Net Worth Update #1

Welcome to the net worth update series! In this series I will update my net worth every month starting in Jan 2024. I might change it to a quarterly update in the future, but for now it's going to be a monthly update.

Net Worth: Know Your Value

So what is net worth and how do you calculate yours? Simply put, net worth is the value of the assets you own minus the liabilities you owe. In other words, net worth is a snapshot of your current financial well-being.

What is Net Worth

Calculating your net worth is pretty easy:

• Add up the value of all your savings, investments, property and other big assets.

• Subtract from that number all that you owe; mortgage, car loans, student loans, credit card balances, personal loans.

• What is left is your net worth, whether this number is positive, or negative.

What Does Your Net Worth Mean?

So now you know what your net worth is, but what does it tell you? If its positive - that means you're on the right track. But if its negative, no worries - time to hit pause figure out how to flip the script and make it a positive. By increasing your assets and decreasing your debt you will be improving your net worth. And with consistency you will be able to retired without worries. Anyways, without any further ado, below is a screenshot of my current net worth as of 1/2024:

Personal net worth

I have been investing for a few years now, but its been in a passive kind of way, investing here and there. And for that reason I missed out in a lot of gains in the last couple of years. Now I want to be more active with my investments and will start investing on a monthly basis. My plan is to create a dividend portfolio in my ROTH IRA account, so taxes will not affect me. And in my brokerage account I'll focus more on growth. Either way, I have a long term investment horizon, like 25-30 years.

Goals For 2024:

Emergency Fund: at the moment I have $1,000 saved up. I used to have more, but I broke this rule and started investing all of my money in the stock market back in October/November 2023. My goal is to have $4,000+ saved up by December 2024.

ROTH IRA: I have  $32,702 invested and $6,503 in cash. I'm restructuring my portfolio and getting rid of all my non-paying dividend stocks and ETFs (Exchange-Traded Funds), since this is going to be my strategy for this account. I'll be allocating 80% to ETFs and 20% individual stocks. Think SCHD, DGRO, REITs and companies that are focused in growing their dividends.

401K: I'll be starting my new job in the next couple of weeks, so I have to decide if my want to roll-over my current 401k into my new 401k or move it to my Roth IRA. My goal for this is to allocate 10-15% of my salary + my employer match.

Brokerage: my strategy for this account will be growth investing, 80% ETFs and 20% individual stocks. Think S&P500 and NASDAQ. I have $10k sitting in cash since I have sold off all my stocks in that account. I decided to sell off all of my investments in this account because I had a lot of companies that were either pure speculation or companies that I did not know why I invested in them to begin with (and I regret selling a couple of them!). As luck would have it, the ones that did make me money offset the one that didn't. Thanks Tesla! Like Warren Buffett once said "It's better to buy a wonderful company at a fair price than a fair company at a wonderful price."  So, I'll focus on buying quality companies this time around.

Rental: I have tent with a year left on his contract (he signed a 2-year contract) and hopefully he stays past the 2-year contract. At the moment I owe $266,306.09 and its worth $433,000 (going off a house that is on the same street and similar to mine and sold for $433k on 11/2023 according to Zillow). My net worth might fluctuate a lot this year since there's a lot of speculation that there will be a recession. But real estate might go up as well since the Federal Reserve is going to start cutting down interest rates in 2024. Who knows what is going to happen, either way it's going to be a wild ride.

Bitcoin: well what can I say, crypto is very volatile and this might up by a lot or it might go down by a lot. I got into Bitcoin back in 2017 when it went up to $19k. My average for Bitcoin is in the $15,000.

Auto: I drive a 2016 Honda accord with 155,xxx miles and it's been paid off since 2020. According to Carvana it is worth $6,400. I almost ended up trading this car for a newer one with less miles, but I decided to sleep on this decision. Thank God I didn't let my impulses get to me. Now I plan to drive this baby until it breaks. It’s a Honda, so keeping up with maintenance this can last me past 300k miles, fingers crossed.

Credit Cards: I used to owe $6,456.72, but a few days ago I paid off $2,554.98! Ever since I started to learn about credit and how it works, I've been paying off my credit in full every month. It's been about 4 years since my last interest charge!

So, there you have it! As of Jan 2024 my net worth is $283,220 up from $208,460 (that calculation was done in 2021). That is approximately a 35.85% increase in the last 2 years-  mostly due to my rental going up in value. I'll be sharing more insights on my type of investments in the near future, that's it for now.