[DISCLAIMER: This is a catch-up post, documenting our financials from the second quarter of 2022. It’s 2023, but I’m trying to organize and document our financial history so that I can have this record to look back on.]
Hello! The above picture is from our visit to Legoland in April 2022. In contrast to 2021, we started spending a lot more on experiences starting in Q2 (April-June) in 2022. This was probably inspired by our newly re-minted dual-income status, as well as general re-entry into an almost-post-Covid-19 world. I was converted from contract to full-time status at work. This meant we’d continue to save on our high deductible health insurance. We purchased a membership to Adventure Aquarium this quarter. We made a big down payment for a future trip to Disney World in the summer. And, we started paying for a regular babysitter to help us take care of the kiddos due to summer break starting. This was the quarter when lifestyle inflation really started to pick up for us.
Here’s how we looked financially during Q2 of 2022.
Monthly Spending and Income
April 2022 Spending
| Primary Residence – Property Tax+Assoc. Fees | $2,416 |
| Rental – Property Tax+Assoc. Fees | $235 |
| Internet | $40 |
| Cell Phone | $32 |
| Gas + Electric | $141 |
| Water + Sewer | $119 |
| Food [Groceries/ Household] | $799 |
| Food [Eating Out] | $851 |
| Transportation [Gas/Tolls] | $221 |
| Car Insurance | $1,035 |
| Life/ Home/ Umbrella Insurance | $90 |
| Health + Dental [Dentist/ Eye Exam + Contacts] | $259 |
| Misc Buffer [Gifts/ Netflix/ Hulu/ Legoland/ Aquarium Membership] | $562 |
| Total Monthly Spending | $6,801 |
May 2022 Spending
| Primary Residence – Property Tax+Assoc. Fees | $300 |
| Rental – Property Tax+Assoc. Fees | $1,971 |
| Internet | $40 |
| Cell Phone | $32 |
| Gas + Electric | $115 |
| Water + Sewer | $0 |
| Food [Groceries/ Household] | $1,146 |
| Food [Eating Out] | $1,010 |
| Transportation [Gas/ Parking/ Tolls] | $210 |
| Car Insurance | $0 |
| Life/ Home/ Umbrella Insurance | $90 |
| Health + Dental [Vision/ Dentist] | $294 |
| Misc Buffer [Grad School/ Disney Hotel+Tickets/ Netflix/ Hulu/ Aquarium/ Gifts] | $4,954 |
| Total Monthly Spending | $10,137 |
June 2022 Spending
| Primary Residence – Property Tax+Assoc. Fees | $300 |
| Rental – Property Tax+Assoc. Fees | $225 |
| Internet | $40 |
| Cell Phone | $32 |
| Gas + Electric | $106 |
| Water + Sewer | $120 |
| Food [Groceries/ Household] | $1,287 |
| Food [Eating Out] | $686 |
| Transportation [Gas/ Parking] | $156 |
| Car Insurance | $0 |
| Life/ Home/ Umbrella Insurance | $90 |
| Health + Dental | $48 |
| Misc Buffer [Baby Sitter/ Clothes/ Netflix/ Hulu/ Gifts/ Photobooks] | $1,266 |
| Total Monthly Spending | $4,356 |
I can definitely see the groceries and eating out expenses explode this quarter. [Reminder: We were expecting $1,100/month for groceries + household expenses and $500 for eating out — 2022 Expectations.] We experienced some inflation with our groceries, and that is what accounted for at least some of the increase this quarter. However, eating out was a different story. We soared past our expected eating out spending every month this quarter. Spring break was in April, so I can see why we overspent that month. We did day trips to Legoland and Adventure Aquarium (along with a family membership purchase). We also hit up the Japanese strip mall Mitsuwa in north Jersey. There, we had even more eating adventures and bought some really cute toys. I think all of the spending during spring break warmed us up to even more eating out excursions that continued into May and through June. We hit all of our NJ favorites in addition to some new ones in NY and PA. This pushed our gas expenses up too. We drove all over. Looking back now, this was pretty excessive. Had I kept up with my blogging, I might have seen this better in May and done more to curb it. Still, I do know we had a lot of fun.
