For the first 5 months of 2021, the money with a view family has been aggressively plowing money into the market. Now that our wedding date is fast approaching, we’ve shifted gears to focus on savings for a little while. But for today, let’s take a look at how we did in May.
(Side-note: Because this is my first net worth roundup post on the blog, I’m digging a little deeper into where our money is, instead of doing a month-to-month comparison.)
May 2021 total net worth: $441,968.04 (incl. property) or $306,466.17 (excl. property)
Home Equity: $135,501.87 (30.66% of total net worth)
I used this online home value estimator to check our house’s current value, and deduct the remaining mortgage amount to get the Home Equity amount. Our early retirement plan doesn’t really include home equity, but I thought I would record it anyways for completeness. If when we retire and we decide to relocate to a lower cost of area, that will just be a bonus. I probably won’t check the home value estimator again for a very long time.
Cash and cash equivalents: $29,065.07 (6.58% of total net worth)
We started building joint finances since we bought a home and moved in together in 2020. Together we have $29,065.07 liquid cash that we can access anytime we need to. This includes a few sinking funds (e.g., property tax bills, our wedding, etc). Starting in June, we will be solely focused on building up this bucket further to anticipate some large expenses coming up.
Investments: $305,347.53 (69.09% of total net worth)
Very happy to see this bucket taking the lead on where the majority of our net worth sits. This means we have over $300k in the stock market working for us every day!
At the end of May, I’ve officially maxed out both TFSA and RRSP rooms for 2021.
Debt: -$27,946.43 (-6.32% of total net worth)
Mr V has $27,001.85 student loan remaining, but because the interest rate is very low (<3%), he’s only paying the minimum and investing the rest. We pay our credit card balances in full monthly.
May 2021 income: $12,603.56
Income source #1 – Net income from our 9-5 jobs: $9,339.70 (74.10% of total income)
We each had 2 pay days in May, which is a very standard month for us. Net income is the amount after taxes and other deductions are taken out. In another words, net income is the amount that shows up on your bank account on pay days.
Income source #2 – Income from Employee stock ownership plans (EOP): $1,603.68 (12.72% of total income)
Mr V and I both work full-time and the companies we work for have a type of benefit, called Employee stock ownership plan (EOP). It allows us to contribute a percentage of our pre-tax income to buy company stocks and receiving a portion matched by our employers. This is considered income because if we hadn’t contributed to the EOP, we would’ve received the after-tax amount as net income.
Income source #3 – Income from Defined-contribution pension plans (DCPP): $1,570.80 (12.46% of total income)
This is very similar to the item above. Defined-contribution retirement plans (DCPP) allow us to invest pre-tax dollars in the markets where they can grow tax-deferred until retirement. Our employers also match with a certain percentage.
There’s a few differences between a DCPP and an EOP, but the mutual benefit is obvious – the part where your employer contributed on your behalf? It’s FREE MONEY. You just have to get it.
Income source #4 – Dividends: $85.65 (0.68% of total income)
We don’t intentionally invest in dividend stocks, which would explain why our dividends income is so low. All the dividends we receive are being re-invested in the market. This is a classic example of making money while you sleep.
Income source #5 – Credit card cash back: $2.68 (0.02% of total income)
We have a few credit cards in rotation right now and one of them is the Tangerine World Elite cash-back card. It’s a great card, we just haven’t been using it much because we’re focusing on credit cards with travel benefits at the moment. Finger crossed we will be able to travel abroad again in 2022!
Income source #6 – Bank interests: $1.05 (0.01% of total income)
Yes I know it’s a incredibly small amount, but gotta catch them all 😉
May 2021 spending: $5,519.91
For context – we are a couple living in Toronto, ON in a home that we own. DINK is our status, it means double-income, no kids (and no pets). $5,500 is about the average amount we spend in a month. To be honest, I don’t really make a budget anymore. With the pandemic still going on, I find it hard to go crazy with spending. We both know what’s a need vs a want, and we discuss purchases regularly. So as long as we make sure to balance both, it’s all good!
May 2021 invested: $5,182.55
As mentioned, we are enrolled in the Employee ownership plans (EOP) and Defined-contribution pension plans (DCPP) with our employers, and all of them is automatically invested in the market.
All the dividends we received from the stock market are re-invested.
We also managed invest $1,322.42 to TFSA and $600 to a Taxable/margin account in the month of May.
May 2021 savings rate: 41%
Here is how I calculated our Savings rate (SR): $5,182.55 (May 2021 invested) / $12,603.56 (May 2021 income) x 100% = 41%.
Final thoughts for May 2021
Before I did all the analysis, I honestly didn’t think we did well in May. Because it didn’t *feel* like we actively invested much. So now I have a deeper appreciation for our benefits with employers – specifically the DCPP and EOP plans. They are both set up to invest in the market automatically, they also come with free matching from our employers, what’s not to like? I mean, besides having to work 40 hours a week for it 😅 . If you’re reading this and you’re a full-time employee somewhere, it’s worth checking with your HR department to see if they have any similar plans.
In closing, here are a few additional views to represent our financial status as of May 31, 2021:
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Thanks for reading. Whether you have any questions, or just want to say hi, feel free to comment on this blog or click here for more ways to reach me. I can’t wait to get to know you as I continue on our journey!