Monthly Review - November 2005 ($394,298, +$40,622)
Another 40 grand climb on top of last month's home-sale-driven improvement of almost 90 grand marked a good start of my new journey on this side of the Pacific Ocean. Admittedly, most of this month's outsized gain is of one-time nature:
- $15,000 net after-tax income as one-time relocation cash bonus
- $8,000 after-tax value of overtime cashout at my last job
- $11,500 stock option gain thanks to MSFT's impressive performance lately (or 9,000 after-tax value)
- $3,800 from other investment gains (or $3,000 after-tax value)
- The balance is regular savings from monthly salary income -- this month's regular savings was suppressed due to setup cost in the new location.
Now I am looking at passing the $400,000 milestone in the next 30 days.
IMPORTANT BALANCE SHEET MOVEMENT DISCUSSION
• Cash & Savings: While this bucket receives most of the one-time income and regular savings, I also redirect part of the significant balance to investments.
• Brokerage: I made some sizable purchase of mutual funds and stocks in the month to redeploy my cash proceeds from the recent home sale to more rewarding venues.
• 401(k): The 2.2% monthly gain is purely market driven -- I am no longer capable of making more contributions.
• Stock Options: MSFT almost gained 2 bucks in the month of November and drove value of my stock option holdings up substantially. Still, none of these options will expire before 2011, so I am more likely to hold them for an extended period of time.
• Receivable (Payable): The decline is due to reimbursement of certain moving expenses.
• Credit Card Loans: The balance includes $16,000 free cash from multiple 0% APR deals, and some recent purchases still in grace period.
• Tax Liability: The increase is triggered by the gain in stock option and other investment accounts.
IMPORTANT PERSONAL FINANCE ISSUES IN MONTHS AHEAD
• AD&D Insurance: When I was reviewing the benefits from the new statutory company I now belong to the other day, I realized the insurance coverage is subpar compared to that from the previous company (the U.S. subsidiary). I already have term life insurance secured for my wife and myself, but I need to acquire some extra Accidental Death and Dismemberment insurance to cover the risks.
• Investment Reporting: Now that investment income is taking a larger portion in my monthly net worth movement, I am working on some new reports to keep investment performance on my radar of monthly reports. Hopefully, I can adopt a new format of monthly report at the start of 2006.
• 2006 Plan: It is planning season again. I will soon start working on my 2006 Financial Plan. Is half-a-million an achievable goal or the bar is too low? I should be able to find out in the next two months.
Throughout my documented personal finance journey, five-figure monthly net worth growth had been a rarity in 2003, 2004 and most part of 2005. Stars recently align differently: the $26,206 improvement in January marked the fourth five-figure growth in five months. Not surprisingly, January's monthly improvement ... Read
As expected, we wrapped up 2005 with over $400,000 in our book. This month's $6,250 net worth improvement is driven by the following factors (in approximate amounts): • $10,000 from regular savings (earned income - expenses) • $3,800 from investment gains • ($9,600) loss from ... Read
What can be more complex personal finance wise than selling a house, selling two cars, securing two life insurance policies, setting up business banking and accounts, and opening several self-employment 401(k) accounts in one single month? Count an international move on top of it. This ... Read
On surface, the monthly addition of $1,832 is the weakest showing in my track record since the start of 2004, and it is a complete change of fortune after a record-breaking August gain of $23,273. The underlying fundamentals are not too bad though -- MSFT ... Read
congratulations! you've had a great 12 months period...impressive results :)
If you can survive on 1/3 of your gross income, which I'm guessing is at least $50k, I think the half-a-mil bar is just right for 2006. You will have to raise it in upcoming years. If this were true, you would be hitting the million-dollar mark in 5 years! Time to revise your target age of 36.
Now that you have sold your house and cars, will you be renting in Shanghai? I assume you are currently living in temporary housing provided by your employer. Do you plan to buy a car or two? Perhaps you can shed some light in your 2006 Financial Plan.
Fatboy, MM's combined monthly gross in the U.S. was 18k, and because MM is not an expat, he is probably earning now a good salary in Shanghai but in local currency (he is also having expenses in local currency, so he is hedged). Therefore your guestimate of $50k is maybe exagerated.
If you have sufficient Term Life insurance, what is the reason for needing extra AD&D insurance?
D-Man- I don't need accidental death coverage, but i need accidental disability coverage -- what if I lose both of my hands and cannot work on my finance profession (and this blog)?
Latin Guy- 50k is an underestimate.
concerning AD&D,
Is there a reason to use AD&D versus long term disability insurance?
The personal finance bloggers net worth rankings are up for November. Also included is a new October to November net worth change ranking.
Congrats, looks like you're doing good. Looks like you have a large cash position, are you slowly investing in the market over a period of time?
You've definitely had a good year.
Hi,
It looks like you're well on your way! I like the idea of tracking your journey and I added your blog to my personal finance directory:
http://www.manageyourdollars.com/directory
I also run a personal finance forum that rewards its loyal members with cash. We'd love to have someone with your expertise as a member!
MM and Fatguy - my apologies I thought you guys were talking about a $50k MONTHLY gross income. My educated guess for a Shanghai assignment (non-expat) is about $15k all-in monthly gross income.
MM, I am in a similar job situation down in Brazil, so I will try to contribute the best I can to the benefit of the forum.
Nice site. FWIW I've got a couple years on you and I have the same goal. I'm about 100k ahead but you're gaining fast. Sold an investmeent house Sept 1 and netted $215K after taxes(Cal.) Invested all proceeds - 75% in equities, 25% cash managed by myself and have returned 3.8% so far. It sounds like you're in a similar situation. Curious to see your path and results. I'll check back in.
You have made impressive progress toward your goals! I especially enjoy the financial detail you post to support your progress report.
