It's XIRR time again!

[spotty_dog]

I know that I'm the only nerd who does this, but it makes me happy to see the numbers all black and white. And just in case you want to be a nerd too, here's the instructions: http://whitecoatinvestor.com/how-to-...xirr-function/

For 2016 we made 9.48% on our retirement investments. For the last seven years we've averaged 7.37% annualized. That's above my projection of 5-6% (4-5% real return) so I'm happy! Hubby is super hopeful he can retire even earlier than our original estimates.

Also is anybody making any changes to their allocations or investment options in the new year? I'm simplifying a bit, and when I'm through with my current phase of reading material I feel like I'd better review the investment classics and see where I can tweak and improve.

[SoonerTexan]

Lol I don't want to see those numbers right now.

But I am getting off my ass and currently looking for a fee-only financial advisor to take a look at "Us, Financially" now.

[spotty_dog]

It doesn't matter what the balance is; if you're on track with your asset allocation, you should be on track with your growth.

But rock on, if an advisor is what your family feels comfortable with, then fee-only is the way to go.

[SoonerTexan]

It doesn't matter what the balance is; if you're on track with your asset allocation, you should be on track with your growth.

Haha, it's the lack of assets at this stage in life that I am referring to. I mean, I do have my 401k hanging out, so there is that.

[spotty_dog]

If you're gonna err, err on the side of not peeking. I completely ignored my 403(b) throughout the dot-com crash of 2000-2002, and even though it was invested in some ridiculous things, I was pleasantly surprised by the balance when I finally checked it around 2004.

[poky]

Thanks for bringing this up! I just nerded out, and added another sheet to my detailed budget spreadsheet, to track this.
Luckily, we haven't done much adding or removing in the past 6 years (thanks, medical training!), so I went back to 21/31/2010 balances (as far back as I could go easily with online documents), then 12/31/2015 balances, so 2011-2015 is in one chunk, and then I tracked the additions and subtractions made in 2016. Overall, 12/31/2010-12/31/2016 is almost exactly 7%. 2016 was 7.44%
The 2010-2015 part might actually be skewing a LITTLE high, because I vaguely recall a few thousand in a 401K through my job that got folded in, that I don't care enough to track down, but it shouldn't have been enough to make a huge difference, and the separate 2016 number is accurate.

[spotty_dog]

Mmm, spreadsheet functions.

Next thing to do with the fun numbers is to find a relevant benchmark to compare your performance to. I usually simplify mine and say I'm aiming for a 70/30 mix. Vanguard Target Retirement 2030 has about that mix, and it made 7.85% this year. So I feel like I'm at least matching the market! (The last couple of years I felt like I lagged the market, sigh. I think I kept too much money in cash.)

[poky]

Yeah, most of ours is actually in vanguard's 2035 target fund (VTTHX)...but it was just moved there in October, from a less-great fund elsewhere. That fund claims its one-year adjusted return is 8.26%. So I guess 7.44 isn't too shabby?

[MarissaNicole]

What are these "investments" you speak of?!?

Just kidding. I mean I know WHAT they are literally. Just not what it's like to have them!


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[spotty_dog]

It's never too soon or too late to start saving for retirement. I know the end of residency is a crunch time, but it's also your last year at this tax bracket. Even if you could find a few hundred bucks to drop into a Roth, it would grow.

I know during medical school I couldn't afford to save much, but automatic deduction and employer match made it relatively painless. I worked for four years and put away about $6000 and my employer matched about $1800. That account is now worth almost $17k. We ate beans and rice and didn't have central heat or air conditioning, but we saved, LOL. DH also put about $500 a year into an IRA even though he had no income during med school. It's the habit as much as it is the amount.

[TulipsAndSunscreen]

We are trying to maximize this "last year at this tax bracket" thing for sure. We are contributing to 401ks and 403bs (me and him). This will also be our lowest income year since I'll be working PT/not at all the entire year (I worked FT until August in 2016 because of maternity leave) so I need to think about what deductions we can take that might not have been as available before (so many things start phasing out right around a resident's salary so we often could only take part of it because we also had my income). Any tips on that [MENTION=985]spotty_dog[/MENTION]? I know I can take out childcare and loan interest!

[OrionGrad]

[MENTION=1315]TulipsAndSunscreen[/MENTION] It seems like this would be an especially good year to max out Roth IRAs for you and your DH, since it's your last chance at the lower tax bracket. (Unless you've already passed the income threshold, in which case you might want to start exploring your options for backdoor Roths.)

[spotty_dog]

Nope, I don't know a ton about tax deductions, sorry!

[SuzySunshine]

I know what I'm doing after the kids go to bed! Thanks!