October 2019 Financial Update

Another month down and it feels like the year is flying by. October was an exciting month right up to the point that our RV got smashed by a trucker that apparently doesn’t value the use of his mirrors.

The month started out slow after I left my job. As I wrote about in my blog post titled “Two Weeks In” I didn’t get any work or even a single phone call for the first two weeks. I was getting kind of worried that I might be stuck without any income for a long time and that wasn’t going to cut it. Luckily I was able to get a connection with a company and they started sending steady business my way. It’s not paying me a lot at this point, but it’s a start and also gives me something to build on.

In the beginning of the month we also got word that our son was accepted to the university he has spent most of his life wanting to attend. He quickly committed to the school and since then we have been looking into every way possible to get some scholarships and mitigate the student loans. We saved money since before he was born for college, but the cost of going to this university is well above what we planned for. As such, we will help him find scholarships and guide him through the decision making process. However, the responsibility will fall on him to ultimately pay for the extra cost above what we planned for. Welcome to adult life kiddo!

As the month went on we also made some financial moves. It was very obvious that the gig job wasn’t going to be worth the effort. It was more financially beneficial to sell the car, so we did just that. This will save us the monthly car payment and future insurance and registration costs. We also got a nice little refund check for the prorated insurance premium we already paid on the car.

Additionally, I have started the process of rolling over my company 401k to my Vanguard Rollover IRA account. I can’t believe how convoluted this process is in this day and age. It seems like something that could be done in a little more than a week, but they are saying up to four weeks! How that can be is beyond me. They sent paperwork, I filled it out and sent it back along with a letter from Vanguard with their instructions. Liquidating the account shouldn’t be too difficult and then transfer the money. Done deal! But no, it’s going to take more time to liquidate and they insist on sending a check directly to me first and then I have to send it to Vanguard. How lame is that? And a complete waste of time as well.

While I’m waiting for this process to play out I’m also reevaluating my investment allocation in the rollover account. When I started this account I had an allocation of 70% stock funds, 20% bond funds and 10% other income funds. The stock portion was spread between 20% small, 20% medium and 60% large cap funds. Over time this allocation has grown out to where I’m at about a 78% stock, 17% bond and 5% other income fund split. This allocation has done very well for us with a 8.4% annual return rate since 2010.

The question now is where do I put the money that is being transferred over? I can use it to quasi rebalance the portfolio or I can go a whole other direction and add a new fund. Or I can go the F.I.R.E old faithful route and just put it in VTSAX and forget it. Apparently I have up to four weeks to decide, so opinions and ideas are welcome. Please keep in mind that this is also only about 3.5% of our total portfolio. So it’s not like we are making a major overhaul here.

Here is where we finished the month of October:

Portfolio- $1,004,094 (Cash and Investments)

Portfolio Goal – $1,500,000

Amount needed to reach goal – $495,906

Our portfolio increased by $12,930 or 1.30% from the end of September.

Year-to-date we are up 20.76%.

Net Worth – $1,205,182

This is an increase of 1.10% from the end of September.

Year-to-date we are up 18.96%

It was a great feeling to finally reach the seven figure portfolio mark. We were able to hold that mark despite some cash drain due to lost income and also a small sell off on the last day of the month. I don’t know that we will be able to hold this mark indefinitely until business picks up, but it sure looks nice for now.

Going forward I still think we will continue to see markets moving in the upward direction. As I said last month interest rates are going lower and they did. Stocks are the natural beneficiary in a low interest rate environment if you want a return on your investment. Additionally, the tariff and trade war with China seems to have cooled with an announcement of a partial agreement to be signed.

These two developments along with mostly positive corporate and economic news should power the markets higher through the end of the year. Of course, we also don’t know what we don’t know. But, barring any surprises it should be a good finish to the year.

Thank you as always for taking the time to read our blog. If you have any feedback or ideas on where to park this rollover 401k money please leave a message in the comments below.

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Until next time……………….



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