Quest for a Million – Net Worth – 9/2011

Well another month has gone by and my net worth (ex-real estate) has taken another hit (-3%).  Now most if not all of these losses are market driven paper losses that should be irrelevant over the long-term.  In the short-term though, the future is a bit hazy.  At least that's what it says when I look in my Magic 8 Ball.  EU debt and Euro mismanagement coupled with a ridiculous, do-nothing US Congress should leave the markets mired in uncertainty for much of the rest of the year.  With uncontrollable macroeconomic events controlling the markets, I'm focusing on making sure my own house is in order.  

September promises to be an interesting month on the home front.  It's the first month that we'll have no childcare expenses in about 3 years.  That amounts to about $600-$700 in reduced liabilities which is most welcome.  Thank you public school!

The other big news is that my wife returns to work this month after taking most of the last 5 years off.  As a sole proprietor, we will need to invest in renting her an office and acquiring some furniture and other tools of the trade.  I expect she'll run at a loss for at least a couple of months, but her business relies on building a base of clients.  Once she starts building that base up there should be some significant upside for our family finances.  I'm looking forward to watching this new dream unfold for her.

Additionally, reducing my 401k contribution in half is also contributing to a higher savings level resulting in a more liquid position in case anything goes wrong during my employer's merger.  It's hard not knowing whether you'll have a job next month and what the salary and benefits will look like at the new combined company.  There's nothing more to do about than networking, saving, and working hard though.  

So, let's talk $$$.  I could be SCREAMING about how I almost hit my $40k emergency fund since it's sitting at $39,996.40.  I am proud of this number.  However, I also know that it's fleeting because in less than 24 hours FIA Card Services will be taking $6k+ of that to pay my credit card bill.  What I really want is $40k just sitting there unmolested gaining some paltry interest rate while I can still pay all the bills and max out the Roth's.  Not.  There.  Yet.

Speaking of not there yet, all of the retirement and investment accounts paid the price associated with a large equity position in relation to bonds.  I have decreased my cash position in these accounts over the past 2 months as there have been several opportunities to dollar cost average into index ETF's at what I believe are attractive prices.  However, with so much uncertainty in the markets, I'm retaining the last portion of my cash to buy more in the case of a deeper crash which is entirely possible.

On the liabilities front, the story remains the same.  I chip away at the debt.  It's great to look and see that I've reduced my student loans by 8% this year.  Likewise I'm still reveling in having less than $300k in mortgage debt.  Small victories every single month.

Net Worth September 2011

ASSETSThis Yr.vs. Last Mth.
Real Estate
My Home (Zillow) $376,300
All Accounts $39,996
All Accounts $216,997
529 Plan $11,834
Brokerage $4,808
Total Assets $649,935
Credit Cards*
All Accounts $12,434
Student Loans
All Accounts (1.5% and 2.5%) $64,379
Mortgage Loans
My Home (4.3875%; 30 yr fixed) $297,309
Total Liabilities $374,122
NET WORTH $275,813

* Credit cards paid in full every month every time.

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