Each month, I share a net worth update for the Brewing FIRE household. This brief summary of our financial standing serves as a progress report on our journey to financial independence.
In addition to giving a snapshot of our net worth, I will take a brief look at our spending, saving, and investing activity for the month.
March 2020 Net Worth
We use Personal Capital to track our net worth. Personal Capital makes it easy to track all of our banking accounts, investing accounts, credit cards and loans all in one place. Personal Capital also has numerous other functions for analyzing your investment holdings, asset allocation and performance, as well as some great retirement planning tools.
March
Whew boy. What a month.
I started March with a business trip to the desert outside of Phoenix, and I ended it with shelter-in-place orders from our governor. Amazing how much things can change in just a few weeks.
With the exception of the first few days of the month, the Brewing FIRE household has been hunkered down at home. Mrs. BF is on maternity leave with our new Baby BF, and our daughter (Kid BF?) is staying home for the time being as well. I have been going into the office roughly 3-4 days a week, since my company has deemed itself ‘essential’.
Having everyone at home almost all of the time has been interesting. Most of the time it’s good. Sometimes it’s bad. Occasionally it’s ugly. It’s hard to explain the concept of social distancing to a toddler. Well, it’s been hard to explain the concept of social distancing to the president, too.
Although there’s a lot of shit going on right now, and I know it’s going to be worse before it’s better, I still feel very fortunate. We have our jobs, we have our health, and we have each other. I can’t really complain.
I wrote about my early Coronavirus feelings in a separate post, This is Fine.
Home Work
So, on the brighter side, what are we doing with the excess time at home?
- We started potty training Kid BF, and she’s quickly getting the hang of it. Hopefully by the time everyone is released back into the wild, she’ll be fully trained.
- I’ve stepped up my domestic game big-time. After years of tweaking, I think I’ve perfected my hummus recipe. I finally made some naturally fermented pickles that stayed crunchy (hint: tannins).
- I actually had time to brew a beer last week. Is COVID IPA an insensitive name for it?
- We’re also cleaning up our massive side yard and prepping the garden for our 2020 crops.
- Our chickens are pumping out 8-10 eggs a day, which is fantastic. We’re effectively supplying our street with eggs during the crisis.
I feel like this time at home is a golden opportunity to make progress in areas that I feel like “I never have time for,” usually. I’m thinking of taking an online course or two, maybe learning some web development skills, or pursuing a totally new area of growth. We’ll see what happens.
Month-Over-Month Comparison
Considering how bad the first half of March was in the stock market, the numbers actually don’t look that bad. As of today, we’ve lost approximately $130,000 of net worth from our February peak. The market carnage has been partially offset by a number of windfalls I will mention below.
Spending and Not Spending
| Category | Spending | Comment |
| Mortgage | $1,221 | |
| Utilities | $627 | heating oil, electric |
| Home Maintenance | $10 | |
| Student Loan | $974 | last payment until October? |
| Transportation | $702 | new tires and tune-up |
| Childcare | $0 | |
| Medical | $0 | |
| Groceries | $358 | |
| Restaurants | $257 | |
| Shopping / Misc. | $467 | diapers, wipes, TP, oh my! |
| Discretionary | $238 | liquid courage, etc… |
| Subscriptions | $58 | |
| March Total | $4912 |
It’s an interesting social / fiscal experiment to see how your spending adjusts with a shelter-in-place situation. I have a few observations.
In some respects, life goes on. Mrs. BF had to have her car serviced at the beginning of the month, and I needed to replace my tires as well, which cost $600 combined. I will offset this cost by selling the rims/tires I bought a couple months ago (it was cheaper to buy new tires than to use them, so I’ll resell them)
It’s also interesting to see that our shopping/miscellaneous spending didn’t decrease by much. We’ve been steadily purchasing necessities such as diapers, wipes, cleaning products, etc.. and I suppose this will continue in any environment. We also had to replace our Instant Pot, because someone placed the top on a hot stove and melted it.
I added HBO Now to our subscription lineup (along with Netflix and Hulu) for at least a month or two, because of the uptick in TV consumption.
Income and Investing
We experienced a large cash influx in March, from a few different sources.
- Tax Return: due to the paper losses I took on my rental property that sold in December, we ended up getting a $10,000 tax refund from the government. Can’t say I expected that.
