Thursday, 2 January 2014

December 2013 Net Worth: $478,000 (+4.6%)

Value% Change
Net worth$478,000+4.6%

My final net worth for 2013 was far in excess of where I thought it would be.  I posted last month that I was hoping for a net worth of $465,000 but as you can see above I managed to do much better than this due to the allocation of my FKP rights as well as the granting of my share based deferred compensation (the deferred part of my bonus from last month).

Over the last 12 months my net worth has increased $144,000 from $334,000 to $478,000.  This was approximately $20,000 more than the previous year which was an unexpected outcome because I have actually been saving far less out of my wage since I moved out of home.  The increase really reflected an incredibly strong performance in the share market.

I normally set my net worth goals on a June year end basis and when I set these in 2013 I set my net worth goal at $550,000.  This will be a bit of a stretch given my large cash flows tend to come in the second half of the year although it does feel achievable.  I am looking forward to crossing through the half million mark in the next few months.

Below I have outlined the positive and negative factors which impacted my performance

Positive factors:

  1. The allocation of my FKP rights
    • I recently wrote a post on the allocation of shares under the latest FKP rights issue and how I was sitting on a large paper profit
    • Since this point the share price has softened a fair bit but I still can't sell them until my employer mandated holding period has expired 
    • Even if the share price does not recover to what it was, I will still be selling down some of this holding as it currently makes up almost a quarter of my share portfolio
  2. The allocation of my deferred share compensation
    • Most people who work for large corporate entities and get paid bonuses typically have part of this bonus restricted for several years
    • If you leave the employer you forfeit this component of your bonus
    • My cash bonus was paid in November however I only found out what the restricted equity component of my bonus was in December
    • I value this equity at 100% even though I could lose it if I leave.  I do not plan on leaving my employer.  If I do I will have to write down the value of these shares to 0.
  3. A continued strong performance in the share market
    • I can't remember the share market ever being this hot - it keeps going from strength to strength
    • If I'm going to be honest it is starting to make me nervous - I cannot see how much further this can run.  In the new year I will be thinking about scaling back some of these holdings
Negative factors
  1. A massive over spend on the personal expenditure front
    • I will talk about this more in my expenditure tracker however I spent far too much money in December 
    • Some of this was related to Christmas gifts however much of it was just on going out eating and drinking - I had largely managed to contain this type of expenditure in previous months but it seemed to rear it's ugly head in December
    • As at 1 Jan I have $85 in my transaction account and I'm going to attempt to survive on this until pay day in 2 weeks time
As I mentioned above, I continue to be surprised at how I am performing in terms of my net worth.  In the coming month I have some big one off expenditures including moving into my new apartment (which requires a bond which I didn't have to pay when I was living with a housemate) and all the expenses that go with that.  I do not think I will be able to save that much from my wage although I should get my tax return cheque back (I still haven't got around to doing my taxes for 2012/2013 yet!).  My goal for January 2014 therefore is a net worth of $480,000.

You May Also Be Interested In

No comments:

Post a Comment