May 2008 Net Worth Update (+3.12%)
It’s the end of month financial checkup! Lets see, where do we start?
On the income front, my wife finally started getting her maternity benefits along with the monthly UCCB payments. Even though the benefits are much less than her regular paycheck, they help take some of the pressure off.
On the expense side of things, we didn’t make any major purchases but made many.. many smaller purchases for the baby. So much so that I am now on a first name basis with the Walmart greeter. … sometimes you want to go where everybody knows your name …
Onto the markets, what is going on with the Canadian market? All time high? Wasn’t it just a couple months ago when we were all predicting doom and gloom with pending recession along with sub prime this and that? Has that all gone away? Seems that investors are confident in the Canadian market place, and it shows with the amount of money pouring into stocks like RIM and Oil & Gas Companies.
One more thing, you may notice a large drop in the mortgage balance. After all the talk in the Manulife One thread, it motivated me to take some of my savings ($15k) and dump it onto my mortgage debt. I don’t know why, but having a lot of cash around gives me a sense of security. Sometimes, however, the “feeling” of security isn’t the most efficient way to use the money.
Enough rambling, here are the numbers:
Assets: $574,450 (-1.13%)
- Cash: $4,500 (+0.00%)
- Savings: $26,800 (-27.57%)
- Registered/Retirement Investment Account: $55,200 (+5.14%)
- Pension: $ 22,350 (+0.00%)
- Non-Registered Investment Account: $19,200 (+4.92%)
- Smith Manoeuvre Investment Account: $25,400 (+0.40%)
- Investment Property: $ 124,500 (+0.00%)
- Principle Residence: $275,000 (+0.00%) (purchase price)
- Vehicles: $15,000 (2 vehicles) (-0.00%)
Liabilities: $263,820 (-5.62%)
- Investment Property Mortgage: $93,500 (-0.21%)
- Principle Residence Mortgage (readvanceable): $137,100 (-10.22%)
- HELOC balance: $25,220 (+0.40%)
- Other Liabilities: $8,000 (-0.00%)
Total Net Worth: ~$ 304,130 (+3.12%)
Started 2008 with Net Worth: $279,300
Year to Date Gain/Loss: +8.89%
Interested in seeing how my net worth has progressed up to this point? Check out my history of net worth updates.
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DAvid, that’s another great point. Even though my house is fairly new, it has increased significantly in value. However, I don’t think i’ll be adding onto the value of the principle residence until the new year.
Yes, the (oil) economy here is booming. It’s VERY difficult to find a starter home at a reasonable price these days.
Also, the value of housing in the St. John’s area has increased about 16% in the past year. http://www.canajunfinances.com/2008/06/12/dollar-parity-means-18-more-expensive/
It’s good to see such confidence in the economy. Danny must be a popular guy in financial and business circles.
Hey Derek, valuations haven’t changed, we sold our old house and built a new one. The principle residence value is our purchase price.
I was wondering why so large a jump in the valuation of your realestate holdings from ’07?
It all depends on how you present it ;-) I’m sure there are some renovations to be done on your rental property… oops that’s my accountant friend talking right beside me ;-) lol!
Seriously, If you want to make it “better”, you could cash in a part of your non leveraged investment and do the same thing. And everything would be 100% right ;-)
why don’t you use your savings to pay off your “other liabilities” and then re-borrow the money from your rental property in order to put it down on your new house? interest becomes tax deductible and it doesn’t cost a penny ;-D
FB, money borrowed that is used for non investment purposes is not tax deductible, even if I refinanced the rental property to do so.
Congratulations to you!
Nice job MDJ,
You are walking the walk while teaching so many how to do it as well. This is one of the better finance blogs on the web and the RSS subscriber increases clearly show that (I am sure traffic increases are even better).
Keep up the good work – I know how time consuming and rewarding writing a blog can be.
Since the value of the home is the largest portion of the net worth statement, Patrick’s comment makes sense, the increases in the other investments will make themselves apparent as they grow in proportion.
Also since the economy usually moves largely in parallel over short periods of time, a similar rate of increase across most sectors would be expected on a month to month basis.
Have you noticed that your net worth is essentially equal to the value of your home? In other words, a 1% move in your home’s value translates into a 1% move in your net worth. (Or, if you’re a Garth Turner-style pessimist, a 50% decrease in real estate prices would wipe out half your net worth.) For my own personal taste, the Toronto real estate market is not somewhere I want to be exposed right now.
Patrick, no, didn’t notice that until you mentioned it! Even if housing prices go down, there is a fairly large buffer between what I declare on my net worth statement, and the actual worth of my home. BTW, i’m in Newfoundland. :)