January 2013 Net Worth Review

2013 is going to be a great year!! Little guy is set to come any down now!  It's so exciting!  I can't believe the pregnancy has gone so fast!  The nursery is fully stocked, the diapers are organized, and Mom and Dad are anxious to meet him!  With all that established - its time to review our finances!!!  YEAAA!!!

Cash - $9,586 ($-10,464)

Investments - $102,938 (+$4,863)
Home Value - $197,000 ($0)
Personal Assets - $50,823 ($-578)
Less: Liabilities - $185,944 ($-2,578)

Okay - let me explain...

Assets -

Cash - I've changed the presentation of cash in the Net Worth calculation.  Within our Growth account, I've set up various sub accounts for future liabilities (ie. Auto Insurance, Property Taxes, and Education) and it doesn't make sense to keep including these as Net Worth when I know they are going to be subtracted in the near future.  In addition, this should eliminate the drastic swings in Net Worth that occur within various months when I make a Tuition payment.  Overall, cash actually held steady.

Investments - Go Market Go!!!!  We only made one small contribution ($500) to our house account, but the markets grew nearly 6% in January!  It was one of the best months since pre-2008!  We continue to invest in retirement and I've noticed bigger gains as the accounts have grown, compound interest baby!!!

Personal Assets - Small amount of depreciation on our two vehicles.  Ho-hum.  We have been going to open houses in our neighborhoods, which has got me very interested in selling our house.  I'm intrigued by what the real value of our house/neighborhood is.  However, I don't want to take on a bigger mortgage right now with new baby and other debts in line.  The Joneses can have their fancy crap, we'll live in comfort and harmony for our entire lives!!

Liabilities -
Mortgage - $131,882 - We made our first mortgage payment on the refi and saw a $362 reduction to the original balance, which is much better than the $200 reductions we were seeing on the old mortgage. 

Student Loans - $31,405 - Big move here as I used a portion of our Christmas gift to make a $1500 payment in January.  Seeing the balance drop so significantly really got my juices flowing for more debt reduction.  It's like an addiction - I want the balance to be ZERO RIGHT NOW!!!
Acura Loan - $22,191- Double payment made in January.  See above.  I might have a problem - or I"m a genius!!  I hate paying First Commonwealth $50 a month for the right to use my car....

Total Joint Net Worth - $174,639!

So, we saw a slight reduction in NW, but only because of the reclassification of the accounts.  Overall, we saw massive gains in our investment portfolio, our debts were greatly reduced, and we still live comfortably and happily.  Unfortunately ND lost in National Championship game, but we still had a great time!  The little guy can't get here soon enough!!!

Can Saving and Debt Co-Exist?

I love spreadsheets.  We have our budget on a spreadsheet with various categories and calculations.  We also have our debts allocated in a spreadsheet with interest calculations and amortization.  I also monitor our investment growth in a spreadsheet.

I like reviewing spreadsheet and manipulating them. 

However, I'm starting to think spreadsheets may not be a good thing.  Can you obsess over a spreadsheet?

I'm constantly flip-flopping between saving money for future expenditures and paying down our debt.  One month, I love making a trade and watching our savings balance grow.  The next, I'm pissed off about our debt level and want to make a double debt payment.  It's a vicious cycle.

I'm content with our plan to save money and pay down debt.  I just wish I could do both more.  We have a pretty substantial amount of investment funds available to us and we also have $5k in an emergency fund.  Our debt payments aren't outrageous right now, mostly because the student loan debt doesn't have a minimum payment due to deferment period.  Our debt to income ratio is about 34%, which is a bit high.

Is this why Dave Ramsey screams about paying off debt first and then saving.  The simplicity of the action.  Perhaps.  However, the accountant in me also understands that my interest rates are low and that the student loan and mortgage interest is tax deductible, which helps alleviate some burden.  However, I still get angry about those debt balances - especially when I look at my spreadsheets!!

Where is the middle ground?  I have a son on the way and desperately want my wife to stay at home.  However, I worry with our debt levels that that is not possible.  On the other hand, without saving more money we may not be able to put 20% down on our dream home, which would be worse.

Perhaps I should get a 2nd job....

December Net Worth Review

Well, 2012 is over and done with and 2013 brings about the year of "Little Guy" in our household as we prepare for the February birth of our son!  We're very excited and also very excited to get crackin on some debt reduction and Net Worth boostin!!  Here we go!!

 

Cash - $20,050 (+$2,915)

Investments - $98,075 (+$10,619)
Home Value - $197,000 ($0)
Personal Assets - $51,401 (+$509)
Less: Liabilities - $188,522 (+$823)

Here's how it breaks down:

Assets -

Cash - A nice increase to our cash balance that was caused by a SERIOUS Christmas gift of $5k from Gram and Pap S.  Amazing how fortunate the Prof and I are.  However, we did make a tuition payment of $3.6k for the Spring semester.  So, we still had a nice increase without those two items, however, the first item will help us pay future tuition and pay down current student loans.  Also, I'm looking into 529 Plans for the little guy.  So, it's nice to have the liquidity.

