This is my first net-worth updates report for the year 2017. For those new to my finance journey, net worth update is a simple report I post every month which tracks the progress of my journey to reach my financial goals.
My ultimate financial goal is to become a self-made millionaire by December 2024 (10 year plan) by saving and investing in stable dividend paying blue-chip companies.
I am posting all my financial information in this website because I love to inspire and motivate people to start their own journey to reach their financial freedom.
You could learn from my successes and failures (experience) and improve your financial IQ.
Along the way, I make financial mistakes and will share my experience here with you. So, you could learn something, avoid those mistakes and save money.
Also, I like to publicly track my progress and get valuable advice from like-minded people.
In January 2017, my net worth increased by $5900 (+3.78%), mainly due to the price adjustment of our home.
Every January, I adjust my home value with average inflation rate of 2%. Thus, I’ve increased my home by $5000.
As many of you know, Canadian housing market is very hot topic in the recent years. The home prices are extremely high.
There are very high demands for small homes in our area. We could easily sell our home for few hundreds thousands more than our purchase price. But, I have no idea to sell because we need somewhere to live.
I feel Canadian housing prices are too high because of supply – demand problem. There is more demand than supply.
For my understanding, home price in a city/area will depend on three factors – population growth, inflation rate and wage growth.
Certainly there are population growths in major Canadian cities, but it is not a double digit growth; and, inflation rate and wage growth are not too high either.
Home prices may cool down in the coming months or years, may be it is not going to happen any time soon. I really don’t know. So, I like to maintain very conservative approach with our home value (adjust with average inflation rate).
My investment assets performed well first three weeks of January and increased over $4000, and dropped over $3200 in last two or three trading days due to new U.S immigration policy announcements. 😀 .
It is the nature of stock market investment. Stock market is very sensitive and it move ups and downs with positive and negative news. If you are new to the investment world, then you should need to learn to live with it.
Now let’s talk about my net worth and financial numbers in January
Last month, my net worth increased by $5900 or +3.78 from my last update.
Net worth update as of January 31, 2017 ()
Assets:$484 700()
- Cash: $1100 ()
- Home: $275 000 () – Yearly adjustment with average inflation rate of 2%
- Canadian Stocks: : $160 400 ( )
- U.S. Stocks:$38 300 ()
- Employer’s Pension Plan: $9900()
Liabilities:$322 900 ()
- Mortgage :$183 000 ()
- Student loan: $24 200 ()
- Margin loan:$66 800 ()
- Credit card 1:$8400 () (low interest credit card – 0.99% special rate for 10 months – will be expired in September 2017)
- Credit card 2:$9000 () (low interest credit card – 0.99% special rate for 12 months – will be expired in March 2017)
- Credit card 3:$0 (paid-off)
- Line of Credit 4: $9000 ()(low interest balance transfer – 2.99% special rate for 12 months – will be expired in May 2017)
- Credit card 5: $3000 () – (low interest credit card – 1.99% special rate for 10 months – will be expired in November 2017)
- Credit card 6:$300() – (regular expenses)- high interest rate of 19.99%.
- Line of Credit 1 :$11 300 () – (low interest credit card – 2.99% special rate for 12 months – will be expired in April 2017)
- HELOC:$7900 () – (low interest of 3.30% – primte + 0.5%)
Net worth : $161 800 () as of January 31, 2017
My net worth up by since my last update.
Note
- all amounts are rounded to the nearest $100;
- all numbers are in CAD; and
- Conversion rate 1.00 USD = 1.31 CAD
I have a huge credit card debts because I take advantage of low balance transfer promotion rate and invest in high quality dividend stocks. Learn, earn, save,invest and leverage your skills are the keys to become wealth.
Thank you so much for being in my finance journey and for your support.
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Do you ever sell naked puts to collect the premium while waiting for some of your blue chip stocks to come down to the price you want to pay for them? Also, I noticed a lot of your low interest credit card debt expires this month. What is your plan to pay those off?
Hello CE,
Thank you for stopping by,
I don’t do any option trading. I may consider do it in the future.
Regarding credit cards expire dates – I already get new offers from same credit cards. I could easily re-finance them for low rate for another 10 to 12 months 🙂 . If I hadn’t received new offers, I will use my HELOC to pay them.
Cheers,
Hi there,
Really enjoy your site! It’s exciting to watch and see how things are progressing for you. I do have a question . When you get your dividends, do you take the cash and use it to buy more shares right away, or have you set up automatic payment plans, or automatic dividends re-investment? I’m just wondering how much new cash you insert each month, or if you just rely on the dividends to grow your portfolio?
Thanks! Keep it up.
Mark
Hello Mark,
Thank you for stopping by,
I collect my dividends as cash, and when I have sufficient fund, I buy more shares. Automatic payment plans and DRIPs are great way to build wealth, but I like to control my investment decision.
And, I don’t add fixed amount of new cash each month. If I find a great company at a discount price, I buy using dividends, new cash from my saving, and if I don’t have enough money, then I use margin loan. Please note that leverage investing is very risky and it is not suitable for all investors.
I hope I answered your questions,
Best Regards,
Good job making progress toward your goal by December 2024 or even earlier. I’ll watch your net worth report every now and then and it’s really motivating on our finance journey to financial freedom. I, too, also track our net worth monthly to keep me accountable. Good luck to you!
