For more details on the relevance of these ratios, please see this How Much Is Needed To Be Wealthy - The NUMBER.
Ratio and Target
Income to Salary
|2.16||4.73||This gain was due primary to receiving and inheritance distribution of property. Without the inheritance the ratio would be slightly down at 1.82|
I plan to sell some additional shares of company stock in my retirement plan, keeping only the low basis shares in my company retirement for a future NUA execution. At this point, I have sold 90% of the stock options with an early 2014 expiration date.
|Savings to Salary|
2007=23 2008=16.7 2009=15.3
|21.2||23.8||Again all of the gain was due to the property inherited. The value would be slightly down at 20.9 without the inheritance. |
During Q2, I continued to trickle funds back into the stock market. I plan to continue trickling in funds into stocks and ETFs during Q3 2013.
|Debt to Salary|
2007=1.51 2008=1.46 2009=0
|We said bye-bye to our mortgage on May 20, 2009. Eliminating a mortgage payment has reduced our expenses by 24%.|
My financial goals for 2013 are:
1. Continue to maintain an Investment Income to Salary ratio > 0.8. (on track)
2. Maintain a Savings to Salary ratio of 20. (on track)
3. Maintain Debt to Salary Ratio at 0. (met final goal of 0)
(For reference, Salary refers to gross salary just prior to early retirement in October, 2007.)
Both #1 and #2 were directly correlated with how well our stock, bond, and CD investments returns. With the flat performance of my company stock and the high proportion of cash, our portfolio was down slightly.
Although I am pleased with our portfolio results, I am not confident the gains are sustainable. Our short term expenses (next 3-5 years) are invested in CDs, bonds and money markets. I continue to be concerned about volatility of our investment portfolio, and there equal downside and upside potential going forward due to EU sovereign debt crisis and the US debt ceiling crisis. So I continue to slowly add funds to the stock market, and hold my company stock and stock options
I continue to have the same financial goals for 2013. At this point, I am slightly optimistic about the economy and the stock market.
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This is not financial advice. Please consult a professional advisor.
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