Investment and Net Worth Update

our beach tripHappy Friday everyone. I’ve been trying to make up for being on vacation last week by working all five days. Let me tell you, a 40 hour work week is for the birds. It makes me really want to buckle down so that I can be on vacation all the time (or at least not in the office). I’m thankful to have work, but working part time has certainly spoiled me. Because I want to keep dedicated to the idea of financial independence and all the freedom that comes with it, I thought it was a good time to share some numbers regarding our investments so far this year and the direction of our net worth. Plus, I really want to be in the Million Dollar Club at Budgets Are Sexy. Do you get a t-shirt with that?

I don’t expect anyone to compare themselves with us. We’re all on our own path. If you haven’t planned for which direction you want your path to lead, today is the day to start.

For a recap of our net worth from last October, you can check out in this post.

Assets:

Cash: $64,288. We’ve been hoarding cash for a tax bill that I though was finished buy may not be done quite yet. By next report, I expect to have our cash reserves down to around $20,000 for emergencies and rental repairs with the rest in a better income producing product.

Retirement Accounts (401k, IRA’s, 403b): $215,313

HSA: $8169

Non-Retirement Investments: $6136

Daughter 529 plan: $8292

Daughter Roth IRA: $11,111 (how cool is that number?)

Business Loan: $290,000. I’m not sure where to classify this. When I sold my practice, we did seller financing, so essentially, I am the bank for the life of the loan. This is the principal balance, but it does earn interest as well. I guess as this balance lowers it will rise in other areas when we invest the income. If the buyer  defaults, my business returns to me as well, so I guess it is an asset.

Home: $375,000

Residential Rental Property $80,000

Commercial Rental Property: $275,000

Vehicles: $27,284 (from Kelley Blue Book)

Total Assets: $1,296,297 

Hike in Torry Pines
Ocean Hike in Torrey Pines

 

Liabilities:

Home mortgage: $149,407

Residential Rental Mortgage: $45,966

Commercial Mortgage: $198,000

Total Liabilities: $393,373

Net Worth: $902,924, Up 20.52% from last October

I don’t think you can hope for a net worth increase of over 20% every six months, but the stock market was good to us, and we did sell my business. We also unloaded our terrible flip house project, which eliminated a large chunk of debt and made a small profit. Without the rentals, we would have owed a truck load more taxes, so I am very thankful to have those in the portfolio.

As for investments, we are on fire. So far this year, I’ve added just over $13,000 to my new solo 401k. We maxed out Siena’s Roth IRA for 2013 in January (You can hire your children if you own a business. Great way to lower your income and save on taxes). We did a 2013 backdoor Roth for Jim this week because the business sale put us over the limit to contribute normally. It was too complicated for me to do a Roth this time because I have other  tax deferred IRA’s and ran out of time to figure it out in regards to avoiding the pro rata forms. We are dollar cost averaging to max out our HSA for this year, and putting $200 a month into the daughter’s 529 and $250 per month into stocks, which isn’t going to make us rich fast, but it does add some diversity. Our main focus right now is maxing out the solo 401k.

I’m also on track for a personal goal of donating 5% of my income to worthy causes. So far, I’ve chosen Pauline’s school support project and my daughter’s school PTA as recipients. I suck at being in the PTA, but did try to get behind the scenes a bit by going to some meetings. I don’t support all of their fundraisers, but the school would be in lots worse shape without them. They have pretty much supplied all the computers, playground equipment, and audio visual technology for the last few years. In a perfect world, we wouldn’t need to sell magazines and popcorn to have adequate school supplies, but that’s a thought for another day.

We still aren’t sure of Jim’s job situation yet, but when we have that figured out, it will be time to invest some of that cash that is earning us about a fifty cents a month. I think we’ll keep enough to pay our estimated taxes for the rest of the year plus the emergency fund, but I’m not sure what to do with the rest. Maybe you can help us choose.

A) Invest in stocks. Still waiting for a good correction before dumping in a big sum or we could dollar cost average.

B)Invest in a new residential rental. Prices are going up, but we could still snag one for under $100K if we do it pretty soon.

C)Keep hoarding it or put it into a CD for about 2%.

D) Go to Vegas!

Please state your reason for the choice.

How is your net worth? Any big deals on the horizon?

 

 

 

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Written By
Sydney White is a Texas-born stay at home mom who enjoys spending time with her family, bargain hunting and, of course, writing. She is currently the editor-in-chief of Snipon.com.

29 Comments

  1. Wow, been a while since I’ve stopped by, but HECK YES! Super cool that you sold the practice for a tidy sum, and you are almost at the $1M mark! Well done! Super inspiring!

  2. Kim,

    Awesome, awesome results! I never even considered setting up a 401K for our kids, that’s a far out idea that makes a lot of sense 🙂

    I’d vote for option A, but I wouldn’t DCA it. If you have the lump sum, just drop it in the market. Don’t try to time things, you could easily do more harm than good by waiting.

    1. I’m not sure they can do the 401k, but they can certainly set up a Roth or traditional IRA with earned income. The Roth seemed to make the most sense to us.

  3. Incredible job Mrs Millionaire! I’m impressed by how small your liabilities are. My vote is to go with stocks or another property.

    1. I would have to agree that she probably does have the highest net worth in the first grade, although that has absolutely no importance at all to her. She’d rather have the largest My Little Pony collection!

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