Whelp. One month you’re up, and one month you’re down…
Seems like the more money in the pot you have, the more fluctuations you get. At least when we’re dealing with 99% stocks and funds ;)
Huh… I’ve actually never really thought about that before – the amount of our net worths tied to the markets vs other things like cash, cars, houses, etc… It’s not all in one or two specific stocks which is good, but still – that’s kinda freaky, right?
Anywho, a down month with our stocks and retirement accounts, and yet another down month with our cash too – the worst part. Seems I still haven’t been able to steer the ship out of that perfect storm we hit earlier this summer, and it’s really sucking. We’re not spending all crazily or anything outside of the new changes, it’s just our *income* has really slowed down with the blogging business and others I’ve got my hands into. Par for the course with self-employment, but still doesn’t make you feel tons better ;)
But I’m not giving up hope (or hustle) just yet! I have a couple of new things on the back burner waiting to make it out in the world, as well as a side hustle or two in the works as well. And if all else fails in the end, I’ll just suck up my pride and get back to doing the “responsible thing” again and get myself a normal 9-5 like the rest of the world… There’s worse problems than that I’d imagine :)
Here’s how August’s Net Worth broke down:
MONSTER CASH (-$3,557.45): The good side here is that we’re finally all caught up with moving expenses and insurance stuff and houses being rented out (well, one house being rented out that is), but the down side here is that WE LOST A $HIT TON OF MONEY!
529 College Savings (-$95.76): Due to the above this month, and previous ones lately, we have have stopped putting in any extra cash here for Baby Money… ‘cuz we have no “extra.”
IRA: SEP (-$1,762.31): Same deal here. Though I always pour in the money at the end of the year anyways once I know how much my biz made and how much I can contribute (the amount is tied to profit). The best part about this is that you save a LOT of money on taxes by dropping a cash bomb here (it’s our self-employed’s version of a “401k”), but the worst part is that you need that cash bomb to be able to do it! Wha wha wha…
IRA: ROTH(s) (-$2,233.53): Nothing infused here either. And probably won’t be this year unless a miracle happens sometime soon (all money would first go to maxing out the SEP anyways, and then the rest here…).
IRA: TRADITIONAL(s) (-$4,145.95): No magic to report in this category either. The stocks doing their thing and our IRA Test still humming along without a clear end in site. The fault of yours truly ;) But at least we can’t say we didn’t test it thoroughly over time! Here’s how they break down:
- IRA #1 (NOT Managed): $70,827.60 **Leader for over a year
- IRA #2 (Managed, USAA funds): $66,356.65
- IRA #3 (Managed, ALL funds): $66,984.86
AUTOS WORTH (kbb) (+$163.00): How these cars managed to outperform all the rest is beyond me, haha… Maybe that’s the new correlation with this economy? Markets up – auto worth down. Markets down – autos up! ;) Here’s how much each of our cars are worth right now according to KBB.com:
- Pimp Daddy Caddy: $1,669.00
- Gas Ticklin’ Toyota: $6,944.00
HOME VALUE (Realtor) ($0.00): We’ll be sitting on the recent valuation of $300k for a while unless the market continues to change enough one way or the other. It had been set at $285k for over a year, and then our realtor said we could probably get $300 or $315k for it when we considered selling it instead of renting it earlier. So we chose the lower number to conservatively estimate its value for now.
MORTGAGES (-$639.52): This is really the shining light of our net worths time and time again. No we haven’t been throwing our $2,000’s towards it like we used to do, but we’re consistently paying off more than needed every month regardless of the crap going on around us. You might think it would be smarter to take this money and apply it towards less of a loss in the cash department each month, but I refuse to hit pause on the early payoff. I find it a slippery slope when you start stopping goals as it makes you lazier and not as motivated! And by “you” I mean “me” :) I’d rather clean toilets for the extra money than give up these extra payments. (And not all the $640 is extra btw, only a portion of it is since standard mortgages have principal payment already included with each payment)
Here’s how our two mortgages break down:
- 1st Mortgage: $277,436.46 – 30 year conventional @ 5.5%
- 2nd Mortgage: $29,161.74 – Maxed out HELOC @ a variable 2.8%
And that’s it for this month… Not as sexy as last month’s $27,000 bump, but much better than the previous month’s $40,000 loss… I guess we’ll just be playing see-saw with our money here, no big deal. It’s not like our future depends on it or anything ;)
How did you guys fair?
