Net Worth Update – February 2009

The numbers came in for the last month and unfortunately, we weren’t able to keep up the momentum that we had built last month, where we gained almost 10%. Oh, well. I guess in this market, we’re going to expect some ups and downs. Probably a lot more downs than ups until things get better in the economy.
Anyways, our numbers look like this:

  • Assets fell 1.0% in value. The biggest reason for this was that our home value reported further falls, and a down stock market. It actually could have been worse (see below)
  • Debt fell 0.49% for the month. We did pretty good here, and I’m proud to say that we’ve knocked off over $20,000 in debt from February 2008.
  • Overall, our net worth slipped by about 2.3%.

It doesn’t look that bad, but it really should have been worse. We got a significant boost by the fact that I became vested in my company 401(k) matches.
I was officially hired in by my company in May 2007. They are quite generous with their 401(k) match, as they match 100% up to the first 6% of salary. However, the vesting schedule was as follows:

  • You are 40% vested after two years of service
  • You add 20% more after year three, four and five, at which point you’re 100% vested.

By that math, I shouldn’t have been at all vested until this May, and not fully vested until 2012. So, did I somehow invent time travel? No. Did I find a way to interrupt the space-time continuum? No.
Unfortunately, it was nothing so glamerous.
In addition the schedule above, there was a stipulation that if the division I worked for was sold, that full vesting takes place. Well, last year my company ownership transferred, so we became fully vested at once.
So, I had previously held off reporting the non-vested portion of my 401(k) plan, but now I added it in. This is a nice one-time boost, and it will also help moving forward, as all future contributions (up to 6%) will be matched and vested.

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Net Worth Update: January 2009

It actually was a good month for the update that I just completed. Probably not so much after the stock market took a dive yesterday, but I ran the numbers on Wednesday morning.
I actually run my net worth on the 7th of the month. I know that’s odd but I have done it that way since I started tracking. The reason I started doing it that way was simple: I pay many major bills on the 1st of the month. The mortgage and credit card payments are the biggies. I always waited a couple of days after the 1st for everything to clear, because otherwise the credit card would show paid and the bank account would still show the money. I think that the 6th was the latest I ever saw it take to balance, so I just started doing it then.
The numbers were actually good this month. Our net worth increased 9.8% from December. I think the stock market rally really helped. As a result, our assets went up about 2.5%.
On the debt side, we reduced 0.35% of our debt. Not the best number but about average. I know that number will be lower this month. I decided to hold a little bit extra back into savings this month with the baby coming, so I’ll be making only one extra student loan payment instead of two.
Overall, this was a good thing to see. It was the first significantly postive net worth report since May 2008. That’s a long time. While the gain of 9% plus was nice to see, it’s tempered by the fact that the overall net worth is still down 33% from one year ago report. There’s still a lot of work to be done, but we’re on our way!

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Net Worth Review: November 2008

Well, as expected the month of October was brutal because of the stock market. Not that it’s a consolation, but I saw many other personal finance bloggers report similar results. At least I’m in good company!
Overall net worth was down 12.2% from October. After a 17.9% drop in September, that brings us down to a net worth level that I haven’t seen in six years. Wow!
Retirement assets have dropped about 1/3 during that these last two months. Luckily we aren’t retiring for a long time, so we have time for recovery. In fact, I increased my 401(k) contribution recently. I had been contributing 6% because that’s the company match, but I increased it because I still feel that this a buying opportunity.
Our property value stayed roughly the same, so not much changed in how property values affect our net worth. For some reason, both of our cars dropped in value a lot this month (I use Kelly Blue Book). It usually goes down a couple percent per month, but this was closer to 10%. Weird.
We continued to make excellent progress in our debt, which is what keeps me positive these days. Because of the extra $2,700 we were able to apply to debt, we paid off a full 1.56% of our debt, which I define as our auto loans (currently $0), student loans, and mortgage.
In fact, we hit a noteworthy milestone this month. In terms of non-mortgage debt, our peak amount of debt was in June of 2006, which is when my wife (we were engaged at the time) purchased her new car and had a brand new loan. Since then, we’ve paid off the auto loan and have made significant progress in the student loan debt. The milestone: we have paid off 50% of the non-mortgage debt from it’s peak amount. In 29 months, we’re halfway to having only a mortgage. Pretty cool stuff!
So, it was another down month if you look just at the totals, but I still feel confident in our financial progress!

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Net Worth Review: October 2008

Well, it was a brutal month if you look at the bottom line for net worth. We witnessed the largest percentage drop since I’ve ever seen since I started tracking.
Let’s start off with the bad:

  • Where to I start? Well, anything with investments was brutalized. Our retirement funds went down in double digits, as did all of our other non-retirement investment holdings
  • Our bottom line net worth was reduced down to levels not seen since 2004. I guess that sort of goes in line with the stock market since I think we’re around lows not seen since around that same time.

The positives:

  • We continued to make good progress on our debt. We paid of 0.39% of our total debt, which is good. It wasn’t as good as last month (which was over half a percent) but it still beat what was normal for us in the first half the year, which was around 0.39% 0.25% (corrected). Our debt consists solely of our mortgage and my wife’s student loans.
  • We began the move of some of our cash savings from a non-FDIC insured account to an FDIC insured account. Even though the return is lower, I think the peace of mind we get makes it worth it. As I outlined in an earlier post, we will most likely create a CD ladder in our ING Direct account to improve our return.
  • Our home value decreased only slightly. Normally this would be a negative, but according to Zillow and CyberHomes, the value only decreased by a few hundred dollars. With the way the value has been shedding off lately, this is actually the ‘best’ month we’ve had in quite a while. I guess you have to look for the silver lining in all clouds.
  • We continue to have no credit card debt, as we pay everything off every month.
  • I have $187 to allocate after winning my Fantasy Baseball league this year. I unseated the previous champion who had won for five straight years, so that was an accomplishment. I will probably dedicate a future post to what I might do with this, but for now it’s sitting in the bank.

All in all, a bad month if you look at the bottom line. But, since I made a conscious decision a few months ago to gauge our progress more on how we pay off debt, I feel we did as good as we could.

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