As regular readers know, at the beginning of every month, I check in with some financial reporting. This helps keep me focused on making better decisions throughout the month concerning use and abuse of my money. Keeping track of my finances was what originally started me on the path not necessarily to getting “rich,” but thinking responsibly about money and keeping myself in positive territory.
On Consumerism Commentary, I report my “modified net worth” which includes all my assets subtracted all my liabilities, without including the value of my home inventory and small coin collection, or my immediate theoretical tax liability that would result from liquidating my accounts.
There were several important items that helped August end on a good note. First, it was one of two three-paycheck months this year. Secondly, my business income continues to grow.
Here are my numbers, followed my answers my some frequently asked questions and general commentary. Please read those remarks before commenting.
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 and earns cash back.
* 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
Last month, I passed the $100,000 mark in net assets. It’s an arbitrary milestone, but fun to consider. It has taken me 31 years to reach this point, far longer many personal finance bloggers. I hope to reach $250,000 within three years.
I opened a business checking account finally, and I have moved some of my business-earned cash to that account with the intention of using it to pay business-related expenses. I still haven’t written up a post about the experience of opening the account, but it was a rather smooth experience.
I haven’t looked at Edmunds.com to re-evaluate my car in several months. This month I will take a look; I’ll likely adjust my 2005 Honda Civic’s value down by a thousand dollars or so, based on what I could fetch for the car in a private party sale. I should start taking a more conservative approach, but I’ll take a look at what the charts at Edmunds.com have to say about my 74,000-mile Civic.
My 401(k) is back over $40,000, but only barely. The market hasn’t been kind. Also, my contributions from the last few months — since the market hit its top — were invested mainly in a money market fund, which doesn’t report any increases in value until some point in the future. It may only be once per year that I will see my return on that amount.
Now with the market “low,” I will likely change my 401(k) contribution allocation at the same time I sell my second quarter company stock purchases. My trading window is open, but I’ve been putting off the sale as my company’s stock price has been lower than usual lately. It has returned a bit, to the point at which I am guaranteed at least a 15% return on those investments.
If you have any questions not answered above, please feel free to ask. Otherwise, stay tuned for my income report, which will be posted tomorrow.
Updated February 6, 2012 and originally published September 2, 2007.