Checkup – March 2020

Welcome to another Dr. PayItBack monthly checkup! I use this space to remain accountable to our expenses and goals, track net worth and debt, and muse on what was done well and what can be improved.

As I mentioned in my last post, it’s cliché at this point to talk about how slowly time seems to be moving. It’s hard to believe that it’s not even been a month since my most recent financial checkup, but indeed that’s the case. When I wrote that post, there were 435 confirmed cases of COVID-19 in the United States and 19 deaths; those figures currently stand at 334,232 and 9,557, respectively. We’ve all seen the horror stories out of the most affected places like New York, and it seems likely that this may repeat itself around the country in the coming weeks. Likewise we are dealing with an unprecedented market decline and a level of volatility that hasn’t been seen since the Great Depression.

I contemplated not doing a normal update, because it seems a bit tone-deaf to put out what I know are very comfortable numbers when people are seeing their wages slashed and losing their jobs. But in the interest of having this continue to be a contemporary record, I decided to go forward with it. I understand how fortunate I am to be in this position, and as a physician who deals with elective procedures I may very well have my income and job security affected substantially before this is all over.

Budget/Cash Flow

March 2020 Budget

As with last month, these numbers are considerably skewed by my paying off a deferred tax bill, in this case a federal tax bill of $6,900. Of course, if I had simply waited a month to file, I not only would have been able to defer this further until July 15th, but I would have also qualified for a $2,900 federal rescue payment since they would be using our much lower 2018 return. Such is life.

Food bills were considerably higher this month from a combination of stocking up on some non-perishables (not toilet paper!) and doing a whole lot of ordering out. Income was somewhat buoyed by a number of refunds from trips and events that we had been planning for the upcoming weeks.

PayItBack Progress

March 2020 Debt

Loan payments have taken a back seat as I prioritize building up an emergency fund. Interest rates are rock bottom; as of this writing they are actually less than what my high-yield savings account is paying, though I suspect that will change soon. A part of me is envious of the 0% interest period for federal loans that has been recently enacted, but I know that I made the right choice refinancing; after all it has saved me thousands in interest over the past several years.

Net Worth

March 2020 Net Worth

First decrease in net worth in almost a year which is rather depressing; I just have to remind myself that this will become more and more common as my investments increase, even with more normal market dips. The good news is that I am continuing to hammer away at debt aggressively, and that’s something that the bear market can’t take away (as long as I keep my job….)

Financial Goals for 2020

1) Devote 2/3 (66.7%) of net income to wealth-building: 49.2% running average
2) Max out 403b: $5,292 of $19,500 (27.1% done)
3) Max out backdoor Roth IRAs: $0 of $12,000 (0% done)
4) Max out 529s for state tax benefit: $0 of $16,000 (0% done)
5) Save an additional amount to achieve 20% of gross salary: $0 of $28,500 (0% done)
6) Pay 2019 tax underpayment: $0 remaining
7) Pay off all carried 0% APR credit card balances: $18,990 remaining
8) Pay off my car loan: $0 remaining
9) Pay off Mrs. PIB’s car loan: $0 remaining
10) Pay off Mrs. PIB’s student loans: $25,330 remaining

My hope is that this month will turn out to have been the worst of the decline, though if I am being honest with myself I don’t believe that. But I’m proud that I have stuck to my guns and my investing plan, and I suspect that I’ll come out on the other side stronger for it.

How Far I’ve Come

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