Monday, October 7, 2013

Net Worth Update - September 2013

While cash flow is more important when it comes to financial independence, it's still good to look at the balance sheet too, which is why I provide these net worth updates.  The S&P 500 was down a little over 4% for the month of August which pushed the value of my investments down; however, thanks to my highest monthly income and a great savings rates I was able to counter the negative pull from market fluctuations.  It was a bit of a let down that my net worth didn't increase more considering I had my highest monthly savings total as well but that's what happens when you have more and more of your net worth tied to the markets.  I had a little over $1,700 in combined 401k contributions, $1,260 in ESPP withholdings, and over $9,250 in after tax savings from my income.  The rest of the change was due to market changes and dividends.

Current Assets: $469,940.46
Curent Liquid Assets: $121,732.35
Current Debts: -$191,775.43
Net Worth: $278,165.03

If you compare September's update to August's you'll notice a big jump in the asset column, unfortunately that also coincides with a huge increase in the liabilities.  The change was all related to our house purchase so the net worth didn't change just the values.  The markets helped to increase my net worth as well and when added to all the savings mentioned above my net worth increase by an astounding $17,526.33.  This was good for a 6.72% increase from August and my second highest monthly increase.  I've already passed my original $100k net worth increase goal for the year and now I'm getting close to surpassing my revised goal to reach a $286,000 net worth by the end of 2013.  I'm about $8,000 short for now but with another round of ESPP purchases going through in October I should be able to reach this by the end of the month.  My budget is going to be in flux for the next month or two as the new expenses start rolling in and I figure out what all I've missed in my planning.  So depending on how the markets behave over the last quarter, there's a chance that I could surpass $300,000 which would be truly amazing.


My after-tax savings rate for September ended up at 84.49% which is just outstanding.  Most of that is due to the income being so high, but there's plenty of people with high incomes that aren't aggressively saving.  I'm now averaging 82.90% through the September which is currently ahead of my 80%+ savings rate goal.  This is only savings from my net income that actually hits my checking account.  However, I do have another 8% after tax being withheld to purchase shares through the employee stock purchase plan provided by my employer.  I'm expecting a dip in my savings rate for the rest of this year due to the added expenses for the house so the 80%+ level might be in jeopardy.  Even if it dips down to the 70% range I'll still be doing just fine as that's well above what most Americans are saving.


My non-retirement accounts net worth could took a big dip in September, also related to the house purchase.  I had to cut a check for $45,000 so that will do some damage and lowered my expense coverage to just 6.18 years.  A big drop from August's 8.64 mark.  The big drop was due to the aforementioned $45k check and my high expenses from September.  Going forward I wouldn't be surprised to see a further dip in this number as expenses are still in flux but over the long-term it will start to trend higher once again.  Luckily though I can start budgeting in more money to the FI Portfolio to continue building up my passive income stream.

I've updated my Progress page to reflect September's changes.

How was your September?  Did you do better or worse than you expected this month?  

8 comments:

  1. You are going to blow pass the net worth of $300k by the end of the year. I hope to be able to say the same in 5 years. :)

    I spent a lot because I took a vacation last month, but from now till the end of the year It is high saving mode!!

    good luck!!

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    1. FFDividend,

      I think I should pass the $300k mark unless the markets are at least stable. If we see a sustained 10% drop then I'll probably come up a bit short. I still have one more round of ESPP purchases that will come through in a few more days so that will help to push it even higher. I've gone so much further that I expected I would and it's been awesome this year, of course the markets have helped out a lot with that.

      Where'd you end up taking a vacation to? Hope you had a great time.

      Thanks for stopping by!

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    2. I'm glad to hear that it has been a great year for you. keep it up.


      I went to Chicago for 5 days. Very expensive city. Had to rent a car and parking was a killer. $20-$40 every time I had to get out of the car. However, I had a blast. It was a great experience, and I gain 4-6 lbs with all the great local food. lol but since then I got rid of the pounds and back to were I was before the trip. I hit the gym 4-5 times a week, so I let lose on the trip.

      thanks for asking. :)

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    3. FFDividend,

      I've been wanting to make it up to Chicago for the past few years but things just haven't worked out. I'm thinking the time to do that for this year is pretty much done because I'm don't want to deal with snow and cold so maybe next summer my wife and I can head up there. Vacations are horrible for the diet but the food is always so good and you get to experience other local flavors.

      Thanks for stopping by!

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  2. Wow! A 83% after tax savings rate is outstanding! I think the most I ever got was 75% as I have a tendency to buy large ticket items whenever I make more money e.g. property.

    How long have you been saving at such a high rate and how old are you now?

    Get's me motivated to save a lot again even though I retired already. Pretty counter productive and I've got a post lined up about this weird scenario.

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    Replies
    1. Sam,

      I really wish I had picked up some property earlier to use as rentals. The opportunities aren't quite as fruitful and abundant but they're still out there. To be fair the 83% savings rate is a little high from a pure savings standpoint because I do save some money for vacations/car insurance/car maint repair that I include in my savings rate calculation since it is technically savings. So that would shave a few percentage points off the rate but I also have 8% that is withheld after tax for my ESPP that I don't account for.

      I'll turn 30 in January and average 77% in 2012 and about 66% in 2011. So about 3 years now although my income was much lower and I still had some debts to payoff in 2011. I'm hoping to push my income even higher to help offset the increased expenses for the house.

      Looking forward to the post. I've been thinking about how switching from saving 80%+ of my income to probably 15% in FI/ER is going to be hard. The change in mindset will be difficult to get over because I know now that if there is some big expense that was truly unforeseen I can make up for it the following month due to my high income. Not so much when you don't have an income source later. Although I still plan to work in some form or fashion once I reach FI, just not at my current job.

      Thanks for stopping by!

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  3. Fabulous progress. An 80% savings rate is pretty amazing. Do you mind if I ask what you do for work now and what you're planning on focusing on after you reach FI? Which will clearly be sooner rather than later... =)

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    1. Mrs. PoP,

      I work in the oilfeld currently. Oilfield cash baby! Once I reach FI I haven't decided for sure. It will probably depend on where my wife and I are at. Part of me wants to just be a stay at home dad because I grew up in a single parent household so ireally want to be there for our future kids. Another part wants to be a teacher because there's not many more nobler professions than educating the future leaders of our country. Of course I've also thought of getting my CFP license and doing financial education/counseling. The main thing is that I want something that will give me more freedom. I'm gone from home a lot for work right now and I know I can't do that forever. Obviously I have several ideas running through my head but I still have some time to figure it out.

      Thanks for stopping by!

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