It isn’t quite the end of the year but it is close enough that I am going to make this my end of the year net worth update. This is my first net worth update since last year. I’ll probably continue to just update my net worth once a year unless something happens to significantly affect my net worth during the year.
2018 Year End Net Worth
Assets
- Cash – $4017
- Stocks – $2162
- Misc – $174
- Solo 401k – $3778
- Trad IRA- $37,918
- 401k – $10,552
- Roth IRA – $1609
- Property – $1000
Liabilities
- Student Loan – $121,003
- Credit Card – $7200
My total assets of $61,210 minus my liabilities of $128,203 results in a year-end net worth of -$66,993. I managed to improve my net worth by a little over $4000 this year.
That is a poor result considering I added $6500 to my IRA and a little over $12,000 to my 401k accounts. The stock market decline resulted in a large portion of this year’s contributions disappearing.
The student loan continues to be a drag on my net worth. Although I paid several thousand dollars on the student loan this year it wasn’t enough to keep up with the interest. The loan accrues over $500 a month in interest which makes it impossible for me to make progress on paying down the loan. Unless my income at least doubles I am not going to be able to pay off the student loan.
I made another mistake of taking a 0% balance transfer on one of my credit cards. I used the money to top off my IRA contribution for the year and invest in some individual stocks. The market decline erased almost all of the money I contributed from the transfer. Nonetheless, the credit card still needs to be paid off before next November. Lesson learned – do not use debt to invest. Actually, I’m going to take that lesson a bit further and state that I will not take on any new debts at all. The only possible exception would be a mortgage and I don’t foresee that happening in the near future.
This year’s results were rather disappointing. The increase in my net worth did not reflect my high saving rate. Looking at the bright side, I now own more shares of the stocks and funds I invested in this year than I did last year so if the stock market rebounds next year my net worth should get a nice boost.
How did your net worth do this year?
What all would you consider property? Would an automobile classify as property?
Property is personal property which does include my car. I don’t own any real property. I’m estimating the value of my property very conservatively. My car is worth more than $1000 by itself. Everything else I own isn’t worth much. I estimate the property value low since I’m guessing what I could get if I had to sell everything quickly in an emergency situation.
Did you evaluate converting the Traditional IRA to Roth?
I probably could have converted some of the traditional IRA to a Roth. For this year, I’d rather have the IRA deduction. I expect my income will be low enough in retirement to allow me to convert some of my traditional IRA then or to just take distributions tax-free.