First Net Worth Update!
We reached another milestone! This moment has been a long time coming. The day where we begin sharing our monthly net worth status. I know there are those that are critical of the idea, or perhaps have negative feelings causing them to think we’re bragging. That’s not my intention.
I do want to state that there is no reason why I shouldn’t be proud of our situation. We’ve had a long journey to get to where we are today. We definitely didn’t do it alone. We can’t thank our families enough for what they have done. There are 100 ways we can improve ourselves daily! Sharing this today is our attempt to improve our personal finances through accountability. With that said please enjoy the following post!
Before I forget, this is just a single month snapshot of our net worth. The idea is to compare this snapshot to those coming in the future. We have already started a page for those of you who wish to follow it, that shares not only this months net worth, but also 3 snapshots of our history. Mostly my own. If you want to see this summary of our net worth you’re in for a treat. It wasn’t always happy times just to be clear.
Over the years, I’ve used many types of programs to help me track budgets, net worth, and investments. About one year and half ago I started using personalcapital.com to track our net worth. I really like their interface and for people with more money than we have, they even provide consultation on investment portfolios. But, there are still a number of things you can do with them for free. One of my favorite things is their retirement planner. But that’s a topic for another time. I had intended on using this program to do these updates, but we have one small problem. Not so much a problem as it is an inconvenience.
I have to update most of our accounts manually.
They have automatic syncing with accounts, but whereas most our accounts are in Italy, we don’t have the fortune of it painting an accurate picture. But we can get close
Here we have an example of their main dashboard and you can see on the left our Net Worth and categorized account positions.
When compared to a manual accounting of our net worth for May 2017 you can see we’re only a about one-thousand off. Still I’m trying to get as close as possible, so better we stick to the manual numbers for now.
You’ll notice I also included the cash flow for the period. You may also note that we spent over $4,400 more than we earned for the month. Let me just say that there is an explanation. Let’s break down the categories.
Right now, we are living on one income. That of my wife’s. When she’s not on maternity leave, she works hard at a bank everyday, and then comes home to three kids (including myself) doing all the things mother’s do. And might I add, does it fantastically!
Previously, I had been playing the part of stay-at-home dad. Now, since September of 2016 I have worked on personal business ventures and project remodel that will prove to pay us back overtime. So what’s the big difference between this month and last month’s income?
Like I said, I’m tracking EVERYTHING. Including reimbursements, gifts, and other incomes that we receive. In April we were paid back for some of the expenses we made on behalf of my in-laws. In addition to multiple rental payments for my townhouse in Idaho. So May 2017 is almost a reflection of our regular monthly net income.
We tend to spend a lot on food, because for my wife especially, eating healthy is important. A 26% drop in our monthly budget is a result of staying half the month with in-laws. Shared expenses. Typically we are incredibly frugal regarding eating out. But being on the move all month we saw an increase in our gluttony. Fortunately we had shared groceries to offset the increase.
49% increase in shopping? Isn’t there a rule you have to buy things on vacation? If it’s not, don’t tell us. You’ll spoil our fun!
This category needs a little work. 100% decrease of expenses. I made some adjustments to the categories in May, and I believe April still reflects my mortgage payments on my townhouse. Here in Italy we have no rent, no mortgage. Truly blessed! Apparently in May we were also fortunate enough to not pay any utility bills! Haha. Don’t worry we’ll make up for it next month.
Transportation up over 400%… ouch! The cause? Traveling to South Italy for the third time! Driving 9 hours ought to do it. Check out our trip to visit Apulia from two years ago! In addition to all our mini trips while we’re here. In a moment you’ll see why we wanted to drive a bit more this month.
Here we are. A 96% decrease! Great! Last month we bought a new-to-us car. We love it! We were going for spacious. If you know anything about euro-cars… that doesn’t really exist! Not at our price range anyway. In reality our spending is back to normal this month… nothing special…
Life & Entertainment
28% increase in this category is due to our vacation. We bought swim gear! In true Italian fashion, I even went out and bought a speedo… don’t judge me! Life & Entertainment will often be a source for a small amount of our reimbursements as well.
I should probably merge this section with the one above it. We typically spend very little monthly here. $10/month for my cell phone and $13/month for my wife’s. Every other month an internet bill roles by. This month it was a bit higher because I changed contracts just a few days ago. I had to pay to set it all up, but it’s worth it.
Old Service = 10 euro/month – 3 Gb data – 1000 minutes – 1000 sms.
New Service 7 euro/month – 17 Gb data – 1000 minutes – 0 sms.
And who really uses sms anymore… Even if the service is poor, it can’t be any worse than what I already had. And I save $3/month. Though it will take 6 months to break even due to activation fees. Still beats the pants off any U.S. contract – Did I mention all this with no contract? I could stop paying next month, no consequences.
$35 spent here. Doesn’t so terrible, until you realize it could have been money saved by paying off that credit card! Here in Italy most (not sure if all of them are this way) credit cards affiliated with banks automatically draft the balance from your account every month, therefore never charging you interest. Guess the card companies don’t want that extra interest from lazy people like me. After June 23rd I intend to pay off this balance. So hopefully we can keep this as close to 0 as possible.
Like I said previously, there is a reason for the poor cash flow for the month. It can all be traced back to Investments. Robert Kiyosaki teaches to use our hard-earned money to purchase things that will earn us more money. This is what we are doing here in Italy. We’re also trying to help others to do the same! This month it was for my in-laws. We’ve meshed our accounts a little bit, but many of the purchases tracked here in Investments are for their property. Cash previously saved that is now counting against our cash flow. This is one of the main reasons, I believe, that businesses track finances in quarters of a year. One month you’re up another you are down. Hopefully over a longer term you can show a positive cash-flow.
Going back to Personal Capital’s dashboard we get a glimpse of some other changes. Although it is displayed numerically, the graph depicts a change of perspective. Accountability at its best. For years now, I’ve wanted to believe my property in Idaho was worth what I paid for it. That I would hold it until it was at least what I paid for it. Well, that was almost 10 years ago.
Time to grow up. The big dip you see is my commitment to tracking our actual net worth. It was hard, but I dropped the value of the townhouse from $180,000 to $165,000. It was hard, but it had to be done. And now it is etched in virtual stone!
Not sure why the extreme expenses in April, but for May I’m glad to say that those 15 euro’s are actually a loan to someone else. And will be on our updates for the rest of the year. Sad story here. My brother-in-law wanted a new phone and he was sold an iPhone 5 for a 15/month contract. He didn’t have a credit card, so we are covering it for him.
Well, maybe you can guess what happened…. After a few months of use, he dropped his phone in the toilet!
Abracadabra! And that kids, is how you turn a phone into a brick!
Feel bad for the guy. Now he’s back to his old phone while still paying for his new contract.
Maybe to some this isn’t the most exciting topic, but where it gets really exciting is seeing progress. Sign up at the bottom of the page to receive emails of our future net worth in coming months. We plan to keep this tradition for years to come! And if you have stories, ideas, or questions, feel free to comment or contact us directly through social media channels. We’re even conducting a few polls right now on facebook and on twitter! Please share your thoughts!
Till next time!