PoP Balance Sheet – October 2014

Welcome to our October 2014 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!

October was another one of those months where we’re still getting our sea legs in feeling the movements of the market to a greater extent underneath us. Halfway through the month after looking at what the markets had been doing I had to warn Mr PoP that he probably wouldn’t want to take a look at our net worth on Mint unless he was going to be okay with being down by a significant chunk of change. But then by the end of the month, as we were sitting at the end of our driveway handing out candy to Trick-Or-Treaters, Mr PoP was telling me he had checked out our mint account that day and thought our net worth might be over $800K (for the first time ever) after the prices on our mutual funds updated for the end of the month.

Mixed in there is the fact that we inadvertently maxed out on Mr PoP’s 401K this month. Ooops! (First world problem, we know.) From everything I can tell, Mr PoP’s company doesn’t do an end of year gross-up on any missed matching funds if you max out your 401K early, so I had been hoping to stretch it out a little toward the end of the year. We missed that opportunity and may have lost about $400 (maybe more?) in employer matching funds because of it. =(

Hopefully we can time it better in 2015 (in 2013 we maxed Mr PoP’s out on the LAST paycheck, something I consider amazing considering how much his pay can bounce around), but at least the increase in the 401K contribution limits (from $17,500 to $18,000) will give us more wiggle room to play with AND will have a nice little positive effect on our bottom line next year, too. Specifically, an extra $280 that we keep in our pockets (instead of paying our marginal 28% tax rate on the extra $500×2 = $1000), as well as an extra $125 in matching funds from my employer.

And that’s about as much thought as I like to give our 401Ks. They are really our “set it and forget it” savings mechanisms and I don’t like to deal with them all that often.

So for the month of October:

  • Our total assets went up by $15.5K
  • Our total liabilities went down by $0.8K
  • Net worth rose by $16.2K
  • Total net worth as of the end of October is $802.3K, which represents a 1.76% increase this month. And Mr PoP was right with his prediction.

And for the details…

dyerware.com


Assets

Stock Accounts

  • 401K accounts: $213.4
  • Roth IRA accounts: $148.6
  • HSA account: $8.2
  • Taxable Brokerage Accounts: $56.8
  • Total Stock Accounts: $427.0

Real Estate (based on current market comparable sales)

  • Primary Residence $215
  • Investment Duplex: $130
  • Investment Residential Land: $80
  • Total Real Estate: $425.0

Cars (values from Kelly Blue Book)

  • Car 2: $9.2
  • Total Cars: $9.2

Cash Holdings

  • Checking Accounts: $15.2 – need to move another $4K into taxable
  • Savings/Money Market Accounts: $20.0
  • Total Cash Holdings: $35.2

Total Assets: $897.1

Liabilities

Real Estate Loans

  • Primary Mortgage: $93.6
  • HELOC on Investment Duplex: $0.0 (re-advanceable)
  • Personal Loan – Used to Purchase $50K Duplex: $0.0
  • Total Real Estate Related Loans: $93.6

Revolving Credit

  • Credit Card Balance: $1.2
  • Total Revolving Credit: $1.2

Total Liabilities: $94.8

Net Worth = Assets – Liabilities

Net Worth = $802.3, up 1.76% from September

 

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.

dyerware.com


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.

dyerware.com


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), 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 164.5. 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

12.60/25 = COL Early Retirement Locale / 164.5

COL Early Retirement Locale = 82.91

… which puts us in Brasov, Romania.

This month our tour of Eastern Europe continues north from Skopje, Macedonia to Brasov, Romania. Located in the Transylvania region north of the Black Sea, Brasov is much like Skopje in that it is a very old city that has been conquered and incorporated into various cultures a number of times throughout history. But if we moved here, we’d need bigger coats as Brasov is apparently known for its winter sports tourism industry. Mr PoP would definitely need to wear socks in the winter there… heck, probably on summer evenings as well. So I’m not sure Brasov is going to be the place for us.

  • 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

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

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