We now have monthly percentage changes in our net worth – woop woop! It only took a handful of you to speak up, and over 5 and 1/2 years for me to actually do something about it, haha… But I must admit it does add a touch of sexiness up there ;) Even though I still prefer looking at cold hard dollar numbers vs percentages… I like feeling the stings and gains!
An overall awesome month though. And exactly what we needed after getting slapped around so much over the past handful of months… I feel like we’re right smack in the middle of the Perfect Storm‘s eye right now actually, and we have to stop and breathe in the serenity for a few before the $hit starts hitting the fan again. Not that I expect some major catastrophes brewing in the near future or anything, but I do know we’re far from being out of the danger zone quite yet. We can talk about that once our cash flow finally stabilizes into the positive regions once more. I miss surplus money! ;)
Here’s how the month broke down:
CASH SAVINGS (-$1,419.49): This may look like a major loss on the record book, but sadly enough this is the best we’ve managed to do in the past 3 or 4 monthly updates.. I’m not proud of that suck-ass number, but it is motivating me to keep on hustling hard and overcome the damn thing… And we only have a good 10 or so months left until the wife gets back in the work force too ;) So I’m trying to keep in mind that this is all just a phase right now…. it’s all just a phase…
529 College Savings (+$186.47): Some extra free cash for el niño! I’ll take it that all day long… And if you’re wondering why we include Baby Money’s 529 in these updates, you can read about it here.
IRA: SEP (+$3,075.69): A nice little bump here too for not adding anything new to the pot.
IRA: ROTH(s) (+$2,204.10): And here.
IRA: TRADITIONAL(s) (+$8,220.44): And here too :) Looks like our IRA Test lives on for another month too. Here’s how it currently breaks down (All of this money btw is from my old 401(k) plans all merged into these three IRA accounts):
- IRA #1 (NOT Managed): $73,659.42 **Leader for two years now
- IRA #2 (Managed, USAA funds only): $68,912.97
- IRA #3 (Managed, ALL different funds): $69,817.16
AUTOS WORTH (kbb) (-$217.00): I thought about marking down my Caddy an extra $500 or so due to all my recent accidents lately (two in 5 months!), but then I read the description of what Kelly Blue Book says for “fair” condition – the lowest of their rankings, and which I’m pulling these numbers off of: “The paint and bodywork may require refinishing and body repair,” and “Needs servicing, but is still in reasonable running condition with a clean title history” – both of which my car most definitely has ;) So I’m pretty confident in these figures for now… I just don’t know how much longer the car will last!
Here are the values of our two cars:
- Pimp Daddy Caddy: $1,763.00
- Gas Ticklin’ Toyota: $6,633.00
HOME VALUE (Realtor) ($0.00): A nice and level “no change” here – just the way I like it… Our house has only gone up ONCE in the past 5+ years since owning it (back in July when my realtor appraised it at $300k ), and all the other tips it’s been drop, drop, and more drop.
MORTGAGES (-$646.61): Slowly and steadily paying those bad boys off! Only $305,951.59 more to go! Haha… Man I hate home ownership… Here’s how they break down:
- 1st Mortgage: $276,923.23 – 30 year conventional @ 5.5%
- 2nd Mortgage: $29,028.36 – Maxed out HELOC @ a variable 2.8%
And that’s it for September… If you’re curious about all my previous net worth updates, you can check them all out – dating back to January of 2008, here. The % difference from then to now is a staggering 627%! Or, more sexily, a jump of $309,848.51 ;)
Hope you guys did well too! Tell us about it in the comments, yeah?
PS: If you’re new to the site and wonder why I dislike home ownership, read this (hilarious) post by James Altucher. He does a much better job of capturing my feelings towards it all than I ever can – which is both weird, and slightly pathetic. But it’s still very much the truth ;)
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)
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Are you expecting the market to start taking a dive because your government is acting like an out of control kindergarten class?
The thousands of suddenly unemployed people could have a negative effect on your economy and the world’s confidence in your economy.
Yes, agreed – we’re a mess over here. But no, I don’t worry about the market or anything else that may or may not happen until it DOES actually happen. There’s so many problems and theories and issues in the world in general that if I got caught up worrying and thinking about them all the time I’d never get anything accomplished (and I’d probably have a few panic attacks in between!). So I keep my head low and just hustle as hard and as best as I can, hopping obstacles as they present themselves.
Bunch of bozos running the government. Ridiculous.
It stinks the cash flow is headed down for now, but once your wife rejoins the workforce it sounds like it should skyrocket every month! You guys will be fine, but good job for hustling right now! Our cash level tends to stay the same every month but Tori’s student loan debt goes down to make up for it!
Yup, you got it my man. As long as there’s a plan in the works, and things are generally moving upwards, we can be happy little finance’rs over here :) You guys are gonna feel GREAT once that loan is out of the way – imagine how much *more* money you’ll have to play with after that? Whew.
This looks great, J$. Dontcha hate phases? I feel like we are definitely in a phase right now, halting extra student loan payments while we get ready to move back to the States. It sucks to not contribute a lot to them but I have to have some extra cash flow to prevent going into more debt!
