Wednesday, 1 June 2016

May 2016 Net Worth: $773,300 (+2.5%)

I continue to honestly be surprised at how my net worth continues to rise month on month.  My wife and I have been talking about finances a lot this month.  As crazy as it sounds this is the first time in my life I have felt any anxiety about money at all.

Why am I feeling anxiety when I am doing pretty decently for my age (for those of you who don't know I just crossed the big 30 a few months ago)?  Housing is the reason.  My wife and I are saving for a new house and housing in the state I live in is incredibly expensive.  I keep going round and round in my head the different options:

  • Do I sell some investment assets to be able to afford a better home?
  • Do I compromise on where I live to buy something more affordable?
  • Do I buy something more expensive and keep the investment assets but leverage myself more?
  • Do we go for the area we want but perhaps not the house that we want?
  • Can I afford to take extra leverage if I'm the sole bread winner and we have kids?
Obviously in a world with limited resources where I am not a multi-millionaire these are all very real questions and questions that lots of people's just my time to ask and go through these issues.

Why do I raise all of these issues in a post about my net worth?  I haven't been tracking my net worth performance this month all that closely and given the stress I have been feeling with the above questions it was a relief and pleasant surprise to see things continue to go well.

So how did I actually do this month?

My net worth performance breaks down as follows (note that totals may not add exactly as there are formulas which round everything to the nearest $100)

Let's walk through some of the major movements this month...

Monday, 2 May 2016

April 2016 Net Worth: $754,400 (+2.0%)

I was surprised how well I performed this month.  I actually spent a fair amount of time this month working on our personal finances and sorting out some admin problems we had (including spending about 2 hours speaking to my superannuation fund to make sure that there weren't any admin errors).

This month we focused a lot on trading and not a lot on investing.  I'm hoping to get back into investing more aggressively over the next few months.

Let's have a look at the breakdown in performance this month:

Friday, 1 April 2016

March 2016 Net Worth: $739,900 (+2.7%)

This month was a pretty good month...I managed to get away for a 2 week break overseas and also to do pretty well in terms of my net worth performance.

Instead of a long rambling summary I thought I would get straight into the numbers.  Below I have included a detailed breakdown of my net worth performance.

In line with the new way I disclose my net worth and the extra detail provided I thought I would address each of the major categories in turn.

Direct Share Investments: +$7,800

I didn't invest anything new in the share market this month and the total gain was due to positive share market moves.  Given the real pain I have taken over the last few months this was a welcome relief.  

Most of these gains came from industrial type stocks.  I made quite a large move into resources and oil exposures while the price was falling and given the low oil price these bets haven't paid off for me yet.  I'm currently considering investing more in this space but am a little gun shy at the moment

Other Investment Assets: +$4,500

Tuesday, 1 March 2016

February 2016 Net Worth: $720,300 (-1.0%)

This was my first negative month in 7 months which is a pretty good run rate when you think about it but I have a bit of an embarrassing fact to admit...I totally screwed up last month's net worth which actually did in the worst performance I have ever had.

It was only because an error on my part that I thought I actually had a decent performance.  The error in last month's performance was due to a share consolidation that I had missed.  Basically the error was as follows:

  • I have ~$4,000 worth of Hello World, an Australian listed travel agency
  • Hello World did a 1 for 6 share consolidation which raised the price 6x
  • I should have just adjusted the shares I held by the same amount but because I missed it (and my share prices populate) I looked like I had $24,000 worth of shars
  • January's net worth was actually overstated by $20,000...instead of an increase of $13,000 I should have seen a decrease of $7,000 to $707,000
Why did I outline this?  Because I actually did reasonably well this month in increasing my net worth to $720,100 and my explanations wouldn't have made sense in the context of a falling net worth.

February 2016 Net worth...the detail

Wednesday, 3 February 2016

January 2016 Net Worth: $727,400 (+1.7%)

You may have noticed that over the last few months I have really dropped off on my posting schedule.  I have not uploaded any goals for this year and I haven't really been updating you on what has been going on in my financial life.

