We’re at the point in the new year where I’m no longer writing 2022 on my checks. Wait, I don’t write checks – all my money has been automated for years. Well, at least I generally know what year it is now. This is an excellent time to review those 2023 goals and resolutions.

Usually, I use the Super Bowl as a reminder to get stuff into gear for Valentine’s Day. That wasn’t very helpful this year. Valentine’s Day snuck up on me very quickly. Fortunately, the local Navy Base has a fancy dinner for a reasonable price. I got reservations a couple of weeks ago, so at least there’s a bit of a plan.

January was a busy month for us. Half the month, we renovated the house. Clarification, we paid for people to come to renovate the home. We had 90% of the interior painted and fresh pet-friendly carpeting upstairs. That required shuffling everything from one room to another while they worked.

We celebrated two birthdays. Our youngest turned nine, and we had lunch and a trip to an arcade with a few friends.

[This is actually both our sons, but the other friends were there.]

Our dog celebrated his 14th birthday. I brought him to the beach, and a wave crushed him. It surprised me too. It wasn’t the most fantastic birthday present. We got him a new vet recently, so we’ll see if that helps him to get to a 15th birthday.

We had our usual bunch of events. The kids continue their martial arts. They were getting bored of it, but they introduced swords (big wooden sticks for them) this month, and that got them excited again.

My oldest finished his Lego Robotics class with a team win of the Core Values trophy at the state championship. It’s funny because he was the only fourth grader, and I felt like he was mostly on the sideline sitting and watching the older kids do everything – not award-winning sportsmanship. My youngest just started his robotics, and that’s more his thing. I’m a co-coach, and most of the kids are way more advanced than the Lego Explore curriculum.

Let’s start the New and Improved Passive Income report. I’ve streamlined this a bit, so hopefully, it will be a faster, easier read. I’ll try to continue to trim it down through the year.

However, that idea didn’t catch on as it did when I used it back in 2008. 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 that I’m going to use in this post.

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 much real passive income from our rental properties. We still have mortgages to pay off. Instead, I calculate the percentage of equity we have to show where we are on that journey. Over time, the bank owns less of the properties, and we own more of them. There will be no mortgages when this number gets to 100%, and all that rental income can be used for living expenses.

When calculating the percentage of rental income, I take the rent (minus estimated expenses) and apply it to 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. If your friend is the bank and it owns 80%, you should only count on 20% of that net rental income. We used to be in that 20% range, but now it’s closer to 75%.

Lazy Man’s Passive Income

I categorize our passive income into three primary sources that are represented mainly in my passive income pyramid. For this report, I ignore the bottom section, “career/job,” – that’s not passive at all. (I 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 my “somewhat active” income. They are a little passive because I can make money even when I’m not immediately tending to them. I can do other money-making activities while I board dogs. When I’m on vacation, some blog money still comes in. I combine real estate and investment income as their separate main sources of very passive income. This way, if you want only to count those, you can do that.

New for this year, my passive income is only going to be 50% of blogging and dog-sitting income, 80% of real estate, and 100% of dividend income. That rewards types of income that are truly passive and punishes my quasi-passive sources like blogging.

1. Blogging + Dog Sitting Income

January is always my worst month with blogging and dog-sitting. Most people are finished with their holiday travel and don’t need a lot of dog boarding. Advertising agencies are resetting their budgets, so they aren’t spending much on bloggers. I would be nervous, but now I recognize that it happens every year.

Knowing that January was going to be a slow month, we closed the dog boarding business for two weeks so we could paint much of the interior of the house and install new carpeting. We ended up turning away significant business. Oh well. As my wife says, “We need to renovate sometime.” I took the opportunity to raise prices by about 7% – we had too much demand, and I’d rather have fewer dogs pay more.

The blogging income for the month was the lowest in years. Yikes! Blogging is trending towards zero while dog boarding goes up.

In December, “dogs and blogs” combined for $9,168.65. In January, it was:

Total Blogging + Dog Sitting Income: $2,226.37

Even with that big drop, I’m happy with the number. It was almost a perfect storm of terrible circumstances, but that kind of money still works well with our investments and other income. Sometimes it’s good to test the bottom.

My kids help with the dog sitting. My 10-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 at pick-ups and drop-offs. My 9-year-old was a little slower to develop dog skills, but he’s carved out a household niche catering to the smaller dogs – he just loves them.

Their help means 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. Here’s why kids should start a Roth IRA as soon as possible.

2. Rental Property Income

Our rental properties have been very boring for several months. With mortgage rates high, property values have come down a tiny bit. We’re not seeing the great appreciation that we saw last year. However, we continue to pay down the mortgages every month. The result is a lot like running in the place – we aren’t going very far.

We might be able to raise rents this year. Our rents are far below market rates. Unfortunately, it is a tough time for a lot of renters, so we don’t want to move up rates too much.

In the last month, we went from 75.55% to 75.76% ownership of the equity in our properties. That seems like a small amount, but that’s what happens month-to-month. I calculate this number as a fraction, with equity we own as the numerator and total property value being the denominator. If we owned both of our rental properties with no mortgages (100% of the equity), we’d make about $2,200 a month after insurance, property taxes, condo fees, and estimated condo maintenance.

[My newly 9-year-old can build anything. Here he’s showing off the Lego Minecraft kit he built in the physical world and then the virtual one in Minecraft world.]

If you multiply our rents of $2,200 by the amount of equity we have, 75.76%, you get $1,667/mo. in estimated passive income. Last month it was $1,662/mo. Obviously, the $5 doesn’t matter much. It could maybe buy a cheap streaming subscription. However, it adds up over time.

When I started tracking rental property income this way (January 2017), we only owned 36.4% of the properties, and the properties had lower rents. The math worked out to $1,174 of passive income back then. In six years, it grew a ton. We sold our biggest rental property last year and invested that money in the stock market. It’s much more passive now. That was a strong driver as to why I started to count certain passive income sources as less valuable than others in this report.

When we get to 100% ownership of the two properties, they should bring about $25,000 after expenses. Rent is inflation resistant as it’ll rise over time. That means that even though this is $25,000 in today’s dollars, it will still have that buying power in the future.

Total Rental Property Income: $1,667

3. Dividend Income

For this section, I look at our stock market investments. I assume we could earn a 2.5% dividend yield on those investments. That assumption is a conservative number that helps us think about what kind of cash we can expect. It should be easy to get that 2.5% number as we could simply put all of our portfolios in a high-dividend ETF. For example, the high-yield ETF, HDV, is currently paying a 4.17% yield.

