Net Worth Update March 2017

Every month for the past few years I have calculated and shared the changes in my net worth.  They aren’t particularly popular posts, nor do I expect them to be as I don’t share actual numbers.  Why do I do it then? Accountability.  Granted, I know it is a false sense of accountability because if I miss a month or two no one will care, but nonetheless it forces me to ‘answer’ to my spreadsheet.  What I did or didn’t do in the previous month is going to appear there either in the form of good investment moves or too much spending.

My Gut Reaction to Net Worth Before Calculating

Every month I have a feeling of how I did the previous month.  Some times I am way off and sometimes I am right on point.  Usually, these are negative feelings, but I think that is natural.  I don’t check my largest liquid and volatile asset that often, my 401(k).  So while I can feel the money being spent on my amex I do not know whether that is up or down.

This month, I am feeling a particular amount of pressure on the spend side of the balance sheet. I have an anxious feeling prior to calculating.  I am hoping I am proven wrong and the seeds I have built in my 401(k) (and my recent rebalancing and rellocation within my 401(k)) are doing their job to cover up some shitty short term spending habits.

My Net Worth Calculation

Creating a net worth statement is pretty simple.  All one has to do is honestly add up your assets and minus your liabilities.  If you build your net worth calculation on lies, what’s the point of even doing the exercise.  I know calculating my net worth helps me keep track of my decreasing liabilities while seeing if my investments are growing like they should be.

My Assets

My assets are pretty simple:

• Emergency Fund – It is a little less than where I would like it, but I don’t calculate it in terms of monthly expenditures.  Rather I think to myself how much cash would I really need if an emergency happens.
• My Dividend Growth Account – It is small, but this is where I have really been focusing my efforts lately and I will writing a lot about it.
• My Wife’s Roth IRA – Nothing special – just a mixture of cheap index funds and individual companies that capture my attention.
• My 401(k) – My 401(k) is terrible with high fees for shit mutual funds, but where else am I getting a match on my money.  I am not one to turn down free cash.  I recently rebalanced the account.
• Wife’s Mutual Funds – This was an amount that was given to my wife from her now deceased grand parents.  They were horribly mismanaged until I stepped in, putting them in low expense vanguard mutual funds.  She and I both look at this account as a super emergency fund.
• My House – This is the first year after buying the house for 4 years where I increased the value of the home.  I increased it an nominal 3% in 4 years.  I don’t plan on reviewing this dead money asset for another year or two.
• My Traditional IRA – Just a few stocks that have captured my attention.
• Investment Account with my Brother – The Wife and my brother invested a nominal amount ($1,200 each) to try and give my brother confidence with his stock picking ability.

My Liabilities

• My Law School Loans – Despite being almost 35 years old I have a significant amount of law school loans left. They are locked in at 3.5%, so what’s the rush to pay them off?
• My Mortgage – I live on Long Island (and its on not in), so the odds of me ever prepaying this down, especially with a 3.375% 30yr fixed is unrealistic.
• Credit Cards – My favorite card is my American Express Premier Gold Card, whose fee I fight every year.  I also have some minor outstanding balances that I’ll just pay down slowly.

My Net Worth Increase/Decrease

• From February 1, 2017 to March 1, 2017 my net worth increased .89%
  
• My net worth increase YTD has increased 8.28%

I guess even the slightest positive increase is better then how bad I thought it was going to be.  Notwithstanding, the gain hides the increase in debt that we accumulated this past month.