March 2017 Net Worth

The first quarter of 2017 can be described as nothing short of successful for us in our pursuit of financial independence. Though March didn’t close out as well as the first two months of the year, I can’t complain about how we’ve fared since the beginning of 2017. At a net worth improvement of $9,521 this month, I’m happy to say I was disappointed in that number. All things considered, a near five figure improvement in our net worth is real progress. On the other hand, it’s our lowest net worth growth since we started reporting it.

We set out to improve by an average of over $12k per month this year. While we didn’t hit that in March, we more than made up for it in January and February. In the month of March, we improved our net worth from -$106k to:

-$96,867

Since the start of the year, we have improved our NW just over $50,000 from a starting point of -$147k.

We continue to add to savings, so our debt reduction is more-or-less at a minimum again at just over $2,300. Market gains and slow-and-steady contributions resulted in our other gains throughout our various retirement accounts.

March was a challenging month in more ways than one. Surprise projects at work left little extra time to write and post like I had hoped. It also led to opportunities and changes that we’ll discuss in April. I’ll also be following up this monthly update with our first quarterly report, which will focus more on a discussion on our progress towards financial independence that’s more involved than just reporting changes in our account balances.

We continue toward our goal of buying a home of 2017 and also improving our net worth such that we’d have a positive NW by the end of the year when considering our down payment toward a home as an asset.

4 thoughts on “March 2017 Net Worth

  1. Why are there so many different loans?
    Have you looked into consolidating?
    Why are you investing? I would be concentrating 100% on reducing your liabilities. If there is a recession your investments go down but your debt will still be there. That’s a recipe for bankruptcy.

    Good luck

    1. Hi there One Dad.

      We have a high number of loans intentionally. We feel the advantages of keeping multiple loans far outweigh the benefits of consolidating. After graduating, we refinanced each of our loans individually to lower our rate as we much prefer a dozen small payments to one large one. The reason being is that it allows us the ability to pay off loans one at a time and increase our monthly cash flow. At the time of refinancing, the only benefit of consolidating would have been to move from multiple payments to one. With the ease of setting up auto-pay, that was hardly a reason. Having said all that, we realize there can be benefits to consolidating (improving repayment terms), which we’ll discuss in a post in the coming days actually.

      As for the decision to invest, we’ve discussed our strategy in our Prioritizing Debt vs. Investing post. We understand the argument some make to focus solely on debt reduction, but we’ve chosen what we think is a better path to reach our eventual goal. By taking advantage of pre-tax retirement accounts, we’re maximizing the use of our income. For example, I’m able to defer $18,000 into my employer 401k in 2017. If I were to instead use that money toward debt reduction, I’d be left with ~$12,000 after taxes. I’d rather add $18k in a total market index fund than pay down $12k of student loans at 3.5%. In addition, it aligns with our end goal of reaching financial independence. Our goal is not to be debt free. While it would be difficult to have the former without the latter, we are taking action that we think is best to expedite our path to FI.

      With regard to your concern of a recession, it’s not if it happens, but when it happens. We fully expect that at some point our investments will drop – significantly. Regardless of that fact, we believe this path is the best option for us to reach our end goal. Part of the debt repayment strategy described above (keeping multiple loans and gradually decreasing overall minimum payment) can help to minimize risk. We feel we have a sufficient cash flow to sustain our debt + investing strategy. If we didn’t, we’d certainly focus on debt reduction.

      I hope this answered your questions sufficiently. Thanks for stopping by.

  2. Great progress in the first quarter! That is very impressive! When you move towards actively paying off your debt do you plan to use the snowball method or attack highest rate loans first? I know most of your loans are relatively low rate. Good luck in Q2!

    1. Thanks Chelsea. We choose the highest rate. You may notice that our loan amounts posted above aren’t in ascending or descending order. They’re actually in descending interest rate order. When at the same interest rate, we list in ascending balance. So, Loan 1 above is the most important for us to pay off.

      Thanks for the well wishes!

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