Net Worth Update Oct 2020

As you know, we are planning to achieve F.I.R.E in 2028, and part of reaching that goal is tracking not only our spending but our net worth. We want to share our progress with you.

What is Net Worth and why is it important?

Here’s an excerpt from Wikipedia:

For individuals, net worth or wealth refers to an individual’s net economic position, the value of the individual’s assets minus liabilities. Examples of assets that an individual would factor into their net worth include retirement accounts, other investments, home(s), and vehicles. Liabilities include both secured debt (such as a home mortgage) and unsecured debt (such as consumer debt or personal loans). Typically intangible assets such as educational degrees are not factored into net worth, even though such assets positively contribute to one’s overall financial position.

Let’s examine October’s 2020 Net Worth:

Assets: 1,347,228

Principal residence	860,000
Condo overseas	137,500
Pension	34,054
Investments (RRSP, TFSA, foreign)	171,323
Smith Manoeuvre	144,351

 

Liabilities: 737,711

Principal residence	617,359
Condo overseas	100,544
Car	19,808

 

Net Worth: 609,517

 

Our net worth has increased by 0.20% over September 2020. Due to the market fluctuation over the past several weeks, our investment went up and down like a rollercoaster! At the end of the month, we came out slightly ahead with 0.20% growth in Net Worth. However, through the ups and downs, we kept adding money to our accounts (around $3,000). A few considerations since we started tracking our updates (first update in July 2020):

• Assets return increased by 0.53%
• Liabilities decreased by 0.22%
• Net worth increased by 1.45%
• Smith Manoeuvre is up 16.74%
• The Total Investment portfolio is down 7.32%

Our strategy for financial independence remains the same: keep investing in dividend-paying stocks and ETFs.

Before we show you the 2020 Summary, there has been a discussion on Twitter if it is worth to post Net Worth Updates. Thanks, My Own Advisor for starting it.

We completely understand that Net Worth Updates don’t show the complete picture. At the end of the day, what really matters is the cash flow in your bank account. Having said that, the way we see it is one more way to share our journey to financial independence, and definitely not to brag about it. We thought this would be beneficial for the FIRE community, especially for newbies like us. But we might be wrong 🙂 Either way, here’s the 2020 Summary to the end of October.

2020 Summary

Principal Residence

Currently, we are living in Toronto, a rather expensive city! But that high cost of living also means that our house has appreciated over the past few years quite a bit. Our home was purchased in 2016 for $615,000 but was recently valued in 2020 at $860,000.

Condo overseas

Last year we bought a condo in Brazil (still under development…but it will be ready in early 2021!) as an investment property. This price was paid in Reais (Brazil’s currency) but we have converted this to Canadian dollars to keep things simple.

Pension

Kristine works for the municipal government and we are using the same number every month based on her best five years.

Investments

This is the total of our investments in both of our RRSPs and TFSA’s, our margin accounts, and Gean’s investments overseas. We are 100% invested in equities (dividend and growth stocks) and ETFs.

Smith Manoeuvre

Since renewing our mortgage, we are using the HELOC (Home Equity Line of Credit) to invest in dividend-paying stocks (100% Canadian stocks).