In Budget Roundups, Money

January 2021: The Net Worth and Investments Roundup

All of the images below have been created with The Wealth Tracking & Budgeting Tool available for sale on Etsy, or at TheBudgetingTool.com where all proceeds go to charity

This is a sheet you buy ONCE and you can re-use for future years, plus it lets you store all of your historical data from previous years (super handy).

All net proceeds go to charity! (Always and forever.)

Sherry’s January 2021 Net Worth

$1,060,864.08
Or a decrease of…
+$51,943.28 or +4.90%

This is how I invest half of money in the stock market and the other half is split between alternate lending (Lending Loop review here), and mostly in dividends (here is my dividend short list of stocks I was looking at to buy for Canada and the U.S.)

The drop is for a few reasons….

It’s just numbers on a piece of paper.. until of course, you sell it all and realize the income as cash, THEN it becomes real. Otherwise, it’s just on paper.

I think a lot of us freak out over net worth but it changes so often that it’s ridiculous to get upset (or happy) over major swings.

As long as you’re in it for the long-term, and you have income coming in, or you are managing your daily expenses well, you have nothing to fear about anything.

-$80K: Removed my car’s value completely

Someone remarked to me when they saw me in my car that if I wanted to sell it, they’d pay me $80K for it. I told them that I was going to drive this car until either I or the car died. But I removed it off my net worth completely this month so now it’s only my home and my investments. I was going to do it slowly but I decided to not think about it and rip it off like a bandaid.

-$10K: Market drops

Perfect time to funnel more money into investing, I say. I think there was an overall drop of about $10K (?) I am just eyeballing it. Could be more.

The Net Worth Breakdown in Detail

Considering I dropped $80K off my balance sheet for assets, it is kind of incredible I “only” dropped $52K. It’s handy because my high income (almost $30K), has helped make up the difference.

Then the market dropping is kind of insignificant at $10K or so.. or more. It’s not $100K like last year in March 2020.

January 2021 Savings Rate = 90.42%

I honestly don’t freak out about any of this because it’s all going up, it’s all good, I am not doing this to freak out over $1 here or 10% here.

It’s just to see the stats over time. Over 75% is great for me. YAY!

Goal: $1M in invested liquid assets

Moving towards my goal of $1M in invested liquid assets, I have done the following:

  • Removed $80K car completely from balance sheet
  • Now only my $400K (market value) house remains

It’ll make it easier to track my investments.

Net Worth Year in Review

I don’t see the point in this for this month, there’s not much to talk about, it’s the start of the year. Next month, I promise!

In the meantime, enjoy this snapshot:

 

2021 goals:

Long-Term Goals

And here are my extra longggggggggggg-term goals:

$1M in liquid investments

I don’t think I feel like a millionaire because I can’t see it in my accounts. Sounds silly but true. I’d like to log in and see “$1M” in my investment balances. That’d be nice.

Then obviously because I am crazy, I’d want to have $1M in EACH account. As I have 3… that would be $3M. I am more likely to hit this in my Margin (unregistered) accounts though.

$2M net worth

This includes JUST my house as an asset, plus my investment portfolio and cash. I won’t be adding any other fixed assets in there. I’d like to even move my house off this balance sheet but honestly, it is an asset (paid in cash no less).. why wouldn’t I count it as my net worth?

The only reason I’d remove it from my net worth completely is on the basis that well.. I need somewhere to live. So I can’t really sell the place now can I?

Anyway, potato, potata. I still own it, it’s an asset, ergo, part of net worth.

$50K passive income

It includes dividends, private lending, bank interest. Right now I am around $23K and I don’t know when I’ll hit $50K. So I set it at some arbitrary year.

Can I hit $5M by 2040? I’ll be 57 by then. Who knows? It’s a great goal.

$50K dividend income

This is a super.. aggressive goal to have just one stream of income coming in as $50K and no other incomes. I could just live off this luxurious salary and not touch a penny of capital.