Two of the really big miscellaneous expenses that stand out for me in Q2 are the down payment for the Disney World trip and our babysitter fees. Disney was easily over $4k, which included an on-site hotel + daily entrance fees into the park. The babysitter fees started in June. That was easily over $1k for just the end of June. With both of us working, we weren’t in a good position to watch our kids during the summer break. Mr. FD hired a babysitter to basically watch the kiddos in our home during “school” hours.
Now for the regular stuff — I can’t see too much out of the ordinary for our property tax and association fees. Our utilities also look in line with what we normally spend. Health-wise, I saw two different dentists this quarter. I couldn’t seem to communicate well with the first one, and I experienced probably the most painful X-rays ever in my entire life from them. So, I moved on to a second one. The cracked tooth needed a crown, so there multiple appointments to slowly address that. I also signed up for one more grad course, and it cost about $800.
April 2022 InCOME
| NJ Tax Return | $2,053 |
| Rent | $1,208 |
| Hobby Site | $42 |
| Mr. FD Freelance | $7,558 |
| Mrs. FD Contract | $5,868 |
| Total Monthly Income | $16,703 |
May 2022 InCOME
| Rent | $1400 |
| Hobby Site | $444 |
| Mr. FD Freelance | $3,758 |
| Mrs. FD Contract + Full-Time | $6,592 |
| Total Monthly Income | $12,195 |
June 2022 InCOME
| Credit Card Rewards | $200 |
| Rent | $1,400 |
| Hobby Site | $472 |
| Mr. FD Freelance | $207 |
| Mrs. FD Full-time | $7,159 |
| Total Monthly Income | $9,438 |
April income was supplemented by the NJ State tax return. 2021 was the first year that Mr. FD went freelance, so we didn’t do a great job with estimating taxes. We’ll try to do better for 2022 with what we learned.
Mr. FD’s hobby site made less on April due to web hosting and domain name registration expenses. Overall, though, it was pretty steady.
I should clarify that Mr. FD’s non-hobby freelance income includes whatever he brings in minus any pre-paid tax and solo 401k contributions. Mr. FD took off some time in April for spring break, so that’s why his income is lower in May. In June, Mr. FD paid both quarterly NJ and Federal prepaid tax in addition to his solo 401k contributions. It looks lower than usual, but it isn’t really. I get a bit envious seeing Mr. FD’s solo 401k contributions. The ability to contribute both as an employer and employee is pretty nice.
My employment status switched from contract to full-time sometime in May. I had been front-loading my 401k during the contract period, but I changed it after my conversion to full-time. This is why my retirement contributions were scaled downward this quarter, while my take-home went up. I didn’t get too much of a pay boost when I got converted, roughly a 5k increase in base pay. The ability to contribute to an HSA plan didn’t change with the conversion, so I just kept on contributing.
Q2 RETIREMENT CONTRIBUTIONS + HSA
| Month | Mr. FD’s Solo 401k | Mrs. FD’s 401k (w/ company match) | HSA | Monthly Total |
| April 2022 | $3,417 | $2,272 | $640 | $6,849 |
| May 2022 | $3,417 | $2,272 | $640 | $6,329 |
| June 2022 | $3,417 | $1,391 | $640 | $5,448 |
By subtracting our expenses from our income and retirement/HSA contributions, we saved $35,694 this quarter. I’m really glad about that. Here’s the breakdown by month:
April Savings: $16,703 – $6,801 + $6,849 = $16,788 in total
May Savings: $12,195 – $10,137 + $6,329 = $8,387 in total
June Savings: $9,438 – $4,356 + $5,448 = $10,503 in total
And, here is the total for the quarter:
Q2 Savings: $38,363 – $21,294 + $18,625 = $35,694 in total
Spending and Savings Summary for the year
Here’s a table of our spending and savings for 2022:
| Spending | Saving | |
| January 2022 | -$6,110 | $4,193 |
| February 2022 | -$4,444 | $15,524 |
| March 2022 | -$2,916 | $17,306 |
| April 2022 | -$6,801 | $16,788 |
| May 2022 | -$10,137 | $8,387 |
| June 2022 | -$4,356 | $10,503 |
| TOTAL | -$34,764 | $72,716 |
Net Worth for the year
I calculate net worth near the end of the month, but not always on the final day of the month. Most of our net worth changes are heavily dependent on the stock market. I’m also including our total FIRE assets, which are invested and expected to grow in our retirement.
