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.
Back to our regularly scheduled programming.
We made it through the month without having to buy a new car, which is already a win. The majority of our annual allotment to tax-advantaged investing was already done in January, and while the stock market continued to flirt with correction territory, it hasn’t done anything out of the ordinary. COVID cases have plummeted (down 85% in our area from the peak a month ago), and my hospital is finally no longer requiring testing before our procedures, which cuts down on about 15 minutes of unpaid work per day.
Budget/Cash Flow
I received a nominal raise that kicked in with my last two paychecks, increasing my pre-tax biweekly income from $14,615 to $15,000. This has been more than canceled out (to date) by Social Security taxes and some withholding for out dependent care FSA (which I didn’t use last year). My favorite time of the year is hitting the SS wage cap ($147,000 in 2022), which I think this year should happen in sometime in May.
Our biggest expense this month was underpaid federal taxes ($3,822) which is close enough that no penalties were due. We’ll also be getting back a four-figure amount from our state in March which will soften that blow. I had the honor of maintaining my certification in anesthesiology ($310), and I put Mrs. PIB in a spa/hotel for a weekend away from the kids ($267).
I finished contributing to my 403b for the year and have kept up monthly contributions to crypto and our taxable brokerage. I also completed a tax loss harvest for the first time (the actual loss ended up being a little more than $14,000). This will be deductible against up to $3,000 of our normal income this year which is nice.
PayItBack Progress
Rates remain at historic lows. Paying minimum. Rinse repeat. At the point where I could probably pay off the loan in 6 months if I really swung for the fences, but why…
Net Worth
Another slump downwards in net worth. The S&P was down about 3%, and the other classes I invest in (international stocks, REITs, bonds) were no different. Our invested assets are large enough these drops are enough to erase an entire month’s salary. But as always, we are in it for the long haul, and all it takes is a look back even just a year to appreciate our progress.
Financial Independence
For all the reasons above, another month of holding relatively steady. FI before the end of the decade remains an overarching goal and we are still on track.
Financial Goals for 2022
1) Max out 403b: $20,500 of $20,500 (100% done) ✅
2) Max out backdoor Roth IRAs: $12,000 of $12,000 (100% done) ✅
3) Use taxable brokerage in addition to 1) and 2) to save $120,000 total for retirement: $20,000 of $87,500 (22.9% done)
4) Max out 529s for state tax benefit: $16,000 of $16,000 (100% done) ✅
5) Continue to pay minimum on student loan as long as rate remains <4%
6) Finalize estate documents ✅
7) Purchase a house
Definitely a time to zoom out on the investments tab and see that the returns remain exceptional in the long run. But it’s always more fun seeing the net worth report go in the other direction! One of the rare years where dollar cost averaging on tax-advantaged accounts would have made more sense.
Maybe! The year is young.