Twofer: October Savings and Net Worth Update
Updated: Feb 22, 2019
Let's start with Net Worth. That was the hardest pill to swallow, anyway, but I have enough data now to notice a trend! Despite saving over $7,000 in the past 3 months, my net worth only went up around $2,000. BOOOOOO! This is largely because right before I checked my statements on October 30, there had been a 10% correction (read, 10% loss) in the market. If I'd had the foresight to check my net worth on October 3 when the market was at it's peak, it would have been around $9,000 more. Darn schedule!
Oh well, you can't win 'em all. At least my net worth went up thanks to a couple of killer savings months! That's what happened from January to April as well, not much from the market balanced with high savings rates. The side hustles have been killing it in October as well, nearly doubling my pay check (even if I haven't gotten paid for the vast majority of it yet), so I didn't put those numbers in my savings percentage, but I did include the money owed but not yet paid in my net worth. Is this the right thing to do? No idea, but it makes sense in my head.
In terms of the savings for October, tons of great news! I saved the second most I've ever saved since I started tracking it! Almost $3,700 saved, and that didn't count the money I'd earned from side hustles that hadn't come in yet! That money should come in this month, which should make November INSANE for savings.
The things that really helped save money this month were the amount of gigs I had with my band on the weekends. Each weekend I was in town I had 3 gigs, two in Abu Dhabi with the incredible Part Time Sinners. I also had gigs playing one of the fanciest brunches in town with the Amazing Carla who I used to play with in As Per Casper. There they fed me crazy food, which I then turned into even crazier food, like the lobster and caviar sandwich I invented below.
When all your weekends are spent MAKING money, and not SPENDING money, your savings rate really jumps. The actual savings rate was 65%, but if I'd actually been paid what I was owed this month, it would have been 76% and like $2500 more than I've ever saved in a month before. Oh well, that money should be paid this month and I'll get those crazy numbers in November instead.
All these savings has really got me thinking about rental real estate again. I know, I know, I said in August how I wasn't ready to buy real estate, and that I'd do REITs, and I put $10,000 into a REIT yielding a 10.5% dividend. And it's totally been working, too, my $10,000 is giving me about as much cash flow as a single rental property would, with no hassles. I'll post about that more fully later on, but I keep learning more about rentals and I keep wanting to jump in to that market.
If the side hustles keep paying, and I don't have anything crazy happen, I really can see myself buying my first rental property this year. It's not just the cash flow, it's the appreciation, equity buildup by someone else, and possible tax elimination as well. I'm reading a great book, Building Wealth One House at a Time by John Schaub, listening to Bigger Pockets podcasts, and reading all the articles I can from Bigger Pockets and Roofstock. I'm officially in the "obsession" phase, and while I know I'm not ready YET, I'm getting there, and by the time I have enough for a down payment, I should know enough to not wreck my finances. I've even reached out to a real estate agent who specializes in turnkey properties in Memphis that was recommended to me be a friend in the industry (thanks Aaron!).
It's all about that savings rate, and if I keep mine high enough, I will be able to buy a big asset sooner than I thought.
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