With today’s interest rates, a 2.5% yield seems ridiculously low. I need to remember that interest rates could go back to where they were a year ago.

Most bloggers use the actual dividends they earned that month. I have quite a few accounts, and I’m too Lazy to add up the dividends on them. Even if we aren’t getting the 2.5% number now, we could always move the money around from growth to dividends if we needed to live off the cash flow. A vast majority of our money is in retirement accounts, so cash flow isn’t important to us now. I also combine all the taxable and retirement account numbers. It’s too much work to separate them out.

[My dog wasn’t happy with his unexpected polar plunge!]

We continue to get a profit-sharing check since I bought (a lot of) a company. The company is doing well, and they occasionally throw an extra profit-sharing check to me. 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.

I found an error in my spreadsheet. It seems that I was double counting one account for a few months. I’m not going to fix all the old posts, but it was easy enough to fix the charts here and going forward. With my new system of only counting 80% of real estate and 50% of dogs and blogs, it is another reason not to look back.

With the market recovery, our dividend-ish income grew quite a bit:

Total Dividend-ish Income: $4,031.00

Last month it was $3,847. The easy math shows that it was up $184. That’s a very big gain for one month. I don’t know if we’ll have too many of those this year. I guess that’s part of the beauty of the situation though – no one knows what to expect with the markets.

In January 2017, the dividend income was at $1,180/mo. It’s been a tremendous six years. If you think about it, that amount of dividend income couldn’t offset some expenses, but it wasn’t enough for many people to say that they live off of that completely. We’d have to make some significant lifestyle changes, but the $4,000 income is nearly $50,000 a year – enough for us to live fairly well if we paid off the small remaining part of our mortgage first.

For the 35th month in a row (?), we’re looking into estate planning, but they gave us a lot of paperwork to do before we can move forward. I’m still not making any progress on this. For the first time in about 15 months, I got to a point where I thought I might be able to get the paperwork back out. One of my main goals for the year is to work on this, so hopefully, it won’t just become another wish.

Adjusted Passive Income

I used to combine real estate and dividend income into “very close to passive income.” However, now I’ll simply add up the 50% dogs/blogs, 80% real estate, and 100% dividend income. This makes things a lot easier.

Dog/Blogs: $2,226.37 – Adjusted to $1,113.19
Rentals: $1,667 – Adjusted to $1,333.60
Dividends: $4,031.00 – Remains at 4,031.00

Dogs/Blogs – Blue Line
Rental – Red Line
Dividend – Yellow Line

Total Adjusted Passive Income: $6,477.79

In the past, that used to be much higher. However, this is more accurate. It’s also particularly low because January is a slow month.

Annually, that’s $77,733.48. That’s significant because, at the start of this blog, I aimed to have around $75,000 in passive income. That was my definition of “winning the money game.” It would be enough to cover our needs and most of our wants.

I think it’s very useful to have different income streams. As blogging income becomes more difficult, dog boarding income has grown to supplement it. For a long time, real estate didn’t grow much at all; then, in the last couple of years, it grew a ton. The stock market grew for more than a decade from 2010 to 2021 but had a little setback last year.

[I had this Hamilton Beach Sandwich Maker gathering dust for years. In January, I made breakfast for myself and a school lunch for my oldest at the same time.]

The chance of all the income streams falling on hard times is low, but certainly not impossible. If we had another event like the Great Recession in 2008, they’d all be impacted quite a bit. In that case, we’d have to rely more on active income (the other 50% of our dogs/blogs, 20% of rental income, and other jobs) or rely on savings for a while.

It’s also important to remember that these numbers aren’t “real” because much of the money isn’t liquid. We can’t spend those retirement investments without penalties. We can’t access the equity we have in properties without opening a HELOC. There are some money moves around these, but it’s not worth making any of them until my wife retires.

You’d think we’d feel “rich” having won the money game. We don’t. Our social circle tends to have generationally rich people. However, we are “rich” relative to many people’s circumstances. Money is relative. It’s nice not to have to worry about emergency bills and make reasonable splurges.

[The blue line represents the total adjusted passive income. The Red Line represents the three-month average.]

The three-month average in January 2021 was $5,605.67. In January 2022, it was $7,612.64. Now in January of 2023, it is $8,984.80. Those are some good gains for the worst month of every year. I hope to get that adjusted passive income to average $10,000/month for the year 2023. I had just about ended December at that high, so we’ll see how it goes all year on average.

That kind of income for writing on a blog, taking care of dogs, investing, and landlording is awesome. I don’t know how long dog boarding will last. It was a lot of work last year – this year has been easier with the lighter schedule. I think that with dog boarding, either the market will change or I’ll change. Perhaps I’ll want to travel more. Perhaps, I’ll want a different challenge. I’m on my third career (software engineering, blogging, and dog boarding), so it would be naive of me to think it might be my last.

None of the numbers here include my wife’s bread-winning day job as a pharmacist or the minor freelance work I’ve been doing over the last few years – neither is passive at all. When my wife retires, we can count her vested military pension as more passive income. A pension is like a passive income cheat code. They are so rare nowadays.

For now, this active income (including the dog boarding) is the fuel that drives the passive income engine – it allows us to live well, get our kids a top education, pay off our mortgages, 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 allows me the flexibility to bring the kids to school and to after-school activities.

Net Worth Update

My net worth updates aren’t fascinating as I don’t share the exact numbers. That’s why it’s just a footnote, not its own article.

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

In January, our net worth was up 3.16%. We’re now about half a percent from our all-time highs. That’s great, considering that the markets are still off their highs by nearly 10%. I feel like I can truly say that we’re in the best money situation we’ve ever been in.

[The sportsmanship award is almost as big as the biggest overall trophy!]

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. If the U.S. government didn’t back it like treasuries or FDIC, I may feel I should account for some uncertainty. I decided that it does make sense to include it. She could have earned a larger 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.

It’s important to recognize that everyone is in a different place in their financial journey. I’ve been blogging about personal finance for 16 years. FIRE wasn’t a “thing” back in 2006, but that’s been my goal since the first sentence of this blog.

We naturally are further along in that journey than some younger readers who may be just starting. Many 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 15-20 years.

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

How was everyone’s August? It feels like a long time ago now that the kids are back in school, and I’ve been to my annual financial blogger conference.

Every month lately has had bucket list events. I’m looking forward to September and getting back into a routine.

August felt like two separate months. I boarded many dogs for the first fifteen days and worked extremely hard to prepare everything. For the last fifteen days, we went on a Disney Cruise in Europe, and I did essentially nothing to earn money. It makes a strong case that dog boarding shouldn’t be considered passive income, but I’m writing this surrounded by four sleeping dogs. It’s hard to argue that I’m actively working with the dogs.

I always start with a little personal recap of what we were up to, but I’ve already written about my first Disney Cruise impressions and my second Disney Cruise impressions. At some point, I’ll combine both posts and clean them up.

To recap, we flew to France and missed our connection flight with around two hundred people. Usually, an hour is enough to make a connecting flight with time to grab a meal. Charles De Gaulle airport makes you go through customs in a terminal that is 30 minutes away. We got on another flight to Denmark, where we spent the night before boarding the ship. We cruised to Norway, Iceland, Scotland, and finally, England, where we spent a few extra days before returning home.

I’m going to spare you almost all the vacation photos. In Denmark, we walked to Copenhagen near our Airbnb and took a short river cruise. In Norway, we took a bus around Alesund and saw some great views. In Iceland, we went to Magic Ice (a bar made entirely of ice) and the famous Blue Lagoon. In Scotland, we found Nessie, the creature in Loch Ness. We also went to the Ring of Brodgar, their version of Stonehenge. In England, we did a tour of the Harry Potter studios, walked Abbey Road, and toured the Downton Abbey castle. We also saw Big Ben, Westminster Abbey, the palace (while the queen was alive), and the Prime meridian in Greenwich. We also walked the red carpet for the Rings of Power premier on our way to the original Hard Rock Cafe.

This was a picture of our cruise around Denmark

The trip reminded me of the power of excellent personal finance. We were able to do all that and not think about money (too much).

What else did we do? We went to Cat Video Fest, which is a compilation of funny internet cat videos in a movie theater. It was quirky and awesome – the kids loved it. Soon after, we saw Marcel the Shell with Shoes On, which should win all the movie awards. That’s all we had time to do during the early part of the month with all the dog boarding. The kids were busy with camps and karate anyway.

That’s a lot for one month; 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. 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. We still have mortgages to pay off. Instead, I calculate the percentage of equity we have to show where on that journey we are. You’ll see that the bank owns less, and we own more each month. There will be no mortgages when we own 100%, and all that rental income can be used for living expenses. When 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 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 my “somewhat active” income. They are a little passive because I can make money even when I’m not immediately tending to them. I leave real estate and investment income as their separate main sources of very passive income. This way, if you want only to count those, you can do that.

For 2023, I’m only going to count 50% of blogging and dog-sitting income, 80% of real estate, and 100% of dividend income. That’s more realistic of what counts as passive.

1. Blogging + Dog Sitting Income

August would have been a record for dog sitting, but I was on a cruise ship for half the month. The first half of the month was very hectic and not at all passive. September is always a little slower as kids return to school and families travel less. However, there’s still plenty of business. I saw this article recently, “A return to the office is prompting people to get their pets a pet.”

This dog wanted me take him for a walk by his canine tooth. I just curled my index finger and he’d hook his tooth in there and we’d walk around the house. Every dog has their own thing.

Blogging was very quiet for the month. I essentially turned Lazy Man and Money into a travel blog for half the month. Also, because I was in the middle of the North Sea, avoiding internet connections, I couldn’t get back to advertisers.

In July, “dogs and blogs” combined for $7,671.19. In August, it was:

Total Blogging + Dog Sitting Income: $5,098.35

That’s very close to June’s numbers when I was also on vacation for a couple of weeks. 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 at pick-ups and drop-offs. My 8-year-old was a little slower to develop dog skills, but he’s carved out a household niche catering to the smaller dogs – he just loves them. They recently finished up vet summer camp at the local animal shelter.

Their help means 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.

(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

Last month, I announced that we sold a rental property going down from three to two. We were fortunate that we knew how to sell at the top of the market.

Now we have a lot less potential rental income from our properties. However, we also have lower liabilities as we don’t have the property mortgage anymore.

The Disney Cruise had a lot of art classes. My youngest son really gets into art.

The sale gave us some cash that I could invest. We’re moving money from rental property income to dividend income. Dividend income will be easier, but it’s also less money. I recently did some analysis of this in my stocks vs. real estate article.

Zillow decided our remaining properties weren’t worth as much this month. That seems accurate, as the housing market is cooling down a bit.

We went from 74.86% to 74.67% ownership of the equity in our properties. It’s very rare to drop, but this minor drop can happen. If we owned both remaining rental properties with no mortgages (100% of the equity), we’d make about $2,200 a month after insurance, property taxes, condo fees, and estimated condo maintenance.

I like to use an “expected rent” as we’re currently trying to catch up from years of very low rents. We liked our tenants, so we’ve kept them at a discount. However, with housing and rents going up so quickly, there’s a massive gap between what we could reasonably be bringing in and what we are bringing in.

If you multiply our expected net rent of $2,200 by the amount of equity we have, 74.67%, you get $1,643/mo. in estimated passive income. That’s a loss of a whopping $1141 from last month. It’s good that we got a lot of cash from the sale to invest in other assets.

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. In 5.5 years, it grew enormously but dropped to $1,643, which is still good, especially with a check of $250,000 or almost $50,000 yearly.

When we get 100% ownership, it should bring about $25,000 after expenses. Rent is inflation resistant as it’ll rise over time. That means that even though this is $25,000 in today’s dollars, we don’t have to worry about buying fewer goods and services in the future.

Total Rental Property Income: $1,643

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 3.69% yield, but it has been less in the past.

There’s a chance we could do better than this. 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; in full disclosure, I make a few dollars if you sign up for it.)

The view from one of our favorite “restaurants” – the Newport Navy Base.

Of course, our investment plan isn’t entirely centered around dividend income. The 2.5% dividend is a conservative number that helps us think about what kind of cash we can expect. Our portfolio there will pay almost 3% in dividends, but we should see asset growth. Our numbers here would be much more if we estimated at 3%.

The stock market had another significant drop when we ran these numbers on Sept 5th. That means we had a drop in our expected dividend income. Since then, the market has recovered a bit, so we should have a good September if it continues.

Until the recent sale of that investment property, more than 97% of this money was in our retirement accounts. That meant the retirement money would be invested for at least another 13 years until age 59.5. Now we have a healthier mix of funds for which we can invest and receive a check that we can use right now.

