Feb 2018 – Net Worth

February’s update and we are now back on track for these posts.

Welcome to my net worth posts where I try to prove to myself and you that I wasn’t crazy for leaving work in the fall of 2017 to start my early retirement.   A few important notes:  we are mortgage free and our goal is have our income/investment gains exceed our spending on a 12 month rolling average (please note this metric is still under development).

Investments

Accounts

RRSP $64,010
LIRA $17,420
TFSA $92,420
Pension $171,630
Wife’s RRSP $91,480
Wife’s TFSA $88,060
Wife’s Taxable $46,190
High Interest Savings Account $39,220

Investment Net Worth $610,460 ($8,850 decrease over last month from investments)

Home Equity

Estimate $395,000

Income

To keep things simple I’m only going to track what income comes into our main ‘house’ chequing account.  I won’t be tracking my wife’s or my businesses income as those don’t really matter until the money moves over to the ‘house’ account. Also I won’t track investment gains since that is covered above.

  • Interest Income: $30
  • Wife’s Monthly Payment to House: $550
  • Child Tax: $310
  • Total Income: $890

Spending

Last Month $1570

Wow, that was a really low spending month which even included a trip to Saskatoon to visit some friends.  Also keep in mind we had a roof shingles replaced in 2017 which accounts for a lot of annual spending below.

Trailing Last 12 Month Average $3894 (or $46,738 for the last 12 months)

Results

Net Worth ~$1,005,460

Feb Investment Gains & Income/Spending Ratio = (-8890+890)/1570 = -5.1 (Target 1 or higher)

Sept to Feb Invest Gain & Income/Spending Ratio = (14557+7870)/17527 = 1.3

Just a note on the multiple month ratio I stripped out all income related to my old job from the early months to provide a more realistic picture for retirement.

Commentary:

So that is what a stock market correction feels like in retirement?  Mmm, well on the one hand it did suck to see almost $9k in investments vanish the good news is the long term plan is still fine.  Why? I don’t need to take any money out during the drop so it really just is a paper loss and not an issue for the moment.  This is also reflected in the results of the monthly ratio being horrible but the six month ratio is still fine.

So repeat after me: don’t panic!

Any questions?

(click to make bigger)