Overall Recap

• Settled into my new Oakland apartment
• Last day in office was March 9, 2020
• Sold my house in May
• Turned 30 alone
• Left Oakland in June for cheaper rent and more space
• Traveled to Playa Del Carmen in early October
• Hit my 1-year mark at my job and got a raise in November
• Slipped into a bout of depression during the holiday season

2020 Goals

I surprisingly achieved all but two of my goals. Instead of saving a 3-month emergency fund, I saved 6 months because of the unprecedented unemployment in this country. I was able to go on a staycation to Santa Cruz and rented a treehouse for a weekend, plus the Playa del Carmen trip I discussed here.

I had initially planned on catching up on my 2019 Roth IRA, but I decided to save instead. I sadly didn’t choose one charity partner to work with because there were so many organizations in need, maybe 2021 will be better so I can focus on 1 or 2 groups.

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2020 Net Worth

One of the saddest parts of a divorce financially is the reduction of your net worth. The home you loved has to be sold and the proceeds split. The household items have to be divided and the savings are halved. For my divorce, I decided to not ask for any financial assistance or to seek a portion of my ex’s retirement accounts. I left with my small Roth IRA and a few thousand from our joint EF which was drained due to moving expenses.

As you can see below, I’m well on my way to catching up to my married net worth. I’m looking forward to reaching six figures (again) in 2021!

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2020 Savings

I really can’t believe that I was able to save my last salary ($60k), as a single woman. I cash flowed a lot of things in 2020 and this number doesn’t account for that.

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Where did my money go?

• 6 month emergency fund
• Maxing our 2020 Roth IRA
• Traditional 401k
• Taxable brokerage account

To look back on all of the years I had only pennies left every month and to now be in the wealth-building period is something I’ll never take for granted. Even if it isn’t God’s plan for me to be a wife or mother, I’ll have the means to take care of myself when I’m older and that brings me peace.

My Goals for 2021

Before my divorce and the pandemic, I was a huge planner. I could see the future I wanted and map out how I was going to get there. Now, I just want to be happy with minimal stress, and my goals reflect that.

Money Goals

I’ve decided to switch up a few things for 2021. First, I will be maxing out my 401k instead of only contributing up to the match. Second, I will not be contributing to my Roth IRA because I may hit the income limit and I don’t want to deal with the drama. I will contribute to an IRA at the end of the year if eligible.

Here is the breakdown of my goals:

Maxed out 401k – $19,500

Vacation fund – $3,000

Lasik – $3,500

Brokerage – $15,000

Life Goals

Unlike most people, I’m in quarantine completely alone. I couldn’t see family even if I wanted to since I live on the opposite end of the country. Being isolated has weighed on my mental health, so prioritizing my well being is important to me now more than ever.

• Self-care day every week
• Working out 3x a week
• Research rental properties (I may buy a rental this year)
• Donate 10% of income
• Read more fiction books
• Make new friends

***

I’m still looking forward to what this year will bring. Having financial stability provides me with the freedom to focus on the other areas of my life that require nurturing. Excited to be back posting on here and Instagram more consistently. Hope you’re well!

Stay Wealthy Fam!

-Dannie

Enter: H&R Block Online

When we left the tax preparer’s office, the first thought we both had is that we could probably do our own taxes way better than that person could. We started searching for options and we came across H&R Block Online.

Now, I was a little bit nervous at first. The last thing I wanted was for the IRS to come knocking on the door saying we messed something up. Y’all know that I have to research everything. So I read about 1,000 reviews and figured out H&R Block was probably going to be the best choice.

The Options Grow With You

Everyone knows that I hate anything that is one-size-fits-all so I appreciate the fact that H&R Block has multiple options to fit your specific tax situation. We were actually able to use the free version of their software that first year because our taxes were extremely simple.

However, as our tax situation changed over time, so did our needs. It’s weird but I felt comfortable coming back, time after time, to do my own taxes because of how easy the whole process is.

Here’s a list of the different options you can choose from:

• H&R Block Free Online
  • This option is designed for people with less complex filing situations, including people who have w-2 income, kids and rent, as well as students and first-time filers.
• H&R Block Deluxe Online
  • This option is designed for homeowners, people who’ve made charitable donations and those with Health Savings Accounts (HSAs).
• H&R Block Premium Online
  • Designed for freelancers, contractors, investors and rental property owners; includes all Deluxe features as well as the ability to import expenses from expense-tracking apps.
• H&R Block Self Employed Online
  • Perfect for self-employed individuals and small business owners with a home office and/or employees; includes all Premium features as well as an improved guided Schedule C interview to ensure a better experience for complex clients.

We used the Self Employed version of their software last year because I did a lot of freelance work for Doordash, various acting jobs and we made a little bit of money from Pennies to Wealth.

During the process, H&R Block’s software literally walks you step by step through the process of doing your taxes on your own. They tell you which blocks to copy numbers from and which forms you should have to find your necessary information.

