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Tuesday, July 29, 2014

Net Worth – Oct 2012

Posted by Tim Stobbs on November 2, 2012

The following is a update on Tim’s plan to retire early.  The current metric to tracking this goal is my net worth.  This will be the last year for these posts, since once the mortgage is paid off it will cease to be useful.  At that point future updates will shift to investment net worth only in 2013.

Assets

House $377,000
Car $18,200

RRSP $30,300
LIRA $11,700
TFSA $16,600
Pension $53,800
Wife’s RRSP $29,600
Wife’s Investment Account $13,100
Wife’s TFSA $11,600
My Investment Account $6,400
High Interest Savings Account $2,000

Total Assets $ 570,300

Debt
Mortgage $0 (Paid off in 2012)
HELOC $18,200

Total Debt $18,200

Net Worth $552,100 (+$16,800 or +3.1%) [+ 16.6% YTD ]
Investment Net Worth $175,100 (+$6100 or +3.6%) [+17.2% YTD]

Well as I mentioned yesterday I hit my major goal for the year and paid off my mortgage. Yah!  Also changing things up this net worth is the fact we got a new car which we paid for with the line of credit.  So to keep the math simple I’m going to mirror the car value to my line of credit balance.  It isn’t correct since the car depreciates regardless of what I pay on the loan, but it also works the other way of I can pay off the loan faster than the car depreciates.  So I’m going to assume that averages out over the longer term.

So what’s next?  For the rest of year, nothing interesting.  Just putting money into RRSP and making plans for 2013 goals.  I have some rough ideas on mind, but until that gets approved by my wife they won’t be going on the blog.  Also I’m going to start on rebuilding these updates to reflect the new goals are all going to be focused on contributions and the investment net worth.  Yet I suppose I should ask for your opinion, would you like me to continue the net worth tracking as well?

Any questions?

(Click image to see larger version)

Comments

12 Responses to “Net Worth – Oct 2012”
  1. Tara says:

    Yes, I’m interested since I am in a similar situation – no debt, saving for early retirement. Look forward to seeing your progress!

  2. jon_snow says:

    Me too!

    Not sure how much you are going to be able to save/invest every month Tim, but my wife and I are stuffing 5k every month into our ER fund. Its incredible how quickly things progress once ALL debt is gone.

  3. Tim Stobbs says:

    $5k a month!! Wow that would help. We won’t be that high.

  4. Jacq says:

    Just one question – are you going back to full time at your job now that you’re not doing the school board gig? Or pursuing other goals and taking the income hit? Just wondering because it might be advantageous tax and compounding wise to do so while you’re catching up on your RRSP and TFSA contributions.

  5. Jon_snow says:

    Our incomes are good, no kids, no car payments, small residence compared to your sprawling Saskatchewan digs… That’s how we do it.

  6. Jacq says:

    LOL Jon – I’m single with 2 kids (one of them is grown and pretty much cash positive though), no car payment, bigger house than Tim (and still have a fairly small mortgage) – and I’m putting away ~ $10k/month. Not bragging – just never underestimate the power of a good income above all. And a bit of frugality helps. ;-)

  7. Tim Stobbs says:

    Jacq – I was going to discuss that next week but since you asked. I am planning on staying at part time until the end of the year and then shifting to full time in 2013. Keep in mind I get a lot of time of at my job to start with.

  8. Nice work Tim!

    Cheers,
    Mark

  9. Gene says:

    Tim… great work!

    I caution anyone on believing a car is an asset. I recently met with a financial advisor for another opinion and he asked me about my net worth and when I didn’t list my cars he agreed. I was pleased to find someone else in the financial industry that doesn’t see the average every day car as an asset. To me a car is a liability… so if you have a loan for a car and have the car you have two liabilities. The loan has to be repaid and then you have insurance, petrol and maintenance, plus the co2 emissions that are a liability on global warming, etc. I simply think one should not consider a car an asset. I own two cars, each cost me around 25K but to me that is money I’ll never see again… if I ever sell them, I’ll simply see the cash from disposal as a little cash bonus infusion. In fact, paying 25K for each car added the liabilities to my cash flow I mentioned earlier.

    Perhaps for folks just starting out a car can be considered an asset but not if you have a net worth like yours.

    I always enjoy reading your blog. Other than the car view, we are very similar. I can retire at any time but I love my job so now I’m working to put my girls through private school.

    Cheers,
    Gene

  10. Tim Stobbs says:

    Gene – I see your point of view. My last car was fully depreciated so I never included it in my net worth. Yet I think I should include the Camry since I could sell it today and get the majority of my money back. Obviously that declines fairly quickly with cars, so for the purpose of my retirement plan this won’t matter since I will have reduced the car to an asset of zero by the time I retire. I struggled with what to do with the car on these updates if that makes you feel any better.

  11. Gene says:

    :-) Keep up the great blogging. I read it as much as I can. Good to see others who share the same financial values.

  12. Phil says:

    So Tim, welcome to the mortgage free lifestyle, you are welcome to grab a breather from what you have been doing and celebrate the well earned milestone. Now that that is out of the way, I’m new to your site, but also a fellow engineer – i retired last year in ontario at age 39 :0. Things htat have helped me – I track daily spending (pennies-in vs. pennies out) and summarize monthly. I also set -up a networth statement, similar to those found found in MoneySense. I find this useful in knowing what costs us and where it is. Example a couple of years back we bought a chalet – interestingly if one excludes a mortgage it only costs $5,500/yr!!! who would have known one could own a place for so chaep!. Since i track the pennies, i role this up into an on going graph of earnigs vs. spending over time – on this chart I also include a future earnings bar based off of earning 7% long term off my investments, which i hope one day to cover over my expenses. One final graph has been to track my investments for retirement. At the end of each year i printout My networth statement and compare it to the previous year just to remind myself where I am headed. Cheers, and look forward to reading more on your site.

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