Sunday, November 10, 2013

Net Worth Update - October 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 up almost 4.5% in October which helped to lift most of the stocks I own as well.  Thanks to the markets and great savings from my income, I almost matched September's net worth increase but ended up a little short.  No real complaints though from me as I had just over a $16,000 increase for the month.  I had a little over $1,440 in combined 401k contributions, $1,050 in ESPP withholdings, and over $8,400 in after tax savings from my income.  The rest of the change was due to market changes and dividends.

Current Assets: $485,807.78
Curent Liquid Assets: $131,809.30
Current Debts: -$191,555.51
Net Worth: $294,252.27

Honestly it's crazy to see the assets approaching $500k, especially considering we started the year at almost $173k.  It's not as impressive as I'd like as over $200k of that is due to our house, but even excluding the house it's pretty amazing.  We're now sitting on 20.10% equity in the house after making our first mortgage payment.  My net worth increased by an astounding $16,087.24 in October.  This was good for a 5.78% increase from August.  I've already passed my original $100k net worth increase goal for the year and now I've officially passed the revised goal to reach a $286,000 net worth by the end of 2013.  In my 3rd quarter goal update I revised the net worth goal again to $306,000 by the end of the year which would give me a $150k increase for the year.  The markets have played a big part in that but all I can do is make sure I control my savings rate and invest at opportune times.  I'm about $12,000 short for now so maybe I should have shot a little bit higher on that revised goal.  My budget is continues 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.

My after-tax savings rate for October ended up at 81.04% which is great but was a bit disappointing as I had my third highest monthly income and expected to get closer to 83-85%.  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 82.71% through the October 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 on a monthly basis 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 increased after a dip in September.  Based on my expenses from October my liquid savings would last for over 6.88 years, which is a 0.70 year increase 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.

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

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


  1. The Net Worth calculation is very interesting!

    In my case, my portfolio amount is ONLY 16,000 EUR!
    But on the other side, I have a debt free house with an worth round about 230,000 EUR.

    So my Net Worth is complete 246.000 EUR. :-0

    This amount is good for the psyche!
    Until now, I have only count the portfolio worth - and have never calculated with the debt free house!

    Thanks für this idea!

    Best regards!

    1. D-S,

      Well a paid for house is a significant accomplishment itself. I'm not as worried about the net worth as I am about the cash flow it can generate but I still want a fairly clean balance sheet as you can easily get overleveraged at the wrong time. That's a very solid net worth that you've got. Keep it up!

      Thanks for stopping by!

  2. Wow, simply staggering numbers when you step back and look how far you have come in the last year. When you add your ESPP and 401k contributions, you will be close or actually hitting six figures in retirement/investment/savings contributions this year. Those are simply foolish numbers! I am really looking forward to following along over the next 12 months as I think your dedication to this level of savings and investment are really going to start paying off and snowballing. Again, great month and awesome job.

    1. w2r,

      It's crazy to think that I was sitting at a negative net worth less than 3.5 years ago and it makes me really appreciate everything. I think I'll end up just a bit shy of the $100k mark for the year for actual invested dollars, although I did have another $16k that was saved specifically for the house. Total savings this year will eclipse the $100k mark though. The next 1-1.5 years should be great as there's now a solid base that will build on it's on plus fresh contributions over that time. I'm expecting some pretty big things although who knows what Mr. Market will have in store. Keep up the great job yourself. I'm enjoying the update backlog as I get to see quick snapshots of how you did.

      Thanks for stopping by!

  3. Absolutely insane progress :) Growing your wealth at $100K a year on average for the past 3 years is really incredible. Maybe I'll take a look at your portfolio again to learn how to choose great stocks ;) I think buying that house has really put you in a good position to leverage off its growth in the future too :) The only thing I regret about my home is not buying it sooner heh. I did well in October, but my net worth is nowhere near yours even though I have more assets lol.

    1. Liquid,

      The markets have definitely helped out this year so I can't take all of the credit. I just hope I can keep growing it around $100k per year, but since the starting base is higher the contributions will start to be less meaningful. Real estate can definitely be a great way to leverage your capital, especially as an investment property. I'm hoping to pick one up sometime next year in hopes of using that leverage conservatively and turning it into a rental property. Hopefully rates/prices don't continue to increase to make the numbers not work out right. I do regret not buying a house earlier. If I hadn't gotten laid off in early 2009 I would have picked up at least one rental property and possibly two. Alas, it's hard to qualify for a mortgage when you have no income. I don't worry too much about the overall net worth figure, I'm more concerned about the cash flow that I can generate and I'm sure you're way ahead of me on that front. This ride over the past few years has completely amazed me. Whenever I look back at where I was financially then compared to where I'm at now it doesn't really seem like I could have made that much progress so I start double checking numbers.

      Thanks for stopping by!