Dollar Diary: Financial exec making more than $100,000 shares week of spending

Dollar Diary is an inside look at the spending – and saving – habits of your fellow 605 residents. It’s sponsored by The First National Bank in Sioux Falls, which is ready to help you no matter what your financial goals.

In today’s edition, we meet Shaun, who is 35, lives in downtown Sioux Falls and earns more than $100,000 as a financial executive.

First, the basics.

Rent/mortgage: I rent an apartment in downtown Sioux Falls for $2,650 per month, and utilities are $200 per month.  Downtown has a vibrant social life for a bachelor, and I love the vibes, convenience and fact that I can walk everywhere. One day if I have a family, I more than likely will get a house, so I’m enjoying the downtown lifestyle while I still can.

Car payment: My car payment is $900 per month because I’m paying it off faster than I might need to and because I indulged in a new Ford Raptor F-150, which is expensive, but I’ve always wanted one.

Other income? Side hustle? I have investment income.

Extras/memberships: Streaming services: $120 per month for Hulu + Live TV, Netflix, HBO Max; hot yoga membership: $70 per month; GreatLIFE membership: $70 per month.

And now, the diary.

Here’s what a week of spending looks like:

Sunday: $160 – I purchased all of my groceries at Hy-Vee to get the Fuel Saver points and then meal prep for the entire week. $55 – monthly supply of protein for working out.

Monday: $45 – gas. I saved 84 cents per gallon with Hy-Vee’s Fuel Saver. $3.19 – coffee.

Tuesday-Friday: $3.19 per day for my butter coffee at Josiah’s.

Saturday: $200 – I did dinner and drinks with friends at Crawford’s, Bin201 and The Hello Hi.

What I learned: I could save approximately $20 per week if I just make my own coffee at home. But I enjoy the social aspect of getting coffee since I work from home and eat at home a majority of the time.

What’s next for Shaun?

What big purchase are you saving up for? A house. I would like to buy a house within the next six months while interest rates are still low.

How would you describe your broader financial goals? Do you feel like you’re on track?

Broadly, I invest most of my money on small- to mid-cap stocks and cryptocurrencies. I manage on my own through free trading platforms to keep my costs low. Additionally, I max out my 401(k) monthly to get my company match as well as max deduction for tax purposes through a Roth IRA.

I feel like I’m on track to be able to retire by the time I’m 62 but still hoping to capitalize on some stronger returns this year with the bullish stock and crypto market, so I can also consider purchasing a boat and lake home in the near future.

Additionally, I get company stock that’s fully vested, and I don’t touch that as our stock price keeps growing, so I feel comfortable with that strategy since I have some diversification in my portfolio.

I’ll feel really good once I have some real estate as the value should increase over time and then I’ll get additional tax breaks with property and interest tax write-offs.

The expert opinion

Of course, it’s just a snapshot, but Shaun’s Dollar Diary gave The First National Bank’s chief wealth management officer Adam Cox a good look at his spending and saving. Here’s Cox’s take:

“Given his great income, Shaun can afford to not sweat some of the small stuff at this point,” Cox said.

“His daily coffee won’t be his problem, so enjoy. Shaun’s housing expenses are high but probably not unreasonably so considering his income. I like his commitment to saving for long-term financial goals given the age at which he would like to retire.”

Cox said Shaun should be aiming to save approximately 20 percent of his gross pay each year, and that should be spread among pre-tax accounts like his company 401(k), Roth accounts and an investment account if he has some extra.

“Now that Shaun’s 35, I might suggest taking a closer look at his asset allocation. He mentions that he invests mostly in small- to mid-cap stocks along with cryptocurrencies. This is a very aggressive approach, and Shaun may want to consider adding some large-cap exposure to further diversify his portfolio,” he said. “At Shaun’s age and income level, he is in a really great position to secure a comfortable retirement while still living a fulfilling life now.”

One of the biggest misconceptions when it comes to investing and financial planning is that you need hundreds of thousands or even millions of dollars to do it.

That’s simply not true.

One thing that is true, though? Your behavior and what you do with your money has more of an impact than how much you have.

Learn more and listen to the latest episode of “Common Cents on the Prairie,” Cox’s podcast, here.