We continue to get a profit-sharing check since I bought (a lot of) a company. 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: $4,247

Last month, it was $4,132. A gain of $103 is very nice.. but how did I gain when the market was down? We’re moving money from the real estate sale into the stock market, so we have more money working. It looks like the numbers will be a little crazy for a month or two while we go through the transition.

When I started tracking this number in January 2017, we were at $1,180/mo. It’s been a tremendous last 5.5 years.

For the 25th month in a row (?), we’re looking into estate planning, but they gave us a lot of paperwork to do before we can move forward. I’m still not making any progress on this. Maybe now that the kids are back in school and I’m back from FinCon, I can get this done.

Very Close to Passive Income

Our “very close to passive income” combines rental property income and dividend income. If we had any royalty income from books, movies, or music, I’d also include that. 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. That takes some active work to keep up. Rental property requires a little work, but not nearly as much.

This was our Disney cruise route before final docking in Dover, England.

I love having both the rental properties and stock market income working together. With the stock market dropping recently, our real estate has saved our net worth from dropping further. And now, we locked in those gains with the sale. It was the opposite for the last decade – real estate didn’t do much while stocks quadrupled. 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.

With rental income not moving much and dividend income growing significantly with the new money, we’re seeing this passive income grow.

Very Close to Passive Income: $5,890.00

This would be over $70,000 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” – simply live off dividends. We wouldn’t have to get a reverse mortgage on our home or 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 draw them down for more fun, charity, or other spending.

When I started this blog, I aimed to have around $75,000 in passive income. That was my definition of winning the money game. It would be enough to cover our needs and most of our wants. We’re not quite there, but we are close.

This $5,890.00 of “very close to passive income” has grown from $2,354/month in January 2017. So in less than six years, we’ve more than doubled our passive income (an extra $1,000 from the double). It’s an excellent income for many, even in their top earning years. This is one of the reasons why I went with the “Lazy” name; it shows that investing money can do more “work” (or somehow produce more value) than active working can. It’s a crazy system. I’m just doing my best to work within it.

England’s transportation system was clean, efficient, and full of positive messages like this one.

It’s worth noting that, once again, these numbers are fudged and aren’t “real” (except for the profit-sharing check and the new investment income) 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, 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. The recent rental property sale gives us much more financial freedom now. We still have plenty of money working for the future.

I wonder if we can get to $8,000/month in passive income by the start of 2025. We’ll have to see how it goes as time’s arrow marches forward. Most of it will depend on how the markets perform.

Final Passive-ish Income

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

Passive-ish Income: $10,988.35

Last month it was $13,450.19. The big difference was an increase in dogs and blogs because of the big vacation.

That would be over $130k a year. That (hypothetical) annual income for writing on a blog, taking care of dogs, investing, and landlording is very nice. For the year, we’re averaging around $135k from all these – which is more than for 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.

None of the numbers here include my wife’s bread-winning day job as a pharmacist or the (small amount of) freelance work I’ve been doing over the last few years (which isn’t passive at all). When my wife retires, we can count her vested military pension as more genuinely passive income. For now, those jobs (and the dog boarding) are the fuel that drives the passive income engine – it allows us to live well, pay off our mortgage, 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 allows 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 definite trend of the numbers staying high for several months. Second, it doesn’t dip down too far. We should be able to count on at least $8,000, maybe $9,000 a month.

(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 fascinating as I don’t share the exact numbers. That’s why it’s just a footnote, not its own article.

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

We saw our net worth drop by 3.02% last month. None of the markets were very good to us. We’re down 1.68% on the year. That’s not great, but I know a lot of people who are

Most of that could be attributed to the selling costs of the property. The market did well, but Zillow valued our properties as being worth less money. For the year, our net worth is down 1.68%. That’s not bad, considering I’ve seen a lot of bloggers who are down around 15%.

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 15-20 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. If the US government didn’t back it like treasuries or FDIC, I may feel I should account for some uncertainty. I decided that it does make sense to include it. She could have earned a larger 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.

I hope everyone had a good July. It’s hard to believe that summer is almost over. By the time you read, we’ll be doing our last-minute packing to go on our European Disney Cruise. It’s breaking the bank, but I’m 46 years old, and my Europe experience is limited to one week in Sicily. The kids, aged 8 and 9, will be old enough to remember the trip, especially with the documentation of digital pictures and movies we have nowadays. LOL, I sound like I’m 106, right?

July was an excellent month for us. My youngest embraced surfing lessons and loves it. Unfortunately, the surfing camps announced their availability late, so we had to book other camps. He’ll have to settle for one-off lessons on the weekends. I went with him to the first lesson this year. I was able to get up and ride a few waves, but he’s much better than I am.

The 9-year-old “found his people” at theater camp. They wrote and produced their own musical, and it was incredible. I would legitimately watch it without my kid in it. The camp is for kids 9-16, and he fits in better with older kids, so it was perfect.

It was a big month for the adults too. My wife and I went to see Bob Woodward speak as he came to town. Since Newport is small, when someone famous comes, it’s an intimate setting, not a stadium like in a big city. We seemed to be the youngest people there. We both agreed that it was incredible. Journalism is under siege as local newspapers struggle, and fake clickbait gets more attention than the truth.

At the end of the month, we saw Bill Murray when he brought his New Worlds Music to town. It was about 300 people and like Woodward it was also incredible. Bill Murray went through the crowd giving out roses and handed my wife one. I missed out on Jay Leno tickets as the website errored and sold out while I was re-entering the purchase information. He did four shows in a small nook that seats about a couple hundred people. He lives in Newport at least part of the year, so hopefully, we’ll get another chance. I missed Paul Simon and Joni Mitchell at the Newport Folk Festival as it’s prime dog boarding time.

Look how happy the crowd is!

The kids started back up on karate after taking a break to try baseball and soccer. They are behind some of the other kids now. That’s okay; it’s not a race to black belt or anything.

My wife booked the good people at Surv to set up a trampoline that the grandparents bought last year. We’re so behind on so many projects. We finally got our ceiling fixed from the January leak. They had to work around the plumber fixing the garbage disposal. He said we needed a new one, so we ordered on. When they installed that they found out that it was an electrical issue all along. At least the company gave us a bit of a discount.

Got the kids to use a different kind of screen. This has fewer pixels, is outside and leads to a lot more exercise.

We went out to dinner a few Fridays at the Newport Navy Base. It’s right on the water. We can usually eat for $50, including a pitcher of beer. Below you’ll see a picture of my son with his yo-yo at the base. My other kid has been learning the Rubik’s Cube algorithms (we’re starting with 2×2). Like surfing he’s already much better than I am.

