Well on paper it was a decent month; our net worth increased by $12K. Our real story is a lot more complicated.

I don't have time to go into gruesome detail, but we've been hit by curveball after curveball this year. First AS and I "lost" $60K of projected income due to a contract job ending much earlier than expected. This was with a previously reliable client of mine so we really didn't see it coming. After that it was a string of expenses: boiler replacement, electrical and dishwasher for the rental property, stove breaking, car repair, bigger than expected healthcare bill...I might be forgetting a few more but it added up to $20K more or less, so our budget was $80K worse than expected (maybe more; like I said I could be forgetting some expenses). And we're only at the end of August.

I knew things were adding up but I hadn't really taken in the full picture until this weekend, so I had an emergency triage session with the spouses. To date we're "only" running about $45K in the red projected through the end of the year, which is actually pretty impressive, meaning we've managed to make up $35K of the $80K shortfall (more if the shortfall was bigger than I'm remembering). But obviously that's not enough; we need to figure out what to do about the remaining $45K.

We ran through some scenarios like withdrawing Roth contributions or selling one of our properties, but the math is telling us if we can find some way to park that debt and pay it off over time, that's a better option than either of the former. 

So long story short, we'll be using up the rest of our existing HELOC, taking a cash distribution from my and AS's business, and trying to find a new HELOC and/or 0% credit cards to soak up any overflow. We are also trying to think of ways to make more money and cut expenses for the rest of the year to further ease that shortfall. We also need to create a leaner budget for 2027 so we can start paying back this big ol' debt.

The boiler comes due tomorrow, so I've already started the HELOC usage, borrowing $12K to cover that. If not for taking that out (and another $6K earlier in the month because some of my freelance jobs got pushed back and caused a cashflow issue), we'd have had more like a $30K gain in net worth, because our funds all showed a gain and we did pay off some principal on our mortgages.

So, it is what it is: a really freaking bad luck year that we weren't sufficiently prepared for. But we've had big headwinds before and we know how to pull together as a team, so we're flexing that muscle yet again.

Huzzah for our blogs being back! I would really hate to lose this community and the hundreds of blog posts I've done over the past 9 years or so...

Due to good cashflow I paid back everything we borrowed from the HELOC this year (not counting the $27K total borrowed over previous years that we're still carrying). We've got the boiler to pay for in September, so I'll definitely borrow from the HELOC again, but it's nice to have it even temporarily paid down!

Net worth increased a little due to paying down the HELOC, even though the markets were flat to slightly negative again. According to my current calculation method we are still in Coast status with a surplus. I've mentioned how I think I'm underestimating our spending in retirement but also haven't really factored in Social Security, so I wasn't sure how close that was. I asked Claude (AI) to create a function to calculate if we started drawing SS at age 70 but covered spending with our retirement funds before that and had it calculate a much higher spending level and a lower retirement age, and the good news is, even with having me retire at 57 instead of 62, it came up with basically the same result as my current Coast calculation!

We still clearly need to get our current income/spending in balance before we can take any calculator or thoughts of retirement seriously, but it's very encouraging in light of how challenging this year has been so far.

Given this year's budget uncertainty, I'm still wavering on visiting Thailand in 2027, which is my dream vacation I was hoping to at least reserve airfare for this year. Tracking prices and they're holding steady, and I think they will for another month or so, so I'm kicking that decision down the road.

Original Coast calculations:

Adding Social Security to the picture: