Net Worth Update - June 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. It's been a while since my last update which was all the way back in March. Since then my net worth has decreased $738.77. Although all of the loss was due to June's poor showing with almost a $8.7k decrease alone which wiped out the gains from April and May.
Current Assets: $608,546.14
Current Liquid Assets: $204,820.20
Current Debts: -$186,969.56
Net Worth: $421,576.57
Overall though I'm still pretty happy with where my net worth is at. I've been able to increase my net worth to over $400k since July 2010 when I was at -$1.6k. Not bad for just about 5 years of work. Since I ended up having about 2.5 months off from work that led to pretty much no income coming in which helped lead to the decline in my net worth. I still have plans to try and build up some more cash buffer over the next couple months but I expect that I'll be making at least a couple purchases each month as well if we continue to get increased volatility and better valuations. Year to date my net worth has increased $3,663.75 or 0.88%, although I was sitting on a $12k+ improvement prior to June's decline.
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 June we have 22.20% equity in our house.
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 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.
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.
There's no after-tax savings rate for June since I spent more than I had in income. So there was a negative savings rate throughout the month which certainly didn't help out my net worth. However, on a positive note my job income for the month came in at $1,685.09 but between dividends, interest, and blogging income I earned $1,074.87. That's my first month ever of having $1k in income that wasn't tied to my day job which is just fantastic as far as I'm concerned. I know I won't be able to repeat that until maybe September because dividends did the heavy lifting but it's exciting to see over $1k in investing and side income. That covered 47.7% of my expenses for June! Truly passive income, dividends and interest, was able to cover 37.0% of June's expenses.
Based on my expenses from June, my liquid savings would last for 6.91 years, a 1.32 year increase from March. All of the improvement came thanks to a reduction in expenses from over $3k in March to just under $2.5k for June.
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 the first half of 2015? Are you on track to meet your net worth goals for the year?
Image courtesy of holohololand on FreeDigitalPhotos.net.