December 1st Net Worth Update

Jordann Net Worth

Happy December, friends! December is here, and with it, the end of 2018 is fast approaching. I’m not going to lie – I’m a little ok with seeing the end of 2018. 2018 was filled with uncertainty for me because my husband was returning to school full-time, and we’ve lived on a single income for the past seven months.

I honestly did not know how this would pan out. Would we be able to make ends meet? My full-time income barely covered our basic living expenses, let alone the cost of tuition and books. I had freelancing to rely on, but freelancing is a fickle beast and unpredictable at best.

I’ll do a full recap of my feelings about living on one income in January, but so far, everything is going ok. We’re making ends meet, and we aren’t going into debt, which is the most important thing.

While 2019 promises to be just as stressful since we’ve got another eight months of living on one income slated for the new year, at least we’ve been through it already, and we know what to expect. I can predict costs, which means I can set tentative financial goals.

Financially speaking, November seemed like a stagnant month, but I made some excellent progress with my finances. This month I earned $3,400 from freelancing, and all of that money went to one of three places:

  • The DIY fund
  • Taxes
  • Goals

November’s Money Goals

This month’s goal was to save up for my husband’s next round of tuition in cash. In 2018 I used the Lifelong Learning Plan to withdraw $10,000 from our RRSP to pay for my husband’s first year of education. I’m trying to avoid raiding our RRSP in 2019, and in November I hit the first goal of fully funding January’s tuition. That’s about $4,000 that I now have tucked away in my EQ Bank High-Interest Savings Account earning 2.30%.

The second big savings goal this month was to put enough money away for new tires in the Spring. Cars are expensive, I’ve said it before, and my Subaru Crosstrek is no exception. I checked that goal off too, and I now have $1,000 chilling in the same account. I don’t expect to spend that much on tires, but I’d rather overbudget than underbudget

Finally, after checking those two highly necessary, but also profoundly boring goals off my list, I decided to treat myself. I also put some money away for a new dresser for my bedroom. My husband and I have a terrible habit of prioritizing every room in the house except our bedroom when it comes to home renovations, and I’m just finally getting around to giving it some love now. So a new dresser is on the list, and I’ve got enough saved to snag the one I’ve been eyeing, now I need to wait for it to go on sale.

November’s Money Sucks

Even though I was able to cross several savings goals off my list in November, my net worth didn’t budge much, because there was also a lot of money flying out of my accounts. First, my home’s heating system. We did some major heating system upgrades this fall to address the old oil furnace and the too-small ductwork that led to the bedroom and office being perpetually freezing. It wasn’t cheap, but it was so incredibly worth it. I’ll post a final tally once the last of the costs come in – I still need to pay a drywall guy to come and do some repairs.

On top of that, November was the month of Jordann. I have this terrible habit of delaying basic self-care requirements until the last possible moment. In this case, I hadn’t had a haircut in over a year (!), and my glasses were in dire need of an upgrade – a fact I could no longer ignore when one pair fell apart in my hands. Finally, my seven-year-old winter coat was laid to rest after I picked up a replacement that I adore from MEC.

A haircut, some new hair products, a curling iron, a coat, an optometrist appointment and two pairs of glasses later, and I’ve spent over $700 on myself this month. I rarely spend money on myself, so this seems a tad excessive, but everything I purchased was sorely necessary. I could have shopped for better deals and done everything on the cheap, but I had the money, and I work long hours freelance writing for this cash, so I don’t mind diverting a small portion of it to myself – and you shouldn’t either.

Ok! Now that you’ve read the book that was my November recap, let’s look at some hard numbers:

(If I say “my” below, I mean “our” because my husband and I have combined finances, including retirement savings.)

Net Worth: $129,754 (+0%)

As much as my Big Pile of Money increased this month (+22%), my short-term cash fell (-39%). The short term cash was earmarked for the heating system upgrade, and it offset the $3,400 I brought in through freelancing this month.

Let’s look at how each of these individual accounts faired:

Liabilities

Consumer Debt: $0

December is the time of year when most Canadians start seeing their credit card balances creep higher. January’s credit card hangover is a real thing, but this year I’m sticking to the straight and narrow. I didn’t budget any money for the holidays this month, and instead, I’m using the $622 in cashback rewards from my Scotiabank Momentum Visa Infinite. That little black credit card is going to completely pay for my Christmas shopping this year – which is why I switched from travel rewards to cashback when I found out my husband had been accepted to school.

Mortgage: $231,127 (-0.28%)

My regular monthly mortgage payment is $1,089, which uncovers about $645 per month in equity on my home. Right now about 45.5% of our net worth is made up of home equity.

