Welcome to the very first net worth update of 2009!
The most notable update this past month was that I took a portion of our savings ($20k) and put a lump sum payment on our mortgage. I’m hoping to do this again later in the year to meet one of my financial goals. However, the priority is to maximize my RRSP and TFSA before paying down the mortgage any further as my mortgage rate is currently very low (2.15%). Why not take advantage of cheap money while it’s offered?
My portfolio’s recovered a bit (for now) which helped in the net worth increase this month. However, the bulk of the net worth gain is again due to savings (here are some ways to save money).
I mentioned last year that I may adjust my home value with inflation. For now, however, I’m going to keep it at my purchase price. Although comps in the area would bring the house value well above my purchase price, I’m not sure if the local housing market will be negatively affected by the weakened global economy. Personally, I’d rather under value my personal residence than adjust monthly based on volatile market conditions.
Here are the assets/liabilities results for the month of January 2009 (compared to December 2008):
Assets: $563,950.00 (-2.00%)
- Cash: $4,500 (+0.00%)
- Savings: $31,900.00 (-29.77%)
- Registered/Retirement Investment Account: $39,700.00 (+5.31%)
- Pension: $22,350 (+0.00%)
- Non-Registered Investment Account: $13,000.00 (+4.00%)
- Smith Manoeuvre Investment Account: $41,000 (+1.23%)
- Investment Property: $ 124,500 (+0.00%)
- Principal Residence: $275,000 (+0.00%) (purchase price)
- Vehicles: $12,000 (2 vehicles) (-7.63%)
Liabilities: $244,900.00 (-7.77%)
- Investment Property Mortgage: $92,000 (-0.11%)
- Principal Residence Mortgage (readvanceable): $101,200 (-16.98%)
- HELOC balance: $51,700 (+0.35%)
Total Net Worth: ~$319,050.00 (+2.94%)
Started 2008 with Net Worth: $309,950.00
Year to Date Gain/Loss: +2.94%
Some quick notes and explanations to net worth questions I get often:
The $4,500 cash are held in chequing accounts to meet the minimum balance so that we pay no fees (accounting for regular bill payments). Yes, we do hold no fee accounts also, but I find value in having an account with a full service bank as the relationship with a banker can prove useful.
Our savings accounts are all held with PC Financial. We hold a fair bit of cash in case “something” comes up. The “something” can be anything that requires cash such as an investment opportunity that requires quick cash or maybe an emergency car/home repair.
Our real estate holdings consist of a primary residence plus a rental property. The value of the principal residence remains valued at the purchase price despite significant appreciation in the real estate market that we’re in.