We’ve made it to the 29th update in my net worth series.
I’m document my path towards:
- $30,000 in annual passive income by 2025
- $1 million in net worth by 2027
For detailed numbers, you can check out my net worth tracker. I update it each month.
Let’s get into it.
June 2022 Net Worth Numbers
As a reminder, my net worth last month was at $127,985.75.
Assets – June 2022
We’re moving to Texas.
I know that we’ll be buying a house in Houston very soon.
More on that in a moment.
To prepare for the move, I haven’t done much to add to my existing portfolio.
After we buy a house, we’ll probably have to buy a car or two when we’re down there, so I’m slowing down my purchases to build some extra cash.
I’m not liquidating my portfolio; I’m just stopping any additions to it for now.
I do still anticipate leveraging my stock portfolio to take out some margin debt at a low interest rate. The same goes for my HELOC.
We’ll see what happens very soon.
In total, our assets are $763,440.36.
Liabilities – June 2022
We’re almost done making payments for my wife’s graduate program in audiology.
She’ll be graduating very soon and will start working a full-time job. That will help us throw more money at debt paydown far more aggressively.
Meanwhile, the student loans are at 0% until at least the end of August, unless the freeze is extended (which would be anything but a surprise).
In the event interest is reinstated, we’ll probably spend more energy towards paying those down since the rates range between about 5% to 7%.
Our goal is to pay off all the student loans within the next three years or so.
But, for now, our goal with our debt is to keep things under control. We’ll probably leverage part of our M1 Finance or the HELOC to use to pay for our next house’s down payment.
All told, our liabilities this month are $625,217.18.
My Net Worth – June 2022
That leaves us with $138,223.18 in net worth.
That’s a gain of $10,237.43 from the previous month.
Our debt ratio is at 81.89%.
And our passive income remains at about $1,100 per month.
What’s Next? (Moving to Houston!)
After quite a few months of uncertainty, my wife and I have decided to move to Houston this summer.
We’re planning on making our move to Houston in August or September. We’re looking for a house right now.
The big reason that we’re making the move in the first place is because my wife landed a really good job down there at one of their largest children’s hospitals.
She’s finally going to be done with school and will have a great job to boot.
My current employer is a big law firm in Chicago. They have an office in Houston as well. They’re allowing me to make the switch to the other office, so I’m applying for the Texas bar right now.
Soon enough, I should be licensed to practice law in both Illinois and Texas.
Let’s talk about some of the major factors we’ve considered between Chicago and Houston.
Living in Chicago
When it comes to big cities, the cost of living in Chicago is not particularly unaffordable, at least depending on the area you live in.
We’re currently living in a 3 bedroom, 1.5 bath, 1,800 square foot townhouse on the north side of Chicago.
We live about 40 minutes away from the heart of downtown area by train.
Our current residence cost us $285,000 about a year ago, and we’re paying about $3,000 a month between taxes, insurance, and other expenses.
Currently, Illinois has a 4.95% as a state income tax. That’s on top of exorbitantly high property taxes in most counties (including ours).
The state’s fiscal situation is simply awful. As is Chicago’s.
People are leaving the state consistently. The trend significantly accelerated in 2020.
Not to mention, the weather is fairly terrible for two thirds of the year.
… the majority of our family is in and around Chicago. I’ll get back to that in a moment.
What about Houston?
Living in Houston
In Houston, we’re looking at properties that are about a 25 minute drive from downtown.
We’re talking about 4 bedroom, 3,000 square foot houses, often with pools.
Properties like that in Houston range from $250,000 to $300,000 range.
We’d be getting much more space for the same or higher price in Chicago.
In Texas, there’s no state income tax, so we’ll effectively be getting a 5% raise just by moving down to Texas and having our income sourced through the state.
We’ll be saving over $10,000 per year just on that front.
And my wife was able to land a significantly better job (and had multiple offers) while the Chicago job market was way tighter.
Plus the state and city are growing as more people move into the area. That bodes well for the long-term economic health of the area.
And it’s warm all year. Well, warm for most of the year and blistering hot for the rest.
But I’ll take that if it means I get to see the sun all year and my eyelids won’t freeze together while walking to the office in January.
Now back to that big downside…
The Biggest Downside to Relocating
The most significant downfall in moving to Houston is the fact that we’d be moving away from family.
Our family is currently in Chicago, so seeing them will be more difficult than before.
However, we do intend on living very close to the airport in Houston and we plan on making trips to Chicago very regularly.
A lot of our savings on taxes will probably get rolled into weekend trips back up north (especially in the summer time!).
But if that means we can explore a new place and put ourselves in a better position for the long run, that’s OK.
If all goes well, we’ll eventually bring our family down south with us.
And if it doesn’t go well, we can always move back.
Whatever the case, we are still working out the details of this move. I’m predicting that the next few months will be very dense. As always, I’ll be sure to keep you updated!
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