Originally this is because I was developing a new financial blog concept.  This blog was originally set up when I wanted to be rich and take over the world.  Since I started this blog however many things in my life have changed including my perspective on life.

I sat down and did some really hard thinking and worked out know what?  I don't know what I would do with $90 million that I couldn't do with $5 million and what I want with the $5 million is more freedom rather than toys.  The only extravagance I would spring for is Business class airline seating (seriously!).

If I'm going to be honest with you I don't really know what I want anymore.  I'm in this odd place where I'm remarkably comfortable but I'm not really sure what comes next.   I'm not financially "free" yet and I'm going to keep working towards this goal but I haven't yet nailed down what a 'perfect' life would look like and until I do my goals are in a little bit of limbo.

With that out of the way - I will (for the foreseeable future) still be updating my net worth on this blog.  When I work out what I want to do next you will be the first to know.

January 2016 Net Worth...the detail:

Friday, 1 January 2016

December 2015 Net Worth: $715,000 (+2.1%) and Goal Tracker

Another month and another year have gone by and I'm incredibly happy with house this month and this year have panned out.  Not everything has gone to plan especially in relation to this I couldn't control (like the stock market) however having a plan in place for my own personal finances helped me whether some pretty tough conditions to come out far ahead of where I originally thought I would be.

Enough of the nostalgia and onto the numbers.  Below I have provided the usual summary of my net worth however I have gone into far more detail than I usually do on my goal tracker given I have just completed my goals for the year.

Net Worth: $715,000 (+2.1%)

% Change
Net worth

This month I had hoped to increase my net worth to $705,000 so I was pleasantly surprised to see it increase far more than that.  Some of the increase was driven by large factors but a lot of it was just grinding along and following the plan I have laid down for myself.

Some of the key factors which affected this month's performance included:

Tuesday, 1 December 2015

November 2015 Net Worth: $700,000 (+5.9%) and Goal Tracker

I love bonus month!  It's the one really big cash inflow that I have during the year and this year was no exception.  Bonus month helped my net worth jump almost 6% to hit the $700,000 mark for the first time.

Crossing these milestones is always a bit of a strange experience.  I technically know that I am building wealth but my life doesn't feel any different.  I'm still doing exactly the same thing day to day but the effect of compounding seems to be accelerating the process.

Net Worth: $700,000 (+5.9%)

% Change
Net worth

This month my net worth increased $39,000 and there were a couple of huge factors that led to the increase.  For once most of it was actually expected (as opposed to hitting me from nowhere) but it was still pleasing to see everything running as expected.

My bonus got paid in the month

  • My annual bonus forms a significant part of my income and it was paid this month.  I'm not going to go into the specifics of exactly how much it was but a good chunk of the increase this month was the bonus payment
  • Part of my bonus is deferred for the next few years (although part of this gets paid out every October so if you read my post last month you will have seen a significant uplift from that)
  • Tax is also taken out of my bonus payment automatically...given that it is taken out at close to the top marginal rate, I'm losing 50% of my bonus almost straight away
  • Even with all these mitigating factors it was still nice to see a significant step up in the amount of cash I had on hand

I paid my tax bill during the month

  • I had an absolutely massive tax bill this month...I owed the government more than $8,000!
  • Most of this was due to my trading in shares and as I generate profits on my share portfolio I keep track of the capital gains tax I have owing which forms part of my liabilities above
  • Although I paid out a significant amount in cash this month it actually didn't affect my net worth all that much as my liabilities stepped down by a similar amount

My investment portfolio continued to perform well

  • My investment portfolio did rather well this month increasing by almost 2% over the month
  • I also continued to contribute to my employee share plan and my employer continued to make superannuation payments on my behalf
  • My investment portfolio (including my superannuation) represents approximately half of my net worth with the rest being the home I live in and the cash I am stocking away from my next house

My credit card balance remains stubbornly high

  • One of the few disappointing aspects of this month's performance is how stubbornly high my credit card bill remains
  • We are doing renovations on our home at the moment and everything we buy goes on the credit card...I think this is an area my wife and I probably need to focus on going forward.

When I look back