t be vaccinated and we should do the best we can with them in mind.

This may sound insensitive, especially to the people who are seriously threatened by COVID. However, people who get Omicron seem to have more immunity from Delta which is more deadly. Maybe we’re getting closer to some kind of herd immunity from the most deadly effects of COVID?

Now… back to the month in passive income.

Very Close to Passive Income: $6,281

Last month it was $6,209, so this is a very good gain. This would be ~$75,000 a year of passive-ish income. We wouldn’t need to touch the investments themselves. We wouldn’t have to sell stocks or have a “withdrawal rate.” We wouldn’t have to get a reverse mortgage on our home or the investment properties. Property maintenance and property taxes for rental properties are already factored in. We would still have all the underlying assets (property, stocks, etc.) and be able to pass these on to the kids for them to build on – unless we choose to draw them down for more fun, charity, or other spending.

In the last year, we went from $5,526 to $6,281, a gain of $754 a month in passive income. That’s $9,000 a year. That can cover a lot of expenses, such as our property tax and some utility bills.

It only took 13 years for my dog to get a bed he loves. He’s had other beds, but he just ignored them and jumped up on the couch. It’s harder for him to jump now. He can still make it up on the couch, but this is another good option for him.

This “very close to passive income” has grown from $2,354/mo. in January 2017. So in exactly 5 years, we’ve added almost $4,000 in monthly passive income – or $48,000 a year. That’s a lot more than the $34,000 I made as a software engineer out of college in 1998. This is one of the reasons why I went with the “Lazy” name, it shows that money investing can do more “work” (or somehow produce more “value”) than I did. It’s a crazy system and you can see that I’m doing my best to work within it.

It’s worth noting that, once again, these are fudged numbers that aren’t “real” yet (except for the profit-sharing check), because the money isn’t liquid. We don’t feel “rich” by any stretch of the word, even though we are relative to many people’s circumstances. We have gained almost $4,000/mo. in passive-ish income in almost 5 years. I used to wonder if we can get to $8,000/mo. in passive income by the start of 2025. A year ago, it was a stretch goal… now it feels like a certainty unless we have that major crash. I think we’re on pace to get there by the end of 2023 now.

Final Passive Income

When you add up “dogs and blogs” to the “very close to passive income” you get:

Passive Income: $9,536.03

Last month it was $11,495.62. The lack of dog sitting income is showing up here. That’s fine, I could use a break. Dog sitting has always been seasonal in our tourist area of Newport, Rhode Island. Last December it was around $6,500, so all income is up by $3,000. I’ll take it.

I had set a goal at the start of the year for this to average $8,000 for the year, but I honestly didn’t think it was possible. However, I finished at $10,168.45 – soundly beating expections. It’s been a great year.

This ~$9,500/mo. income is over ~$114,000 a year. That (hypothetical) annual income for writing on a blog, taking care of dogs, and investing is very nice. This amount of dog sitting isn’t too bad, unlike previous months. If we can manage 100K from all these sources we’d be doing quite well – given our necessary expenses for the next 45 years. Of course, those necessary expenses aren’t going to cover all our spending, but it’s a large percentage of it.

As the last nearly two years have shown, you never know what bad news is lurking around the corner. This preparation gives us the financial flexibility to fight it.

None of the numbers here include my wife’s day job of bread-winning pharmacist income, her vested military pension (more passive income when she retires), or the freelance work I’ve been doing over the last few years (which isn’t passive at all). That’s the fuel that drives the passive income engine – it allows us to live well and invest. My income doesn’t match my wife’s, but the flexibility gives me the time to stretch almost every dollar in much of our spending. It also gives me the flexibility to bring the kids to bring the kids to school and after-school activities.

I’m 98% sure that I did this when I was 8 as well.

I love two things about the graph below. First, there’s a solid trend of the numbers staying high for several months now. Second, it doesn’t dip down too far. It’s been above $6,000 for a while now. It seems safe to say that $7,000 or $7,500 should be considered the new floor.

(Once again, the blue line is the monthly number. The red line is a 3-month average which helps smooth the curve.)

Net Worth Update

My net worth updates aren’t very exciting as I don’t share the exact numbers. That’s why it’s just a footnote here.

I truly believe that net worth is one of the most important numbers in personal finance so it is worth sharing in some way. Showing relative growth can be useful.

We saw our net worth grow 1.55% in December. That reverses the losses in November. For all of 2021, our net worth is up 28%!! That’s the most our net worth has gone up in one year since 2013 when I started keeping meticulous net worth tracking. A big percentage gain after years of a big bull market means it is a big number.

Recently for something new, I decided to share our liquid cash growth (or loss). I’ve been tracking it for some time, but never thought to share it. Many other bloggers break down their income and expenses in great detail. I’m too “Lazy” for all that, even if my credit cards reports can do a lot of it. Looking at our liquid cash is a way to roughly gauge the bottom line, income minus expenses. In the past, we haven’t focused much on this because we’ve been investing that money. However, our focus now is to build enough cash so my wife feels comfortable retiring. Last report, our liquid cash went up by 26,500 thanks to a big IRS refund. This month we’ve lost around $10,800 as we’re paying a lot to renovate our basement. That is a lot of money, but adding ~200 sq. ft. of living space is life-changing.

It’s important to recognize that everyone is in a different place in their financial journey. I’ve been blogging about personal finance for 15 years. FIRE wasn’t a “thing” back in 2006. We naturally are further along in that journey than some younger readers who may be just starting out. Some of those readers are saddled with huge student loans that we didn’t have to deal with. If you are one of these readers, I hope you won’t be discouraged by some of the numbers above. I didn’t start many of these graphs until year 10 of blogging and early retirement planning. Please try to use it as motivation for what may be possible (depending on your circumstances and market luck) over 15+ years.

There’s a big wild card in calculating our net worth. Now that my wife’s military pension is vested, it’s reasonable to ask whether we should include it in our net worth. I decided that it does make sense to include it. She could have earned more in immediate salary if she didn’t work for the government. That would have boosted all the numbers across the board. Calculating pension value is not easy, but here’s the best way to know what a pension is worth. However, like most of the money mentioned in this article, this isn’t money we can spend right now.

How was your month? Let me know in the comments.