This is my second post on net worth and the first of the new year. Now that we have 1 month’s worth of data, we can begin to look at how my net worth changes over time. And, since it’s the beginning of a new year, perhaps it’s time to set some goals as well.
First, let’s take a look at the changes from last month to this month.
In the Assets section, the glaring concern is that savings dropped an astonishing 57% since December. This is a much larger monthly change than is common. It was brought on by 3 things. First, I was carrying a large amount of credit card debt accumulated when I charged new garage doors and several large work-related expenses to my card in order to get the 2% cashback. I, of course, had to pay those all off in full. Second, I paid my real estate taxes. Since I don’t participate in escrow (why give your mortgage holder a free loan???) I have to pay the taxes at the end of the year. I have an automatic transfer set up each month from one money market to another one designated just for real estate taxes so by the end of the year, there’s always the right amount. Thirdly, I had to pay taxes on my wife’s business. We knew these were coming but had not previously calculated them. Hopefully a large chunk will come back once we do our income taxes soon.
Aside from savings, my son’s 529 plan went up sharply due to a gracious gift from his grandma. It’s great to have a grandparent invested in her grandson’s future! Prosper declined at the anticipated rate as more loan payments came in and were promptly transferred to ING. My home value dropped $5,500 which would only be a concern if I intended to sell it (which I don’t) or re-finance it (which I already did last year). The only reason it’s worth mentioning is because that accounts for a large portion of the overall drop in net worth.
For liabilities, you can see the corresponding drop in credit card debt to a much more typical level once I paid off the large expenditures. As always, let me emphasize this debt never revolves. Rather it is paid off in total every month. This is the only way to use credit cards (aside from 0% transfer games).
Overall, my net worth fell 1.5%. This is not ideal, but also not a big deal.
Net Worth January 2011
| ASSETS | vs. Last Month | ||
|---|---|---|---|
| Real Estate | |||
| My Home (Zillow) | 374,500 | -2% | |
| Savings | |||
| All Accounts | $23,787 | -57% | |
| Retirement | |||
| All Accounts | $208,225 | 4% | |
| Investments | |||
| 529 Plan | $11,593 | 20% | |
| Brokerage | $4,905 | 0% | |
| Prosper | $243 | -14% | |
| Total Assets | $623,253 | -2% | |
| LIABILITIES | |||
| Credit Cards* | |||
| All Accounts | $3,866 | -162% | |
| Student Loans | |||
| All Accounts | $68,734 | -1% | |
| Mortgage Loans | |||
| My Home | $301,690 | 0% | |
| Total Liabilities | $374,291 | -2% | |
| NET WORTH | $248,962 | -1.5% |
In terms of goals, I would like to substantially grow my savings this year. Ideally I would like to have a minimum of $40,000 in savings by the end of the year. This will be a tough goal considering I still owe $15,000 to my Roth IRA’s for 2010 and then 2011. Actually considering this, it’s probably unachievable unless I get a nice raise, but I believe in reaching for the sky even if I only reach the mountaintops.
As always, I would love to hear your questions or comments on my net worth.