I cannot believe that it is already October. Where did September go!? It was an eventful month. I started a new job, which was an especially big deal since I had been with my previous company ever since I graduated from college. BF is back to school and is teaching several classes this year, which is both exciting and time consuming.
The good news is that despite all of this change (and a continued lack of cooperation from the markets), I’m finally moving in the right direction again. This is the first month since I embarked on my goal to increase by net worth by 46% this year that I’ve actually managed to increase my net worth! Yay!
The Numbers
Between September 1, 2015 and October 1, 2015, my net worth increased by 3%.
My cash savings dropped by 8%, which is mostly good because I invested my extra cash. I’m trying to take advantage of the poor market conditions to buy low. I don’t generally time the markets, and I’m not really planning to in this case either (I’ll hold for quite a while), but I figure whenever I can buy in at a low point it’s a smart decision.
Another reason my cash is a little low right now is that I’m still adjusting to my new pay schedule, which is now bi-weekly. Previously, I was paid weekly, so I had a good understanding of what money would go into and out of my account on a weekly basis. Being paid bi-weekly will be fine, I just need to adjust my cash accounting to reflect it.
My non-retirement investments are up a whopping 48% this month. I am really pleased with this. I have been actively working to build up my non-retirement investments and it is starting to pay off. I’m hopeful that this will continue to move in the right direction as I keep pouring money into the account and, hopefully, the account starts growing a bit more on its own. Markets, please improve!
Finally, my retirement investments are down 3%. This is due mostly to poor market performance. I also haven’t been contributing to this account through paycheck deductions because it took a little while to get that set up through my new employer. I think that the deductions will resume in the next pay period, so the balance should go up in the future.
Overall, I’m very pleased with the progress I made this month. I did very well on the things I can control, and I did well not worry about the things I can’t control (this is a continual struggle for me). I am pleased with where my budget ended up, and hopeful that I can continue on this trajectory.
I think the biggest challenge will be not spending more now that my salary has increased a bit thanks to the new job. With more money coming in, I’m sure there will be more temptation to spend and succumb to that nasty thing called lifestyle inflation. My current strategy is to invest extra cash on a weekly basis so that it isn’t sitting in my checking account waiting to be spent.
How was your September? Any advice for not increasing my spending now that my salary has increased?
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Anything You Want - A Personal Finance Blog 
Two little words ……. Self Control. 😊
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Haha easier said than done! But yes, that probably is the key!
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Curious do you max out your 401K or planning to? That’s been the best decision for us for meeting our investment goals and not succumbing to lifestyle inflation. After, I set a monthly goal of investing in our taxable accounts. It often feels like we live pay check to paycheck this way, but have built up a sizable taxable account in just one year. I think this is a great strategy because we used to be the couple thinking because we make a dual income and were bringing home pretty decent paychecks it meant we could spend more. Ever since we switched to this strategy we spend way way less.
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I don’t max out my 401K. I could, but right now I am investing in both a 401K and a Roth IRA, and I don’t want to put any more into retirement specific accounts. I do like your idea of making yourself feel like you’re living paycheck to paycheck because everything goes directly into investments, and I’m trying to do something similar right now with my taxable investment accounts.
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Way to go, Ali! That’s the best way to look at it – doing well at what you can control, and also doing well with the things you cannot control (like this volatile market we have going on right now). I’m trying to avoid looking at my retirement portfolios, yikes. In it for the long term! As far as not increasing spending with a salary increase – are there any short term goals you would like to save for even if this goal will take place in the next few months? You can create an online high yield savings account that you still have easier access to, and set up an automatic transfer of the additional income you’re receiving. Just a thought! 🙂
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Thanks for the suggestion! Great idea! I did recently open up an online, high-yield savings account. I think between transferring cash to that and investing other cash, hopefully I’ll be able to keep myself feeling poor and avoid spending more!
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If you’re in the 25% tax bracket or higher, I would definitely consider maxing out your 401(k)! It defers a huge chunk of taxes now and isn’t as unwieldy as a person would tend to think it is because of the huge tax savings. For example, in the 28% tax bracket, maxing it out would cost you $12,960 of after-tax income or about $1,080 per month. Especially if you plan on having kids, it’s great to have contributed more to your retirement accounts now and then you could cut back while paying daycare bills in the future, for example.
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Good point! I’ve been trying to save more in non-retirement accounts so that I’m not stuck with all of my money in accounts I can’t use until I’m 60, but I probably haven’t given as much thought to the tax side of things as I should. I’ll have to dig deeper into that. Thanks!
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I am not sure how realistic this is, but could you “pretend” that your salary didn’t increase and save the entire difference? If you implement this fast, then you won’t be used to having more money yet, so then the approach stands a chance.
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Its a good idea, and something I’m trying to do. I built my budget around my old salary, so I’m thinking that if I just don’t change anything I should be Ok. We’ll see!
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Congrats on the new job aassnd the net worth.Self control is great but there are also always two other words: automatic transfer 😀😀
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Haha yes! I need to set one of those up because goodness knows I don’t have enough self control!
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Net worth going up with the market going down?! Well done. I agree with what others have said. Take as much out automatically as you can and then use the rest to fund your Roth IRA and your non-retirement investments. We haven’t maxed out our 401k yet, but we’re working toward that. If we got a pay increase, we would definitely put it toward that. Then we still feel the same urge to hustle to increase our non-retirement investments. Well done!
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Thanks! All of these comments have me seriously considering trying to max out my 401k. I’m definitely going to be funding my non-retirement investments as much as possible.
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Congrats for ur new job. And I must say you are so well organized !
http://polkadotsandcurry.com/2015/10/05/ethnic-mama-2-nine-yards-of-love-and-style/
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Thank you!
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Its good to consistently invest money automatically, it just grows and compounds beyond the occasional here and there investing schedule. I started several automatic withdrawals and direct deposits to help increase my net worth in 2015. Good Luck .
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Agreed, I need to get into a better habit of automating investing. I used to invest only once or twice a year in big chunks, but I’d like to try to invest weekly or bi-weekly going forward.
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That’s amazing! I like how you talk about your net worth! Normally people wouldn’t think of it other than talking about billionaires. My first time when I heard about MY net worth was when I met with a financial adviser. Good luck with your goals! Such an inspiration!
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Haha, yes, everyone has a net worth! That is great that you met with a financial adviser. Good luck with your journey!
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