Wednesday, May 16, 2007

net worth update may, 2007

NET WORTH - One Year Results (Year Over Year):

Net worth change = +109%
Total asset change = +21%
Total Liability change = -5%

House Value / Total Assets - 2006 May = 83%.....2007 May = 77%

Debt/Asset* Ratio - 2006 May = 0.77........... 2007 May = 0.60

*Reader kindly pointed out it is actually asset not equity.

I am very pleased with our results this year, and I look forward to continuing on the path we are on. We are growing our assets at a phenomenal rate, and slowly shedding liabilities along the way. The less of our total assets that the house accounts for the better, and we have reduced this from 83% to 77%, which is great given the appreciation of our home during the year.

6 comments:

Anonymous said...

21% ROA, does that include any additions of equity from, say, employment, inheritances, etc.?

What was your underling ROA once you subtract non-investment returns?

Anonymous said...

21% is listed as total change in assets, not return on assets, so I suspect it does include addition of equity

clearly he is tracking change in net worth - so change in assets minus change in liabilities is what he is looking at

FinancialJungle.com said...

(Off-topic. Please delete)

investor99, are you planning to support RSS feed? I subscribe to personal finance blogs so I can quickly scan for new posts.

bakeapples said...

Why the obsession with driving your Debt/Asset Ratio as low as possible?

Before giving the "debt is bad, don't have debt children, m'kay" lecture please let me say that without a mortgage, most people would never own a home and building wealth would be difficult. Mortgages are typically the only good debt people will have as it allows them leverage.

I don't have a problem with killing higher rate debt, typically in this low prime environment credit cards, LOCs, student & car loans. However, all debt should not be painted with the same brush. Having some good debt will help you create wealth and reach your financial goals.

moneygardener (AKA investor99) said...

Change in assets, is not my ROA. The additional of funds from savings is a major way that I grow my assets every day, combined with market movement in real estate and equities.

ROA would be an interesting, yet time consuming calculation that I might complete at a later date.

Jungle,
Email me at akl99@rogers.com and let me know how to sign up for RSS.

baked,

While I wouldn't call it an obsession, I am trying to lower my D/A ratio. I understand that debt is not always negative. I am actually only paying the minimum on my mortgage, which I believe is wise at my 4.5% fixed rate. The D/A is just basically a measure of asset growth with small liability reduction thrown in. If interest rates changed, I might want to switch my emphasis toward liability reduction, however I would still want to see my progress. Net worth is the real driver here, and always will be.

Thanks to all for the great comments!

Canadian Dream said...

Re the feed. Blogger has a default feed built into every blog see the very bottom of the page called Atom. Depending on your reader you should be able to add the feed. I know in Google Reader you can do it based on URL.

CD