Yes! Agreed! Avoiding more debt is priority #1, and then if you’re blessed enough to have extra that month, you can then apply towards the next priorities down the line… So I’m proud of you and your man :) It def. blows – esp when you’re USED to paying $hit down! – but that’s life and we roll w/ the punches…
I’m sad you’re coming back to the States though – I know how much you love it out there!
Solid gains even if you’re still missing out on the dual income benefits. =)
Indeed :) For this month at least, haha…
IRAs are doing well all around, it’s been a surprisingly awesome year for my investments. Hopefully the political drama won’t kill them all.
Congrats! I’m a fan of the percentages ;)
IRA’s are looking good. On the cash side sound like you need to hit those walks more looking for loose change. :)
I know, right?
These numbers are great! It must feel interesting to see just how much those passive income streams affect your net worth :)
Impressive. Makes me want to go up my investing game.
Looking good! 3.4% is great for one month. I like the percentage. heh heh.
I thought you would ;)
This is good news, especially considering the temporary lack of spousal income.
I do question one aspect of your strategy, however, J.:
You are sitting on cash savings of $21K, but at the same time have a $29K HELOC at 2.8% APR variable (awesome APR, but that rate can only go up). If my math is correct $29K at 2.8% APR costs $822.50 in interest annually.
If you used your savings and paid off $19K of it (still keeps a $2K buffer in your savings account), you’re only left with a 10K HELOC, which would cost you $283.62. That’s an annual savings of $538.88 if you can keep from drawing back against the HELOC, not to mention a reduction of your debt:income ratio. Even better, if the APR suddenly rises to 4.8%, it turns into a savings of $932.34 over 12 months.
If you’ve got 10 months left on one income, losing $1,400-1,500 in savings isn’t optimal ($14-15K total loss), and speaks to a higher ratio of expenses : income. See what you can to do equalize the income : expense ratio.
One obvious suggestion: Now that you’re both working from home, are two vehicles really a necessity with no commute? I know they’re both paid for, but insurance and maintenance costs add up, and the convenience of having a second vehicle can lead to the temptation to make unnecessary trips (increases fuel expense and wear). Consider selling the Cadillac and using the proceeds to again lower the balance on your HELOC.
I also read in your other post that you’re carrying collision insurance with a low $200 deductible on the Cadillac (which helps if you tend to confuse R and D) :-P but you’re probably paying close to the value of the vehicle in insurance premiums annually (if you do keep it). The vehicle is at the point in its life where it has become a disposable commodity. Cancel your collision coverage, drive more carefully, and use the money saved to balance the budget or pay down your HELOC. At-fault damage which is purely cosmetic can be lived with or repaired when you have two incomes. If you do damage the car severely, sell it for scrap and use the proceeds to help fund the purchase of another vehicle – the value of which can be determined by your needs and financial position at such time. Unless your state’s insurance reg’s are drastically different than they are here, you should still be covered – either by your insurance or the other party’s – for a collision where you are not at fault provided the other party can be identified (i.e. it’s not a hit & run).
Wow Nicolas that’s a well thought out post! I agree with the car thing and downgrading to one if you can. We will be doing that soon as soon as we know if my partner is working local (eg needs his car) or in a fly in fly out position to which we will sell and be freeing up around $6000 worth of expenses a year in rego petrol, servicing etc. Much better spent on debt or a holiday I think! Also Americans are extremely lucky in what they can get paid to recycle. I only wish Australia would follow suit! At the moment all we can recycle (and get paid for) is scrap metal and bottles. You guys seem to be able to recycle everything.
Thanks for spending so much time on this, wow. I feel special :) Here are some answers for you:
RE: Cash — I need as much as I can get in that account as it acts as our Emergency Fund and I am completely self-employed (ie no stable money). If I dumped it all into the HELOC and something bad happened I’d end up spending a lot more gong into debt to get ourselves on track. So no can do there. I’d rather pay a little more interest but have peace of mind than the opposite :)
RE: Car — Now you are def. correct on this one. I can, and possibly should, dump the Caddy as it’s serving as a convenience more than anything, but I’m just not *all* the way there yet to pull the trigger. Yet another one of those things I prefer to have peace of mind on vs. being financially smart – if that makes sense? If I get more strapped for cash though, it’ll be one of the first things I get rid of – believe me :)
Oh, and I’ll look into the deductible stuff too – thx for the reminder. I think I only pay around $20/mo right now anyways though, haha, so would it be still worth it if I only shaved off a few bucks?
We’re at $534k this month. The housing market here is in an absolute bubble. Two years ago, our house was down by 50% of our purchase price. As of this month, it’s down 5%. So all of a sudden, all the money we were desperately throwing at the mortgage to try and get out from underwater is actually inflating our net worth.
I’m tempted to sell, but it seems like a huge gamble. I don’t want to purchase yet another house in a bubble… But if we sell and rent and the houses keep going up further, we run the risk of being priced out of the market.
Well that’s a good problem to have!! Would be even better if you were in the market to buy in a much lower state too, haha… that’s the problem with home ownership, you always need a new place to live when you sell ;) Though you can also downsize!
