January 2018 NCF Update: No Job. No Bank. No Problem?
Welcome to the monthly update of our house fund goal, Nuestra Casa Fund (NCF). Our NCF goal is to save enough to fully fund our home purchase before early retirement. We’ll measure our progress by providing a monthly update against our benchmark. Our number one rule: Never, nunca, touch this money unless it’s for the house. We’ll achieve our goal by continuing to work at our full-time jobs.
As far as investing, our action plan is to continue maxing out retirement accounts, while saving for the house and fulfilling the rest of the buckets we deem necessary to retire early.
This is the year, baby!
2018 is going to be a very interesting year for us. This is the year that we’ll complete our NCF goal. After we’re done saving here, the money will stay invested until it’s time to settle somewhere with a decent climate and a nearby beach.
You know what’s so crazy about saving for a specific goal? Once you get really into it, you throw every dime you can towards the goal. I mean, there are times when the paychecks are just hitting the accounts and we already have planned transfers to the brokerage account. It’s absolutely the reverse of spending our money first and then saving what’s left.
Talking about spending, we already took a peek at how we spent our money last year and we did great! Soon we’ll be able to share it with you, because we all know how much you enjoy peeking into other people’s spending habits. Hahaha…. 🙂
No job. No bank. No problem?
At some point we’re going to be in the market for a house. I wonder how it’s going to feel when we call a realtor to put an offer on a property and they ask if we’re bank approved and we say no.
How are these unemployed folks going to pay for a house.
Better yet, what if I show up first to meet with a realtor and tell them that we’ll be paying in cash.
Think about this for a moment. A future 44-year old Latino with jeans, maybe shorts, and a t-shirt telling a realtor that they’re self funding their home and want to put an offer on a house. WTF!
Or should we just send Mrs. Enchumbao instead? Imagine a future 34-year old immigrant retiree, also with shorts and t-shirts, stating that she’ll be paying in cash? We’ll even throwing in a little bit of a Russian accent. 😉
I think we should have some fun when that time comes. How often do you get to be the bank and the buyer?
Now let’s see how we did last month on our house savings goal.
January NCF Update
We expect to meet our goal by August 2018. The allocation for our goal is 80% bonds and 20% cash. We decided on this allocation, so that our goal can keep up with inflation, without risk of major losses during a downturn. Our goal is not to seek huge returns, but to manage risk.
Below are our December results along with a year-to-date update.
|Year-to-date NCF Update|
|Month||Percent of Goal Met||Benchmark||Percent Increase Towards 100%|
|January 2017||23.9%||23.9%||Month that we started tracking this goal.|
|September (new target)||78%||77.2%||28.9%|
Last month we saw an increase of 3.1% towards our march to 100% of funding our goal. We’ve now saved 85.1% of the funds for our future home purchase.
That was a nice jump, thanks to some dividends, a 3-paycheck cycle and unused purchased time off that was reimbursed to us. It will be more challenging to stay ahead this quarter since we’ll be funding our Roth accounts. However, we should be able to catch up as soon as we’re done with the Roths.
The total return for the month was $372.22. The bond funds were down by $6.47 and we had income returns of $378.69. ($378.69 – $6.47 = $372.22). We manually reinvest this income every month.
What else is happening besides savings?
It’s snowing, again! That’s our motivation to spend no more than one winter in the cold Northeast.