On Investment Portfolios and Financial Privilege

So I’ve been paying attention to my investment portfolio, even though that is the one thing personal finance experts are telling everyone not to do right now — if you don’t look at it, you can’t worry about it, right?

Well, let’s look at it:

It's a bar graph. A very very downward curving bar graph.

My current net worth, which includes not only my investments but also the $15,450.84 I’ve got saved in various bank accounts, is now $138,011.15.

That’s down $29,020.70 from the beginning of 2020.

And yes, that’s all investment-related. (I didn’t, like, go buy a car or anything.)

I’ll be the first to note that I am still in a very very financially privileged situation right now; I’m still freelancing, I don’t have to worry about where next month’s rent is coming from, and I have a cash emergency fund that will cover me for six months if I’m judicious with it.

The financial independence calculators now estimate it will take me 7 years and 9 months to FIRE (and yes, I ran those calculators with just the past month’s market data, so they wouldn’t be tricked into thinking we were still in a bull market). I’ll remind you once again that I’m not looking at these calculators as an actual predictive tool; they’re just fun to play with — and now it’s interesting to think about how much of that theoretical FIRE money might come from actual earnings and not investing gains.

Because that’s what the calculators told me this morning: that I could FIRE in a bear market if I continued earning at my current level for the next eight-odd years.

That said, I am well aware that employment of any kind is always tenuous (you might remember me writing the “treat your salary like it’s temporary” post for Lifehacker last summer), especially right now.

So I’d love to hear your thoughts on where I should be donating my money at present — is it better to do, like, a Red Cross thing, or to find a few GoFundMes and help fund them?

Because I do very much want to do something. ❤️

UPDATE: There was something that was still bugging me about the FIRE calculator’s numbers, and it turns out it was that the calculator wasn’t pulling current stock returns; it was autopopulated with an automatic 7% percent return.

I adjusted the calculator to run the 3.8% return that my portfolio has actually gotten since I opened it in 2018 (at the end of 2019 it was getting a 9% return; currently it’s getting something like a negative 30% return, although Vanguard won’t calculate negative returns because maybe that doesn’t work mathematically), and the calculator adjusted my theoretical FIRE timeline to 9 years and 1 month.

For whatever that’s worth.

4 thoughts on “On Investment Portfolios and Financial Privilege

  1. I decided to pledge to a few more patreons. I work in the arts and am one of the lucky few who has a salaried job in the arts. I also did some one off donations to some of my favorite artists. I decided to giving everyone a little bit instead of one artist a lot. I felt better about spreading the wealth around. With everything going on in the economy, are you still saving/investing the same amount or do you plan on adjusting what you are doing?

  2. I’m focusing on hyper-local stuff right now: my friend/high school theatre teacher’s business, the food assistance program my best friend’s mom set up, the community care network in my town. I think that all charities that are large enough are going to have PR issues at some point, but the last few Red Cross disasters have pushed me to get as close to direct giving as possible.

    1. I haven’t seen any local requests from my community yet, though I’ve been watching for them. I did make a donation to Feeding America today, since they’re working on keeping food banks stocked during the coronavirus outbreak.

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