Here’s my net worth update and summary for September 2015 – this part follows on from my September income summary.
My Score for September
|Living Expenses $||3,850|
|Security Ratio||23.9 %|
|Wet Worth $||70,408|
|Work Freedom Day||8-Nov-15 (!)|
This is my fixed monthly budget for living expenses and it includes both essential (e.g. groceries, mortgage, insurance), and non-essential (e.g. music, travel) purchases. $3,850 is the amount from my current Budget 3.5.
I spent a total of $3,355.45 in September which means I underspent my budget by $464.55. So it was back to a more normal month after last month’s expenses.
This is the percentage of my monthly living expenses budget that my dividend income would pay for this month.
This month’s ratio of 23.9% means that my dividend income paid almost a quarter of my living expenses this month! Last month I earned $386 in dividend income; this month was $919.
Living Expenses %
The percentage of net income that’s spent on living expenses. Lower numbers are better here.
This month’s 50.4% is a better than the last two month’s because of the additional dividend income I earned this month. It’s my second best score; beaten only by June’s 49.7%. Any change in this number is caused by a change in either income or budget; my overall income was higher this month and my living expenses were constant.
The chart above shows the trend in my Living Expenses % since the start of 2014. For the first part of 2014 I was paying two mortgages. In June 2014, I introduced Budget 1.0 after selling my first house and I made some minor tweaks in Budget 2.0 from October onwards. In January I started Budget 3.0 which I updated to Budget 3.5 in July.
Looking over the last several months and I’m achieving a ratio that’s 4% better compared to the corresponding month last year.
The percentage of net income spent on savings.
I put aside $530 every month for mid and long term goals (any large expense or purchase due a year or more in the future), as well as $547 for my car payment and added an extra $100 into my Emergency Fund. This month, the savings amount was $1,177.25 or 15.4% of my month’s income.
The percentage of net income that I invest.
Any spare money left over after savings, retirement and living expenses are paid goes into my current income portfolio. This month it was 34.3% of my income.
I’ve written about my portfolio income and gains in September in a separate post, so I won’t repeat all of that here again.
This would represent the percentage of any post-tax contributions from net income towards my retirement accounts, but I don’t have any plans to do so at the moment. You can read about my retirement account asset allocation here if you’re having trouble sleeping. It’s a simple low-cost index investing strategy.
Wet Worth $
My liquid assets minus all debt (excluding retirement and assets).
My Wet Worth decreased $765 in September to $70,408. There’s a more detailed breakdown of this amount further below.
Work Freedom Day
The day in the year that my dividend income could pay for the rest of the year’s expenses.
Based on my current projections my Work Freedom Day advances one more day to 8 November 2015!
Wet Worth Detail
I’m showing my Wet Worth in this post – this is the cost of my liquid assets minus debt, I exclude assets and retirement accounts from this number. I prefer this over Net Worth since the equity in large assets (house, car) and retirement funds is hard to get at and not always predictable. I find this is a more honest view of where I’m at on my journey.
The change in Wet Worth is caused by
|Cash||$813||Cash for living expenses increased on the whole due to the budget surplus this month.|
|Debt||$123||Debt increased this month mostly from credit card charges. There was nothing really out of the ordinary though.|
|Savings||-$41||So although I put aside $530 I managed to lose $41 in my Savings. This is because I’m including some investment accounts such as my Health Savings Account in my savings total and those investments lost some value this month. Cash went up, investments went down, result: a little less money.|
|Emergency Fund||$67||My Emergency Fund consists of cash, a stock fund (VTSMX) and a short term bond fund (VBIRX). I added $100 to the stock fund in my Emergency Fund, but ultimately any increase is dependent on the investment values.|
|Portfolio||-$1,481||My overall income portfolio decreased in value this month. See my earlier post for details.|
|Total||-$683||Total change in Wet Worth.|
September 2015 Summary
Mixed results this month; September was awesome for income but not so good on the value front with the second consecutive decrease in my Wet Worth. Still, I’d rather have investments even if they lose a little month than have no investments at all.
Quote of the Day
Have the courage to say no. Have the courage to face the truth. Do the right thing because it is right. These are the magic keys to living your life with integrity.