Net Worth Update - May 2020

Net Worth Update - May 2020

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.

The markets continued to confuse just about everyone as they have since late January.  The S&P 500 climbed another 4.5% during May.  With most of my assets tied to the stock market it should come as no surprise that my net worth generally follows the trend of the markets.  

During May my net worth increased $30,652.13.

Total Assets: $831,937.38
Liquid Assets: $310,312.10
Total Liabilities: -$168,210.97
Net Worth: $663,726.41

For May my net worth increased 4.8%.

The volatility in the markets have brought some wild swings to our net worth.  From -17.5% YTD at the end of March to now just -4.4% on the year.   




Our main goal for 2020 continues to be ridding ourselves of the one non-mortgage debt, the loan on my car, that we carry.  We're making good progress and paid an extra $1,000 on it during May.  I'm still not 100% sold on needing to focus all of our disposable income to debt reduction but do still want to pay it off on a very accelerated timeline.  At the end of May the remaining balance on the loan is $14.1k.

At this time I don't believe it makes 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 outside of the car loans.  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 29.4% equity in our house based on our purchase price from 2013.  According to Zillow our house has increased in value around $64.3k 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 44.9%.

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 2020

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 2020

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 25% and our debt to total capitalization is 20%.  Not bad, but I can't wait to get that debt down to ZERO!

Personal Capital Structure - May 2020

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How has your net worth fared throughout the craziness of 2020?  

Please share your thoughts below!