Investments - This increase is a bit deceiving.  I've added a Pension Fund of $6.7k that the Professor has which I did not know existed.  I guess its a mandatory thing for all teachers at her Charter School.  So, that was a nice bump.  Otherwise, the Fiscal Cliff didn't really happen, which saved our investments and we made our usually $2k contribution into House Fund.

Personal Assets - No change here other than the car values inexplicably going up!  I can't explain it, but I'm sure it will go down more often than not.

Liabilities -
Mortgage - $132,244 - So, we added about $1.7k to our Mortgage Loan this past month as we closed on the refinance loan.  The actual loan is $132k, but because its a Home Equity Loan, the interest is calculated daily and reflected on the website.  Frustrating because I see the balance go up every day, however, I'm okay because we'll be paying this down faster with the 20 yr term.  Plus, I used the small amount left over to pay down a student loan.
Student Loans - $33,089 - As I said, we made an additional $126 payment this month, which was almost all principal.   

Acura Loan - $23,190 - Second payment in the books.  I'll be making extra payment on both of these items in January as part of the Christmas gift utilized.
Total Joint Net Worth - $178,004!! 

We accomplished our 2012 goal of $170,000!!!  Amazing!  The increase is largely attributable to the new Pension Fund account and the extra Christmas gift.  However, with those two things, we still saw an increase of $2k even though the mortgage went up.  With the baby on the way, we've discussed getting more aggressive with the student loans - so we may see more head-way there.  But, for now, I'd like to wait and make sure we have a healthy, happy baby until doing anything major to our current savings/debt ratio.

November Net Worth Review

Alright, alright - Let's get down to business.  We've had a lot going on this past month which effects our Net Worth results.  Let's get started and I'll explain throughout!

Cash - $17,135 (+$2,049)
Investments - $87,456 (+$4,087)
Home Value - $197,000 (+$17,000!!!)
Personal Assets - $50,892 ($0)
Less: Liabilities - $187,699 ($-930)

Here's how it breaks down:

Wow!  So, obviously the home value has increased!  A few weeks ago we decided to refinance our existing mortgage since PNC offers a super-sweet Home-Equity Installment Loan, which reduces the closing costs to $250! since they remove the need for title transfer and insurance!  So, we're going to get a lower interest rate of 3.77%.  Plus, we are going with a 20-year fixed rate tenor so we'll be reducing our principal more and more each month!  A huge WIN-WIN if I ever heard one!  What's the catch?  Well, the Installment Loan does not come with escrow, so we're on our own to manage the taxes and insurance payments throughout the year.  Although, the luxury of having that taken care of was nice - it does not match my desire to reduce interest and principal.  Plus, I was always a little fishy of how they handled it!

Assets -
Cash - A huge increase that was impacted by two things.  1)  November was a 3 paycheck month for me and 2) No mortgage payment this month.  Since we will be closing on the new installment loan next week, the mortgage payment was not required.  I could have made a payment - but didn't see the reason since the loan will reconcile everything in a week.  I may make an extra principal payment anyway.

Investments - Wow.  I was very surprised by the results of our Investment accounts.  However, most of that gain is offset as contributions of $2,822.  I was surprised because immediately following the election, the Dow fell 400 points due to impending fiscal cliff and the worry that Obama would screw it up since the House and Senate are republican.  For some reason though - the markets bounced back on decent manufacturing and Black Friday data.  So, the markets should be in flux for a small period, but the gains are nice to see!!

Personal Assets - The change in Home Value is due to the appraisal that was performed by the bank as part of the Refinance.  Personally, I was shocked.  I did not think the value could rise that high in 30 months, but I'm happy to admit I was wrong.  Location, Location, Location!!!  That really makes me feel good about potentially selling this house in the future - to think I could reasonably expect to sell it for $200k and only have to pay down $130 mortgage, makes for a very good return!!  That might make my desire for Income Property a reality sooner than I expected!!

No change in the car values since I researched them in October.  Every other month review seems appropriate based upon the depreciation levels.

Liabilities -
Mortgage - $130,524 - No change now, but they are pending.... 

Student Loans - $33,493 - We made 3 payments this month along with the 3 paychecks.  So, an additional $140 was knocked off. 

Acura Loan - $23,682 - First payment is in the books.  Long way to go!

Total Joint Net Worth - $164,784!!  ($147,784)

A huge increase based upon the new home value.  However, even without the new appraisal, our Net Worth increased $7k!!  So, we definitely had a very good month!!  I'm also encouraged because following the refi we should see bigger gains in Mortgage Reduction and we'll receive a slight increase in Cash as we now are responsible for Escrow, which has a couple thousand in already.  We'll keep chopping wood!!!

Going to the Ship!

ND is going to the National Championship!!!

SOOOO - Although we have our first child on the way and are saving for the next "Forever" home, we are being completely financially irrational and trying to make the trip to Miami!!!

$467 for flights to Orlando.
$725 for tickets to the game.

No problem.  Life was meant to make memories and none would be sweeter than a National Championship!!! 

