Here is my May 2017 net worth update. As I’ve said before, I like to track my family’s progress through monthly net worth updates. To calculate our net worth, I add up all of our household assets and subtract any outstanding liabilities (ie. debt owing). The result is simply a snapshot of what my family is worth at a particular moment in time and does not give any of the relevant details as to how or why we reached that point. For that kind of information, as well as for our monthly investment income, please refer to our dividend income and monthly highlights section.
In a previous post, I laid out a variety of financial goals for 2017. My focus for the year however, will be on achieving 3 major goals. First, we want our net worth to hit 1 million dollar mark by the end of the year. Today we’re almost at the 990k mark, so we need to increase this by 12k to achieve the 1 million dollar goal. I think this should be doable barring a major stock market or real estate meltdown.
Our second major goal is to increase our passive income to $25k. In 2016, we managed to earn just over $16k. So I feel that if our rental properties perform nicely and we continue to invest a great deal of our paycheques then I think that it’s entirely possible that we earn $25k from our investments. At that point we’ll be half way toward our goal of earning $50k a year in investment income.
Finally, we still want to aggressively pay off our mortgage so that we can be mortgage-free in 10 years or less. To this end, we plan to pay off at least an extra $35k this year in the form of lump sum payments.
Well thanks to our approach to regularly invest our money, along with a little help from the Trump rally, our assets have risen past the 1.4 million mark!
Home: $846,000 (0%)
A few years ago we purchased our “final” family home where we expect to be for at least the next 30 years. In June of 2016, we received the latest property assessment and the assessed value had increased to $846k!
Rental Properties: $0
We recently sold our out of town rental property due to management issues.
The big jump in cash is due to the proceeds from the sale of our rental units. As a matter of habit, I rarely keep a lot of cash on hand in a savings account. The reason being is that at today’s record low interest rates I’d rather put the money toward paying off my mortgage faster or invest it. That said, I’m building a cash cushion in my Tangerine Savings account. If you’d like to open one, then visit the Tangerine website and remember to use my Orange Key: More25 to get $50 in free bonus cash just for opening up an account!
Non-Registered Investment Accounts: $40,300.57
Our non-registered investment accounts include DRIP accounts with Computershare and Canadian Stock Transfer, a discount brokerage account and a work savings plan. For the most part, in these accounts, I prefer to hold Canadian companies that pay eligible dividends. From time to time you may see a decrease in this account as a result of me moving some of these assets that are fully taxable into our registered accounts that are not subject to any immediate taxes.
Tax Free Savings Account (TFSA): $126,517.40
In the TFSA I like to hold growth assets, such as low-cost ETFs, TD e-series index funds or Canadian dividend paying stocks.
Retirement Accounts: $299,125.58
Our retirement accounts consist of RRSPs, a small locked-in retirement account (LIRA) from a previous employer and a company defined contribution pension plan. The RRSPs and LIRA hold low-cost TD e-series index funds and other low-cost ETFs, while the company pension plan is invested in a low-cost target date fund.
Education Savings Plans (RESP): $21,483.00
In the RESP we hold low-cost TD e-series index funds. We contribute the annual amount of $2,500 so we can get the 20% match from the government. Our strategy for contributing is to use the money we receive each month from the universal child care tax credit and make up the difference at the beginning of each year. This ensures that we receive the maximum government contribution of $500.
Other Assets: $27,400
Under the “other” assets category, I include an extensive coin and paper money collection. For years I collected rare gold and silver Canadian coins and Canadian paper money. The collection has a face value of $10,000 so I conservatively estimate the collection’s worth at around $27,400. For the purpose of my net worth calculations, I’ve been keeping this number constant versus increasing it over time because (a) coins and paper currency can be difficult to accurately appraise as they are subject to changing market trends and (b) can become illiquid if you can’t find a buyer for them.
The only debt we now carry that is not tax deductible is the mortgage on our primary residence. This is a priority to pay off so we can get out of debt!
Mortgage: -$428,493.93 @ 2.89%
Paying down our mortgage will be a high priority for 2017 and we expect to be mortgage-free in less than 10 years.
HELOC: -30,184.05 @ 3.35%
I use the HELOC for to boost my investing funds. The interest is tax deductible so I’m fine with carrying a balance. However, I intend to pay this off with the proceeds from the sale of our rental properties.
Thanks for reading my May 2017 Net Worth Update!
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