Operation Positive Networth

New! Use this space to post your goals, accomplishments, and setbacks on your path to get rich slowly. Others can read about your situation, and provide critiques and motivation. Look here to find somebody who has experienced a situation similar to yours!

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Posts: 36
Joined: Mon Mar 19, 2012 11:09 am

Operation Positive Networth

Postby candicem » Tue May 01, 2012 8:28 am

I am on a mission to have a positive networth in 2012. Here's my background: I am 30 years old and married, no kids yet. I am an attorney earning $69K annually. My income will increase to $83K in September. I do not have access to an employer-sponsored 401(k) plan. I have a rollover IRA and a Roth IRA.

My husband just got his job and was not working for the past 7 months. He now earns $31 per year. My husband has access to both a 401(k) and Roth 401(k) with his new employer. He has a rollover IRA and a Roth IRA.

Within the last year, we moved from Pennsylvania to Ohio. We own a condo in Pennsylvania that we rent out and lose about $25/m. For now, we're keeping the condo. Though it may be in the cards to sell it within a couple years.

When I started calculating our networth about a year ago, we were at negative $35K. In the last year, we've managed to widdle it down to negative $14K. We've been able to sock away quite a bit since my husband started his job, saving his entire salary.

We started saving the following with my husband's income:
- $218/pay period to 401(k) or $3,924 for 2012
- $183/pay to Roth 401(k) or $3,294 for 2012
- $577/pay to Emergency Fund/general savings or $10,386 for 2012

Total anticipated savings from my husband's income for 2012: $17,604.00

I also save approximately $500/m from my income and will save my entire increase in pay that starts in September.

Our assets currently total $217,660.72:

Cash: $25,179.40
Stocks and 529: $749.45 (This is just some money we invested to get bonuses)
Savings Bonds: $3,811.25 (Gifts to us from when we were children.)
Retirement: $30,920.62
Condo: $157,000.00

Our liabilities currently total $232,038.46:

Mortgage: $140,884.89
Student Loan: $89,438.90 (Owed to a relative at 3% interest: interested in suggestions to pay back early, but don't want to create an accounting nightmare)
Credit Cards: $1,714.67 (This is monthly spending and is always paid in full each month)

Networth: Negative $14,377.74


To reach our goal of having a positive networth in 2012, we'd need to save $1,797.22 each month for the 8 remaining months of 2012. We're on track to reach a positive networth by mid-November given the planned savings of $17,604.00 (approx. $2200/m) from my husband's income, not counting any additional savings. To make this goal more challenging, I will attempt to have a positive networth by September. I think it will be a stretch, but I think it's possible too. It would mean increasing our networth by $2,875.40/m regardless of market dips and savings.

We both want to max out our Roth IRAs for 2012 before April 2013. We are willing to use some of our emergency fund/general savings to max out the Roth IRAs, so this is not necessarily a separate $10K that we need to save.

My vehicle lease will expire in December 2012 and I will need to get a new vehicle. It is undecided whether I will buy with a loan or lease again, but I will need a downpayment for either. I estimate $2K to lease and $3K to buy (putting 15% down if I buy). Again, this can come from our general savings, but I'd also like to save a bit extra toward this as well once I get the increase in pay.

My plan is to keep this journal updated monthly. I'm open to any suggestions to improve our current plan or add additional goals. Thanks for reading!

Posts: 5602
Joined: Wed Sep 23, 2009 9:01 am

Re: Operation Positive Networth

Postby DoingHomework » Tue May 01, 2012 1:35 pm

It sounds like you are already in fairly good shape. Congratulations!

I'm going to comment on the student loan in the other thread.

One comment about the car: If you need one you need one so I won't question that. But would you be able to deduct the car as a business expense? I'm asking because if you can't then it is likely that leasing does not make sense. And I'm concerned that your focus on maintaining a positive net worth, while commendable, will push you toward a lease since that does not create a loan while a purchase would. The main benefit of a lease is to be able to deduct the costs as a business expense. If you can't do that then it is usually better to buy.

