June 22, 2011, 6:00 am

May Net Worth Statement +1%

by: The Financial Blogger    Category: Assets and Net Worth
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All right, I realize that we are almost done with June but this month just flew by with the launch of my dividend investing ebook (I’ll share with you the results next week!). So it’s about time that I provide my net worth statement.

The good news is that my assets are growing faster than my debts. The bad news is that my debts are still growing. On another positive note, I’m done with my major expenses for summer (A/C has been paid, baby showers are history, municipal taxes have been paid and the birthday gifts for both my children are paid for). On the other hand, I didn’t receive my mid-year bonus yet. I am hoping that I will get it in July, yet the news is that the bank is very conservative and I won’t be receiving much (as compared to what I will be getting at the end of the year!).

I have increased the value of my house by 7K which was the cost of my central A/C. Perhaps I should not increase the value by the full 7K but I swear it’s worth it ;-). Since I only attribute a 3% increase annually on my house (while the market is growing faster in my town), I don’t feel too bad about it.

I still haven’t received my pension plan update, I am starting to think they forgot about us ;-). This will also see a big jump (as I am still working with 2008 numbers). We are now about to enter a cool period in terms of spending as I don’t have many expenses coming up this summer. Therefore, I should benefit from 3-4 months in a row where I should be able to drop my debt level. It is definitely about time!

I also got a good income increase (which starts this week!) so  I will use this extra income to work on reducing my debts. So far, I’ve been able to switch my debts around so I don’t pay more than 2% interest on any of my debts. This is probably why I keep spending; the impact of the interest rate on my budget is minimal. However, things won’t always be this way so I had better start cooling down ;-).

I’m really looking forward to next month’s update, as I should be able to drop my debt by 1 or 2K. Let’s concentrate on my goal to pay off my credit card debts by the end of the year!


CHECKING ACCOUNT$1 000$1 0000.0%
$5 774$6 1977.3%
RRSP ACCOUNT$22 175$21 407-3.5%
PENSION PLAN$12 000$12 0000.0%
HOME$338 640$345 6402.1%
COMPANY SHARES$98 000$98 0000.0%
MAZDA TRIBUTE$21 266$20 832-2.0%
MAZDA RX-8$8 800$8 400-4.5%
TOTAL$507 655$513 4761.1%


CREDIT CARD$14 870$18 85926.8%
LINE OF CREDIT$19 348$19 7592.1%
HELOC$264 348$264 5740.1%
CAR LOAN$21 266$20 832-2.0%
Personal Loan$12 500$12 291-1.7%
TOTAL$332 332$336 3151.2%

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Assets up 6,000, liabilities up 9,000 so net worth should go down by about 3,000. How is that up 7%? Am I missing something? Just wondering.

by: The Financial Blogger | June 22nd, 2011 (11:34 am)

You are so right! sorry for the confusion!

I played around my debt and asset tables and didn’t save/uploaded the right one!

net worth is +1% this month!

Yeah sorry I don’t think you bump your house’s value up by the cost of the upgrade. I know it helps increase your net worth but I would error on the side of caution. I think it is a case of massaging the number to say what you want.

Iain, then what would be your approach to adding value to a house after an upgrade?

I had about 25K of upgrade done to my house last year. I would have done TFB and added it to the house’s worth since I will be able to ask for that much more on the market right now. Probably more.

Not sure how I would have applied the upgrade on an decreasing market.

Is your approach of valuating house upgrades market independent?

1% doesn’t seem like a lot but when you look at the whole numbers (still waiting for that updated table) it is a significant push in the right direction!

Great job!

Wow–mid year and end of year bonus? That is awesome!

Amazing job TFB, keep it up!! What are your objectives for the year and long term?

Honestly I think people focus on the net worth of their house too much. The true value of an asset is what somebody is willing to pay for it. Some investments into your house will result in returns (put in an extra $10 K and sell your house for extra $20 k) but others will result in a loss (putting in $10 K and selling for an extra $5 K).

Honestly I only adjust my house for inflation but I know that my net worth might change dramatically the next time I sell my house.

Since you won’t get the return on your upgrades until you sell house it is a difficult issue. Should I also start factoring the legal fees and commissions that will come along with selling that house as well?

Interesting that you consider a vehicle an asset. Even more interesting is that you consider it to be worth exactly what you owe on your loan.

by: The Financial Blogger | June 23rd, 2011 (7:31 am)

yeah, but my mid-year bonus is very small compared to the year-end. they tend to be conservative, I can’t blame theme!

This is why I consider my cars as asset; because I borrowed money to buy them. It would be unfair to declare that I have a 20K car loan but with no value to offset it. It would create a “fake” negative net worth. Since I don’t want to give value to my cars either, I just use their value to offset their loan. So they depreciate by roughly $400 each per month. Which will lead me to a situation where I will have 2 car free of debts that still worth a few thousands in the real life but nothing on my balance sheet.

congrats –

the company shares stick out like a sore thumb! keep them shares appreciating!!!!! liked your article on reinvesting back into your business to grow its value.

we try to keep the value as conservative as possible. In fact, if I only sell TFB or The Dividend Guy Blog, I would probably be able to get my 100K in my pocket (and so my partner) ;-D

on the other side, the market for 100K+ sites is very small…so liquidity is a big problem!

Makes sense when you put it like that I guess.