August net worth update
The bull market keeps going, and I moved….
By MeTheMillennial
August Monthly Net Worth Update
Officially month five on this net worth series and financial freedom journey, and wow there have been some big changes in August, both personally and financially.
As you may know in this series, every month I track and lay bare, financially of course ;), my progress to reach $1.5M in net worth by age 35. I am now 30, so 5 years to get there.
This will then allow me to coast and finally leave my corporate rat race job behind (strategy consulting), which although pays well – is definitely not something I want to do in the long term – in fact I am currently weighing up my exit options.
So read on to hear the latest on my progress towards that goal.
*As always, I am not an expert or financial advisor, so nothing on this website should be considered financial advice. These are just my opinions, everyone is different. Always do your own research and have your own independent thought process.
Life Update: August 2021
So you may have noticed over the last couple of weeks, I haven’t posted as regularly as normal. Firstly apologies for this, there will be more to come over September and to keep us occupied as we move into Autumn and Winter.
The reason why??…I moved!!!
Finally, I took the plunge and left downtown city living and the madness that is Toronto behind. I moved out west to Vancouver. I’ve posted a couple of photos below close by to me, this place is just awesome – if you haven’t been before make sure to put it on your list!
I am just getting my feet wet (literally :)) here so more to come on future updates. But hopefully this will reduce the stress I have felt lately with my job. Make sure to explore this alternative on your own journey, moving from a high cost, high stress city can be a real life changing move. Both personally and financially. Not to say Vancouver isn’t high cost, it definitely is. But there seems to be a whole different ethos towards work and the importance of health and the outdoors here.
Make sure to check out why I moved to Canada in the first place and how it instantly increased my income.
So other than personally, I also continue to grow my portfolio substantially this month through my continued focus on Index Funds and REIT’s.
Check out what Index Funds I invest in here, and similarly here for REIT’s.
What do you mean by net worth update?
Well put simply, it’s how much I have saved and/or invested across my assets minus my liabilities. Assets include cash, stocks, ETF’s, REIT’s, Pension etc. Liabilities are recurring bills I pay each month such as credit cards, rents etc.
Net Worth is simply a snapshot of your total wealth at a point in time. Put simply, it’s what you own minus what you owe.
Okay, long intro – get on with it, how much are you worth then?
I have now hit $308k in savings and investments. Woohoo, I’ve crossed the 300k mark hopefully for the first and last time. Writing this even now blows my mind. My original target of hitting $300k by Christmas 2021 has well and truly been smashed. Thanks to increased savings rates and stock returns/dividend reinvestments over the last few months. Compound growth is really starting to take hold due to the size my portfolio is now reaching.
Below is August, 2021’s breakdown versus the prior month (in excel of all places, as if I don’t spend enough time there in my day job working in strategy consulting).
Overall I have increased my net worth by nearly ~$18k or 6% in just one month. While I contributed $9.8k this month, which means $9k was due to increases in the stock market and dividend reinvestments.
This is a major milestone, my portfolio returns are now at the same level as how much I am actually saving and contributing. This is the power of compounding in action. Hopefully next month they will actually be greater than my savings contributions!
Upon request from some readers, I have also included a contribution column so you can determine how much my increase/decrease was due to additional contributions versus gains from stock market movements.
Please let me know in the comments of any additional information that would be useful to also include.
Read on for a breakdown by category, and also what I spent for the month of August
Checking: $3k (+$1k) – I am continuing to build up my cash balance each month in my checking account for any unforseen costs due to the recent move. Looking into getting a car to explore more of this beautiful city and surrounding area which may eat up this cash, Vancouver Island anyone? You can’t be all work and no play. (I realize not everyone is as fortunate with their income levels)
Brokerage: $254k (+$14k) – Increase of $14k this month, which actually means I’m up overall in my brokerage by $9k this month as I contributed $5.5k to this account for August. My REIT’s have been really performing well lately, driving most of this growth. Check out here what REIT’s I invest in.
My brokerage is made up of the following (approximate %’s):
- Index Funds – 35%
- REITS – 20% (+8% this month, I’ve started investing more in Residential Housing REIT’s given the current inflation market – check out here why)
- Bonds – 0% (I recently sold my Bonds and pivoted further into REIT’s with the proceeds)
- Individual Stocks – 30%
- Gold Stocks – 15%
Regarding the above allocation, it constantly changes. I got out of bonds compeltely in my brokerage this month although my pension has some exposure. The plan going forward is to continue to increase my index funds and REIT allocation and reduce my single stock exposure to below 10%.
Gold Stocks – I am content with my current 15% allocation. I want to protect myself from any upcoming market crashes, and having exposure to these will provide some upside when the rest of my portfolio could be crashing.
RRSP AND DPSP: $47.9k (+$1.3k) – Increase of $1.3k this month with contributions of $1.5k. I currently have an 80/20 split between equities and bonds respectively. I actually lost some money here which I am looking into – it looks like its down to quarterly fees, I am currently looking into switched to a lower Pension fee provider. You should do the same, these fees significantly eat into your returns over the long term.
Discounted Employer Equity Scheme: $5.7k (+$1.4k) – I contribute a portion to an equity scheme through my employer where I buy into company stock every 6 months at a 15% discounted price. This basically means an automatic 15% return on my contributions, a no brainer to take advantage of.
Rent and Credit Card: $2.5k – Additional costs this month can be blamed on moving City! Also we had some cottage trips away and my rent has increased from $1.1k previously to $1.3k in Vancouver.
August 31st 2021, I am now worth, financially at least ~$308k which is an increase of approx $18k since last months update. The snowball effect is really starting to take hold, every month I am consistently making more gains than the previous month, the power of compounding. My short term goal of $350k by Christmas is achievable, and my ultimate goal of retiring and achieving financial freedom by 35.
Hopefully this will provide some value to you, and even help you keep you on track for your goal.
Calculate Your Own Net Worth
If you haven’t worked out your net worth before, or even if it’s just been a while since you’ve checked, do it now! Open up your accounts, and list down the key buckets of assets and liabilities (don’t sweat the small stuff to start, you can worry about this later).
The first step is having visibility into what your own financial breakdown looks like, and you can plan accordingly. Will also give you a realistic view of what you can achieve, and also what you need to cut back on to achieve your goal.
Let me know what you think of these net worth updates below. I hope you find some of these areas helpful in your own journey to whatever your goal is. For me that is having the ability to quit my corporate job in Strategy Consulting and spend my time how and where I want.
Follow along on my journey, I keep my net worth updated here.
Leave a comment or contact me if you would like to get in touch and update me on your progress towards your goals.
Have a lovely week everyone! 🙂
