Friday, April 10, 2015

Net Worth Update - March 2015

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.  Since more and more of my net worth is tied to the markets, there's a larger correlation between my net worth and the markets but in the long run as I continue to save and invest the net worth trend should be higher even though short term fluctuations can vary wildly.  As a dividend growth investor I'm not overly concerned with the short-term gyrations as long as the dividend stream remains in tact, but the markets' effect is noticeable.  During March my net worth increased $2,378.96.

Current Assets: $609,996.10
Current Liquid Assets: $207,002.37
Current Debts: -$187,680.76
Net Worth: $422,315.34

March's increase wasn't as great as February's $17k jump but with the markets being volatile I'll take a slow steady increase.  I made a lot more purchases for my FI Portfolio during March than I was originally anticipating but considering I'm always on the lookout for excellent companies selling for cheap prices, I went ahead and made the moves.  My net worth is now solidly above the $400k level, but depending on what kind of mood Mr. Market is in he could easily wipe that out over a couple weeks.  Over the next couple months the plan is to try and rebuild our emergency fund to a more comfortable level and then start aggressively investing once again.  Although I hope to be able to still make at least one purchase per month in the meantime.

My net worth at the end of March showed a 0.57% increase from February 2015's tally.  YTD there's been a small 1.05% increase in our net worth or a total of just over $4.000.  I haven't set any goals yet for my net worth because there's just too much in flux with our financial house to be able to come up with reasonable goals.  The net worth goal has always been a secondary goal anyways since a lot of it is out of my control since I invest primarily in the stock market.  I'll just continue to focus on what I can control which is maintaining a high savings rate and investing in high quality companies at fair prices.

Liabilities continue to be just the mortgage on our house.  I don't see the point in paying extra on the mortgage given our relatively low interest rate and think we'll come out much further ahead investing the extra cash flow.  So the liabilities side of the net worth equation will be slow moving.  However, once the FI portfolio is able to get to a self-sustaining level of dividends then I'll aggressively pay down the mortgage.  As of the end of March we have 21.87% equity in our house.

The following chart shows my assets and liabilities, as well as my net worth, since January 2012.  While I have accurate records for my net worth dating back to July 2010, I didn't keep track of my assets and liabilities on a monthly basis until the start of 2012.


March finally saw a move back into positive territory for the savings rate but it was quite disappointing.  The combination of higher than normal expenses and lower than normal income resulted in a paltry 14.7% after-tax savings rate.  This should start to trend back higher but I'm not expecting to hit 50%+ on a consistent basis for a while.


Based on my expenses from March, my liquid savings would last for 5.59 years.  That's a 0.99 year decrease from February.  Luckily though that is due to the fact that my expenses were very high this month which should correct itself over the coming months.

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

Make sure you sign up to receive new posts to your email so you don't miss anything.  And be sure to follow me on Twitter@JC_PIP to get up to the minute news of new purchases for my portfolio.

How did your net worth fare in March?  Did you get started off on the right foot towards your financial goals for the year?

18 comments:

  1. I had a slow month in net worth increase this month, but it's still going the right way so no complaints. Although, next month will be full of renovation costs, so perhaps I should cherish this month a lot more. The goal is to reach $100.000 at the end of the year. I wish you good luck with your goals.

    ReplyDelete
    Replies
    1. financethingsinlife,

      Any month with a positive move is always welcomed. Best of luck reaching $100k by the end of the year. That's a huge milestone.

      Thanks for stopping by!

      Delete
  2. Nice PIP! I like how you have how many years your liquid savings will last you in terms of years. I am slowly adding to my dividend portfolio and paying down my debt. More goes toward my debt to get those off my balance sheet.

    Cheers!

    ReplyDelete
    Replies
    1. Ron,

      I think that's a cool metric to see. It kind of puts things into perspective that if SHTF we have plenty of coverage based on current expenses. Even more encouraging is that expenses should decline if that happened so we could probably squeeze out an extra half year.

      I don't blame you for paying down your debt. It truly is a burden. I'm glad that you have a balance between investing for the future and paying down your debt. I think too often people get a singular focus on doing one or the other.

      Thanks for stopping by!

      Delete
  3. Gogogogogogo! March didn't treat me very well but April has been gangbusters so far. I finally broke 500k in liquid networth!

    ReplyDelete
    Replies
    1. FV,

      That's awesome that you cross $500k. Especially for liquid assets. That's a huge amount. We've got a long ways to go to reach that level but I'm happy with the $200k+ in liquid assets that we have.

      Thanks for stopping by!

      Delete
  4. Good job. February was a great month for me too. Keep working at it. FI will arrive soon enough.

    ReplyDelete
    Replies
    1. NNL,

      Eventually I'll get there but sometimes it seems like the journey is a bit longer than I'd like. But there's no real complaints on my end.

      Thanks for stopping by!

      Delete
  5. Thats a neat amount of increase in net worth, JC. Keep it up!

    R2R

    ReplyDelete
    Replies
    1. R2R,

      I'd love some more February months but I'll definitely take an increase for any month.

      Thanks for stopping by!

      Delete
  6. Insane networth, JC! Always love the charts you post and thanks for inspiring the rest of us :)

    ReplyDelete
    Replies
    1. MDG,

      It's been a lot of work to get the net worth to this point but it's still amazing to me how quick it's happened. I can't say the bull market hasn't helped out but I do have to say that I've done my best to save and invest everything I can.

      I really like making the charts because they make it so much easier to see at a glance.

      Thanks for stopping by!

      Delete
  7. JC,
    Impressive net worth for someone so young. You are well on your way.
    Blessings,
    KeithX

    ReplyDelete
    Replies
    1. KeithX,

      I just wish I had started even sooner, but I'll gladly take the progress that's been made so far. That $1M mark is going to be awesome to hit but I'd guess it'd be at least another 3-4 years assuming we don't have a major bear market near the end of that time.

      Thanks for stopping by!

      Delete
  8. Doesn't look like you actually increased your progress page :-). It still shows "through Jan 2015". ;

    Some bloggers exclude property value and mortgage from net worth calculations, because property value isn't assured. I notice you do include it (along with mortgage as a liability). How do you value your property?

    ReplyDelete
    Replies
    1. Ferdi,

      Thanks for catching that. I've got it updated now.

      I just use our purchase price for the value of our home. It's not ideal but I'm not going to have it reappraised just for information purposes. I also calculate my liquid assets to try and give a better view, although I guess I should really start adding a liquid net worth to these updates. As of the end of March we were at $19,321.61 but that includes paying off the mortgage balance but not accounting for any of it as an "asset".

      Thanks for stopping by!

      Delete
  9. Definitely a nice increase in net worth. Good luck going forward.

    Keep cranking,

    Robert the DividendDreamer

    ReplyDelete
    Replies
    1. Robert,

      I'm always happy with an increase and the YoY growth has been fantastic.

      Thanks for stopping by!

      Delete