He’s getting good with the yo-yo.

We also found our way to the beach a couple of times. Some of that was related to surfing, but we went independently of that so that the kids could build sand castles other times. On the topic of castles, we went to the Marble House mansion and had tea at the Chinese Tea House. It was very expensive avocado toast, but people traveled quite a distance for the experience. We might as well enjoy the awesome stuff in our own backyard.

My wife did the Red Sox charity Run to Home Base to raise money for veterans’ mental health. She raised $2500 got to run around Fenway and cross home plate. It also came with tickets to the game. The kids don’t have the attention span to watch baseball. With Devers injured at the time, I didn’t have the attention span either (the Red Sox are not great this year). It was still a ton of fun. There are a lot of things you can do besides watch the game. The kids loved participating in the wave.

That’s a lot for one month… 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. 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. 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. There will be no mortgages when we own 100%, and all that rental income can be used for living expenses. When 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 my “somewhat active” income. They are a little passive because I can make money even when I’m not immediately tending to them. I leave real estate and investment income as their separate main sources of very passive income. This way, if you want only to count those, you can do that.

1. Blogging + Dog Sitting Income

July was our second best dog sitting month ever. I probably could have had a record, but I closed down so I could see my wife do the Run to Home Base. Tourism in the summer months of Newport is always a lucrative time. You may wonder how I could do everything above, but they are quick excursions.

Blogging also went well. I think I just got lucky with the advertisers. I think I know how to do a lot more SEO stuff that could make more money, but it would take a lot of time to rewrite much of my 2500 articles, and I’m too Lazy for that. I’m having more fun writing new content on Kid Wealth.

In June, “dogs and blogs” combined for $4,847.86. In July, it was:

Total Blogging + Dog Sitting Income: $7,671.19

I beat April’s record by less than $10! I actually got a $15 tip on August 7th for a stay back in July as the owner looked to book again. I had already written most of this, but I’m doing a rewrite for the record. I think I’ve reached the limits of what I can do with dog boarding without adding other services. There’s more potential with blogging, but that might be another year or so for Kid Wealth to start getting advertising deals.

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 at pick-ups and drop-offs. My 8-year-old was a little slower to develop dog skills, but he’s carved out a household niche catering to the smaller dogs – he just loves them. They recently finished up vet summer camp at the local animal shelter.

Their help means 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.

(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

It’s another ho-hum month, except, wait….

***NEW, NEW, NEW***

Yep, there’s something new this month. We’ve had three rental properties for ten years now. In July, we sold one, and now we’re down to two.

Selling the property was threading the needle. Even though the lease was over and the sale was agreed upon, the tenant wouldn’t leave, so we had to get an eviction. I hear that’s more common nowadays because rents are high, and people don’t want to move on when they have a nice low rent. I have lost patience managing it from far away, and we were able to get it sold at a high price because the buyer locked in a mortgage rate a couple of months ago. She went a little crazy and threatened a neighbor who got a restraining order against her. She finally did the right thing with the lease over and the restraining order in place.

This means we’ll have a lot less potential rental income from our properties. We’ll also have fewer liabilities.

The sale gave us some cash that we could invest. We’re moving money from rental property income to dividend income. Dividend income will be easier, but it’s also less money. I recently did some analysis of this in my stocks vs. real estate article. For this particular property, it was a good move to sell. Even if we had owned 100% of the property, the rent would make only a 4.2% return. We can make our money work harder elsewhere.

One of the Newport mansions has this tea house. It feels authentic to me, but I’m no expert.

While selling the property was the big change, Zillow decided our remaining properties weren’t worth as much. That seems fair with the housing market cooling down.

We went from 76.84% to 74.86% ownership of the equity in our properties. It’s very rare for it to drop, but we’ve only got the two properties now. Our equity dropped, but our liability did too. The other thing that dropped is our expected income. If we owned both remaining rental properties with no mortgages (100% of the equity), we’d make about $2,200 a month after insurance, property taxes, condo fees, and estimated condo maintenance.

I like to use an “expected rent” as we’re currently trying to catch up from years of very low rents. We liked our tenants, so we’ve kept them at a discount. However, with housing and rents going up so much, so quickly, there’s a massive gap between what we could reasonably be bringing in and what we are bringing in.

If you multiply our expected net rent of $2,200 by the amount of equity we have, 74.86%, you get $1,647/mo. in estimated passive income. That’s a loss of a whopping $1141 from last month. It’s good that we got a lot of cash from the sale to invest in other assets.

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. In 5.5 years, it grew a lot but dropped to $1,647, which is still good, especially with a check of $250,000 or almost $50,000 a year.

When we get 100% ownership, it should bring in about $25,000 after expenses. Rent is inflation resistant as it’ll rise over time. That means that even though this is $25,000 in today’s dollars, we don’t have to worry about it buying fewer goods and services in the future.

Total Rental Property Income: $1,647

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 3.61% yield, but it has been less in the past.

There’s a chance we could do better than this. 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; in full disclosure, I make a few dollars if you sign up for it.)

Bucket list item checked off – family at Fenway. Sweet Caroline!

Of course, our investment plan isn’t entirely centered around dividend income. The 2.5% dividend is a conservative number that helps us think about what kind of cash we can expect. Our portfolio there will pay almost 3% in dividends, but we should see asset growth. Many experts suggest using a standard 3.5% or 4% withdrawal rate. Our numbers here would be much more if we did that.

The stock market had its best month in a long time. We would have seen this rise even if we didn’t have the significant change mentioned above. With the sale of the investment property, we have more cash to invest here. That covers some of the losses we saw in the real estate section.

Until the recent sale of that investment property, more than 97% of this money was in our retirement accounts. That meant the retirement money would be invested for at least another 13 years until age 59.5. Now we have a healthier mix of money for which we can invest and receive a check.

We continue to get a profit-sharing check since I bought (a lot of) a company. 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: $4,132.00

Last month, it was $3,406. A gain of $726 is a big move, but most of it is the transfer. If the markets return to new highs, maybe we’ll knock on the door of $5,000 a month! This monthly number of $4,132 would be almost $50,000 a year.

When I started tracking this number in January 2017, we were at $1,180/mo. It’s been a tremendous last 5.5 years, even if the previous year hasn’t done much. With the sale of the property, it might be hard to compare this number with the January 2017 numbers going forward.

