November proved to be an interesting month. I think many of us were surprised by the Trump win in the election. Since that time the market has been doing fairly well. I guess Wall Street likes the idea of lower corporate taxes? In addition, bond markets have seen big swings and mortgage rates are climbing quickly. Boy are we happy we locked in our two new mortgages at under 4% earlier this year!
Thanksgiving was a nice opportunity to see some family and to reflect on all the wonderful things we have in our lives. Truly, we are very blessed.
Our net worth continues to climb thanks to aggressive saving and primarily market returns. We’ve been up 9 out of 11 months so far this year, and with any luck we’ll actually hit our growth goal of 25% increase in Net Worth by the end of the year.
My primary goal is to have the freedom to “retire”, or reach financial independence (FI) at age 40. As of this month, that is now just 15 months away!
I’m a big believer in completing monthly net worth updates as a way to stay on top of your financial situation and work towards your goals. Therefore – I share my monthly net worth updates here.
Here’s the latest net worth breakdown.
Total Net Worth this month came in at $1,229,861 – this is $23,936 more than last month. Here are the details…
November 2016 –
Net Worth Notes:
Cash – This shows a pretty significant dip in the chart above, but this is mainly due to the timing of when I pulled these numbers together. Because it was a bit later in the month (not on the 1st), my mortgages had paid out already, thus depleting some of my checking account. Note the liabilities section, especially the mortgages show a big change. I’m continuing to try to save cash so that I will be able to deploy it during a market downturn or take advantage of other opportunities, but sometimes I just want to invest it! I have to keep reminding myself that at least part of the goal now is to build cash. Soon I’ll be working on my plan for 2017, and specific goals, so that might help keep me focused.
Taxed Stock Account – A while back I reduced my monthly contribution here from $2k to $1.5K – believing that a little extra cash might be a good move right at this moment. It’s all set up as part of an automatic investment plan where the money is spread across 5 or 6 different index funds. Occasionally I change the mix based on performance of the various ETFs in the portfolio. Specifically, these are ETF Index funds with iShares and some Vanguard. I intend to continue funding this at this level (or more) for as long as possible. Also in this bucket is a small amount invested recently in a LendingClub account. (Read more about my experience with LendingClub so far here)
Retirement Accounts – This consists of my 401k, Trad IRA, Roth IRA, and HSA account, as well as Mrs. Freedom 40’s 403b, new TSP, and two Roth IRAs. We maxed out the 401k/403b the last three years and will do so again this year. We make too much to directly contribute to a Roth.
Rental Property – This is a 2BD/1BA across the street. We used to live there and rent it out now. Since refinancing we’re starting to see some positive cash flow here! We were at almost $0, but now this little rental creates about $240 in monthly cash flow. That’s if there are no maintenance costs though. If no major repairs are needed between now and the end of 2106, we should net about $845 for the year. It’s not a ton of money, but in my mind the more important thing is that the tenants pay the mortgage every month and so over time my mortgage will be paid off and I can either sell the place or continue to rent it while growing the cash flow it generates. As for what I’m doing with the $240 cash flow each month, I’m actually just putting it towards additional mortgage principal pay down. The whole landlord thing can be a headache from time to time, but for now, we keep it. Ref 1. Ref 2. Ref 3.
Home Value – During the Refi process we had to get appraisals done for both of our properties. Our main home appraised $7k higher than I had, while the rental condo appraised for $10k less. I’ll continue to use these estimates for the next several months. We have no plans of moving or selling either property in the near future, so in many ways, these values have limited meaning.
Other – This consists of two cars and some gold and silver coins.
Home Mortgage – With our refi we are now at 3.5%, which still strikes me as an amazingly great deal! Money is so cheap right now! Auto payments are all set up for this now and we’re paying the same as we did for our old mortgage. I ran the numbers and this means we’ll have it all paid off in 17 years if we stay as is. (30 yr note) I plan to write more on our recent refi experience soon.
Rental Mortgage – We completed or refi here too and are at 3.75% for a 30 year. As with our primary residence, we’re continuing to pay what we paid before so that we pay the loan down sooner.
Other Loans – This includes 2 Student loans Mrs. Freedom 40 has. Both are at 2.125%. It also includes Mrs. Freedom 40’s car loan at 0.9% and my car loan at a whopping 0.0%. We could pay all of these loans completely off if we wanted too, but the rates are so low, I don’t think it makes any sense to do so. Update: Mrs. Freedom 40 recently decided she wants to just completely pay off and get rid of her student loans. It’s been years since she graduated, and I guess she’s just tired of looking at them. I have mixed feelings about this, but it’s her decision and it’ll be good to erase some debt and a monthly expense from our lives. We’re planning to completely pay all student loans off by the end of 2016 so we don’t have to deal with any tax implications in 2017.
Finally, here’s what our Net Worth looks like over the past 12 months. The line is climbing again and I’ll take it for now!.
Some other interesting notes about our net worth to share
YTD Gain/Loss = +$194,852
YTD Percentage Gain/Loss = +18.8%
12 Month Gain/Loss = +$191,874
12 Month Percentage Gain/Loss = +18.5%