It’s net worth update time! I’ve been a bad blogger. I missed two net worth updates in a row! To be fair, I was super busy freelancing. So far in
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Ok, on to the money talk. Right now I’m working towards a few savings goals, and I’m in the process of wrapping up what was almost certainly the most expensive six months of my life. Between paying for round three of my husband’s tuition and finalizing the upgrades on my home’s heating system (more about that in a later post), most of the money I’ve been earning since November has been spent, not saved. The result is a flagging net worth and less than stellar gains.
There are a few bright spots, however. For one, that streak of spending is coming to a close. By the end of May, we should officially be in savings mode once again, as the final round of tuition will be paid (hopefully in cash) and the heating system will be fully paid for. On top of that, I restarted contributions to my RRSP in May, sending $600 to it every month.
Between those contributions and the equity that paying down my mortgage each month uncovers, my net worth has been going up, albeit slowly. I absolutely cannot wait until we return to life as DINKS, but until then, here’s how our money shakes out:
(If I say “my” below, I mean “our” because my husband and I have combined finances, including retirement savings.)
Net Worth: $135,472 (+1%)
March was a good month income-wise, but I also did a fair amount of spending. In March I spent money to get my old fireplace working (check out my Instagram DIY stories for that saga) and my husband’s entire family visited, which meant a few hundred dollars spent on restaurants and bars. But I also contributed to my RRSP and saved money for my husband’s final round of tuition and a new set of tires for our Subaru (damn, cars are so expensive). The net result is a 1% increase in my net worth.
Liabilities
Consumer Debt: $0
March was an expensive month, with many unexpected and unplanned expenses. Fortunately, I’m still committed to paying off my credit card every month to avoid interest charges. I’m still rocking the Scotia Momentum Visa Infinite for cash back rewards, with my Tangerine Money-Back credit card as a back-up card and for Costco spending.
Mortgage: $228,521
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 that most homes in this area are selling for
Car: $18,871
In January I updated my Subaru’s value according to Canadian Black Book and it dropped in value. This is no surprise, we know that cars are depreciating assets, but when I have to actually update that value in my net worth and see how it affects me directly, it’s much more obvious. I’ve had this car since 2017, and I won’t be selling it until I’m ready to upgrade to an electric car (Hyundai Kona EV, I’m looking at you).
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: $26,330 (+4%)
In 2018 I paused my RRSP contributions because we were living on one income as my husband returned to school full-time to upgrade his education. At the time I wasn’t sure how life on one-income would be for us, so I designed a restricted budget that cut out all unnecessary spending, including RRSP contributions.
At the beginning of 2019, I still had 8 months of one-income life in front of me, but the previous year had made it clear that I could afford to restart RRSP contributions, funding them out of my freelance income. So that’s what I did, and I’m happy to say our my RRSP has blossomed. It’s grown so much in fact that I really need to get serious about moving it out of the Tangerine Streetwise funds that I’m currently investing in. More on that in a future post.
TFSA Investments: $4,209 (+0%)
I opened this account in 2017 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 the growth within this account has slowed significantly.
Big Pile of Money: $15,242 (+4%)
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
- May’s Tuition: $1,181
- New Tires: $460
- Fireplace Money: $3,600
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.
I keep this money in a combination of chequing and savings accounts at Tangerine Bank. I use Tangerine for my daily spending because they have no fees on any of their accounts and the online platform is excellent. You can sign up for Tangerine using my Orange Key: 38939199S1 and we’ll both earn a bonus $50.
Previous Net Worth Updates
2018 (Age 28)
This time last year I was prepared for 16 months of one income life as my husband entered school in May. To be honest, the prospect of being the sole breadwinner was pretty terrifying. My net worth was $117,000 and I had a $236,000 mortgage on my home which was valued at $285,000. My RRSP had $31,000 in it, but I was about to raid it using the Lifelong Learning Plan to pay for my husband’s tuition.
2017 (Age 27)
Two years ago last year I had a net worth of $83,858. I still owed $14,904 on my car loan and had just made a big payment using my income tax refund. I owed $243,869 on my mortgage, meaning I’m uncovering about $6,000 per year in equity on that baby before appreciation. My retirement savings sat at $24,000, my TFSA was starting to bloom at $1,000, and I had $2,400 earmarked for renovations.
2016 (Age 26)
Three years ago I had a net worth of $50,471 and was doing a little happy dance for finally crossing that $50,000 threshold. A significant portion of that net worth was tied up in my house fund, which was sitting at $22,894. Most of the rest of my net worth was tied up in my emergency fund and my retirement savings.
2015 (Age 25)
In 2015, my husband and I were adjusting to being a two-income household as he celebrated one month at his new job. Our net worth had only decreased slightly during his period of unemployment and sat at $27,000. Our retirement savings was nearing the $9,000 mark, and we had just booked our trip to Mardi Gras for February 2016.
2014 (Age 24)
In 2014 my finances were in pretty good shape. I had a pretty solid net worth of $14,301. That was made up of a baby-sized RRSP ($2,310), a stable emergency fund ($6,177) and my travel fund ($1,632). I had no debt, and my blog had just turned two years old.
2013 (Age 23)
April 2013 was a big month for me. I had just made a $5,600 payment on my debt thanks to a significant income tax refund. This payment brought my debt to $12,508 owing. I still distinctly remember making that payment because it got me so pumped about debt repayment. Paying big chunks like that is an excellent technique to keep up your enthusiasm for paying off debt. This large payment meant that was the first time I’d achieve a positive net worth, squeaking by the mark with $690.
You can read all of my net worth updates here; those early ones are pretty hilarious.