Net Worth Update - May 2019

May 2019 Net Worth Update

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.

After the S&P 500's blistering rebound to start the year, May brought some much colder weather to the markets.  The S&P 500 pulled back 6.6% for the month.  Since the majority of our net worth is tied to the markets it should come as no surprise that our net worth had a nice move higher once again.  Of course receiving over $600 in dividends helped to cushion the blow some.

During May my net worth decreased $20,203.87.

Total Assets: $755,613.96
Liquid Assets: $282,470.64
Total Liabilities: -$184,945.77
Net Worth: $570,668.18

For the month my net worth declined 3.4% but it's still up 11.9% YTD.




All streaks eventually come to an end and that was definitely the case in May.  As our invested assets continues to climb the movements of the markets play a much bigger role in the direction of our net worth.  Unfortunately the nice 4 month streak of increases ended in May due to the 6.6% decline for the S&P 500 which I couldn't counteract through cash flow/savings.

Our main goal for 2019 continues to be reducing our non-mortgage debt.  As of the end of May we have just over $27k non-mortgage debt so we'll have our work cut out for us.  While it was hard to leave and head back to work, the good thing is that it's going to allow us to start making progress once again on our debt reduction goals and eventually lead us back to regular investing.

At this time it doesn't make much sense to pay extra on the mortgage given our relatively low interest rate as well as the tax break on mortgage payments 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 the plan is to aggressively pay down the mortgage.

As of the end of May we have 27.8% equity in our house based on our purchase price from 2013.  However, according to Zillow our house has increased in value around $41.6k from our purchase price which is a nice bonus, although I keep the purchase price as the value in the net worth equations.  Based on Zillow's estimate the equity in our house jumps to 39.4%.

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.

Net Worth History through May 2019

In order to give you a general idea of the breakdown of my net worth I include a % breakdown of our net worth with each monthly update.  The assets are broken down into cash, taxable investments, tax advantaged investments (401k, Traditional & Roth IRAs), house (using our purchase price) and other which covers things like our cars and various collectibles from when I was a kid and deeply discounted (they don't really move the needle at all but I have them in my spreadsheet because I was bored).  

Net Worth Breakdown - May 2019

Since I write so much (or at least try to) about investigating companies as an investment I figured it'd be fun to see how our balance sheet looks.  At the end of May our debt to equity ratio is 32% and our debt to total capitalization is 24%.  Not bad, but I can't wait to get that debt down to ZERO!

Capital Structure - May 2019

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How did your net worth fare during May's market swoon?  

Please share your thoughts below!