June 2013 Net Worth Update

May was a great a month, financially, as I officially finished up my first set of short term financial goals.  To keep my ADD ridden focus on my finances I came up with the idea of setting up “short term” financial goals in the amount of $5,000.  It took about 6 weeks but I completed the following goals:

1. Deposit $3,000 to my dividend investment fund
2. Get my Home improvement fund up to $1,000
3. Pay $500 towards my student loan principal
4. Save $500 in my Son’s 529 Plan

I thought this was going to take me a few months to complete but I received my tax refund and had a few clients finish up estate plans.  I doubt my next set of goals will go as quickly.  I am thinking this next set of financial goals will take at least 2 or 3 months.

1. Contribute $500 to my Traditional IRA
2. Save $500 into my Son’s 529
3. Save $1,000 in cash towards a future house purchase
4. Invest $1,500 into my Dividend Portfolio
5. Save up $750 to allocate to my whole life insurance policies
6. Save $750 in the house repair fund (The $1,000 was already used for a few things – mainly 13 trees for the backyard, who the hell knew trees were expensive?)

These short term goals provide me with the knowledge and focus that I am moving forward even if the my net worth is temporarily retrained by the market.  On that topic, my stable home equity is almost even with my other investments (when cash is included) so I guess it is only natural that my net worth is becoming more and more a function of how the market did that month.  I thought doing this post was going to be fantastic and then the last half hour of trading on Friday took the market down quickly.

Truth be told I hope this is the beginning of the correction I have been waiting for so I can buy as much stock/funds as possible.  This will keep my net worth down for the short term but will hopefully lead to an explosion much further down the line.

But onto some calculations.

Calculating my Net Worth

My Assets

• My Cash Savings Accounts – I only really count my emergency savings since everything else is ear marked to be spent elsewhere.  For example, I have a vacation fund, a house improvement fund, etc.  About two months ago I came up with a round number that I am going to use going forward.  It is a multiple of my monthly nut.
• My 401(k) – Just keep throwing part of my paycheck at my 401(k) even though I sort of hate my 401k.
• Random Non-Qualified Investment Accounts
• The Wife’s Roth IRA – This account only holds to 2 funds. An index fund of the market and a dividend paying fund.
• My Dividend Investment Portfolio – Easily my favorite part of my financial empire hut.
• Home Value – A lot of bloggers seem to stress over home value.  In my old place I just rounded to a number that I thought I’d sell for (I was off by less than 1%), I think I am just going to use my purchase price for the year and look at comparable home sales next year.
• My Traditional IRA – Been trading using my covered call strategy and earlier this year I bet against my first stock!  I am currently getting KILLED on that bet.  KILLED.

I will provide an update to the traditional IRA after that bet expires (most likely worthless).

My Liabilities

• My Mortgage – The mortgage on our old home was a 40 year note with a 5.875% interest rate while the current mortgage is 30 years and 3.375%…so I am shocked to see how much principal I have paid down already as compared to what we paid back over 7 years in the old place!
• Law School debt – While I recently paid off the much smaller of the loans I have a while before this category makes any significant moves.  My first set of financial goals included an extra $500 payment (which I made) I left it off this time around.
• Credit Card debt!

I haven’t had credit card debt in 3 or so years, but with the house purchase came a lot of fix it up purchases as well as furniture.  So as we were buying the house I called up all my dormant credit cards to see what they could do in terms of 0% on purchases until June 2014. It may be needless to say, but the card will be paid off prior to that date.  While I have the liquidity to pay off the debt I prefer not because I respect liquidity way too much and the debt is at 0%.  The debt isn’t as much as when I started this blog (~$18K) but it is a damn good amount.  With my short term financial goals I keep throwing money at the CCs too.

My Net Worth Growth

• From May 2013 to June 2013 my net worth increased 2.34%
• Year to Date my net worth is still down 4.39%.

I think next month is finally the month I get back to even year to date!