March Net Worth: Down $28k

Sheesh! It's no wonder I've been putting off this post. I'm a week late posting this and as a result, our financial picture is slightly better because of the delay. The 3-day rally on Wall Street helped to recover some of the killer losses in our investment portfolio.

Real Estate Values are More Accurate
In terms of valuing our real estate, I've abandoned Zillow altogether in favor of a more localized calculation based on neighborhood comps sold in the last couple of months. I'll outline my methods in the next post. I adjusted last month's RE values to align with my current valuation approach.

Chipping Away at Debt
On the bright side (something we CAN control), we've reduced our debt by nearly a thousand dollars in the last month. Gotta keep that Smackdown focus! I'm hopeful that we can step up our intensity in this area in the next 60 days. Kinda depends on my sales performance, since my income is 100% commission. Last month sales sucked. Partially due to the economy, but mostly it's a post-holiday seasonal thing. Looking back over the last few years, my sales in January and February have never been on par with other months.

Debt Smackdown! Update

Time for an update on our debt reduction progress. It's been a month since I heralded our goal to pay $20,815 in debt.

We're a little over 1/8th of the way to achieving our goal. Extrapolating our progress into future months would put us smack dab into *debt free status by mid-September, 2009. Ever the optimist, I'm predicting we'll beat that handily.

By publishing this information I'm finding I think about being debt-free more than ever. Socrates was on to something when he said:

The unexamined life is not worth living.

Consequently, I've come to the conclusion that blogging changes behaviors. In my case, I'm grateful because I very much like the new and improved, financially astute Boomer.

Here's the detail of our progress from the original January post:

1) $384 medical debt (orthodontist) Paid in full
2) $6,887 $4,676 credit card debt
3) $13,567 2nd mortgage on the SFR rental.

*debt free, that is, except for first mortgages

Photo by w00kie

February Net Worth (-$19,815.90)

We had a mixed bag of results last month. Our investment and RE holdings took a substantial hit to the tune of about 2.25%. OUCH!

I've read several discussions about how to properly value RE in the context of calculating net worth, but for my purposes, I'm most interested in the comparative values from month to month. We don't anticipate selling either property anytime soon. So for all its shortcomings, I've chosen to use Zillow. I think the site offers accurate trends within a given market.

Still, it's interesting to compare Zillow with other RE valuation sites and see the sometimes vast disparity in values. I'll write about that topic in a future entry.

What's most heartening is the nearly $2,000 of our medical and credit card debt paid off over the last month. Our debt smackdown is on!

Financial Goal #1: Debt Smackdown!

We began budgeting last fall so we have a great handle on our expenses and monthly cashflow. Wife is salaried but I'm straight commission; makes it a little tough to budget but my income has been commission-based for years and I'm used to the roller coaster. The numbers have been crunched and now it's time to apply focus and discipline to the process.

Our #1 goal this year is to eliminate $20,815 of debt.

1) $384 medical debt (orthodontist)
2) $6,887 credit card debt (just plain dumb)
3) $13,544 2nd mortgage on the SFR rental.


The strategy is quite simple. Every available extra dollar will go toward debt reduction until we've ground that bugger's face right into the sweat-stained mat. I'll get one of those bar graph doo-dads up as soon as I figure out how to get it done. Stay tuned....

Photo by RJL20