I’m not in a hurry to pay down my mortgage right now because my mortgage interest rate is just 2.29%, so I’m not making any extra payments. I also don’t have the spare cash to make additional contributions, as long as my husband is still in school. The recent interest rate hikes have changed things for me a little though, and once my husband is back to work full time, we’ll begin making extra payments.

Assets

Home: $291,000

Two years ago we bought our home for under market value ($270,000) because it needed some work that the seller was unwilling to complete before sale. One year after that our real estate agent estimated our home was worth $285,000. This year I added the region’s growth of 2.1% to that number, bringing us to a home value of $291,000. This estimate is conservative and doesn’t take into account the thousands we’ve spent in home renovations over the past two years, but I’d rather be conservative than overly optimistic.

Car: $20,098

According to Canadian Black Book, my 2014 Subaru Crosstrek is worth $20,098. I’ll update the value in January to reflect depreciation. Some people don’t include their car in their net worth updates because they “need it” and while I do need a car in my life, I don’t need a $20,000 car. If I needed to, I could sell this car and buy a beater.

Retirement Savings: $23,260 (+3%)

After the bloodbath that was most of 2018 (or so it feels like), I’m happy to see my RRSP go up instead of down for a change. I still owe this account the $10,000 I withdrew through the Lifelong Learning Plan, but I’ve made two big changes to how I’ll treat this account in 2019:

  • I’m hoping to avoid withdrawing any more money. Instead, I’ll pay the remaining tuition in cash
  • I’m hoping to restart retirement contributions before my husband graduates

Both of these changes will improve my RRSP’s value and get it back to where it should be sooner rather than later.

TFSA Investments: $4,000 (+2%)

I opened this account last year, and it has slowly grown as I’ve contributed about 10% of my freelance income every month. Since my husband has returned to school, I’ve suspended those contributions, and growth within this account has ground to a standstill. In November it did go up slightly though, which is nice to see.

Big Pile of Money: $16,004 (+22%)

The Big Pile of Money (nicknamed the BPM) is a no-fee, high-interest savings account at EQ Bank earning 2.30%. EQ Bank is where I’m hoarding cash at the moment. Right now the contents of the BPM are:

  • Emergency fund: $10,000
  • January’s tuition: $4,018
  • New tires: $1,000 (this amount is a generous estimate, I do not expect to pay that much)
  • Dresser for the bedroom: $986 (and lamp, and mirror, and desktop fan)

This account is where the bulk of my freelance income is going every month, and most of it is planned spending that will happen in the next year.

Other Money

If you’re doing the math, you know that there is some unexplained money in my net worth. I’ll tell you where that money is: in my planned spending account for taxes, budget deficits, mortgage payments, gas, the internet, etc.

Previous Net Worth Updates

Here are my past net worth updates, along with my age, for reference.

2017 (Age 27)

In December 2017 I was sporting a net worth of $110,000. I still owed $3,300 on the Subaru Crosstrek I’d purchased almost precisely a year before, and I was throwing everything I had at eliminating that debt.

I owed $238,000 on my mortgage, and my RRSP was approaching the $30,000 mark. My emergency fund was nearly fully funded at $8,300, and my renovation fund had a pitiful $71 in it after upgrading my hot water tank.

2016 (Age 26)

December 2016 was the first net worth update I missed in five years! My budgets indicated that I had a net worth of $71,000 at that time. My retirement fund was sitting at $18,557, and I owed $246,360 on my newly minted mortgage.

2015 (Age 25)

At this time in 2015, my husband and I marked our first year of living in Halifax for the second time. My net worth was sitting at $42,000. This net worth was mostly made up of our retirement savings ($13,000), emergency fund ($10,000), and our house down payment fund ($15,000). Little did I know in just over six months I’d be pulling the trigger on my first home!

2014 (Age 24)

Four years ago I was gearing up to make the big move to Halifax. My net worth was at $28,000, and I was saving a ton of money for the move, an upcoming trip to Paris and for my husband’s potential unemployment. My retirement account was starting to bud with $6,500 in it, and my emergency fund was sitting at a solid $10,000. I remember feeling like I was starting to get my financial footing.

2013 (Age 23)

Five years ago I was debt free! But just barely. I’d just paid off my car loan on my Volkswagen City Golf the month before and could officially declare myself debt free. My net worth was small at $7,300. $2,300 of that was my emergency fund, $1,000 was in the form of a travel fund, and I’d just started saving for retirement with $250 in that account.

So, in five years I’ve added $122,454 to my net worth, despite living on one income for one of those years. Not bad.

You can read all of my net worth updates here; those early ones are pretty hilarious.