PoP Balance Sheet – August 2015

Welcome to our August 2015 Balance Sheet!

We use the structure of a monthly income statement and balance sheet in tandem to make sure we are keeping our expenses low and planting our pennies wisely. If you’re not already tracking your finances using these two methods, go to mint.com and get started today! If you have any questions about how we do this just post a comment and we’ll be sure to help!

I knew without even looking that there was no way we squeezed out a gain on net worth this month, so checking in on the balances was more a matter of “how much” we dropped. We knew the S&P500 dropped 6.26%, and a quick check of VTIVX (Vanguard’s 2045 retirement fund which we also own a bunch of) dropped 5.87%. Considering a little more than half of our net worth is tied to the stock market, we thought there was a good chance we would see a drop of 3% or so. Turns out it was a *little* less than that, buttressed a bit by savings from our income as well.

That said, we were pretty happy with our reactions to the market turbulence (I feel like that’s putting it nicely) that we experienced alongside most others this month. After watching the market drop over 5% the week ending August 21st, Mr PoP cheered “Woohoo, bring on the correction!” while I bemoaned the fact that it hadn’t happened a week earlier so we could take advantage of the dip on our 401K buy-in days (known to others as pay-day). Then when it kept dropping earlier the next week, I moved $3K into Vanguard (after checking where our in/out flows were for the month so far and determining that we’d be investing at least that much at the end of the month anyhow) and was able to buy a handful of VTI shares at prices lower than we had paid in about a year.

It’s pretty unusual for us to make investment moves like this mid-month, since we usually do them the first week or so of every month after we wrap up our finances for the previous month. We’re not likely to be confused with investors that partake in market timing, but we are the kind of folks that like to take advantage of a pre-payment discount (which is what this felt like) on something we knew we’d be buying shortly anyhow.

So where did we end up at the end of it all?

  • Our total assets down by $19.5
  • Our total liabilities went down by $0.6
  • Net worth went down by $18.9K 
  • Total net worth as of the end of August is $906.3K, which represents a 2.05% decrease this month.

And for the details…



Stock Accounts

  • 401K accounts: $249.6
  • Roth IRA accounts: $155.8
  • HSA account: $11.1
  • Taxable Brokerage Accounts: $82.7
  • Total Stock Accounts: $499.2 

Real Estate (based on current market comparable sales)

  • Primary Residence $239
  • Investment Duplex: $140 – increased by $10K
  • Investment Residential Land: $80
  • Total Real Estate: $459.0 

Cars (values from Kelly Blue Book)

  • Car 2: $7.6
  • Total Cars: $7.6

Cash Holdings

  • Checking Accounts: $12.4 – need to move $2K over to our taxable account for the month!
  • Savings/Money Market Accounts: $18.0
  • Total Cash Holdings: $30.4

Total Assets: $996.2 (kicked out of the asset millionaires club again!)   


Real Estate Loans

  • Primary Mortgage: $88.2
  • HELOC on Investment Duplex: $0.0 (re-advanceable)
  • Personal Loan – Used to Purchase $50K Duplex: $0.0
  • Total Real Estate Related Loans: $88.2

Revolving Credit

  • Credit Card Balance: $1.7
  • Total Revolving Credit: $1.7 

Total Liabilities: $89.9

Net Worth = Assets – Liabilities

Net Worth = $906.3, down 2.05% from July


Tracking Investable Asset Growth

This first graph shows the growth of our investable assets (net of any liabilities against them), and shows the distribution of the various equity classes we hold. Pretty self explanatory.



How Many Years Of Spending Do We Have Saved?

Here I’ve taken the total of our investable assets for each month and divided it by the expenses (excluding our investment property expenses) for that month. The idea being that this shows how many years we could live off of those assets at that rate and gives us a better idea of what lifestyle inflation (or intentional deflation) can do to the relative value of our savings.


It fluctuates in a much bigger range, because in high spending months (like February 2013 when we spent almost $7K paying off our car completely and February 2015 when we spent a bunch installing solar panels), the denominator is so much bigger. Because of that, it’s the overall trend we’re looking for.

Early Retirement Locale Index

Mr PoP wanted one more way to understand more viscerally how much we have in “investable assets”, so we’ve come up with what we’re calling our Early Retirement Locale Index. The basic idea is that we know how many years of savings we have at our disposal if we were to continue living in south Florida. (That’s the chart above.) But using the “magical” 25 years of savings necessary for early retirement, where would we have to move so that our current investable assets would cover 25x our COL adjusted current spending? (Note, this is purely for fun, we’re not intending to move. Don’t worry Mama & Papa PoP!) If you want to follow along, we’re using this Cost of Living Index from Expatistan, and using the average of the two big cities in south Florida on the list (Miami and Tampa) as our current COL index, which gets us 195. Our city isn’t on their full list, hence the average – but maybe yours is. Then we’re solving this equation:

Current Years Saved/ 25 = COL Early Retirement Locale / COL S. FL

12.64/25 = COL Early Retirement Locale / 195

COL Early Retirement Locale = 97.04

… which brings us to Recife, Brazil!