Hello Tim,
Thank you for stopping by,
I am glad to see that my net worth report adding value in someone life. If someone has idea about financial freedom, then they should track their net worth at-least once a year- monthly tracking is much better.
Cheers,
Hi FJ
I am following your blog for more then a year and as I said in some of my posts, you are an inspiration for many people. Indeed there are so many people who do not understand the financial area and even if you are trying hard to show them the simple fact about the saving they can not take it. Even sometimes they put a bad tag on you… my advice, if somebody do not show interest in investing/financial freedom after first discussion do not bother to open the subject anymore.
Your goals are achievable, even you can do better but, in my opinion, there are a few points everybody following such path should take in consideration:
-a big part of your worth increase is based on leveraging on borrowing money to a small rate and investing in stock for a better return. If the interest will rise and the market will do a correction you might be in a situation where your plan might not work too well. Make sure that you have an unused line of credit (HELOC better) or other source to use it in case that is required.
-the best way to increase your saved worth is to save more. As you said, nobody wants to trade the today’s life for the future, so the best way to increase the saving is to focus on career and get a better job (I tell this from my personal experience). Doesn’t matter how pleasant is a job, when you will earn more money for the same effort you will appreciate it.
-try and get the best possible from using the TFSA, RRSP and other investing accounts. Try to pay as less taxes possible (in a legal limit).
-try and get the most from this blog…. maybe a separate forum tab where people can discuss some topics, analyze stocks, opinions….
Here are a few question for all people following this blog:
How do you chose a stock? Do you look for technical, fundamental or both analyses? Do you calculate the intrinsic value of the stock? What method do you use? What do you buy in order to protect for a crash? Bonds, preferred shares, gold, ETFs..?
Cris
Hello Cris,
Thank you for your valuable comments, really appreciated!
I am trying inspire people who are making similar income like me and having hard time to deal with their financial needs. I was in their shoe before (before 2012) and made some right decision to reach where I am today. I am more than happy if I could reach one or two people and change their life in a positive direction. We all born in this world to help each others. I really wanted to help people without expecting any returns from them. If they take it, I am happy. If they don’t, I will move to other person.
Re my debts – I have good backup plan for debts. As you said, I have HELOC and other line of credit with low interest rate.
Re my income – Currently I am accepting some mini projects at my work for little extra pay. Hopefully, I will some increment this year.
How do I chose a stock – First I select dividend stocks with solid fundamentals, then do some reach and find the best entry point to accumulate a stocks. Then I patiently wait for the right time to buy the stock. I build my portfolio with high quality stocks and really hope it could handle well during a market crash.
Best Regards,
I’m really enjoying following your financial journey and seeing your net worth increase steadily. I see that you annually adjust the value of your townhouse using the inflation rate (currently 2%). I’m curious why you don’t use the propert assessment value calculated by your municipality. Wouldn’t that be a more accurate measure of the current value of your property if you were to sell your home today? For example, this year my propert assessment value went up by 38%. Using the inflation rate would significantly undervalue my house (I live in Greater Vancouver and property values seem to increase over 10% yearly).
Hello Rickpsguy,
Thank you for stopping by,
I also receive a property assessment value for my home. It was unrealistically pretty high (over 18%). I like to go with the inflation rate calculation in order to avoid any unpleasant surprise my net-worth 😀 .
To be honest, I feel home prices in our area are way too higher than actual values. It will correct sometimes near future as stock markets do. I could be wrong..
Best Regards,
Thanks for sharing… the mere fact that you’re keeping yourself accountable by posting this update monthly will help you take control of your finances.
As far as using credit cards to fund investments, it’s not something I would do. However, it sounds like you’re doing it with great care and control. Just be careful when those “bait” rates reset.
Take care!
Hello FerdiS,
Thank you for stopping by,
Thank you for your suggestion regarding my credit cards debts. Leverage investing is not suitable for all investors, in fact, there are great risks involved. I have a great control on my debts. I always have a backup plan to pay them off if I don’t receive another promotion offer.
Cheers,
I really like it that you set yourself a goal to become a millionaire one day. However, considering that it is 2017 by mow, that only leaves you with 8 years to achieve that goal. Based on your current net worth of 161,000 that would require a yearly return of 26% for the next 8 years.
It would seem like that kind of goal might be counterproductive, as it sets you up for failure. Wouldnt it be much more useful to set your goal at a point that is actually achieveable and might assume a 7% return for example.
That would leave you room to beat your goal but a 26% yearly return for 8 years straight, after taxes, fees and interest, is all but impossible.
Without updating that 10 year plan, I would expect you to fall further behind your goal with each passing year, which means there is not muvh to be gained from having it as a plan in the first place.
I would love to see an updated version of your plan based on your current net worth to see what you think you could realistically achieve with your portfolio in the future.
Hello Andre,
Thank you for stopping by and your suggestion regarding my goal setting.
I have broken-down my long-term goal to mini-goals (yearly basis). When I reach my short-term goals, then I will be one step closure to my ultimate goal.
I really wanted to set this goal because it will really help and motivate me to earn more & save more. The 7% return is from stock market alone, but I will have new capital from my saving too. So, I really hope that I will achieve my ultimate goal of one million dollar net worth by December 2024.
Cheers,