If you have the chance to hear Bob Woodward speak, run, don’t walk, to take the opportunity.

One of our goals has been to have more cash that we can use before retirement age. My wife had been wanting to retire, but then got awesome new job. The shine of the new job has worn off, so the pendulum has swung back to the middle. That’s a roller coaster of emotions. Some days she wants to retire, and other days, it seems like she wants to work for many more years. Whatever she wants to do is fine with me. At least this new job is much better than the last one. She’s had time to bring the kids to school and do things like that.

For the 25th month in a row (?), we’re looking into estate planning, but they gave us a lot of paperwork to do before we can move forward. I’m still not making any progress on this. Maybe when the kids are back in school, and I’m back from FinCon.

Very Close to Passive Income

Our “very close to passive income” combines rental property income and dividend income. If we had any royalty income from books, movies, or music, I’d also include that. 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. That takes some active work to keep up. Rental property requires a little work, but not nearly as much.

There is where we see how selling the investment property worked out. We clearly have less work as we move assets from the real estate to dividend income. However, we also lost potential passive income as the rental property would have performed better. It’s not that big of a loss, though, as we’re still looking at numbers similar to where we were in early 2021.

We also moved some of the passive income from “potential” to “active”, meaning that the dividends are real money we can spend. They aren’t real estate assets that make money when mortgages are paid off or money we can access without penalty when we are of retirement age.

Somehow Bill Murray in concert just works!

I love having both rental property and stock market income working together. With the stock market dropping recently, our real estate has saved our net worth from dropping further. And now, we locked in those gains with the sale. It was the opposite for the last decade – real estate didn’t do much while stocks quadrupled. 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.

Very Close to Passive Income: $5,779.00

This would be almost $70,000 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 draw them down for more fun, charity, or other spending.

Having around $75,000 passive income was my goal when I started this blog. I figured that would be winning the money game as it would be enough to cover our needs and most of our wants. We’ve dropped out of that $75,000 goal briefly, but that’s okay. As you can see from the charts, the growth is slow and steady.

This $5,779.00 of “very close to passive income” has grown from $2,354/month in January 2017. So in less than six years, we’ve much more than doubled our passive income (an extra $1,000 from the double). It’s an excellent income for many people even in their top earning years. This is one of the reasons why I went with the “Lazy” name; it shows that investing money can do more “work” (or somehow produce more value) than active working can. It’s a crazy system. I’m just doing my best to work within it.

It’s worth noting that, once again, most of these numbers are fudged and aren’t “real” (except for the profit-sharing check and the new investment income) 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. The recent sale will help us feel a bit more financial freedom right now. We’ll still have plenty of money working for the future.

I used to wonder if we could get to $8,000/month in passive income by the start of 2025. I thought it would be difficult, but it looked like we’d hit the mark earlier. Now, it seems like more of a challenge. We’ll just have to see how it goes as time’s arrow marches forward.

Final Passive-ish Income

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

Passive-ish Income: $13,450.19

Last month it was $11,058.86. The big difference was an increase in dogs and blogs because we didn’t leave on vacation. It also helped to have a holiday and holiday rates.

That would be over $160k a year. That (hypothetical) annual income for writing on a blog, taking care of dogs, investing, and landlording is very nice. For the year, we’re averaging around $135k from all these – which is more than for 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 or the (small amount of) freelance work I’ve been doing over the last few years (which isn’t passive at all). When my wife retires, we can count her vested military pension as more genuinely passive income. For now, those jobs (and the dog boarding) are the fuel that drives the passive income engine – it allows us to live well, pay off our mortgage, 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 allows 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 definite trend of the numbers staying high for several months. Second, it doesn’t dip down too far. It seems like it should be at least $8,000, maybe $9,000.

(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 fascinating as I don’t share the exact numbers. That’s why it’s just a footnote here, not its own article.

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

We saw our net worth drop by 0.55% last month. Most of that could be attributed to the selling costs of the property. The market did well, but Zillow valued our properties as being worth less money. For the year, our net worth is up 1.18%. That’s not bad, considering the markets are still down about 15% or so.

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 card reports can do much of it. Looking at our liquid cash is a way to gauge the bottom line, income minus expenses.

This month, we gained a lot of liquid cash with the sale. Our liquid cash to net worth ratio was 3.67% last month, and now it is 11.73%. I’m also counting non-retirement investment accounts in this number since we can always sell and withdraw the money.

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 15-20 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. If the US government didn’t back it like treasuries or FDIC, I may feel I should account for some uncertainty. I decided that it does make sense to include it. She could have earned a larger 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.

Is everyone having a great June? We’re currently on vacation on Block Island. I love that it’s a good place to get away from technology. However, I needed to send some pictures from my phone for this article and the lack of internet connection is making it impossible. So the best I can do for now is publish this word soup.

If pictures did work you’d see kids playing with dogs and our old dog showing a rare bark. The kids were also in school plays, musical performances, and had an art show. The school does a lot at the end of the year to show off their work. My wife did a lot of traveling in May. She was running a conference of 6000 people and got back in time to fly to D.C. with my oldest kid to see the POTUS’ Memorial Day speech.

I’ve been working on Kid Wealth. As part of that, I’m learning about new bloggers. One that I’m really liking lately is Money Buffalo.

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 my “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 those you can do that.

1. Blogging + Dog Sitting Income

In May we took a step back in our dog boarding income. April had school vacations so many people were traveling leaving their dogs with us. Nonetheless, May was still our second best month of the year. We did have the benefit of Memorial Day which leads to some dogs staying the long weekend at holiday rates.

We averaged two dog overnights a day, which is only slightly more than average. We did a lot of day boarding though and that helped add to the income.

Blog income was slightly below average. This is to be expected when I’m more focused on dog boarding.

In April, “dogs and blogs” combined for a total of $7,664.90. In May, it was:

Total Blogging + Dog Sitting Income: $5,079.36

That’s about 20% above the average over the last year. By any measure that’s a good month.

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 at pick-ups and drop-offs. My 8-year-old was a little slower to develop dog skills, but he’s carved out a household niche of catering to the smaller dogs – he just loves them. He’s started to recently take an interest in feeding them.

Their 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.

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 to 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

Once again the rental properties appeciated $20,000 according to Zillow. We’ve seen this quite a few months now. Zillow is usually fairly accurate because our rental properties are condos with many similar properties for comparisons.

