Posted by Since 2020, I update our “personal finance” spreadsheet every month that tracks all our investments and our net worth. I’ve seen the balance bump up and down, but generally the trajectory has been up.
This summer, to my surprise, we passed the $1 million mark across all our investment accounts! After a quick minute of celebrating joining the “two comma club”, the moment passed quickly. Life returned to normal. I’m not even sure I told Mr. LJ.
The lack of excitement is probably due to being perpetually tired with a baby and a toddler at home. Or I’ve achieved nirvana of being cool-as-a-cucumber when it comes to personal finance. Or it’s because $1 million is less than half way towards our FI goals.
We’ve hit CoastFI
Assuming a 4% real return rate, the $1 million nest egg would grow and be able to fully fund our retirement at 65 years old, without any further contributions. We’ve hit CoastFI status!
While we are aiming to retire earlier than that, it is mentally freeing to know we only need to earn enough to match our spending. However, we will continue to sock away as much savings as sensible. Being able to earn enough money is never a guarantee.
If we continue to contribute into our investments, retirement is definitely within reach in the next 10-15 years. This would be a few years faster than I first anticipated.
The potential of AI scares me
I’m not concerned of a “Terminator-like” future. I’m concerned with how AI can replace a large part of the workforce, especially knowledge workers like Mr. LJ and myself.
AI represents a risk to our income earning potential. It can lead to us being terminated from our current jobs and/or be forced to take on lower income jobs in the future. Other than upskilling, one of the ways to mitigate this AI risk is to save money and grow our investment portfolio. Even if we were forced into lower income roles, at least we’ve hit CoastFI!
AI also represents a risk for our children’s future. They would also face the same employment income challenges. On top of that, I do believe that AI benefits accrue to those who own capital (or shareholders). For young people without a capital base and without the high-income employment opportunities, it’ll be so hard to keep up with those that do.
My priorities have changed
At the end of my first maternity leave, I was very excited to return to work and resume my career progression. At the end of my second maternity leave, I wanted nothing to do with work other than the ability to earn an income and progress towards financial independence.
The vision of my future life became very clear. I wanted to spend more time with my kids. I wanted to coach their sports teams, take them to every extracurricular activity. I wanted to see how they grow up, what they’re thinking and what their personalities become. But I only have 24 hours in a day and work takes up too much of those limited hours already.
I have limited desire to get a promotion or move into a new role where it requires me to spend more time at work. Perhaps if a promotion led to a significant earnings increase that exponentially reduces our timeline to financial independence. But even then, my children are only young for so long. If I miss the time when they’re young by spending more time at work, I can never get that time back and get those experiences.
Outside of some highly unlikely windfall, I can only focus on what I can control. It means figuring out how to accelerate my timeline to financial independence. Since taking outsized risks can lead to either greater gains or greater losses, I don’t think it’s a viable path to take. Simply, this means we need to save more (and spend less!).
Financial Goals Progress
To recap, our 2025 financial priorities were:
| 2025 Goals | Year End Progress |
|---|---|
| Fund any monthly expenses only with our “baby #2 cash fund” | 100% |
| Max contributions on company plan top-ups | 100% |
| Contribute $2,500 to Baby LJ #1 RESP & $5,000 to Baby LJ#2 RESP | 100% |
| Adjust payments on our variable mortgage to maintain <20 year amortization | 100% |
| Max out both Mr. LJ and Ms. LJ’s TFSAs | 100% |
Knowing we would be on one income most of the year, we set fairly conservative financial goals. So it’s not a surprise that we met all of them.
The main reason is we didn’t spend all the money within the “baby #2 cash fund”. Unlike with Baby LJ #1, we did not wrap our parental leaves with a family vacation overseas. Frankly, watching two kids under 3 years old at home was hard enough. I had no desire to do so halfway around the world.
With the excess cash left over, we were able to max out both TFSAs at the end of the parental leaves.
Net Worth Update
Consistent with our updates in 2022, 2023, and 2024, I’ll focus on the controllable and non-controllable net worth components to assess progress.
Within our control
Goals: We achieved all 5 of our (conservative) financial goals for 2025. A good year!
Savings & Contributions: Excluding our two kid’s RESPs, we contributed $61K to our investment accounts (vs. $48K in 2024), inclusive of employer match but excluding the increase in our emergency fund (increased from $50K in 2024 to $60K in 2025). This was a very surprising outcome, which likely indicated we oversaved into our baby #2 cash fund in 2024 leading to excess cash for investments in 2025.
Asset Allocation: We kept to our target allocation and no rebalancing is required.
| Target Allocation | Q4 2025 | Acceptable Deviation (<2.5%) | |
| Cash (excl. emergency fund) | 0% | 0.5% | Yes |
| Bonds | 0% | 0% | Yes |
| Canadian Equities | 27% | 26.4% | Yes |
| US Equities | 44% | 44.7% | Yes |
| International Equities | 29% | 28.4% | Yes |
| Total | 100% | 100% |
Mortgage: Our variable mortgage rate dropped from 4.26% to 3.26%, which helped our cashflow. We kept up our mortgage repayments at a higher dollar level than we needed to maintain our amortization schedule. We ended up repaying $34K (vs. $26K in 2024). If we keep this up, we’re on-pace to repay the mortgage by 2039, just shy of 20-years.
Outside of our control
Portfolio Returns: Another year, another double digit percentage market growth. US markets were +17%, Canadian markets were +28%, and international markets were +21%.
For 2025, my portfolio was up +21% (vs. +24% in 2024). Mr. LJ’s was up +18% (vs. +22% in 2024).
Mr. LJ’s returns continue to be dragged down by holding a large porportion of our emergency funds in low-interest instruments. Also, we were less diligent with investing Mr. LJ’s contributions into ETFs, so it sat in non-interest earning cash balance for a long time. I’ll chalk that up to “baby brains”, but we will have to review Mr. LJ’s portfolio strategy in the new year.
Overall
Obviously, reaching the double comma club is a key financial milestone. It’s hard to complain about three straight years of double digit market growth, but markets are volatile. Who knows how the portfolio balances will bounce around in the upcoming year.
What I do know is I’m more focused than ever on saving more to get to our FI goal faster.