Tuesday, 2 July 2013

Net Worth: 2013 Financial Performance Summary

Yesterday marked 2 years of me writing this blog and of tracking my net worth to my target of $90 million.  It has been an up and down year for me both in terms of my career, my personal life and the focus of this blog, my wealth journey.

When I wrote this same post last year to mark the one year anniversary of my blog I set my target for the 2013 financial year of $500,000 which was very ambitious at the time and I needed to start generating some new sources of income to get to this level.  I started thinking up business ideas and actually got fairly advanced in some however this never get off the ground for various reasons (including personal ones).  My performance for the last 12 months can be seen below:

Some of the changes that have occurred over the last 12 months include

  • An increase in assets from $599,000 to $724,000 (+21.0%)
  • An increase in liabilities from $355,000 to $356,000 (+0.4%)
  • An increase in net worth from $244,000 to $368,000 (+51.1%)
In absolute terms this was actually a very similar performance to the 2012 financial year.  In that year my net worth increased $120,000 whilst this year it increased $124,000.  Compounding would normally have more of an effect however in the 2012 financial year I was still getting paid an investment banking salary and bonus which I did not get in the last year.

I have also included below a chart which shows my performance from when I started tracking my performance in June 2011.  In this time I have seen
  • An increase in assets from $478,000 to $724,000 (+51.5%)
  • An increase in liabilities from $354,000 to $356,000 (+0.6%)
  • An increase in net worth from $124,000 to 368,000 (+196.9%)

What is also interesting is to note is the difference in composition of my investment portfolio over the two periods.  Below is a diagram showing how my portfolio has shifted over the last year from one in which the dominant component was property (on a net basis) to one which is much more heavily weighted towards shares and cash.  This is a little bit skewed because ~15% of my share investments are in property trusts which skews the portfolio back towards a property dominated portfolio.

Note that I have made superannuation it's own category because I have a diversified superannuation portfolio and it would be wrong to put it in any one category.

I am still extremely far from my $90 million target and if I'm going to be honest I was hoping to crack the $400,000 mark this year.  Next year I should crack the $500,000 mark reasonably easily and I'm going to add an extra challenge to myself and set my target for the 2014 financial year at $550,000 (an increase of ~$182,000 for the year).

If you have goals that you set yourself I would love to hear about them!  

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