I’m a huge numbers nerd and I love reading net worth updates. If you’re unfamiliar with net worth updates, they are a popular feature among personal finance or FIRE (Financial Independence Retire Early) bloggers. Each month or quarter the blogger will essentially get financially naked and reveal the specific details of their net worth (all their assets minus all their liabilities).
They’ll usually compare it to the previous month’s numbers and explain any unusual discrepancies that might appear. If you aren’t a numbers nerd, I can see your eyes glossing over already.
They’re actually my guilty pleasure. It’s a bit like being a financial voyeur. You get a front row seat to watch others reach goals and cross milestones. It’s akin to watching The Biggest Loser when you yourself are trying to lose weight. You celebrate their success and commiserate in their setbacks. All the while you are being fueled to succeed in your own journey.
My Net Worth
Despite the hypocrisy in it, I won’t be starting my own series of net worth updates. There are a whole host of reasons for this, but the 2 biggest excuses reasons are, first and foremost, I’m not sure a monthly net worth update fits with the premise of this blog.
Second, while this blog is currently anonymous, that anonymity won’t last forever. Eventually our family and friends will find out and then co-workers. I ultimately don’t want people to see or treat us differently.
I reserve the right to change my mind on this in the future, but as of right now, I just can’t bring myself to publish our current net worth.
Time Machine – Set Course for 2009
That doesn’t stop me from getting in the net worth time machine and giving you a glimpse into the past.
In financial news: the housing market was continuing to bottom out, as was the US stock market.
Personally I had ticked all the boxes of the things I was supposed to have done as an adult.
Get a “real job”…check
Buy your first home…check
Have a kid…check
I loved every minute of it. The wife, the new baby, building equity instead of paying rent: it was great. But it wasn’t all bunnies and rainbows. While I wouldn’t start tracking my net worth for another 7 years (I started thanks to J$), I was aware enough of our financial situation that I can give you a glimpse into what we were facing.
I knew our net worth was on the wrong side of zero. In my Debt Merry Go Round post, I provided a general overview of the total debt we’d taken on over a five-year stretch. However, I noted that we didn’t carry all that debt at one time. Well, 2009 represents the financial low point for our net worth.
We had ignorantly bought our house right as the housing market was crashing in 2007. To add insult onto idiocy we not only took out a first mortgage, we had also added a second mortgage. After starting a new job in late 2008, a job that provided little to no income for the first few months, I thought it would be a good time to finance a car.
1st Mortgage – $195,000
2nd Mortgage – $18,000
Car Loan – $11,000
Student Loans – $87,000
Total Debts – $311,000
Believe it or not, we had made some pretty good financial decisions as well: paying off close to $30,000 in credit card debt in 2007 and paying off my wife’s car loan of $10,000 in 2008. But I certainly wasn’t feeling too good about things with over $300k in debt to my name.
Maybe the assets would help offset this bleak picture. Unfortunately due to the housing crash and subsequent stock market plunge, our assets weren’t looking good either.
House – 2 years after buying it for $245,000 it was appraised at $167,000. Which was all the more painful since we still owed $213,000 for it.
My 401k – $5,000 (with the market crash, so did my already paltry 401k value).
Wife’s 401k – $8,000
Brokerage Account and other savings – $3,000
Total Assets – $183,000
This put our net worth at $128,000 below zero. Ouch.
Fortunately things moved in the right direction after that. We didn’t take on any more debt and began to slowly claw our way back to the right side of zero. Time to hop in the TARDIS and return to present day. Thanks for traveling through time with me!
Let me know if you liked this trip down memory lane? If so, I might get back into the net worth time machine and revisit another point in our net worth journey. Anyone else brave enough to share their net worth low point, I’d love to hear from you below!