Personal Balance Sheet, August 2008: Net Worth +0.43%
Filed under: Personal Balance Sheet
Each month, I post an analysis of my finances and my end-of-month net worth. For more on why I do this, please take a look at my explanation post.
August’s markets were up and down all month, but the S&P 500 eventually posted a gain of around 1.5% for the month. While that does little to ease our pain from the previous seven months, progress is progress and a positive is always better than a negative. Since a relatively small amount of our net worth is tied up in the stock market, we didn’t see the same gains but we still had an up month.
Here’s how August ended up for us (click to expand):
Net Worth, August 2008
Overview
Assets
For the second month in a row, our total assets have dropped. While I know where the money is going, I’m not the least bit keen on seeing reds in that row. Now that the property taxes are done for the year and the car loan is nearly paid off, that number should start increasing again - if only by the nominal amount I set aside every month to pay for future property taxes.
The second half of our annual property taxes was mailed to the county near the end of the month, draining our savings account of nearly $2,500. Hopefully the appeal we made to the state challenging our property tax assessment will be granted, but we probably won’t know until the end of the year, if not later.
It’s been a month since my company started depositing their 401(k) match alongside my contributions (versus depositing them once per quarter) and it gave a nice added value to my two contributions. Not only that, my 24 hours worth of overtime really added up to a paycheck and contribution boost. I’m still calculating my actual cost basis for my investments, but I already know that I’m in the red overall.
Over August, after the gains in my 401(k) and the losses due to my wife’s IRA and payments against liabilities, our assets dropped by 0.44%. It’s painful to see a loss, but at least it was smaller than last months.
Liabilities
The debt elimination addiction continues…
After paying off nearly half of our car loan debt last month with “found money”, we did the same again this month, but with my overtime and per diem profits instead. We’re now within a comfortable range to pay it off at any time, but we’ll probably separate out the balance over three months, just so we maintain some liquidity. That is, unless we find more money to throw at it!
In an effort to finally pay off the extra accrued interest on the student loans, we paid extra there this month as well. Unfortunately, due to some crazy allocation scheme by the loan holder and the timing of the payment arrival, we still maintain a small amount of interest. Hopefully we’ll nail that this month for good.
Paying down that accrued interest on the student loans seems to have given us some extra benefits as well. Not only has it driven down our balance, but one of the two loans dropped to 4.22% last month. With the other at 6.22%, they’re now both well below the home equity rate of 8.375% and half as high as they were at the beginning of the year (around 9.5%). I hope this trend continues and allows us to drive down our debt even faster!
By diverting the gains from overtime and my per diem profit to our liabilities, we were able to reduce our debt load by 0.77%. This reflects an overall decrease of over $1,500.
Net Worth
While August didn’t provide as great of a show as July, we still had a solid month. Our aggressive debt elimination strategy saved what may have been a negative month and turned it into a net positive of $314. This is an effective growth of 0.43% month-to-month!
With the car loan coming to an end, we’re looking forward to implementing the first step of our snowball plan: Paying down the Home Equity loan. I can’t wait to write that first $500 check that will begin our ascent into debt freedom!
September 8th, 2008 at 5:33 am
I really admire your honesty and persistence in these net worth posts. Can I be so crass as to ask about your tracking spreadsheet? It is organized so much better/more clearly than what I use, I’d love a reference. Thanks and keep up the great work on your PF and your blog!
September 8th, 2008 at 7:22 am
MM,
I’ll try to find the time soon to set up a template for download. Thanks for asking and thanks for the kind words!
September 9th, 2008 at 8:26 am
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