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Welcome to my 3rd monthly net worth update!

By 3rd, I mean the 3rd that I’m publishing here on The Budget Boy. It’s amazing when you look at some of the other personal finance bloggers out there like J. Money at BudgetsAreSexy who just published his 120th net worth update. That’s 10 straight years!

I’ve got a long way to go…

On the other hand, I started tracking my net worth (and expenses) at the end of 2012 when I first moved out on my own. In that regard, I’ve crossed the 5 year mark now.

You can check out my net worth journey and recent reports below:

My Personal Net Worth Story
November Net Worth Update (+$4,600)
December Net Worth Update (+$3,100)

Let’s look at the January numbers:

Net Worth Update January 2018

Net Worth Update January 2018

Savings (+$168.16)

Our savings went up just a tiny bit. Right now building this up isn’t a priority as our monthly net income is being applied towards paying off debt. If this were our only emergency fund, I’d prefer to have it a little larger, but that’s where the liquidity of stocks comes in handy.

I’ve got over $31K in my brokerage account, which I could have in our bank account in 3 business days if it were absolutely necessary. It acts as a real emergency fund. Altogether, we easily have 5 months of expenses readily available in case body waste hits the fan.

Stocks (+$486.54)

The stock market started off the year on a tear. In my personal trading, I made 1.55% in January. Unfortunately, I still underperformed market for the month as well as cumulatively.

Retirement (+$2,302.01)

Last month I mentioned how I switched from using the account balance for our retirement accounts to the vested balance. This gives a much more accurate reflection of the money that is truly ours. Because both of us are in our first years with our current jobs, the employer contribution matches are not helping as much. We’re only getting 0-20% of it at the moment.

As mentioned above, the market did really well in January, so we got a nice bump in our retirement accounts.

Real Estate Investment (No change)

No change here. This is a house flipping fund that is winding down. As the last couple properties are being sold, money is distributed to the stakeholders and is no longer being reinvested into new properties. No properties sold in January. There are 4 properties still left to be sold (which gives you an idea of how small my stake is).

Rental Property (No change)

I use the estimated sales price minus closing costs to determine my property value. I didn’t see any evidence to change it’s value in January.

Car (-$545.00)

This is really painful. The car is depreciating faster than we’re paying it off. That’s two months in a row now. We currently owe $4K more than what it’s worth. Hopefully, the value will start to stabilize soon and the gap can close.

Accounts Receivable ($26.43)

This Accounts Receivable is mainly used for Mrs. Budget Boy’s work expenses that she gets reimbursed for. She got reimbursed for some previous expenses and then had some new ones that offset each other.

Mortgage (-$2,495.61)

I’m putting my money where my mouth is. I’ve talked about how the effective cost of PMI keeps going up as you pay your principal down. Since our LTV dropped below 82%, the effective interest rate on PMI is now higher than the highest interest rate on Mrs. Budget Boy’s student loans. And it keeps going up at an increasing rate!

Rather than getting it down to 80% LTV and paying $550 on a appraisal to terminate PMI, I’m trying to speed straight to 78% LTV where it can be canceled without paying for an appraisal. According to the debt avalanche strategy, this is currently the best use of available funds.

Student Loans (-$923.42)

Even though getting my mortgage to 78% LTV is priority #1, paying down student loans is still a high priority. I’m reluctant to pay only the minimum and put all money towards the mortgage although that’s starting to look like the smarter thing to do. It could mean hitting 78% LTV a month or two earlier.

Car Loan (-$291.58)

No extra principal is being allocated towards the car loan as it’s our lowest interest debt. The principal decrease is less than last month that has more to do with calendar timing than anything else. The sad thing is the car depreciated $545 in January, much more than the principal paid.

Credit Cards (+$437.86)

We pay ALL of our credit cards in full every month, but our balances went up in January. Even after a higher month of spending in December due to the holidays. In January, we started booking a bunch of accommodations and activities for our big 2-week vacation to Greece in a few months.

Accounts Payable (+$155.69)

I account for Unpaid Taxes due to stock gains/losses, which offsets either a little bit in terms of net worth. Since my personal trading showed gains in January, my Unpaid Taxes increased.

Bottom Line

In the month of January, our assets increased by $2,438.14 (mainly due to retirement gains) but we also decreased our liabilities by $3,117.06, a total net worth increase of $5,555.20. In terms of percent, that is a 5.25% increase in net worth, better than November and December!

Net Worth Update Jan 2018

Our net worth of $111,469.25 is just barely below our all-time highs from 2 years ago. The max net worth I have on record is $112,271.48. February is poised to break through to an all-time high as this train is gaining momentum!

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