September 2019 Net Worth Update

by Evan

For the past few years I have been tracking my net worth increases or decreases and sharing them on my personal finance blog.  I usually share month over month results as well as year to date.  I am completely aware that without actual numbers the posts aren’t that fun to read, but this is all I am comfortable sharing.  If nothing else it forces me to take account of my assets and liabilities every single month, and I really believe updating a net worth statement is something all adults should do.

Thoughts before calculating: Usually I have a pretty good feeling on how I did over the past 30 days or so.  This month, way, way, way, to much has happened in my life to even have an inkling of an idea.  In the past 30 to 45 days I have:

  • Closed on a new home (closing, moving costs, painting, etc., etc.);
  • Sold part of my old home (20%) to 2 investors;
  • Used the proceeds of that sale in a very specific manner (which I should have outlined here – will do next week);
  • Bought a ton of stuff for the new house;
  • Went away twice (Nashville and Binghamton);
  • The pull back and volatility in the market; and
  • Generally loving summer (lots of eating out, hanging out, etc)

With all this out of the way – let’s do this and see where the chips land!

My Assets

For years I would write that my assets are “pretty straightforward” but I don’t actually think they after really thinking about it, nonetheless, here they are:

  • Emergency Fund – In the month of August The Wife and I, scarily, went to zero on this when we closed on the new house.  Not cool.  I got it back up with some of the liquidity above briefly mentioned above.
  • Wife’s Mutual Funds – From years of grandparents and parents gifts this has grown to a nice amount.  When I first got involved they were invested in some terribly priced mutual funds, we changed that right away.  Earlier this year, when we decided on the house we moved to I liquidiated almost everything just in case the market corrected and we needed (more liquidity).  Right now, I am going to leave the two-thirds liquid because The Wife and I have discussed some bigger projects on the new house and this is where it will be coming from.
  • Dividend Growth Investment Account – One of my favorite assets/accounts.   Every month I screen the dividend champion and some of the dividend contenders list to find possibly undervalued companies that have paid an increasing dividend for more than 20 years.  In addition to new capital/savings I also sell naked puts on those same companies to further provide positive cash flow in an effort to create a self sustaining stream of income later on in life.  Recently, I have been reducing some of this exposure just because I have some in the money puts that I have been dealing with (i.e. rolling).  Once I amount of those it is off to the races again.
  • 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 went back to a long term allocation rather than trying to market time.  This is allocated at almost 100% equities and is by far my largest asset.
  • My Traditional IRA – Just a few stocks that have captured my attention.
  • Physical Gold – In 2018 I decided on buying 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 in 2018 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.
  • Cash Surrender Value Life Insurance – I am not a “buy term and invest the difference” kind of guy. Mainly because no one actually invests the difference! I have been building my Cash Surrender Value for a number of years, but I never captured it on these statements until 2019.
  • Rental Property – I am very excited to add this line item! I have been talking about getting into real estate for years, so it is finally nice to be in it.  I will be keeping detailed records since this I have two partners that deserve it.  I haven’t completely figured out the logistics, but I am not all that worried.  For my net worth statement I am going to keep this as a net number eliminating the debt from my balance sheet.
  • My Home – Our new home takes over the main residence line item! It is going to hurt watching the mortgage payment basically pay for the interest, but such is an amortization table.

Liabilities

  • My Law School Loans – I still have a significant amount of law school loans but they are locked in at 3.5%.  I figured out last year that my student loan company, NELNET, was misapplying my extra payments but that is all fixed now.
  • My Main Residence Mortgage – As of writing this post I haven’t made a payment yet (still have 6 weeks prior to my first payment
  • Credit Cards – My favorite card is my American Express Premier Gold Card, whose fee I fight every year.  I open and close other cards to get ridiculous offers but right now I am rolling out of them with nothing on the horizon.

I have eliminated my HELOC and old mortgage as I netted out the asset going forward.  It may seem like just an accounting thing, but the reason I did it was so that I see that venture as just a net asset for years and years to come.   I have been giving real thought to paying off my law school loans.  It would clear up an significant amount of cash flow per month, but I am worried about an incoming democrat president eliminating them and me wasting precious dollars for no good reason. I am going to mull this over for a few weeks.

My Net Worth Change

  • From August 1st to September 1st my net worth increased 10.77%
  • Year to date my net worth has increased 46.90%

The increase is basically new money coming in mixed with a realization of the value of my old house at a much higher rate than what I booked it for years.  I always kept the value on my balance sheet lower than what I thought it was worth, so that caused a big “on paper” spike.  At the same time my invests were down hard! A couple of my individual long term holdings as well as my broad mutual funds in my 401(k) tanked hard otherwise the gain would have even been larger (probably a good thing so that when there is a correction I am not too bummed out).

Big, busy month for me and I think September is going to have even more craziness prior to it calming down before the end fo the year.

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4 comments

Buy, Hold Long September 3, 2019 - 10:03 am

Wow what a massive month. That sounds incredibly busy.

Well done to you.

Reply
Evan September 5, 2019 - 4:36 pm

So busy! I am looking forward to a sleepy last quarter lol

Reply
JC September 3, 2019 - 10:14 am

Almost an 11% gain is fantastic, even if a lot of it was accounting/realizing previous gains related. We somehow eeked out a small gain despite the markets’ whipsaw action so I’m pretty excited about that. We drew down our emergency fund significantly several years ago, but that was after I was laid off and my wife and quit her job to deal with our son. Luckily we had a sizable emergency fund and it did it’s job.

Reply
Evan September 5, 2019 - 4:39 pm

I honestly do not know how people sleep at night without a well funded emergency fund! Prior to refilling it up, the pressure and anxiousness I felt was incredibly stressful. The fact that the cash allowed you to deal with your family and find a new position is exactly why it is there!

Reply

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