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Net Worth Report - End of 06/06

June was a fun month. The first two weeks brought a worldwide drop in equity markets. The losses were more-or-less steady in the United States, but sudden and sharp in many other markets. The last two weeks generally brought recovery.

In addition to the end-of-month calculation, I also rolled up my net worth on June 13th, the bottom of the market. This was an easy bottom to call and my only regret is that I didn't have more cash to invest at the time. I was illiquid due to a CD that unfortunately didn't mature until the end of the month. Curse those two weeks! I'm much more liquid now and will be watching for the next dip.

I was holding the CD as part of my credit card arbitrage strategy, and this was the cause of my liquidity crunch. You may recall that I recently had to pay off one credit card because I wasn't able to secure another 0% balance transfer. That CD held enough money to pay off the balance, but didn't mature until slightly after I had to pay off the card. I knew about the possibility of the liquidity crunch when I opened the CD, but decided to risk it. In hindsight I shouldn't have opened the CD at all, both because of liquidity and also because money market accounts turned out to offer higher yields for most of the period.

By this point you're probably wondering where the numbers are, right? Okay…

Net Worth Figures
Category05/0606/06
Total$439,321.99$446,227.17
Short-term$17,077.73$15,994.62
Medium-term$95,603.98$98,503.80
Retirement$150,881.38$150,116.64
Property$175,758.90$181,612.11

At the bottom of the market, I was down to $424,221.48. In the first two weeks of the month I lost $15,000, and in the last two weeks I made $22,000. Volatility is fun.

Recall that I'm defining "Adjusted Net Worth" as net worth excluding the value of autos and unvested stock. The "Estimated Contribution" is how much money I believe I'll need to invest in order to meet the following month's ANW target. A declining EC indicates that I'm ahead of plan, and an increasing EC indicates that I need to save more in order to reach my long-term goal.

Goal-Tracking Figures
Item05/0606/06
Adjusted Net Worth$404,501.19$410,882.92
Next Month's Target$406,814.01$413,615.26
Estimated Contribution$388.80$368.22

My credit card balances are 100% backed by time deposits and/or savings accounts earning interest at a higher rate than I'm being charged by the credit card companies. The monthly payment is estimated as 2% of the balance. (Most credit cards are now using a 2% minimum payment, and due to this it is important to have a strong cash flow and/or pay with funds from your credit card arbitrage savings account.)

Credit Card Arbitrage Figures
Item05/0606/06
Balances @ 0% APR$31,934.98$31,768.11
Balances @ 1.9% APR$19.69$0.00
Total Balances$31,954.67$31,768.11
Monthly Payment$639.09$635.36

You can keep track of other personal finance bloggers at NetWorthIQ. I've updated my entry there.

Tiny Island