Posts: 36
Joined: Mon Mar 19, 2012 11:09 am

Re: Operation Positive Networth

Postby candicem » Wed May 02, 2012 5:05 am

Thanks for your comments. I cannot deduct the lease as a business expense. I'm currently leasing because of the cheap payment. We were in a position where we needed to lower all monthly payments, so I traded in a car for this leased car and cut my payment in half.

Going forward, I'd really like to buy. Nothing fancy, just something to get me from point A to point B that has a good warranty at the outset. It doesn't have to be brand new, but fairly new. My husband is against buying because of the higher payment initially. It's a matter of convincing him that I will keep the car for a long time to make it worth the payment.

Posts: 36
Joined: Mon Mar 19, 2012 11:09 am

Re: Operation Positive Networth

Postby candicem » Mon Jun 04, 2012 11:41 am

Time for an update of June's networth:

We increased our networth from negative $14,149 to negative $13,054. We actually saved quite a bit. We saved over $2,000 in cash and another $1,000 in retirement. But the markets did not perform well, so we didn't see as much of a gain as I would have liked.

Assets total $218,962.00:

Cash: $27,320
Stocks: $727
Bonds: $3,846
Retirement: $30,069
Real Estate: $157,000

Liabilities total $232,016:

Mortgage: $140,698
Student Loan: $89,005
Credit Card: $2,313

I still think we can get to a positive networth by the end of September. Hopefully, the market will hold steady or improve in June, so that we can see our savings accumulate more.

Posts: 36
Joined: Mon Mar 19, 2012 11:09 am

Re: Operation Positive Networth

Postby candicem » Tue Jul 03, 2012 11:26 am

July's Networth:

Cash - $28,830.00
Stocks - $763.00
Bonds - $3,856.00
Retirement - $32,444
Condo - $157,000

Total Assets: $222,893.00

Mortgage - $140,511.00
Student Loan - $88,787.00
Credit Card - $1,949.00

Total Liabilities: $231,247.00

Networth: Negative $8,354.00

I'm very happy with this month's progress. We had an increase in networth of 36%. We are on track to have a positive networth by the end of September.

Posts: 36
Joined: Mon Mar 19, 2012 11:09 am

Re: Operation Positive Networth

Postby candicem » Tue Oct 02, 2012 5:28 am

We have met our goal to have a positive net worth by October 1! It's not by much, but just $3 counts in my opinion!

A few updates:

- I bought my leased camry, paying $3K down and financing the remainder (approx. $13K) at 1.99% for 48 months. My plan is to pay it off in 24 months.
- I funded $2500 to my Roth IRA for 2012 and will fund the remaining $2500 before the end of the year.
- In August, we had about $1200 of maintenance expenses to our rental property for the HVAC system.
- Our rental property is currently listed for sale.

Assets Total $242,449.00:
- Cash: $24,095
- Stocks: $809
- Bonds: $3,885
- Retirement: $39,410
- Rental Property: $157,000
- Camry: $17,250

Liabilities Total $242,446.00:
- Mortgage $139,944
- Student Loan: $88,131
- Credit Card: $1,922
- Car: $12,449

Net Worth: $3!!!!!

Posts: 1188
Joined: Thu May 17, 2012 10:05 am
Location: USA

Re: Operation Positive Networth

Postby Eagle » Tue Oct 02, 2012 8:10 am

Congratulations! That is awesome! Keep up the good work! Knock out that debt! ;)
~ Eagle

Posts: 266
Joined: Fri Jul 29, 2011 8:38 am

Re: Operation Positive Networth

Postby fiddlefaddle » Tue Oct 02, 2012 9:35 am

Congrats on hitting your goal! You've made great progress this year.

Posts: 90
Joined: Sat Feb 12, 2011 5:47 pm
Location: Ontario, Canada

Re: Operation Positive Networth

Postby Kate1 » Tue Oct 02, 2012 2:37 pm

That's an amazing accomplishment!

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