| Value | % Change | |
|---|---|---|
| Assets | $745,000 | +0.4% |
| Liabilities | $360,000 | +0.7% |
| Net worth | $385,000 | +0.0% |
My Net Worth performance has become a lot more volatile of late in line with the share market. My share portfolio now comprises a significant portion of my assets and as such, swings in this portfolio often more than outweigh all the savings and investing effort that I put in. August 2013 represented my second worst performance ever although it was (thankfully) still in positive territory. I round the figures but my actual increase in net worth over the month was a whole $102!
This month was affected (in both a positive and negative sense) by more than just the share market and I will outline the major effects in more detail below. My target for the month was a net worth of $390,000 which I obviously missed by a significant amount. Some of the factors which affected my performance this month included
Positive Factors
- The allocation of my employee shares to my account
- When my ESP shares are allocated to my account I typically get the 15% step up associated with this (the discount that I get the shares at)
- However, at the same time I also account for the tax that I need to pay on this step up so the recorded gain is more like 8%
- This month I got allocated the shares and the share market started tanking almost straight away. I have held onto them in the hope that I can make more than the 15% like I have tried to do in previous months so the recorded gain is actually somewhat less than the 8% that I would expect
- I managed to save some cash into my home loan offset account
- When my investment property when positively geared I stopped savings as much into my offset account and started investing this money in shares instead
- In the last month I contributed more into my offset account for 2 reasons
- I am starting to think about buying my own house in the near term (next 1 - 2 years) so want to be more liquid
- On a net basis I haven't really paid down any of this loan since the start of the year
- I have saved more in a high interest savings account to 'smooth' my credit card bill
- Every second or third month I moan about how high my credit card bill is and how it has blown up my savings plans for the month. I have a new method to combat this
- When I actually spend on my credit card (not necessarily when it's due) I transfer some of this from my transaction account so that I have a block of funds to pay this amount back when it falls due
- This means that in months where I have a low credit card bill I typically have lower savings in this high interest account and in months where I have a high bill I have higher savings
Negative factors
- A rather bad performance in my share portfolio
- After the stellar month I had in my share portfolio last month I was not surprised to see it pull back somewhat however the instability in the Middle East and other factors have combined to see the value of my portfolio drop by ~4 - 5%
- After adding in the benefit of my employee share plan (outlined above) as well as my regular contributions to this plan the value of my share portfolio fell 1.5% over the month
- A higher credit card bill driven by large annual expenses
- My home loan insurance bill and my car registration fell due this month. The combined value of these was $1,500 - both were placed on my credit card which has caused my bill to nearly double when compared to last month
- Further the repayment of last month's rather large bill meant that I had less money to save
- For a more in depth look at this see my expenditure tracker for the month
As mentioned above, I did not hit my net worth target for the month. Given my overall net worth did not move significantly over the month I am going to have the same target for the coming month - i.e. my Net Worth target for September 2013 is $390,000. I know it is just a number but psychologically I really want to cross the $400,000 mark before the end of the year.
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