For $50K at 1% return, it would mean $5M in invested capital.

I’d like to hit it at 65? Again, this is all made up.

Future FUTURE goal:

5-digits in monthly savings (e.g. $10K/month) without my day job

It is easy to save when you make lots of money. I know this sounds like nonsense (DUH) but .. it’s true. I am going to work on increasing my side income past $10K so that I can save 5-digits a month.

But not this year. I am working this year, I don’t have time for that. Later.

If you are interested, my money is parked here:

  • EQ Bank: 1.5% now.
  • Tangerine: Use my Orange key { 32726976S1 } for free money ($50 once you deposit $100; and I get $50 too) — At 2.74% until February.

…cashback sites and cash-earning sites for surveys:

It is invested here:

THE INVESTMENTS ROUNDUP

General Investment Strategy

My strategy is to have 50/50 as in:

50% of my portfolio in index mutual funds
50% of my portfolio in dividend-paying stocks

The ultimate goal is that my portfolio for dividend paying stocks will yield $12,000 at a minimum in dividend income (I hit that this year) each year, up to $50,000.

I am also playing the other side by having money invested in index mutual funds, and letting them grow slowly and appreciate. They too, pay out dividends at about 1.24% so it isn’t zero, just not as fast.

As my dividend stocks go up, I do sell for capital gains, and then I take that money and plow it into index funds, which drops my dividend payout rate, but it makes it ‘safer’ in the sense that it diversifies it more.

Small business lending is way down…

My money just keeps accumulating in cash there. It’s just not getting lent out for 2 main reasons:

  1. Small businesses are not starting up or needing money (they’re closing at an alarming rate)
  2. They’ve increased restrictions on who they will lend to taking into account the pandemic

I took out some cash from the balance, from $700 down to $200, so I can reinvest it into the market while I wait.

Will take a mortgage in the future

I will take a mortgage in the future instead of trying to pay for my home in cash, as it’s an interim loan, interest rates right now are quite low and depressed, and if I have to pay it off early and pay a penalty, so be it – it’ll be cheaper than draining funds and selling investments, paying taxes, etc.

Artificially drained my emergency fund to under $7K

I have decided to keep my emergency fund at a healthy, starved state (haha).. of around $8000 – $9000 because it triggers in my little pea brain that I feel like I don’t have enough money (ooohhhh scarcity!!), and it makes me clamp down on extraneous spending instinctively because I wan to preserve that cash.

I am not above tricking my spending brain by looking at these low bank balances to keep my instincts sharp.

Reinvested most of my side incomes

Last month, I only managed to replenish ~$1300 of the $2675 I spent with the pure $CAD cash into my actual bank accounts. Everything was reinvested.

That boggles my mind… but it’s what I’ve done.

FYI my investments are all here:

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Sherry of Save. Spend. Splurge.

Am my own Sugar Daddy. Am a millionaire at 36 after getting out of $60K of student debt in 18 months, a little over a decade earlier, using TheBudgetingTool.com. I have worked 50% of my career (taking 1-2 year breaks), and quadrupled my income within 2 years of graduating, going from $65K to $260K with an average lifetime savings rate of 50%. I have 11 side incomes that are on track in 2020 to make me $50K - $75K. I could retire today if I wanted, but love my work-life balance as a freelancing consultant in STEM (Science, Technology, Engineering, Math). I am all about balance - between time and money, and also enjoying my money. I also post daily on Instagram @saverspender.

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2 Comments

  1. Steveark

    You are doing amazingly well and living exactly the life you choose. And you have a well thought out plan. Your life is vastly different from the one I chose, as it should be, but it’s also not that different in that is not accidental or lived in fear. Fun to watch you go!

    Reply
    1. Sherry of Save. Spend. Splurge.

      It’s definitely not accidental. I try to plan, but with flexibility built in. Right now, the peace of mind I have is incredible. I do not have to worry about spending or living, or working. I know I am fine until the end of time.

      Reply

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