Net Worth 2015-06

Total Net Worth in June: $303,529.  (-$5,057)

Ok, so its clear I cant be accused of beginning this blog on a high note.

June was an expensive month.  My wife graduated from school and had friends and family in from out of town to visit. So we spent a lot more than we would have.

In addition our rental property switched tenants.  So we spent some money on getting the place ready for the next tenant.  Items included painting the whole unit, a new dryer, a new refrigerator (unexpectedly stopped worked), pest control, we took out some old carpeting and installed some wood laminate in one of the rooms.  In addition we replaced a half dozen windows.

Assets: (+0)

Going forward I am going to assume the houses at conservative values.  Honestly I have one listed near the purchase price and another at an overly conservative value.  I dont think that I will update housing values very often (if ever).

Our vehicles are both paid for, and every few months I will update the KBB value on both. Vehicle 2 was added to the net worth calculation this year.  We always had it, but I just recently took the time to look up the value.

Net Cash Accounts: (-$3,021)

This section contains the balances of all of our cash accounts outside of our rental property.  Emergency funds, banking, savings accounts, HSA, FSA and credit cards. (we do not include escrow balances in our net worth) We pay the credit cards off in full every month, but the mid month balance will have an impact on this section.

As I said we spent a lot of money this month in order to celebrate my wife’s graduation.  In addition we had some family (kids) who came to visit for a couple of weeks and we spoiled them with concerts, nice meals, cloths etc.  Next month we will tighten the belt a lot.

Net Cash Rental Accounts: (-$1,731)

In this grouping we have a rental checking account, a savings account for emergencies and big ticket items, liabilities booked for the return of damage deposits.  Additionally, in this group we have a credit card for rental expenses that is paid off in full every month.

As I mentioned, this was a tough month for the rental.  We spent money on maintenance getting one of our units turned over for the next tenant and our reserves are a lot lower than I would like them to be.

Hopefully we will get a chance to build a respectable cushion over the next few months.

Retirement accounts: (-$1,087)

Nothing much to say here, we took a small hit on most of our accounts.  In the future I will lay out our view on investing.  In general we aren’t super active with trades or exchanges.  However I didnt like the overall market setup and we moved a month or so ago into a little larger cash position in our 401K and main IRA.  (25-30% in one, and about 15% cash in the other.)  Nothing drastic, but just a little more in cash that we will look to get back into the market over the next few months (if there is a sell-off).

Liabilities: (+783)

This is about the norm every month.  I may book two payments in one month, and none in the other.  But the pay-down from regular payments will be about $800/month over the course of the year.

Just a note, every one of these four loans is tied to one of our two properties.  The 401K loan was done last year to help get into our second property.  We have begun to pay it down early, and with our new income, I anticipate us becoming very aggressive about paying off this loan..

Thanks for reading, hope to hear some feedback.


3 thoughts on “Net Worth 2015-06

  1. Wow that sounds like an expensive tenant turnover. I just had to replace a range in one of my rentals and added a new fence in another so im right there with you. Not sure what my July Net Worth update is going to look like yet but hopefully its not too bad!


  2. @Cashflowdiaries, thanks for stopping by.

    I may have mentioned it elsewhere, but our property was built in the 20’s with a lot of character. Its in a trendy neighborhood for young millennials and the rents are going up really fast.

    We bought the place about two years ago, and part of our rental strategy is to over time invest and upgrade our place so that we can continue to select top tenants.

    Much of our costs were one time items. We pulled out some nasty carpeting and replaced it with some nice laminate flooring in a study. We repainted the whole unit from yellow to a nice light gray. We replaced a dryer that died, an old one (probably 25-30 years old). We had a refrigerator that died as well. (it also was old and needed to be replaced). We replaced a few windows as well that were leaking and were a safety hazard as they didn’t allow for proper exit from the bedrooms..

    We paid a fee to my real estate agent for letting the property and then we had the usual things, locks, maid service, pest control etc.

    So my point is most of our expenses were one time things that really were deferred maintenance items. I wouldnt anticipate having to do as much in the future for our next turn.

    I think the biggest thing I have learned about the rentals, is that the first couple of years after buying a place, you will likely have deferred maintenance items. Especially if you want to keep the place in a condition that attracts top tenants.

    Liked by 1 person

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s