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Personal Balance Sheet, May 2007 ($98,224, +8.65%)

by Flexo on June 4, 2007

in Monthly Update

Thanks to more cash on hand and some investment growth, in May I came precariously close to a personal milestone: a six-figure net worth. This may not be that significant to most people; in fact, I’m not quite sure there is any significance for me. The actual number isn’t as important as what I’m doing to get myself there.

Last month, I predicted I would pass this milestone at the end of June. I should pass it within a week.

I still struggle with spending in some categories, but tracking my net worth helps me stay more focused than I would be otherwise. While there is only questionable value for any readers, making everything public keeps me accountable.

Here are the latest balance sheet figures. The numbers are hard to read unless you click on the image below.

Flexo’s Net Worth Balance Sheet, May 2007

Answers to Frequently Asked Questions.

* The report is made with Intuit Quicken and Microsoft Excel. Here’s a balance sheet Excel template.
* The credit card balance is paid off every month.
* My student loan interest rate is 4.25% and my savings account interest rates range from 4.5% to 5.05%. I’m not rushing to pay off the student loan so I can have cash on hand to eventually make a down payment on a house, and the rate is decent.

Explanations and Details.

Cash and bank accounts were up 14.77%. I transferred a couple of thousand dollars into checking from savings to take care of fees associated with my new apartment, such as application fee, holding fee, and eventually a security deposit.

I invested $1,677 into my accounts, including my 401(k) contributions and employer match, Roth IRA contributions, and employer contributions into my company stock purchase plan (though these funds just go into a holding account and are invested at the end of the quarter). In addition to my contributions, my investments gained $1,581 thanks to market appreciation.

My company stock plan balance has gone down because I withdraw what has accumulated each quarter. The amount listed reflects April’s and May’s contributions, sitting in a holding account before they will be invested at the end of June.

My credit card balance is low this month. I don’t believe I had many out of the ordinary purchases. If I had, they would be listed on my income and expense report, which will be posted shortly.

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About the Author

Flexo, the owner and creator of Consumerism Commentary, has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about him and follow him on Twitter.

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  • Ed
    I am curious to know - If you list your 401k as an asset why do you not list the corresponding estimated tax liability? ou can expect to pay when you start to withdraw in retirement? Aren't you artificially inflating your net worth (this is like putting you car value and not including your remaining loan amount in the liabilities)?
  • Ed: Good point. There's a good case for including as a liability either the expected tax consequences in retirement or the tax consequences and penalties if the account were to be liquidated right now.

    The tax consequences in retirement are too unpredictable -- espcially trying to look forward 30 years. Any number included would be a best a wild guess. I don't intend on liquidating the accounts, so that option doesn't sound good for me either.

    I'm not sure what value including the liability would add to the reports, but it is something I will definitely consider adding if I can come up with something that makes sense.
  • Sun
    Ed: I believe Flexo does include car loan as liability in his calculation.

    I think including any future taxes on 401(k) right now doesn't make too much sense. First of all you don't exactly what your tax rate will be at the time you start to withdraw. Using an inaccurate number is not better than not using it at all. Second, taxes are paid at the time when you withdraw, not now. Therefore, it's better to just subtract whatever you will have to pay at that time as expenses.
  • The difference between the tax liability on the 401k balance and the car loan is that the tax liability is dependent on an unpredictable contingent event -- withdrawing earnings. Only if earnings are withdrawn is tax due. On the otherhand, the car loan is due regardless of one's actions.
  • Virginia
    Good for you Flexo. Your income is probably too high now to deduct the interest on your student loan from your taxes, so you should probably consider paying it off with your savings. Oh, and maybe renting a cat-friendly apartment too? Just a thought.
  • Congratulations, Flexo. Ed has a point. Future home value and 401k value are also uncertain but those entries are not blank. Since net worth is a snapshot of liquidation now (thus excluding future interest), tax brackets and penalties for liquidating a 401k now are known. Thank you.
  • Jack
    Nice job on the financial statements. I am curious about your auto entries in the Balance Sheet and the Income Statement. How do you calculate the value of your car as an asset year to year, and the amount of the depreciation entered as an expense? Where do the values come from?
  • Jack: I estimate the value of the car from edmunds.com's "private party" selling price... but I only update it a few times a year. When I do, I usually adjust the depreciation expense amounts over the previous months.
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