In July 2004, my car was my biggest asset, although my loan left me with no equity. That same car, as it lost value over time and as my finances generally improved, is now the least significant line on my balance sheet. One would think that the progression of net worth from $20,000 at that time to today’s number would have changed my lifestyle, but very little has changed.
Speaking of change, I may add a line to my personal Quicken file. Although I track the value of income from Consumerism Commentary and other projects, I don’t track the value of the website as a business. It would be interesting to go back to 2004, when I first began earning income from projects like this, and use a formula (such as a multiple of annual revenue) to determine the business’s value. I may never know the real value — what someone might pay — for the website, but if I use a consistent formula I will see the growth over time. This could help me get a truer picture of my complete net worth.
Until then, I’ll stick with the same balance sheet I’ve been using for the past few years. There’s nothing surprising on the report this month. Keep reading to see the details.
Here is my process for creating the above, as new readers ask about this every month. I generate the above report using Quicken Home & Business 2011. I reviewed Quicken 2011 recently and decided to buy the Home & Business upgrade for myself.
I export the customized net worth report to an Excel-compatible text file, which I link to a balance sheet template. The template includes all the formulas necessary, though not everything is completely automatic.
I check the resulting table to ensure all balances are accounted for, and I copy and paste the table into a graphics editing program. I save the table as a graphic and upload it to Consumerism Commentary to be shared with readers.
The value of my car hasn’t been updated since March, so I plan to take a look at Edmunds to determine a reasonable estimate and make that adjustment this month.
As the year comes to a close, I’ll be thinking about another visit to my family in California for Thanksgiving in a few weeks, year-end tax-saving moves, the holidays, and making some major adjustments to my life.