We’ve been trying to sell one of the properties, but the old tenant wouldn’t leave. So now we have to go through an eviction process even though the buyer should already be moved in. Until the situation resolves itself, I’ll have to continue this report with the assumption that we had a tenant who was paying rent.

We went from 75.85% to 76.53% ownership of the equity in our properties. That’s another month of good gains.

If we owned the rental properties with no mortgages (100% of the equity), we’d make about $4,000 a month after insurance, property taxes, condo fees, and estimated condo maintenance.

I like to use an “expected rent” as we’re currently trying to catch up from years of very low rents. We liked our tenants (except the one that wouldn’t leave), so we’ve kept them at a discount.

If you multiply our expected net rent by $3,650 by the amount of equity we have, 76.53%, you get $2,793/mo. in estimated passive income. That’s a gain of $25 from last month.

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 5.5 years, we’ve seen that number grow tremendously to $2,793. The forced savings of 15-year mortgages is extremely powerful.

Before we decided to sell the property, it was looking like we’d have $45,000/yr. of income. I’ll have to recalculate this when the sale closes. Rent is inflation resistant as we can raise rents over time. So this income will grow as things get more expensive. This was looking like enough for us to live on once our own mortgage is paid off, but I’ll have to revisit that too. Of course, that’s just one part of the plan as you can see.

Total Rental Property Income: $2,793

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 3.31% yield, but it has been less in the past.

There’s a chance we could do better than this. 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, these numbers would be much bigger.

We saw a very slight gain in the stock market. For now, any kind of gain is a good gain. We’ll continue to buy in at these low prices and when the market recovers we’ll enjoy new portfolio highs. Since all of this money is in our retirement accounts, we’ll be invested for at least another 15 years.

We continue to get a profit-sharing check since I bought (a lot of) a company. 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: $3,548

Last month, it was $3,535. A gain of $13 isn’t a much. Maybe the markets will be more interesting by next month. When I started tracking this number in January of 2017 we were at $1,180/mo. It’s been a great last 5 years.

Our money has been working hard to multiply until this month. For a while, we stopped adding to our investments. Instead we had been 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. That’s a roller coaster of emotions. Some days she wants to retire and other days, it seems like she wants to work for many more years. Whatever she wants to do is fine with me. At least this new job is much better than the last one. She’s had time to bring the kids to school and do some things like that. Before they had a keyboard tracker on her.

Getting back to the monthly update, this monthly $3,548 would be over $42,000. As with the rental income number above, we should be able to live on this by itself. 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 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. I started the paperwork, but I don’t even know where it is now. Not great.

Very Close to Passive Income

Our “very close to passive income” is a combination of rental property income and dividend income. If we had any 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 made some slight gains this month. The stock market dropped and then recovered by the 8th when we took these numbers. (It has since crashed again, but we’ll see where that takes us next month.) I love having both rental property and stock market income working together for us. With the stock market dropping recently, our real estate is saving our net worth from dropping further. For much of the last decade, it was the opposite – real estate didn’t do much while stocks quadrupled. 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.

Very Close to Passive Income: $6,341

This would be over ~$76,000 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 5.5 years, we’ve added about $4,000 in monthly passive income. That’s nearly $50,000 – 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 investing money can do more work (or somehow produce more value) than I did. It’s a crazy system. I’m just 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 one reason we are selling a rental property. It will help us feel a little more financial freedom right now. We’ll still have plenty working for the future.

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 it could go either way. We’ll have to see where the numbers are when we sell off the rental property.

Final Passive-ish Income

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

Passive-ish Income: $11,420.36

Last month it was $13,967.90. April was crazy with all the dog boarding and this was much more manageable. This was much closer to being passsive, but it still a lot of dogs

That’s over $135k a year. That (hypothetical) annual income for writing on a blog, taking care of dogs, investing, and landlording is very nice. If we manage $170,000 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 or the freelance work I’ve been doing over the last few years (which isn’t passive at all). When my wife retires we can count her vested military pension as more truly passive income. For now, those jobs (and the dog boarding) are the fuel that drives the passive income engine – it allows us to live well, pay off our mortgage, 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 least $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. If this month is any indication, it’s possible to hit all-time highs when the economy isn’t doing well.

(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 2.28% last month. That’s tremendous, but so much of it came from our the value of primary residence going up. That’s not useful for us unless we move or do a reverse mortgage. It reminds me that buying a home and locking in a mortgage in 2011 was a great idea. For the whole year, our net worth is up 3.89%. That’s really great when it seems like the economy is bad for a lot of people.

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 card reports can do a lot of it. Looking at our liquid cash is a way to roughly gauge the bottom line, income minus expenses.

This month, we lost around lost $500 in liquid cash. We should try to do a little better in this area. It will have to wait another month or two because we just bought tickets for an expensive vacation later this year.

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 15-20 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.

Is everyone having a great May? The weather is getting good in Rhode Island. We’ve even gotten some use of our inflatable hot tub. Perhaps I’ve been using it too much because April’s passive income update is later than usual.

Each month, I look back at the pictures on my phone and try to pick out the interesting moments to share. This past month there were a lot of dog pictures. As you’ll find in a bit, dog boarding was crazy.

In other news, I’ve been having some tenant troubles. We’re selling a condo. The tenant is upset that we decided not to renew the lease. She’s decided not to her rent for the rest of the lease. She doesn’t seem to be making any plans to vacate either, so this is becoming a big problem.

Aside from that, we had a successful annual Easter egg hunt. My 8-year-old had his first traveling soccer game. (It’s amazing how much better he’s gotten in just a couple of months). In April, the 9-year-old was just getting started in baseball – he might have had one practice. I’ll update how that’s going next month.

The kids earned another belt stripe in karate. They can use kamas now. They’ll be fine if they find themselves in a self-defense situation where they have a small sickle-blade-on-a-stick weapon handy. Last year that happened to me 7 times and I regret not having the kama skills to pair with the kamas that were nearby. We’re putting karate on hold for a couple of months because baseball and soccer were just too much.

I guess it’s boring times around here. That’s a good thing, I guess. It would be fun to share that we’re doing all this extra stuff.

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 my “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 those you can do that.

1. Blogging + Dog Sitting Income

April was our best month ever for dog boarding on Rover.com. Before the pandemic, we averaged about 1 dog overnight per day. After vaccines and everyone started traveling, we averaged 2 dog overnights a day. I raised prices to match other dog boarders. In April, we averaged 4 dog overnights a day. We also had many dogs for day boarding, but I don’t keep stats on these. (My spreadsheet subtracts the check-out day from the check-in day. When these are the same day, that number is zero, so it is like we didn’t care for the dog at all, except that the money still adds up.)

