We like to figure out our net worth each month to keep track of our progress towards meeting our goals. We share these numbers here to keep ourselves accountable, and for our readers to follow along with our journey.
What is Net Worth?
If you are new to tracking your net worth, start with the post, How to Track Your Net Worth. Your net worth is all of your assets, minus your liabilities. Since Mr. Farmhouse Finance and I combine finances, I track our net worth as a couple. I enter our numbers into an Excel spreadsheet once a month, usually on the 14th or 15th. For the purposes of these posts, I will be sharing a summary of our numbers entered into a Word table.
Here is our net worth for April 2017.
What’s included in our net worth?
We have many different retirement, checking, and savings accounts, as well as a number of different credit cards. I total up the numbers for these different accounts, and add them to the appropriate category on our table, rather than copying the entire spreadsheet with all of our different accounts. For the Kelley Blue Book value, I always use the dealer trade-in amount, since that is a more conservative estimate of what our cars are worth.
For those of you wondering about all our different accounts, here is a list:
- Retirement Accounts (Roth IRAs, 403b, Roth 401k from old job)
- Cash (personal checking accounts, joint checking, savings accounts for down payment for house, emergency fund, vacations, gifts, exercise equipment, road bike, taxes)
- Cars (2013 Subaru Impreza and 2007 Toyota Prius)
- Credit Cards (Chase Sapphire Preferred, American Express, Bank of America Visa, Mastercard)
What’s not included in our net worth?
Mr. Farmhouse Finance and I are both public school teachers. We have been contributing to the Teachers’ Retirement System, and will continue doing so throughout our careers. We have decided not to include this in our net worth summaries at this time, but may change our minds about this in the future.
Why so much cash?
We have been saving for about a year and a half for a down payment for our house, and have opted to keep this money in cash because of our shorter timeframe. We also are building our emergency fund and vacation funds. Once we build our house, we will continue to keep a small bit of savings in cash, and invest the rest.
This Month’s Progress
Holy Guacamole, we really were killing it this month! Since I figure out our net worth on the same day each month, sometimes there are four paychecks (we get paid biweekly on alternate weeks, so there’s always a paycheck on Friday) and sometimes there are five. This month there were five paychecks, and I received half of the health insurance buyout from my school.
With my extra paycheck, in addition to transferring money into our joint checking account, I did the following:
- contributed $350 extra to the house fund
- maxed out my Roth IRA for 2016
- made an extra car payment
We used the health insurance buyout to contribute an extra $2,500 to our house fund.
Goals for Next Month
Next month, we will meet our original goal of having $50,000 saved for a down payment for the house, but I have since readjusted that amount. We are working on putting together a budget for the house, and it’s looking like we will need to continue saving if we want to put 20% down and have enough cash to cover closing costs (usually 2-5% of the cost of the house). We will continue saving as much as we can for the house, while also paying a little more off the car each month.
How are you doing with your goals?
Illusion of Scarcity Worksheet (PDF)
Download this free worksheet and start paying yourself first.
- Budget for financial obligations and recurring expenses
- Prioritize your financial goals
- Make all your transfers on payday