I'm very excited and nervous.  The tickets are no guarantee and the Mrs. will be 35 odd weeks pregnant.  So, there is no definites regarding this game - but who cares.  Sometimes, you need to be irrational.

The debt paydown will continue as I'll just tap into our reserves - which were set aside for moments like this!!  We've been diligent about savings money and splurging can be very exciting and refreshing.  Ramsey fans can shove it because things like this happen only once every 25 years!!!

Go Irish!

October Net Worth Review

I really need to get back to the blog.  I've neglected it the past couple months aside from the Net Worth Review.  To be honest, it's been really hard to find the time - and that's not an excuse nor is it an embellishment.  School has picked up and I've really tried to concentrate at work and devote more time to that.  I let myself slack off and realized I need to do more at the office to set myself apart.  So, between that and the preparations for Little Peach - the blog has taken a backseat.

 

Cash - $15,086 (-$4,067)
Investments - $83,369 (+$623)
Home Value - $180,000 ($0)
Personal Assets - $50,892 (+$26,977)
Less: Liabilities - $188,626 (+$23,720)

Here's how it breaks down:

Obviously, there was a major purchase made during the month.  The Prof and I bought a new car!!!! (Everytime I say that I feel like Bob Barker!)  The Acura MDX is not sitting in our driveway being sweet!!  So, we paid $5k down and took a loan of $24.2k for a car worth $27.6k.  So, the major fluctutations are mostly explained through those three items.  I'm not thrilled about the taking out a loan like that, but we got a decent interest rate and the value was great.  Also, we had the cash ear-marked for this purchase since June, so no love lost there either.  However, I did get to create a new Loan Pay Down Schedule in my Super Sweet Spreadsheet!!!  Let the Debt Destruction begin!!!

Assets -
Cash - Decent month overall when you consider the $5k reduction for the car.  We put one of Laura's paychecks into Investments and used one to build up the emergency fund.  Also, we received some supplemental funds regarding Fantasy winnings of $50 and $150 for selling some books.  Not a lot, but every bit helps.

Investments - The markets took a hit this month as my return was actual negative (1-1.5%) for the month.  Most of that was due to II-VI's negative return of ~13%.  Easily the most frustrating stock to own ever.  Some people say to buy now that its low, but everyone fundamental mark is negative.  I don't see the upside.  We'll keep what we have since they were a gift, but I won't be adding to that.

Personal Assets - No Change to the Home Value.  Then we see the additional of the Acura less normal depreciation on the Sonata and Acura.

 

Liabilities -
Mortgage - $130,524 - Blah, Blah, Blah. 

Student Loans - $33,908 - A small change here as we've altered our strategy toward growth and away from paying down debt.  No big deal. 

 

Acura Loan - $24,194 - I told the Prof that we would be taking an aggressive approach to this debt in order to reduce the principal sooner.  We'll pay a bit more than expected per the 60 month amortization schedule to try and pay it off in 3 and half years.  Did I ever tell you I hate debt??

Total Joint Net Worth - $140,721

After all that we saw our Net Worth decrease $187.  Not bad considering the loss in cash and the markets in October.  November election looms so the markets could be volatile, but it is a 3 Paycheck Month!!!  So, hopefully we'll see some big gains.  Also, the Prof and I have some NFL Office Pools in action - hopefully we can get lucky over the next couple weeks! 

September Net Worth Review

Things have been pretty crazy around the Peaches household!  We've been anxiously preparing for the arrival of Logan and the family will be getting larger today as the sister is having her 2nd boy!  It's an exciting time and a good one to take a step back and monitor our progress:

 

Cash - $19,153 (+$146)
Investments - $82,746 (+$5,062)
Home Value - $180,000 ($0)
Personal Assets - $23,915 (-$747)
Less: Liabilities - $164,906 (-$457)

Here's how it breaks down:

Assets -
Cash - A solid month.  As I said last month, we're going to be super-aggressive within our savings, so excess cash will be put into Investments for growth.  As such, nominal gains are awesome!  It tells me we are budgeting appropriately.

Investments - A nice month for the savings.  We had about a 3% growth within the accounts outside of our retirement and savings contribution.  The markets were relatively steady this month and hopefully will continue to grow in the 4th quarter, as they have historically.  The presidential election may cause some fluctuation, but our contributions will not! 

Personal Assets - No Change to the Home Value.  Probably should have a realtor to the house soon, but probably not til the spring when it would show better.  The Sonata value decreased based upon our bi-monthly KBB check-in - just normal depreciation.

Liabilities -
Mortgage - $130,723 - Blah, Blah, Blah. 

Student Loans - $34,183 - A small change here as we've altered our strategy toward growth and away from paying down debt.  No big deal. 

Total Joint Net Worth - $140,908!!!

We've hit $140k!!  We're still far from our $170k goal - but the growth the past couple months has been fun to watch.  Due to our strategy change, I'm not sure I'll be continuing the Net Worth Review.  I may change it to an Investment Analysis and go into more detail there.  Until the baby comes, there hopefully won't be any earth-shattering changes to this line-up.  Small debt and property changes with increased growth in Investments.  Also, it might be more beneficial to chart my investments and track their progress .