PS: It’s crazy how your money changes over the years when you’re tracking it. We’ve done almost 6 years of these updates now, and it really gives you a good sense of how far you’ve come (or not) and what your life was like throughout…. I highly encourage you to start tracking it yourself if you haven’t done so already. It’s like a diary of your money :)
PS: If you’re just getting started in your journey, here are a few good resources to help track your money. Doesn’t matter which route you go, just that it ends up sticking!
- The "Budget/Net Worth" spreadsheet - the colorful Excel template I personally use.
- The "Money Snapshot" spreadsheet - a simple Excel template I created for my former $$$ clients
If you're not a spreadsheet guy like me and prefer something more automated (which is fine, whatever gets you to take action!), you can try your hand with a free Personal Capital account instead.
Personal Capital is a cool tool that connects with your bank & investment accounts to give you an automated way to track your net worth. You'll get a crystal clear picture of how your spending and investments affect your financial goals (early retirement?), and it's super easy to use.
It only takes a couple minutes to set up and you can grab your free account here. They also do a lot of other cool stuff as well which my early retired friend Justin covers in our full review of Personal Capital - check it out here: Why I Use Personal Capital Almost Every Single Day.
(There's also Mint.com too btw which is also free and automated, but its more focused on day-to-day budgeting rather than long-term net worth building)
Get blog posts automatically emailed to you!
Hi J- Long time reader newer commenter here-
When the market swings 1% that’s several thousand dollars in a day! Sure beats a latte factor of $4. Since my wife and I have been maxing out our contributions to our retirement accounts we have manage to build up a sizable account, on volatile days its a couple of thousand dollars swing. I’m 97% in stocks so I swing with the market like you.
That’s a great way of looking at it actually – you’re right, small %s = big swings when you max out retirement accts like that. We’ve been doing it for so many years now that it’s become second nature, though it’s still freaky that it’s ALL tied to the market :) But it def. beats the latte factor that’s for sure! I’ll gladly take my coffee AND my investments, thank you very much. Haha…
You should put a % too. As your net worth grows, it’s much more palatable to look at %. We’re down about 1.5% in August. That’s not too bad, but if I look at the $ amount, I’d get super depressed.
True true… but %’s don’t mean/feel much to me, so I need the zing of the stone cold numbers ;) For the good, and for the bad.
With so much of your net wealth in the market, these kind of fluctuations (even in a stable increasing market) are normal. I wouldn’t get too concerned about the short term fluctuations which are partly out of your control.
Instead, focus on how well you’ve done over the past 6 years. Going from $58k to $366k in 6 years is pretty darn awesome!
Hey, you’ve been doing your homework! :)
Ha, still winning the war, I’d say…
We’re in a similar boat where now that we have a significant chunk of change in the market, it’s getting to be harder to put in deposits faster than the occasional market swings down! But that’s kindof a good problem to have, right? That’s what I tell myself. =)
I agree that fluctuations like this are common when you have so much money in the stock market. But thanks for breaking it down and sharing so much of your investments in detail. I’m a new reader and I appreciate the level of detail you shared.
Hey, great! I’m glad you appreciate it :) I often times wonder if I should take it down at some point and stop, but then I have to remind myself that it’s what got me to START this blog and ENJOY blogging to begin with. Just getting a bit harder as the pots rise for some reason… But thanks for the kind words!
Putting a lot of your money on the market can really make your net worth fluctuate. I think you will recover what you lost at some point of time. Good luck!
Yes, this was definitely a rough month for retirement savings. I definitely feel your pain. Nothing we can control, I guess, but I know it stings.
I’m with you, J… definitely some cringe-worthy fluctuations going on. Upwards of 80% of my money is in the market so I’m feeling the same bumps as you. Add to that the fact that I’m currently studying abroad, had business school tuition recently due, etc. and it makes for a pretty pitiful financial picture when compared to earlier this summer.
BUT apparently US home price are up 12%?!
It’s an interesting give-and-take!
Yeah!!! And I’ll take higher home prices any day all day!!! Can’t wait to not be under water anymore, haha… Hopefully it’s helping you out too! Wherever you are in this world right now :)
Hi J$, most of what has happed you have no control over – like the IRAs going down. Our ISAs (a tax free saving/investing thing in the UK) are down as well. I am still believe in the law of equifinality (may have the spelling wrong) – this says that given sufficient time any system is likely to end up in the same place as any other system. In investing it simply means ‘keep calm and give it time’. And keep hustling!
Better than “keep calm and have a cupcake” as I’ve been seeing all over the place the last two years here ;)
Ditto was others have said, as the market goes, so does your monthly net-worth. We are paying debt at a pace of $2200 a month, so no big investing until that is complete.
That’s a plan I can really appreciate – you know exactly where your money’s going each and every month with a finite payoff attached. Keep it up!
