Net Worth: March 2014 Progress

March was a “catch-up” month for us financially, which resulted in a standstill from a net worth viewpoint. The market mostly moved sideways, so our investment balance barely moved – despite contributions to my 401k. Let’s dive into the numbers…

The Numbers

For background on the methodology and definitions, see Net Worth: September 2013 Progress.

Category Feb 2014 Mar 2014 Difference
Net Worth $600,075.89 $599,957.23 – $118.66 + 0.02 %
 Assets $991,861.99 $992,582.92 + $720.93 + 0.07 %
— Real Estate $602,416.00 $601,406.00 – $1,010.00 – 0.17 %
— Automobiles $25,000.00 $25,000.00 0 0
— Investments $356,181.35 $355,650.46 – $530.89 – 0.15 %
— Cash $8,264.64 $10,526.46 + $2,261.82 + 27.37 %
 Liabilities $391,786.10 $392,625.69 + $839.59 + 0.21 %
— Mortgages $364,726.50 $363,534.58 – $1,191.92 – 0.33 %
— Auto Loan $25,311.63 $24,890.31 – $421.32 – 1.66 %
— Credit Card $1,747.97 $4,200.80 + $2,452.83 + 140.32 %

Analysis

The Month

In an unusual fashion, the market didn’t move much one way or the other. So all in all my balance barely budged, despite a couple contributions. For me, the month was a down investing month, but nothing like the drop we saw back at the beginning of this year.

The largest changes were in my cash and credit card balances. These are both short term pools of money. I pay off my cards in full each month, so again the balance is a trailing expense indicator. It is currently somewhat inflated as expenses for a business trip got added to my card at the end of the month, but will get reimbursed next month. That is somewhat offset (the inflated balance) by the last remaining balance on my “off the books” promotional card balance for the  bathroom remodel. I played catch-up and put $1,100 down on that balance in March, and have roughly $900 more to pay down here in April. When you match those numbers up, the credit card balance isn’t too far inflated (maybe $500).

I mentioned in last month’s update that the family had taken a small trip down to Florida to visit my parents. While we were gone, we had our dog boarded and that bill hit the numbers here as well. Pets are expensive!

It’s April, so that means the biggest financial item is tax returns. We got our papers filed here at the end of March, and will be looking forward to a pretty sizable ~$9,200 return from federal and state. I hate the idea that we let the government hold onto that much of our money for so long – but we haven’t had a stable year-to-year tax situation so it’s been a crapshoot trying to get the witholdings right. I’d much prefer a surprise large refund than last year’s surprise that we owed ~$2,000 in state taxes, and as a result I had to pay estimated quarterly taxes at the state level throughout 2013. No more of that!

The current plans for that return are to stash about half in our savings account in anticipation of expenses for our next bathroom remodel (yay! the last major room to do in the house!); and then likely use the remainder to pay down principal on one of the mortgages. It should get us close to the 80% equity line where I can get rid of the nasty $40/month PMI payment. Then I can use my surplus cash each month to focus on maxing an IRA for my wife, and eventually accelerate principal payments on that same mortgage. This year, I’m betting that paying the 6.75% interest off on that mortgage is a more sure return than the stock market returns. I’ll still be maxing my 401k, don’t get me wrong – but I believe the economy will continue to improve, but the market has gotten a little ahead of itself in valuation and likely won’t have a blockbuster year like last year. I expect it to move up slightly over the year.

 

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