I am pleased to highlight that I managed to reach the $750K net worth target in 2013. I know I have highlighted in the past that net worth is fun but investment portfolio is what matters and I believe that. It is, however, a milestone. According to my past history, I think I could reach the 1 million dollar target in three years. It might be possible in two years but I would need help from a continuing bull market. My RRSP portfolio contributed to 50% of my growth in 2013 thanks to all my US dividend stocks.
Related: S&P Dividend Aristocrats
Net Worth Summary
I track my net worth by months just like I track my dividend income by month. The net worth obviously include the mortgage (as a negative) and all the assets including my home (as a positive). I have not increased my home value since 2002 where I used a 3 year average of my property assessment which is close to the market price. It’s down 4.8% this year reflecting the cooling down in the real estate market in my area but the value is still above the current value I have given myself. I am trying not to inflate my net worth with the market value mostly because my net worth is really not a focus unlike my portfolio value.
In 2013, my net worth grew by $105,401.32. My dividend income for 2013 contributed $6,303 to that growth. As you can see, dividend income is nice but that’s not what really moves the needle. I contributed a total of around $34K between my dividend portfolio and defined contribution plan. I get a match from my employer too. The next big chunk comes from my mortgage payments which are accelerated. I know, in retro-spec, I should have invested rather than paying my mortgage but it’s about managing risks in a one income family. My portfolio is a paper value and could drop at any point with a market correction.
Related: Mortgage Strategies
My investments are doing good and my next target for my investments is $500K within the next 2 years. Again, the markets have a say in this to some extent although I believe I have investments that are safe but no one is immune to major corrections. The good thing is that I would look at buying more if there was a correction.
Net Worth Tracking
If you are not tracking yet, it’s pretty simple to do. All I do is track each of my accounts by month with a total at the bottom and all loans are negative.
- Non-Registered Account
- Can Stock Transfer Agent
- Defined Contribution Plan
- <any other loans or line of credit>
I don’t track my credit cards since I pay them every month. It’s pretty simple as you can see. I don’t consider my vehicles an asset but the loan is a liability. If you were to need to list all of your assets for a specific purpose, you probably would need to list vehicles, bicycles, computer and anything else with value. Home insurance would probably want to know that but you don’t need to track the value every month since you need them to live. Best thing to do is to have photograph of your home assets for insurance.
Readers: Do you track your Net Worth?