Though we’ve never been to Recife, we’ve definitely heard all about it for years from a good friend of ours who grew up there – so if we did move there we know we’d get at least one visitor! Serendipitously, we ended up with Recife as our ERLI spot the very same month that our good friend brought a teeny tiny human being home from the hospital for the very first time.  Much congratulations were in order, as they will be amazing parents to that very lucky kid.

In case you don’t have a friend who has been boasting to you about Recife for nearly 15 years now, here’s the scoop.  Recife is a coastal city in northeastern Brazil (kindof stuck out on the part of the country that juts out the furthest east) with a tropical climate and even smaller swings in temperature than we get in S Florida (which is saying something!).  It’s a modern city (complete with amazing beaches (particularly Porto de Galinhas), though some may know Recife from paying one of the hosts of the 2014 World Cup (which our friend attended, of course).

That said, our friend doesn’t always have great things to say about the government in Recife and Brazil as a whole.  Corruption is rampant, some waterways are incredibly polluted (even with human sewage as they’re finding near Rio Olympic sites) and there is still a huge class of people in Brazil that live in abject poverty.  So despite the quite favorable exchange rate between the USD and the BRL at the moment, we’ll postpone the move to Recife for the time being.

Here’s our journey through the ERLI so far…

  • January 2014 – Delhi, India
  • February 2014 – Quito, Ecuador
  • March 2014 – Kiev, Ukraine
  • April 2014 – Chiang Mai, Thailand
  • May 2014 – Madras/Chennai, India
  • June 2014 – Colombo, Sri Lanka
  • July 2014 – Bangalore, India
  • August 2014 – Yerevan, Armenia
  • September 2014 – Skopje, Macedonia
  • October 2014 – Brasov, Romania
  • November 2014 – Prague, Czech Republic
  • December 2014 – Mexico City, Mexico
  • January 2015 – Zadar, Croatia
  • February 2015 – Kiev, Ukraine
  • March 2015 – Cairo, Egypt
  • April 2015 – Bangalore, India
  • May 2015 – Niteroi, Brazil
  • June 2015 – Nowhere!
  • July 2015 – Skopje, Macedonia
  • August 2015 – Recife, Brazil


How was your balance sheet in August? Where would your savings land you today?

14 comments to PoP Balance Sheet – August 2015

  • We’re neighbors! My result was also 97.04 :)
    Leigh recently posted..Defining my uniformMy Profile

  • Thanks for sharing! I look forward to the monthly updates because they are always so inspiring.
    Mrs. Crackin’ the Whip recently posted..August 2015 Spending ReportMy Profile

  • Only a 2% drop in net worth? Not bad at all! Interested to see how things shake out the rest of the year, not like it’ll change my game plan though :)
    Fervent Finance recently posted..It’s the Most Wonderful Time of the YearMy Profile

    • We’re curious as well and it looks like analyst predictions for EOY market performance are still pretty divergent so who knows what’ll happen! Like you, it won’t really change our game plan one way or another.

  • Based on how the market has been doing, a 2% drop in net worth doesn’t seem too bad at all. Especially with so much of your net worth being invested in the market!
    Debt Hater recently posted..Somes Sound View Campground ReviewMy Profile

    • Yeah, we were surprised it wasn’t a bigger drop… though September hasn’t been a great month in the market so far either, so we may be in for another drop. =P

  • I had a similar reaction when I was watching the market fluctuations :)

    Your burn rate spreadsheet has inspired me – I’ve been thinking of our investment income in terms of replacement income for our (early?) retirement but was trying to decide the best way to see that visually. Is it really as simple as taking the value of your invested assets divided by spend rate, for the purposes of this spreadsheet?
    Revanche recently posted..#1GoodMoneyThing Monday, update 2My Profile

    • The burn rate calc is really easy – we just take our “investable assets”, which is basically our net worth minus the equity in our house and the value of our car, and divide that by 12*the month’s personal spending. (We don’t count month-to-month expenses on our investment properties in this calc, which is why I call it personal spending).)

      I think Leigh uses a 12-month rolling average of her spending for her calcs, which is another good way to go. Personal preference =)

  • lucas

    Yeah for perspective on the market this past month. I am also hoping for more of a correction for a better buying opportunity :-)

  • Ours was about a 5% drop overall (which included pretty robust savings on our part), but our investments really plunged like crazy (possibly because I didn’t look until a week later than I should have). I am interested to see how low this correction can take us. It seems unlikely that we will drop to the 2010/2011 levels, but perhaps I’m wrong.

    • I’m definitely not a market prognosticator, so have no idea where the market will end up. If it does drop to 2010/2011 levels, the best thing we can all do I think is just buy as much as we can at cheaper prices while they last since I don’t think they’d last forever.