Net Worth Updates

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January 2008 Net Worth Update

No, I didn’t win the lottery…This month’s numbers are going to look a little funky as this is the first time I’m including my house in the numbers.

As I mentioned last month, I’ll be calculating its month-to-month value using the 2007 property assessment and the Zillow estimate with the latter holding more weight.

With that out of the way, on the assets end of things I pulled all but $1k out of my ING Savings account. With the rates having fallen even further in December, I decided to pull out even more to throw it at higher rate credit card debt.

And apparently I crossed a “magic” mileage number on my primary vehicle, which lost over 5% of it’s value in the span of a month. It had been holding steady, and even went up in value a few times, over the year, but I guess the 26k mile marker is when the value starts to drop heavily.

On the liabilities end, the credit card balances continue to fall. As hoped, I wiped out the 9.9% Bank of America Business Card entirely, and put a significant dent in the other two cards carrying balances.

Everything else was business as usual.

In the grand scheme of things, ignoring the new house number, my net worth is higher than it’s ever been. My total debt is also at it’s lowest point ever.

Together, that makes 2008 look pretty bright, right from the get-go.

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Real Estate ValuationsFor my monthly “Net Worth” assessments, I’m toying with the idea of including the value of my home on the assets side for the first time.

In the past, I’ve left it off entirely because I never thought I was in a position to accurately estimate the value of my home. Enter

I’ve played with Zillow for a few months now. Mostly to check in on what my house was worth at any given moment.

Okay, I admit it, it was to size myself up with all of my neighbors — oh yeah, and really pretty much everyone I’ve ever met.

It’s not a “keeping up with the Joneses” type of thing, but let’s face it, it’s fun to compare yourself to others.

Anyway, the city we live in recently completed its city wide home revaluation for tax purposes. The results came in a few weeks ago, and I was going to post about it, but never did because it was, well, a little to bland unless I got a little too personal for my own comfort.

The news, for me, and really everyone in the city was not good.

Average residential property went up a staggering 47% in the city since the last revaluation in 2002.

Thinking about it, from 2002 — the numbers sound reasonable, but the 2009 property taxes are going to hurt considerably, as are my mortgage payments because the property tax is paid through an escrow account linked to my mortgage.

Needless to say, I’m not looking forward to the next escrow analysis Countrywide does on my account.

All of that aside — the report that each homeowner in town received in the mail, along with the bad news, held some really interesting information. Among it — the assessed value, the appraised value, and the replacement cost of your home. (and better yet, a link to an internet site where you could look up everybody in town’s information too!)

I looked at the Appraised Value and liked what I saw. I then headed over to Zillow and their “Zestimate” on the value of my home was, well, within $2000 of what the city’s report said.

I then looked at the historical data Zillow offers to see what the “zestimate” was of my home back when I purchased it, and you know what? It was right around the price I paid for it. How about that?

So I’m thinking that for 2008, I’ll start to use an average of the city’s 2007 apparaised value and the current Zillow zestimate (weighted double to the appraised value as it’s more current) to semi-accurately track the value (and equity I have) of my home.

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December 2007 Numbers

Another month where the market recovered, for the most part, in the last couple days…Without the pseudo-recovery on the last day of the month, my bottom line would have decreased significantly.  Even still, November of 2007 would still have gone down as another month headed in the right direction thanks to some large credit card payments.

For those of us with a high percentage of our wealth in the markets, I’m not sure any of us could have come up positive on the Assets side this month.

And on that side, besides the sizable drop in the 401k balance, things were pretty steady.

I temporarily moved some money from my savings over to checking in order to keep my daily balance above Bank of America’s minimum in order to avoid a service fee.

If the $3,000+ payment I’m waiting for on one of my side income projects comes in soon (God willing) — that savings withdrawal will be re-deposited first thing. But, I’m also considering pulling even more out of savings next month to pay for Christmas and knock down debt more rapidly. I’m still weighing the pros and cons but right now I may even withdraw all of it due to the looming interest rate drop scheduled for December 11th.

The Liabilities portion of my net worth is where most of the action took place.

I didn’t make a mortgage payment this month because I’m far enough ahead to be able to let it slide, so I applied what would have been my mortgage payment to the credit cards instead — and did it ever help!

My Bank of America Business Mastercard should be paid off in full by the end of the year as I’d planned back in October before I’d even given a second thought about this snowball business. That’s going to feel really nice as it’s my highest rate debt (a tolerable 9.9%) right now.

At this pace of nearly $3000 falling off of the total credit card balance per month, I could wipe out all of them (and in doing so, fully pay for the siding project that ran them up so high in the first place) in the next four months.

Unfortunately, I don’t think this pace is sustainable.

You never know though, ’tis the season for bonuses and tax refund time is just around the corner as well. I’m not counting on anything, but we’ll see!

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November 2007 Status

Nothing terribly notable this past month.

My assets remained relatively flat while my debts kept pace in the right direction resulting in another “positive” month.

