The paycheck I received this week marks a big milestone for me: My first full year of saving! Mid April last year was when I bumped up my 401k contribution to max it out (or so I thought). I started my first official “big girl” job in January, but gave myself until mid April to outfit my house and buy the stuff I needed. You know, stuff like a dresser, laundry baskets, a garbage can and most importantly in my book, my mattress.
This is a look back at the last 12 months. When 2016 rolls around, I’ll reset and do my year end reviews then from now on.
What I’ve Learned
1. Buying quality items that will last a long time are cheaper in the long run. If it’s something you’re going to be spending a lot of time using, go high quality. Things like shoes, a mattress, and a good winter coat are worth investigating for the best quality. But, just because it’s good quality doesn’t mean it has to be the most expensive of the options. My bed cost me less than $700, and it’s almost the exact same thing as buying a Serta mattress for $2k+.
2. Understanding your taxes is a MUST. I messed up my taxes this year and withheld far too much from my paychecks. Yes, it was nice come tax time, but in the mean time that’s money the government accumulated interest on and not me. I’ve since adjusted it for 2015.
3. In a similar vein, I also “messed up” my 401k contributions. I thought I was maxing them out, when in reality I was including my employer match in my calculations. This caused me to lose out on $5000 that could be earning extra interest for me right now. I’ve adjusted it and am now sending roughly 25% of my income straight into my 401k. Honestly, I’ve barely missed it so far.
4. Roommates can be a wonderful thing. I moved into a 1500 sq ft, 3 bedroom house in January. I couldn’t even afford to furnish the entire house, much less need 3 rooms to myself. So, when my friend was looking for housing, I offered the attic and he moved in. Having an extra $450 in my pocket per month was excellent, and I’m going to miss the extra income when we part ways soon. However, I can’t say I’ll miss being woken up at 2 am by his antics or his slightly irritating cat.
-In the last 12 months, my net worth has doubled! It doesn’t feel like a whole lot when it comes out of my paycheck, but it’s added up over the year. I went from a net work of roughly $25k last April to being worth $57k this month! Saving so much feels really great (like I imagine becoming FI will feel, except 10x better!).
-I’ve reached 10% of my goal to retirement! I estimate I’ll need roughly $500k to retire.
-According to the Mad Fientist’s FI Laboratory, I have 13 years and 2 months left until I can retire. I think I can do it in 10, since that doesn’t take into account any raises I’ll get in the future.
-I will have spent $18k on housing alone in the last 18 months. Crazy how expensive housing can be!! (one day I won’t need the freedom to move and will be able to turn that into $18k of equity in a house!)
Thanks for reading! What has your last 12 months looked like?