The not managed IRA did the best–not bad!!
Congrats on another great month. It must be so great to see your accounts increasing by over $10k during a good month by not doing a darn thing. The market has been on a roll the past year or so and I really hope it continues. I’m enjoying the gains while I can.
It is nice :) But remember other months I lose $10k+ for not doing a darn thing, haha…
Net worth for us has gone up this month too! Mostly due to the market though…which might reverse itself as the days go on and the govt acts likes babies. Hopefully not.
I liked the IRA test, but at this point, I think it is time to roll them all into one. (I like that you were able to prove what most research shows about non-managed funds – they meet or beat anyone else)
You are down about 9K if it had all been in the winner all along. I say it is time to combine them!
Haha thanks – I agree I need to do that soon :) Though I like to look at it as putting all my money originally into the BAD account so I feel like I’ve EARNED a lot more money than lost, haha… And with my luck I’m sure that would have been the route I chose if I had to pick only 1 back then :) I’m not good at “the game.”
I can definitely see why you prefer looking at hard numbers. Seeing a $12,000 increase is a lot more gratifying than the tiny 3%. Although keeping track of both will allow you to create some cool looking graphs down the road if you ever need to look back.
Wow you have a seriously amazing variable rate on the second mortgage and not a bad one on the first. We fixed for three years at 5.99% which was really good at the time but have had an interest rate drop since down to about 5% How do you actually calculate your net worth? I want to try and do the same. It’s really frustrating not having a lot of play money over at the end of the month hey, I am currently making between $700-$1000 on the side each month at the moment doing various hustles. I am desperate to renovate our house a bit and get some equity in it so we can rent out and buy another property. Fiance been out of work for a week now so we are both motivated to move our behinds and hustle a little bit more! (It also helps to have him help with picking up freebie furniture! haha) Good luck with increasing your net worth :)
Keep on hustling! It’s only a phase right now and once you’re old and gray like me you’ll look back fondly on these moments ;)
To calculate your net worth is easy btw – just add up all assets/accounts/money on one side, and then subtract all loans/debt on the other. Whatever the difference is is your net worth :)
Jmoney next stop $400K. The market is something isn’t it? I do like the percentage added to your net worth.
Congrats. I think we all had good months this time. I am with you, I think we are in for a bumpy road ahead. We have been in bull territory for a few years now, time for a pullback. You are in 7th place on my blogger net worth tracker. Looking forward to moving you up the list.
Hah, really? Now you’re forcing me to go over and look cuz I have to feed my curiosity! :)
Curiosity fed? It is interesting to have it consolidated. Does it bring out the competitive spirit in you to reach the top? Probably more motivating to simply have a high net worth to be financially free!
Yeah, it’s just purely a fun voyeuristic thing to see for me :) I’ll be just as motivated to hit a million dollars all by myself, haha…
Great gains despite being a single income household! You’re doing great!
I was just wondering about your IRAs.
In Australia, we have compulsory superannuation, where your employer has to put an amount equal to 9% of your salary (at least) into an approved managed fund (that you choose and control). This is outside of your salary and any amounts you invest privately. You can add to it, its encouraged by favourable tax benefits.
Do you regularly put a specific amount of money into your IRAs? How are they performing per year? How much do you expect to have by retirement age?
Thanks! Love the blog!
Wowww that’s awesome! I’M MOVING TO AUSTRALIA RIGHT NOW!!!!
Haha.. that’s really great man, good for your country. You guys are gonna be so much more well off in retirement than us (the U.S.). Which is why people like us on this blog are all so hardcore about saving and investing as much we can so we – too – can be okay by then… employers here don’t have any of those requirements – if we’re lucky they’ll match 3% of whatever we put into our 401(k) program. And you usually have to then work there for X number of years until it’s 100% yours – it’s crazy.
To answer your questions though, yes – every year I do my best to max out our IRAs, which is $5,500 for each person in 2013 (for Traditionals and Roth IRAs). But keep in mind we also have 401(k) programs (max of $17,500 in 2013) and SEP Iras (max based on profit from your business) and others… So at least we have a lot of tools at our disposal :) It’s just all up to us – individually – to take advantage of them, and as early as possible so it all builds up over time…
I invest about $20,000-$30,000 every year into my retirement accounts, so if I keep that up (and they continue to grow), then we should be set by the time retirement comes. Haven’t done the calculations really cuz I’d probably never “retire” anyways, haha… right now i work for myself but it’s mainly fun and would prob do if i didn’t have a job anyways :)
Thanks for stopping by, my man – glad you’re enjoying the blog.
We are very lucky! It’s truly a shame however, with these sort of schemes, that people still are so lazy at taking control of their finances. Most people consider super “boring” because it will only affect them when they are 65.
Thanks a lot for your insight and your candid openness about your fiances – I’ve drawn a lot of inspiration from your budgets and it was a big help in setting up my own. Keep up the good work!
Cool! Glad to hear it man – please do stay in touch :) Always fun (and interesting) learning about how stuff works in other countries. And even cooler that it’s so easy for all of us to be connected now with the internet! Best invention ever.