The Government Bonds were the big negative this month — I cashed out all that I could earlier this month because the money could serve me better elsewhere.

Where’d it go? Well, it got me ahead on my mortgage again (next payment is due in January) and it knocked off some of the credit card debt.

And speaking of credit card debt, I ending up throwing well over $2k towards the debt hoping to really get a good jump on knocking out one of the cards before the end of the year, but the unexpected expense of the hard drive crash swallowed up any of the noticeable drop.

That’s okay though. Under the new plan, November’s looking pretty good already.

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Oct 2007 Net Work Update

Another month headed in the right direction!

That’s what the numbers say, anyway… I didn’t really *feel* like I made any progress in September.

I mean, I’m the type who usually pays the mortgage nearly a month in advance and I was only able to afford it three days before it was due this past month. I hate cutting it that close.

Obviously, the big jump came from my 401k. Over three quarters of the increase is tied up where I can’t touch it. I’m still *very* cash poor and that’s mostly due to the fact that a number of my clients are behind on their bills. One of these days, my mailbox should have a decent number of checks waiting in it.

Until then, I’ll continue to tread water.

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September 2007 Numbers

Back on track. Phew!

After a few months headed in the wrong direction, finally I’ve managed to right the ship despite the stock market woes.

Speaking of the stock market, a late month rally put me ahead for the month on my 401k balance. Taking that out of the equation, the assets side of things pretty much went no where.

That’s okay though — the plan is to wipe out the liabilities side first and foremost and everything there is dropping. Not much of a dent in the auto loan, but I don’t actually have a payment due until 2008, so I’m focusing more on the credit card balances.

I’m happy with the $1753 drop there, but it should have been better. I still managed to charge around $425 dollars. That’s still $600 less than last month, but I can cut it even more I’m sure. That will be the goal this month.

In the end, a 6% gain is something to be content with…especially after two consecutive months of double digit drops.

(Still can’t explain the wonky rising car values… Another few months of this, and I may drop them from the calculations.)

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August 2007 Net Worth Update

As expected, another month headed in the wrong direction. Both losses come on the assets side this month — the tumbling stock market is having an impact on my 401k (like everyone else), and though the chart indicates that I only dropped 2.26%, if you were to just take the second half of July, the losses are closer to 4%. Ouch.

Good thing I’m still young and in it for the long haul. At the same time, it also appears that I’ve timed the market perfectly as I just increased my 401k contributions last week.

Okay, that might be a stretch… I’m not actually expecting it to have a large impact in the short run.

The other sizeable loss came in my checking accout; due almost entirely to the siding project. With that behind us, and just a small electrical project on the horizon, the home improvement expenses are done.With that, the ship will be righted in August as there are no large looming bills, besides a dental bill that might actually fall in September, but in comparison to the renovations, it’s a negligible amount.

Unfortunately, the trend of increasing value on my daily driver (it actually went up $25 in June!) did not continue this month. I didn’t really expect it to, but it was nice while it lasted.

On the liabilities side, it was all good news. All balances, credit cards, auto loan, and mortgage dropped in July. The credit cards didn’t fall as much as I would have liked, but they’re still falling and now, again, with the siding bills paid, my income can be directed at them more aggressively.

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July 2007 Net Worth
Not as bad as I thought it would be…

The siding project is nearly finished and there is one more $8k payment due at completion. That will wipe out my cash reserves entirely. I think that’s when it will set in — all gains to this date so far are gone in the span of a month. But… the house looks nice!

The big movers this month, again, were the savings account and the credit cards. Both are 100% to finance the home improvements.

My 401k also tanked this month. Actually, dropping less than 1% isn’t that big of a deal, but with all of the volatility lately, it seems like it’s swung a lot further than that over the whole month.

Something very strange, and something I’ve never seen happen, was that the trade-in value of one of my cars actually went up! It’s a model year 2005, so it’s not like its hit a “collector” status or anything. Maybe the value of cars getting 45mpg is going up? I dunno, but I’m not complaining. It’s likely a fluke. And probably one of the reasons many people don’t include their vehicles in their calculations.

My sneaky plan to pay down the mortgage has already made a noticeable difference in just two weeks. I’m not about to get more aggressive than $25/week because I know paying down your mortgage is kinda stupid at the point I’m currently standing, but even an insignificant amount like $25 is truly putting a dent in it. To think, year to date, I’ve only knocked off a little over $1000 on the balance, but just last month with a couple of $25 payments, it took off nearly a quarter of that. That’s HUGE and it costs nearly nothing to me.

In the end, once the renovations are complete, overall, I think my net worth will have dropped around $16k. Not too bad considering we’ve spent right around $26k on renovations, but it still feels like a kick in the stomach.

I’m trying my best to look at it like a 6-month setback. Hopefully I can keep on the same track (of debt re-payment) that I’ve been on since January, but it might be tough over the next couple of months as I’m not real comfortable being cash poor. And as I said, when we write that final $8k check, we’ll be broke.

Can You Dig It?