Even though we had saved over $70k by the end of Q2, our net worth DROPPED by roughly $100k this quarter. Our FIRE assets followed by about the same amount. Our dual income helped us temper the large losses due to the poor stock market performance, but I didn’t feel so good about that at the time. All that work and effort seemed wasted. However, looking at it now, I’m glad that we had the benefit of dual income during this time. Even if our net worth was decreasing, we had the opportunity to lessen the loss. It would have been much worse if we hadn’t both been working. I should be grateful.
| Net Worth | FIRE Assets | |
| December 2021 | $2.53 M | $1.92 M |
| January 2022 | $2.44 M | $1.83 M |
| February 2022 | $2.45 M | $1.84 M |
| March 2022 | $2.48 M | $1.88 M |
| April 2022 | $2.40 M | $1.80 M |
| May 2022 | $2.43 M | $1.83 M |
| June 2022 | $2.38 M | $1.78 M |
FIRE Failure Indicators
Here’s our sanity check for the month.
- Is our spending on track? So far, yes, but just barely. We projected in a previous post that we’re expecting to spend about $73,000 this year. With our current rate of spending projected to the end of the year, we’d have been on track to spend a little less than $70k. This is a big change from last quarter, but I think it’s okay. We did pretty little during the pandemic, so getting out and experiencing more was a lot of fun. For now, I think the trade-off was worth it.
- Is our withdrawal rate okay? Hmm… we’re behind now. If we were doing a Roth Ladder, our projected spending for this year would have been a little above 4%. Currently, we’re on track to spend about $70k, which is MORE than 4.0%. Ultimately, we want our spending to be at or below 3%. We’re spending a lot more than what I expected when I started this blog, and we’re way past 3%. It’s good that we didn’t officially retire early yet. With the drop in the stock market, our circumstances have changed. At this point, I think we should try to work a few more years to pad our savings and see if the market will rebound.
Withdrawal Rate Withdrawal Amount 4.00% $69,872 3.75% $65,505 3.50% $61,138 3.25% $56,771 3.00% $52,404 2.75% $48,037
Happiness Indicators
On a scale of 1-10, how would I rate my happiness?
7.5
I got the full-time conversion! I felt really good about this. All that time and effort trying to do good work and feel useful again seemed worth it. I liked my job. The people were good. The work was satisfying. I was still tired and stressed out, but I felt accomplished. And, I actually passed one of my grad courses. At this point, I was probably thinking that I needed to adjust my work-life balance. But, I had gotten through some big hurdles at least.
We spent a ton on trips, eating out, and future vacations, but these experiences were priceless. I’m glad we got to do them. I also got to feel what paid vacations were like again. It’s great knowing income is coming in even if you’re not physically working. The trade-off, of course, is that you have to go back to work afterwards. It is what it is!
Looking back now, I feel really lucky that I had this opportunity to work during this time. I wish the market wasn’t as bad as it was, but that wasn’t anything I could change. I was doing the best I could. As a family, Mr. FD and I, along with our kids, were in a good place.
As for FIRE, we probably should keep working a few more years before really retiring. Again, I feel lucky to have our dual-income for now. We’ll keep at it.