In Naked With Cash, seven anonymous Consumerism Commentary readers publicly track and analyze their finances on a monthly basis. For almost a decade, I tracked my own finances on Consumerism Commentary; now I’m sharing the benefits of public accountability with the participants. I’ve partnered with financial planners who will offer some guidance along the way. Read this introduction to learn more about the series.
SteveDH is retired, and he and his wife have two grown kids. By the time he retired in 2008, he had reached his retirement asset goal of $500,000. His goal now is to ensure his savings last as long as he does. Read his bio to learn more about SteveDH. SteveDH is on Team Roger, with Certified Financial Planner Roger Wohlner.
Keep reading to see his net worth report, updated for August 2013. You can read last month’s analysis here. Following the analysis from SteveDH, Roger Wohlner will offer his own thoughts and guidance from his planning perspective.
Roger Wohlner, CFP appears courtesy of The Chicago Financial Planner.
SteveDH analysis and comments
We had a good cash-flow month but the market masked our good behavior with more volatility than was justified. As Roger pointed out last month, my finances are boring. “Boring is good,” he said, and I wholeheartedly agree. Future market volatility is always an unknown. There is no perfect portfolio regardless of your age or life situation; you can only try to balance your upside possibilities with the downside risk.
Since there is no special topic of discussion this month I thought I would share two tools I use to monitor our finances. These are visual which makes it easier to discuss. The first is the Income/Spending representation.
The various shades of green represent fixed (pension) income. The blue is all other income including interest, dividends and realized capital gains (not value change, real dollars). The red is total spending. As you can see July was so extreme I added a note about the landscaping job just to caveat the gap. This gives me and my wife a clear picture of how we manage spending by comparing monthly cash flow and understanding the ups and downs of our spending needs. Our overall cash flow through August was just short of $13,000 so we’re happy. The second chart tracks investment performance.
The green bars represent the aggregate growth since January 1. The line with the longer dashes and wild fluctuation shows what our investments did for that month. The more sedate dashed line is a simple linear trend line which isn’t all that encouraging. Our investment performance has been a paltry $4,100 through August. Both charts are simple and easy to maintain using Quicken, spreadsheets or other financial programs. We like them because they show us how boring our finances are — and that’s a good thing.
September. September should be good with the end of the third quarter producing increased revenue in the form of quarterly dividends. We don’t have any cash-burning projects scheduled so unless we’re faced with some unexpected issues we should remain… well you know.
Feedback from Roger Wohlner, CFP
I reiterate my “boring comment” from last month and commend Steve on another “snoozer” of a monthly report. I mean that in totally a good way.
I love the tracking graphics and commend you on both your monitoring of your situation and your ability to live within your means. Most folks don’t do either of these vital tasks all that well. Keep it up!
Feedback from Luke Landes
These charts are awesome. Visuals can be an important part of tracking financial progress. Numbers in a table give you the data, but charts make that data come alive. And even boring, consistent financial progress looks more interesting with graphs, charts, and colors.