Friday, November 30, 2012

Monthly Networth Review

I have started my monthly update of our networthiq profile for December 2012.  Updating our net worth numbers is part of my monthly personal finance tasks which also include the following:  (1) update monthly spending plan (our form of a budget); (2) pay beginning of the month bills; (3) update 2012 savings goals chart and move money to savings goals as appropriate; (4) review and monitor automatic payments/automatic savings/automatic distribution of our allowance monies.

When updating our net worth numbers I review, on line, the status and amount of our ING/Wells Fargo savings which is reflected in the "cash" category on our networthiq chart.  I, also, review our non savings ING accounts, these would include our various escrow and short term savings accounts for travel, holidays, fun, etc. and these monies are reflected in the "other" category on our chart.

Then, I review all of our retirement savings/investments.  I log on to Fidelity and review my IRA accounts and my 401k account from a prior employer.  My current 401k account is at Vanguard so I log on and check those numbers.  I also log on as Mr. Sam to Fidelity and review Mr. Sam's IRA accounts and his 401k accounts.  My IRA monies are reflected in the "stocks" category and Mr. Sam's IRA monies are reflected in the "bonds" category on our chart.  Our 401k monies are combined into one number and are reflected in the "retirement" category on our chart.

The other asset categories on our networthiq chart include the value of our home, the value of our other real estate, the value of our cars and the value of personal property.  Those numbers get updated about once a year.

On the other side of the networthiq chart are our debts which right now include the mortgage on our primary home, the mortgages on our investment properties and, currently, some Home Depot credit card debt (0% interest rate) incurred at Rental # 3.  I update the debt numbers when we pay our various mortgages.

Keeping track of all these numbers and updating them on a monthly basis certainly takes some work, but I find the tracking to be beneficial.  First of all, for me, tracking these numbers helps me stay motivated in our personal financial and savings goals.  Second, checking in on our investments online, at least once a month, is useful.  Today, while I was checking my Fidelity numbers I converted my non-deductible traditional IRA to a Roth IRA (I'll be posting about this later if you are curious) which took less than 5 minutes to do.  I would have, and I did consider, doing the same for Mr. Sam but I figure I ought to ask him before I go ahead and convert his account.  Three, being familiar with the online tools for our retirement accounts is very helpful because there are some great research tools.  When you jump onto those accounts once or twice a month you get much more familiar and comfortable with the tools and terms, you increase your education and knowledge.

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