I first started tracking my net worth and then sharing my gains and loses way back in January 2013. I absolutely regret not starting earlier, especially when this site was started a few years prior! I believe that every adult would benefit from seeing how their short term personal finance decisions are playing out over the course of a month, months or years, and the easiest way to do that is with a net worth statement.
Thoughts before calculating: This month is going to be rough. This quarter (2018 4Q) is one of the worst on record, and since my net worth is particularly correlated to the market I have been feeling the pain. Specifically in two of the last 3 net worth statements, my net worth has plummeted and I am pretty sure this is one is going to be just as bad if not worse.
My Net Worth Calculation
My assets are pretty simple:
- Emergency Fund – My goal is to keep an amount in cash that The Wife and I believe is needed for a real emergency amount rather than a specific amount linked to monthly expenditures. At this point it is a quite a bit lower than I’d like it to be.
- My Dividend Growth Account – I am finally back into undervalued dividend growth investing and I am very excited to share my screens and purchases! I decided a few months ago to take the record keeping of this account a bit more serious than I have for the past 18 months.*
- My Wife’s Roth IRA – Nothing special – just a mixture of cheap index funds and individual companies that capture my attention.
- My 401(k) – I finally just reallocated future contributions after discussing it for a few months.
- Wife’s Mutual Funds – This was an amount that was given to my wife from her deceased grandparents. They were horribly mismanaged until I stepped in, putting them in low expense vanguard mutual funds. She and I both look at this account as a super emergency fund.
- My House – I increased the value of my home starting in 2018 3%. This was the first time since I bought the home that I even bothered to increase the value.
- My Traditional IRA – Just a few stocks that have captured my attention.
Wife’s Business – NEW IN 2018– Just going to value this at the cash that is on the books at the end of every month. There won’t be a distribution for quite sometime, so hopefully, there is a nice trend upwards.
- Physical Gold – Earlier this year I decided that I would buy a small amount of physical gold every month or two. After doing some quick math, I am getting killed in transaction costs. I set up a capital one 360 account to save the amount I would be buying in gold and I will make a larger purchase less often.
- Cryptocurrency Account – Earlier this year I bought a tiny amount of Bitcoin. By the time my initial payment cleared bitcoin had dropped 40%. I am not exactly sure what I am going to do with this account just yet. Right now I am going to ignore it.
* – This account is also where I sell naked puts, so when market volatility reared it’s ugly, ugly head this particular account got decimated in terms of percentages. Last month I wrote that,
Currently, I am holding two large positions in BUD and WYNN, as well as very in the money puts. My plan is to keep selling covered calls on those positions, and hopefully I’ll be able to keep rolling the puts until they are out of the money (if I get prematurely put the underlying equity I’ll sell covered calls).
I was able to roll out of the WYNN Position at break even, however, I am holding on to BUD and it feels like it is going to be a while before that goes away!
- My Law School Loans – Despite being
3637 years old I have a significant amount of law school loans left. The loans are locked in at 3.5%, so I have no real rush to pay them off. I’d like to get the monthly cash flow back but at about the $35,000 it would be a tremendous hit to liquidity. I figured out last week that my student loan company, NELNET, was misapplying my extra payments but that is all fixed now.
- My Mortgage – I live on Long Island (and it’s on, not in) so the odds of me ever prepaying this down, especially with a 3.375% 30yr fixed is unrealistic.
- Credit Cards – My favorite card was my American Express Premier Gold Card, whose fee I fight every year, but in January of last year I opened up an American Express Platinum Card for 60,000 points, and last month I opened up an American Express Delta card to get $200 off our recent trip to Atlanta and I got an extra 40,000 delta miles (not sure how that translates to the Amex points yet). I’ll be canceling the Platinum card this week because I can’t justify the $500/yr membership costs.
- My HELOC – A good portion of it was to capitalize The Wife’s Business. I decided to keep the debt of the HELOC on the balance sheet, but ignore the corresponding asset (the removed checking account).
Net Worth Increase/Decrease
- From December 1st to January 1st my net worth Decreased 3.02%
- For 2019 my net worth
It was extremely painful to prepare this month’s net worth statement. I think 2018Q4 has taught me a few things about my true risk tolerance. I’ll be keeping this in mind when I prepare my 2019 goals and objectives (and corresponding changes to how I calculate my net worth).