Welcome to the July 2016 edition of the Future Proof Net Worth Update. Below you will find details on how I manage my money. I plan to update this quarterly so you can grow with me in this crazy world of math, medicine, and money.
- Cash - my attitude towards cash is that I only need enough to cover my monthly expenses. Any extra should go towards the emergency fund, paying off debt or investing for the future. I'm currently holding more cash than I need. That's because I'm planning to pay off my credit card debt as detailed in my New Year's Resolution post. So far, so good.
- Emergency Fund - depending on where you look, people usually recommend a emergency fund of 3-6 months' worth of expenses. I'm in a relatively safe financial situation thanks to residency - no short term risk of unemployment and I'm relatively well insured through the program. So I'm targeting 3 months' expenses. I hold my emergency fund in Betterment which technically is a taxed brokerage account, but the assets are liquid and accessible. I made a large withdrawal from my emergency fund earlier as part of my plan to pay off debt. I am now in the process of building it back up slowly.
- Roth IRA - best overall retirement investment vehicle. Read this post if you want to know why. I started my account in 2013 and have been contributing the max every year. I paused my contributions earlier this year to prioritize debt payoff. But I am now back on track to get my $5,500 in for 2016.
- Roth 403(b) - I started investing in my employer's Roth 403(b) plan in September 2015. There is no employer match but the other benefits were enough to win me over (See A Change of Heart - Future Proof Investing Update). Currently, my contributions are on pause until I max out my Roth IRA.
- Health Savings Account (HSA) - I started contributing to my employer's HSA plan in January of 2016. I plan to take advantage of the employer match and max out the contribution at $3,250 for 2016. See my previous posts here and here for the benefits of an HSA.
- Taxed Investments - I made no investment purchases or sales since the last update. So all the changes you see above reflect market fluctuations of my chosen investments. Currently I'm not planning to make any additional taxed investments until I pay off my credit cards.
- Car - I went with the Kelley Blue Book value for my 2009 Honda Fit which is a very optimistic estimate as the car has quite a few cosmetic blemishes. Like a true geek, I put a $1,000 deposit on the upcoming Tesla Model 3. But the Fit should fare just fine until then.
- Credit Cards - As you can see above, I've made some progress in paying off my credit card debt. The only balance I carry is a $7,886 charge on my Chase Slate card which is scheduled to be paid off on 5/18/2017, just before the 0% APR offer expires on 5/31/2017. The other balances I pay off on a monthly basis. The plan is to only use credit cards for monthly rotating purchases after 5/18/2017.
- Student Loans - I've made some changes to my repayment plan since the last update (to be addressed in a future post). But my overall goal remains unchanged with the intention of eventually qualifying for Public Service Loan Forgiveness (PSLF) in 2024.
My net worth increased by 12.85% in the last 3 months. That is good news. But the outlook is even rosier for a couple of reasons:
- I am now a PGY-4 resident, which means I'll be able to pick up more moonlighting hours as a benefit of seniority. More hours = More income.
- Thanks to your readership, Future Proof, MD LLC is now officially in the black. Stay tuned for more Future Proof giveaways.
I hope to continue to chip away at that negative net worth in the coming months.
I track my net worth with Personal Capital - a great FREE tool for keeping all the numbers straight.