January 2007 Net Worth - Two Negatives Make A Positive
Posted on February 05, 2007 by Him and tagged net_worth
| December 2006 | January 2007 | % Change | ||
|---|---|---|---|---|
| TOTAL NET WORTH | -$70,787.94 | -$66,274.27 | 6.4% | |
| TOTAL CHANGE FROM JAN 2006 | +$32,341.12 | 32.8% | ||
| Assets | ||||
| Savings | $15,330.33 | $9,387.56 | -38.8% | |
| His SIMPLE IRA | $5,851.56 | $6,670.08 | 14.0% | |
| His Roth IRA | $6,470.53 | $6,455.70 | -0.2% | |
| His HSA | $1,030.93 | $557.76 | -49.9% | |
| Her 401K | $9,531.94 | $10,605.57 | 11.3% | |
| Her Roth IRA | $1,695.85 | $2,732.94 | 61.2% | |
| Automobile ? | $10,045.00 | $10,080.00 | 0.3% | |
| Household Items ? | $25,000.00 | $25,000.00 | 0.0% | |
| TOTAL ASSETS | $75,518.14 | $71,489.61 | -5.3% | |
| Liabilities | ||||
| Credit Cards | $11,560.40 | $4,276.06 | -63.0% | |
| Student Loans | $133,931.93 | $133,487.82 | -0.3% | |
| TOTAL LIABILITIES | $145,492.33 | $137,763.88 | -5.3% | |
Bears lost. Boooooooooo.
This months was a crazy month for us in terms of moving money around. We were motivated this month by making progress on our 2007 financial goals. In summary, we had a net decrease in assets in order to get a large decrease in liabilities, thus giving us a nice increase in net worth this month. Some of the details:
Much of our increase in assets is attributed to our retirement funds. First, we decided to start contributing to our Roth IRAs - much of this month's increase is due to gift money and an unexpected settlement that Her received (I'm sure she'll write about that later). Second, the reinvested dividends from our mutual funds combined with rising NAVs for those mutual funds all provided a healthy rise the values in those accounts.
We've rid ourselves of the cash and upromise categories, and haven't added those values back in anywhere. It's nice to know that those categories don't really amount to much.
Of course, the main increase in net worth comes from the decrease of our credit card balances, at the cost of a large chunk of our savings. Because of that action, we've managed to get both of our bad debt ratios to under 15%. All we have is one card that has a 0% rate for the life of the card, provided we make two purchases a month on that card. We're going to pay off the card by the end of the year, so the interest on a few packs of gum is negligable.
So far, 2007 has been a pretty good year.
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It's too bad about the Bears, but then again, the Patriots didn't win either.
Congratulations to you both for such a productive year. Growing your bottom line by over $32,000 is an impressive achievement.
Great job of knocking down your credit card debt. Looks like you've got your priorities straight. I'm on track to get rid of my personal credit card debt by March of this year, so I'm pretty excited. After March, I'll work on my business credit card debt, then my car loan.
gegenschein | Feb 18, 2007
I don't know if I should say it, but every month I overpay my credit card by $100. I've done this for about 2 years. I typically charge $3k a month. So when the bill comes it says only $500 is due, but in fact I pay what I have charged, not what the company says I need to pay in full.
This has turned my credit card into a kind of debit card where, over time, I have reached the point of depositing the money I am going to spend in advance, but none of the games that get played with debit cards (freezing a block of money in your account: what the hey is THAT about) and less vulnerability to having your bank account frozen in case of theft or fraud. I lose some interest with this technique but it helps with peace of mind.
I loathe debt and had to crawl out of a $40k student loan jail back in the early 90s. I've always seen credit cards as a kind of poison and have developed the overpayment technique as an antidote. So far so good.
gegenschein,
I used to prepay my credit card when I was about to go travelling for several weeks. That way, I'd get home to find that the money I spent on the trip was already paid off.
Whatever mind games work to keep you from spending more than you can afford to spend...
To Him and Her:
Yahoo! Credit card debt under $5K. You guys are well on your way.
inagm | Mar 8, 2007
My mom has a discover card that has a 0% balance transfer for the life of the loan, as long as you make a purchase each month. So, each month she buys 10 - 50 cents worth of gas with that card. She thinks it's kind of embarassing and a bit of a hassle to buy a cheap pack of gum with a credit card, but there's no problem about gas!
Chitowngirl | Feb 5, 2007
Great Job!!! Keep up the good work. The two of you give me hope for when I enter my debt repayment phase. =)
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