At 4 dog overnights and day boarding, it wasn’t passive at all! In fact, I was stressed out most of the month because people wanted to pick up their dogs after work. That’s reasonable enough, but that’s when I had to shuttle the kids to their after-school stuff.

Blogging dropped back down to average. I’m told by the advertising nerds that budgets get reset in April, so it takes some time for the spending to come in on adds

In March, “dogs and blogs” combined for a total of $4,295.77. In April, it was:

Total Blogging + Dog Sitting Income: $7,664.90

That’s an all-time record. We could have similar or bigger numbers over the summer as that’s our busiest season. I would like to see blogging income pick up because dog boarding doesn’t scale and we are maxed out there.

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 at pick-ups and drop-offs. My 8-year-old was a little slower to develop dog skills, but he’s carved out a household niche of catering to the smaller dogs – he just loves them. He’s started to recently take an interest in feeding them.

Their 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.

You can tell I didn’t get a lot of good pictures of soccer. My son is #14 off to the side of the action.

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 to 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. Last month it was $40,000 which was crazy, so I wasn’t prepared for another big gain. It seems like we’re back to the days of properties jumping up in value all the time. Last month, I said that we were finding that Zillow’s Zestimate for our condo may not be accurate. We were listing a condo and the real estate agent showed the comps and they were 10% less than Zillow. However, in the first few days, we got an offer that was 10% above our asking price – almost exactly Zillow’s Zestimate. So maybe Zillow does know best after all.

Each month, we pay down a couple of thousand dollars of mortgage debt. We build some equity each month aside from the appreciation.

We went from 75.10% to 75.85% ownership of the equity in our properties. That’s a month of good gains.

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), 75.85%, you get $2,768 /mo. in estimated passive income. That’s a gain of almost $27 from last month. That’s a very solid gain for one month.

This number will change a lot when we sell our condo. Our potential rental income will go down. However, we’ll have new money to invest that will earn dividends in the next section. It’s one less property to manage, so our income will be a little more passive.

Our teenager living his best life on one of our boarder’s beds.

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 $2,768. The forced savings of 15-year mortgages have been a very powerful force.

When the mortgages are paid off, we would have had $45,000/yr. of income. I’ll have to recalculate that when the sale closes. Rent is inflation resistant as we can raise rents over time. So this income will grow as things get more expensive. This was looking like enough for us to live on once our own mortgage is paid off, but I’ll have to revisit that too. Of course, that’s just one part of the plan as you can see.

In the previous report, the rental property income was $2,693.

Total Rental Property Income: $2,741

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 3.28% yield, but it has been less in the past. We could also get that yield 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, these numbers would be much bigger.

The market rebound in March was short-lived. I took the numbers in this report on May 5th. The market has gotten a lot worse since then, but we’ll have to deal with that next month. It doesn’t look like the market is very good. For us, that’s fine as it has been great while we invested over the last decade. I had a larger than usual concentration of money in high-dividend index funds (the HDV mentioned above) and it is only down about 5% from its highs. I sold off a little and bought the Nasdaq index (QQQs) when it was down 30% from its highs recently.

I don’t know where the markets are going. The good news is that I don’t care too much. We’ll be invested for between 15 and 40 more years.

This bird found a nest that built outside our window in the early COVID days. It’s been sprucing up that abandoned nest

We continue to get a profit-sharing check since I bought (a lot of) a company. 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: $3,535

Last month, it was $3,762. A drop of over $200 is a lot. I’m almost positive it will only be worse next month. When I started tracking this number in January of 2017 we were at $1,180/mo. Instead of focusing on the month’s drop, I choose to look at how much growth we’ve seen in those five years.

Our money has been working hard to multiply until this month. For a while, we stopped adding to our investments. Instead we had been 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. That’s a roller coaster of emotions. Some days she wants to retire and other days, it seems like she wants to work for many more years. Whatever she wants to do is fine with me. At least this new job is much better than the last one. She’s had time to bring the kids to school and do some things like that. Before they had a keyboard tracker on her.

Getting back to the monthly update, this monthly $3,535 would be over $42,000. As with the rental income number above, we should be able to live on this by itself. 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 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. I started the paperwork, but I don’t even know where it is now. Not great.

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.

The Easter Bunny was a jerk this year – hiding eggs up in a tree.

We lost some of the gains here again this month. The stock market drop is too much for the real estate market to cover. 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. For much of the last decade, it was the opposite – real estate didn’t do much while stocks quadrupled. 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.

Very Close to Passive Income: $6,304

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 5.5 years, we’ve added about $4,000 in monthly passive income. That’s nearly $50,000 – 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 investing money can do more work (or somehow produce more value) than I did. It’s a crazy system. I’m just 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 one reason we are selling a rental property. It will help us feel a little more financial freedom right now. We’ll still have plenty working for the future.

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 it could go either way. We’ll have to see where the numbers are when we sell off the rental property.

Final Passive-ish Income

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

Passive-ish Income: $13,967.90

Last month it was $10,798.77. This is an all-time high, but more than half of it came from dogs and blogs and the dogs were not passive this month. I’ll be happier if/when we can get to this number from investments. I enjoy working with all the dogs for now, but in the future, I’ll probably cut back.

That’s almost $170k a year. That (hypothetical) annual income for writing on a blog, taking care of dogs, investing, and landlording is very nice. If we manage $170,000 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 or the freelance work I’ve been doing over the last few years (which isn’t passive at all). When my wife retires we can count her vested military pension as more truly passive income. For now, those jobs (and the dog boarding) are the fuel that drives the passive income engine – it allows us to live well, pay off our mortgage, 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 least $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. If this month is any indication, it’s possible to hit all-time highs when the economy isn’t doing well.

(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 drop by 1.73% in April (including up to May 5th). That’s not great, but it’s what we signed up for when we invested in the stock market. For 2022, our net worth is up 1.58%. There are a lot of people who have a negative net worth for the year. Not that it is some kind of competition, but it is reassuring.

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 card reports can do a lot of it. Looking at our liquid cash is a way to roughly gauge the bottom line, income minus expenses.

This month, we lost around lost $1,500 in liquid cash. It looks like the main drop has come from the cash in our real estate LLC. We paid the tax preparer a lot and one of my tenants is a couple of months behind on rent. Some of it was just general spending as our joint account is lower than usual.

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 15-20 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.