There’s no way that we could have figured any of this out without them holding our hands through the experience.

No Surprises

H&R Block’s “No Surprise Guarantee*” really satisfies my need for transparency. While you’re filling out your taxes, you get constant updates as you go.

If you add information to an area that will cause an increase in your package price, you get an alert. You also have a tab on the side the constantly updates your tax refund as you enter your information.

I always plan on a very small refund or paying just a little in taxes (the government won’t get a free loan from me) so I love watching this number update to see whether or not I calculated correctly.

Help When You Need It

This year, I’m most excited about using H&R Block’s Online Assist while I do my taxes. This tool allows you to live-chat with highly trained H&R Block tax experts, IRS agents or CPAs.

I want to consult the experts this time around so that they can make sure I get EVERY tax break I can from all of the changes that happened in 2019!

Do It Yourself This Year

I believe doing your taxes with H&R Block is extremely easy. As a gift for the PTW Family, H&R Block has given me a special link to share with you. This link will let you take 25% off all of their software options! Go save your coins fam!

Let me know in the comments if you’ve ever done your own taxes or if you plan to for the first time this year!

$tay Wealthy Fam,
— Dannie

* Receive 20% off next year’s tax preparation if we fail to provide any of the 4 benefits included in our “No Surprise Guarantee” (Upfront Transparent Pricing, Transparent Process, Free Audit Assistance, and Free Midyear Tax Check-In).  Limitations apply.  Description of benefits and details at hrblock.com/guarantees.

Getting Started

Before creating a monthly budget, I used the free annual spreadsheet to plan out my year. Seeing everything all on one page is super helpful in analyzing how my cashflow changes throughout the year. Doing this helps me be proactive instead of reactive towards irregular expenses that I know are on the way.

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Fixed Expenses

This was the category that gave me the most anxiety due to the exorbitant cost of living in the bay area. Since I do not have any family or friends here, living alone was my only option (I refuse to live with strangers or somewhere unsafe, sorry not sorry). Other than my rent costs, everything else is pretty normal for me.

I currently only pay half of my Geico and Tmobile. Webpass (internet) was paid in full when I had it activated at a cost of $504 or $42 a month/12 months.

Like I mentioned in my previous blog, I did receive two months’ free rent as well as $1k off of the third month which helped me tremendously during my transition to the bay. My effective rent will be about ~$2300 for the duration of my lease, which is a big reason why I decided on my place.

However, I’ll begin paying full rent in April 2019 so the budget below reflects that change. I’m still waiting on my water/trash bill so it will stay at $0 for now. I have no clue why it’s taking them so long!

Variable Expenses

To figure out my spending amounts, I simply divided most of my previous joint costs in half. If you’re looking for more ideas on how to determine your budget percentages, go here.

This category can differ from month to month based on my needs and spending requirements. I tend to also track travel and unplanned expenses in this category as well just for simplicity purposes. I don’t budget a specific amount for the last 4 expenses unless I have something coming up.

• Groceries = food and drink
• Home expenses = house crap (toilet paper, cleaning supplies, etc)
• Spending = fun money (eating out, entertainment, shopping, etc).
• Laser = laser hair removal (legs), used Groupon for other areas
• Giving = I keep private
• Fastrak = tolls

Savings

To be honest with y’all, these are just estimates. I’ve been hoarding money the past few months in checking accounts but I do plan on sending a majority of those funds to my emergency fund, IRA and sinking pot (general savings).

About my 401k, my employer does offer a match so I will be contributing 6% of my pay after I take care of my emergency fund and other obligations.

Debt

For debt, my house will be put on the market this month and hopefully sold by March/April. There is equity within the home so this will be mostly a positive financial transaction for us. Right now, I plan to use the money to just save and invest (boring yet effective).

Regrettably, I bought an Acura RDX and sunk a lot of cash into that purchase. I will be selling the SUV and buying a smaller car soon. I may or may not use an auto loan for the purchase and I’m still running the numbers and weighing the pros and cons of that decision. Honestly, I just never want to have so much cash tied up ever again because as you can see, life happens.

Tracking Expenses

I track my expenses using Goodbudget (GB) and my monthly budgeting spreadsheet. I also use my AMEX Gold card for all expenses unless I’m forced to use Visa by the merchant. Using my AMEX helps me keep my credit active, gives me rewards and lets me track my spending if I forget to input things in GB.

Here are my variable expenses shown as digital envelopes in the Goodbudget app.

Simplicity is Key

So that is my budget Wealthy Fam! Budgets are not a set it and forget it kind of thing. I’m sure I’ll be tweaking my amounts throughout the year and I’m fine with that.

I’m just thankful that I was financially literate and financially stable enough to enter this new chapter. 5 years ago, I would’ve been dealing with a disaster.

If you need additional help creating a budget and debt payoff plan of your own, check out my free Getting Started – Basics series.

Thanks for reading! I’d love to know which of my expenses are higher of lower than yours <3.

Stay Wealthy Fam,

Dannie