- I received an 8% bonus from my employer. I really didn’t expect that, considering our current conditions and their general tendency toward stinginess.
- We already received ~$3,000 in FSA reimbursements from some childcare and medical bills from Baby BF’s arrival.
- We also collected rent for The Basement Bungalow, as usual.
That’s the good news. The bad news is that we will not be collecting rent on our basement apartment in April, since we allowed our tenant to break his lease early.
Also, my brewpub is shut down indefinitely, and I will predict, permanently. This is OK, since I don’t often have the time to go down there anyway.
Finally, Mrs. BF is only receiving 60% of her income, since she is on short term disability. That runs out in April, and she will have approximately 6 weeks of unpaid time off before returning to work.
What does all this mean? I’m stashing cash like a fiend. We’re sitting on almost $50,000 in savings right now. I plan to invest a good chunk of this, but I’m going to wait a bit longer before deploying it.
I’m thinking of writing a separate post to detail how we have been investing over the past month, and what we plan to do going forward. I wouldn’t call it market timing, but rather strategic rebalancing.
How was your March? How much pain did you feel in your portfolio? Have you learned any new skills, like knitting, or whittling? Stay safe, and let me know how you’re doing in the comments.
that tax return and bonus came at a really good time, didn’t it? we’re waiting on 3+ grand from ny state for that preservation type tax credit. i swear they’re holding onto them as ny is out of money. it’s a good time to have a bunch of liquidity. i’m sure you’ll get the ol’ bungalow back and cash flowing when this ends. it’s not like it’s going anywhere. 5% down most anyone would accept for this past month. march has been pretty damned dull around here with a couple of paid weeks off but at least i’m back on the sauce with no signs of the dreaded kidney stones! i’m claiming victory on that one….for now. stay safe over there.
A pandemic without alcohol is like a.. pool without water? Good thing wine is back on the menu. The massive cash infusion is never a bad thing, but I’m happy that we don’t actually need it at the moment. It will be good to start deploying the cash, hopefully I’ll be able to average in at some better prices.
We actually have a new tenant lined up for May already. Ironically, she’s a PhD Virologist. She’ll be on TV directing us through the next pandemic in 10 years.
Great to hear you didn’t get hit so hard (compared to most), and man, what a great couple windfalls!
I had a real estate deal fall through that I invested in back in early Feb. But I just found out the partnership is refunding 100% of my capital. It’s not a windfall because it’s ‘wealth’ I already had, but I must say I’m sleeping better at night with a larger cash position than I planned.
Cheers!
That’s fortunate that you were refunded, and it definitely feels good to have a bunch of cash right now, just in case. I feel like there will be a major divide during this crisis, where the top X percent (maybe 50?) of households will be largely unaffected, due to the ability to work remotely and no job loss. I worry about the rest of the country. Hopefully we come out of this quickly. Thanks for the comment Joel!
I also brewed an IPA in early March and have been informally referring to the bottles as Coronas…I choose to classify it as witty rather than insensitive.
Looking forward to a post on how you plan on stashing/deploying your cash. The ongoing debate in our household is how much to hold in cash vs. continuing to plow into the market at discount prices, all while considering the chance of at least one of us losing a job in the not-so-distant future. Happy/fortunate to be in a place of relative financial strength so far. I agree with your comment on the potential for a large divide of households on the other side of this, whenever that may be.
If you ask someone if they want a Corona, they’ll probably decline. It’s a tough decision, between saving further cash and investing. We have a considerably large cash position now, but it’s mostly happenstance as I’ve mentioned. My wife’s job should be very secure (medical professional with emergency response experience), but for me to assume my job will always be safe is perhaps overconfidence. I guess we just have to wait and see how this develops, but is nice to be in a good financial position during these times. Thanks for the comment.
Great that you have a cash stash in hand to invest or just provide extra liquidity. We’re majority real estate, and I think we’ll need the liquidity in case the economic downturn goes deeper and more people lose their jobs. Our rentals are in solid neighborhoods but this is a wide-reaching downtown.
It’s good to hear that you’re doing OK with your properties so far. I can’t help but wonder if a lot of people in the RE community are going to get wiped out because they were overly reliant on leverage and, in some cases, investing in primarily short-term rentals.