2013 Breakdown

Today I analyzed where my income went in 2014. It's pretty impressive, if I do say so myself. Even Mr. Money Mustache would be mostly cool with it I think. So taxes ate up 36% of my gross income, I saved 37% of it and I spent 27%. I saved 55% of my net income. Not too shabby. Of course some of that is because I get a bonus in December and I therefore end up saving it all because I have zero opportunity to spend it. In reality I don't spend that much of it. This is a pretty standard year in that 1/3 of my gross income usually goes to each of these categories.

Favorite Time of Year?

In theory, I should be super happy right now. I literally wait for this moment all year long. I found out my bonus and it is higher than last year by 16%. I know how fortunate I am to be well-compensated for doing my job. I know there are people who work just as hard, and sometimes in dangerous or uncomfortable jobs, that are paid much less. That said, I just feel tired and burned out. Work is still very busy and while we finally hired someone to support me so I'm not the only person on my teams, that person was on vacation all this week.  The crowds are bringing me down too. I guess I'm really starting to learn/believe that my career/job and saving/building a nest egg are the most important things.

How much do you save?

I've been reading Mr. Money Moustache a lot lately. I love his blog and feel like it's really the only PF blog where I am actually learning new things. Anyway, as his readers know, he advocates saving like 50% of your pay. Um, wow. And  I thought I was an aggressive saver!

I've never actually added up about how much I save each month, so I wanted to see what % I save. In various ways (pre-pay mortgage principal, cash direct deposited to my trading account, and cash deposited to my checking account) I save about 15-20% of my monthly income. It's not bad, but it's not great. The only thing that makes me a super saver is my bonus.  I usually get a bonus in December (praise be to the Gods) and it's a good chuck of my income. Last year 50% of my gross was paid out in that one check. And I save the whole thing (except when I spent it on my downpayment for the apartment last year). So in reality I save a lot more than 20%, but I want to try to get better at saving on the day-to-day level. I guess it's just more challenging because so much of my compensation is paid out at the end of the year. It's good practice though for if I ever had to take a lower-paying job. I know I can successfully live on half of my salary and still save 20%.

This month I've been traveling a ton for work which means I save a lot on food expenses. My monthly spending for June had been very low, until I booked an international vacation for December. But the saving wasn't for naught, because I was able to pay for it all out of my salary and not have to touch savings.

I'm curious about doing my networth update for Q2. The stock market was humming until about June. Unfortunately I think I'm going to end up down or flat on my investments for the quarter, and I haven't saved a ton of cash, so I think I'll be below average on my quarterly networth increase, but we'll see.

Networth Milestone: 500K!

I'm excited because today I updated my net worth entry on NetworthIQ for Q4 2012 and I've crossed the 500K threshold!!! I also checked back over the last 4 years of net worth entries and realized that I tend to jump by about 100K a year. Which is insane. And only possible because of the generous bonuses I have been receiving. So I'd like to be around 600K this time next year. That would be sweet. Ultimately, I think I'll feel a lot more secure once my net worth hits 1 million (of course it won't all be liquid). Hopefully that will be in about 5 years. That's a great long term goal. Then maybe I'll feel like I can chill out a bit more about life and not have to have such a stressful (but for the most part manageable and sometimes even fun) job.

Update

Wow, this last month has been really crazy. Both financially and otherwise.

First, the IRS audit. My business expense was rejected by the auditor. I found a great, relevant tax course case, and my accountant encouraged me to fight the finding, through the proper channels. This would mean talking to the agent, then his supervisor and if I didn't get anywhere, filing an appeal and then meeting with an agent in person. All of this would have meant I had to write up my findings and basically act as my own lawyer/rep. I was ready. And then life happened. And I realized I had already spent a lot of time on this audit and that my resources would be better spent elsewhere. So I gave up. I paid the $2K to make it go away. Of course I'm not done. I'll probably have to re-file NY taxes for that year, too. In the end, I'm glad that it's over and I do not have to think about this anymore. Also, the IRS agent I spoke to was SOOOO nice. I hated him (of course) until I spoke to him. He actually encouraged me to provide him with the case I had found, but I just kept telling him I did not have time. I think he even offered me an extension.

Second, the market. I have no idea. One day I am poor, the next I'm back up to where I started. All of this up and down just means that I net out about even from what I can tell, not really making or losing money.

Third, job. I've decided that I am very bored at my job. I am getting pretty far along interviewing for a new one, so we'll see.

Fourth, it's that time of year. With any luck by the end of this month I will be in possession of a bonus check. Considering how lean but successful we were this year everyone is expecting a bigger one than last year, so we'll see. Crossing fingers.

My most favorite time of the year

. . . is approaching. It's a time when my income increases. First, just like last year, I got a credit for my gas bill. I should not have to pay a gas bill for several months starting from August. On the income side, I will have paid all of my social security tax probably by the end of next month. So my paychecks in September, October, November and December are bigger than the rest of the year. This year I've been paying $756 a month in SS tax. That is an enormous amount of $ to have added to a paycheck. This is like Christmas, Easter and my birthday all wrapped into one. And then the best part of all (hopefully) is getting our bonus paid in December. Our business seems to be doing okay this year, so hopefully it will be comparable to last year's.

End of Year and Holidays

To keep with the theme of the last post, I'm enjoying the holidays and for once am spending money (while still saving of course). Having reached the limit on taxable social security income, I have extra money in my paycheck during Q4, so that's nice. In theory, I will also recieve a bonus in the next few weeks -- something I've been dreaming of all year. And I'm making my end of year charity donations, which is fun. So between extra money and all the fun spending on gifts, charity (and myself), this is a great time of year!

Of course that means I'm not too excited for Jaunary, but I'm thinking of planning an inexpensive trip to try to ward off the winter blues.

I'll post my Q4 net worth post-bonus. I hope the stock market continues this winning streak. Bonus + stock market gains + end of year income bump = nice Q4!