I’ve been following you since 2009, and it’s amazing how far your goals and net worth has come! You’re a constant inspiration. Monthly fluctuations don’t matter so long as you’re making forward progress. Keep rocking, J Money :)
Awww, thanks friend! I can’t believe you’ve been reading for so long – you may have the record! :)
Thanks for trucking on with these – you got me plotting our financial freedom after reading all your NUs last December (and are to blame for my passion for PF blogs now :-) ) I’ve been doing ours since Feb, and am now so addicted i start next month’s straight away lol.
We had a reasonable month, ’cause at least our super went up by what we put in, even if the market was down. What scares me is the upswing in house prices – i under-estimate ours AND take 5% off for marketing costs for the purpose of the NU, and it’ still gone up 18k in 3 months.
Even if we have a down month in the markets though, i still get satisfied seeing total debt decrease, which is something i can control…
Awesome!! Way to go on sticking with it and tracking everything – one of the best things you can do :) And at least those housing swings are GOOD problems to have! Not sure what you use (Zillow, Redfin, etc) but might be a good idea to pick and hold one number for a while and then update later vs every month if it’s driving you crazy… I like to check-in every 6 mos or so.
You posting your net worth updates is a great reminder to me. Back in January your posts on this got me going with tracking my own updates. This month was a rough one due to the market. But the year to date is looking great.
Your post today pointed out to me that it’s important to watch a few things on my net worth tracking. 1. month to month what’s driving the changes – is there any trend that I am in control of that I should tweak or keep a watch on. 2. year to date trend. 3. year over year – this is where I hope it gets VERY exciting over the coming years. Your’e increase over the past 4 years is inspiring!
Good job! Keep it up! There’s def. some things we *can* control, and then those we *can’t*. But overall if things keep going up as another commenter pointed out, then you’re def. on the right track :) I’m proud of you for watching it all.
Yeah, I think a lot of people saw investments go down in August–but it is kind of offset by a huge spike in July…hopefully.
Paying down the mortgage and student loan debt is where I saw the biggest movements–things I can control month over month.
Thank you for sharing this. Investing is a topic that needs to addressed more and blogs such as yours are really a good source of information. I have learned not to be disheartened with bumps I’ve come across on my journey to savings and investment (no matter how painful). Hold fast!
Thanks – you too!
That sucks. Luckily (?!?!) I don’t have as much in the market so I am not going through the swings. With that said, I wish I had more in the market (and I’m working towards that) to actually feel the swings as in the long run, there’s the positive average.
As you suggested in the P.S., I started my net worth tracking just last month and it’s helping a ton. I posted my net worth update today over at my blog for everyone to enjoy my teeny-tiny progress. ;) It may be small but it’s progress.
Good job man, you gotta start somewhere :) Especially when you have “net worth” in your blog title! Haha…. you’re too much.
Ain’t investing fun? I guess its to be expected when markets go up and down like this. I am sure next month will be better for you.
I never like months like this, but I have been beaten up in August. The only good thing is that when the market is down, I start buying in hopes of it going up. Just have to remember that I am in it for the long haul.
Yes!! A great perspective to have – as well as strategy… buy low, sell high baby!
Haven’t done my net worth yet. We’ll see how it goes…
Hmm if you think of it as a diary, should you be giving your money a name? When I was little I would give my diary a name so it would be like I was actually writing to another person.
Haha sure. How about Mr. Mulah? :)
Probably should buy some bonds for diversification. :)
I have some in there somewhere :) I should probably look at the breakdown of all of them and see where it all falls… if only I had that much patience/smarts!
Everything around me continues to break. I had the plumber here for an emergency call on Labour Day. I would be happy with not falling behind. I will not be showing any improvement for the next few months until I get rid of a cluster of repairs that ended up on the Visa.
Vanguard is now in Canada and I sold a few stocks that were unusually high because of takeovers and sell offs and bought a Vanguard ETF dividend fund. It is mainly Canadian banks and natural resources.
I hope things get better for you too :( Sucks when everything happens at once.
Fluctuation is natural and things don’t look that bad. The good thing is that you continue to pay nice chunks of the mortgage and compared to your first networth update, your networth is 290k higher. That’s a great thing!
I think we were all down or flat this month with the way the stock market has been correcting. I expect more of the same for the next couple of months before evening out. It is the right strategy for the long term though, so keep it up.
With income slowing (hopefully temporarily) do you regret the 2Ks into the mortgage vs having it in your liquid or stock account.
Man, that’s a GREAT question… and honestly, I’m not sure all the way? I’ll have to think about this for a bit and get back to you :) Maybe I’ll do a post on it?