Family Net Worth – Up 10% Since January Thanks To the Recent Market Rally

by Hank Coleman

elevatorThanks to the recent stock market rally, my family’s net worth is making a comeback.  We are up 10% since January 1st, 2009.  While that is not as good as the stock market’s approximate 50% rally since its March lows, I’ll take it and run with it all the way to the bank.  As you can see by the handy dandy bar chart on the lower right side of the blog, we are about half way to our yearly goal of increasing our net worth by 20% this year.

Here is a little bit of how the change in our net worth breaks down…

ROTH IRAs (up 63.4%) – I have two main mutual funds that we invest in for our Roth IRAs.  Unfortunately, these great funds that I really love took out big bets on famous names like Fannie Mae, Freddie Mac, Wachovia, and AIG.  The prospectus read like who’s who of the crash.  But, these great managers have since turned it around like I expected them to do.  Another thing that helped us…we kept buying shares even as the prices sunk further.  With dollar cost averaging, we kept buying shares of the mutual funds at unbelievable prices.

401-k Plan (up 61.2%) – My 401-k through my work is extremely boring.  It invests in nothing but index funds that follow the S&P 500 Index, Wilshire 5000, and other indices.  The investments may be boring, but at least the fees associated with them are extremely low.  Once again, my wife and I dollar cost averaged during the up and down swings in the market and kept buying shares of the index funds that make up our 401-k retirement plan.  I actually increased my investing by one percent of my paycheck (raised it from 7% to 8%) over the year after I paid off a stupid 401-k loan that we had taken out years ago.

You Need To Track Your Net Worth According to survey by the Consumer Federation of America (CFA) and the Financial Planning Association, less than 49% of Americans actually know their net worth.  Tracking your net worth lets you see where you are financially and how healthy your situation is.  Are you meeting your financial goals?  Are you headed in the right direction or sliding backwards?  Are you saving enough for retirement, college, etc.?

Why I Don’t Give Specific Numbers You may have noticed that I have only give you a percentage of increases here on the blog.  Call me crazy, but a part of me thinks that you don’t really want to hear how well or poorly my wife and I are doing financially.  I may be off base, but I don’t think you really want to hear the specifics.  Please let me know if I am out in left field on this subject.  But, then again, it might not matter.  My mom reads this blog (or at least she told me she did), and I don’t want to share too much with her either.  Another thing I always think about is that a lot of times we use money as a scorecard, as a gauge on how well we are doing with our neighbors.  I hate that because I’m not a gracious loser most days, and I will stay up at night if I think that I’m losing at the game of life and money.

I’d love to hear what you think or how you are doing with your own struggles with your net worth.  Please leave a comment on the blog.

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