Beginning in July, I committed to a goal of increasing my net worth by 46% this year. This goal is ambitious, but I think it should be achievable with some careful budgeting and a little bit of help from the markets. Today, I’ll share how I’ve done in month one.
Between July 1, 2015 and August 1, 2015, my overall net worth dropped by 1%. My cash savings dropped by 6% (ouch), my non-retirement investments remained the same, and my retirement investments increased by 1%. As you can see from the chart below, this puts my cash position right in line with my goal, while leaving my non-retirement investments as the area needing the most growth.
Why did my net worth go down?
It might seem like poor planning to announce an ambitious net worth goal and then apparently fail at it one month later. Despite appearances, this is actually exactly what I expected to have happen, and here’s why:
- The markets have been crazy lately. They go up a little; they go down a little more. It’s been a roller coaster, but I’m not too worried about it. While these market fluctuations impact my investments in the short term, I’m in it for the long haul and over time these fluctuations should even out. Of course I would like to see the markets go up instead of down, but there isn’t anything I can do about this and in the long term it won’t impact my investments whatsoever.
- I spent 8 weeks in France this summer, with no income. Remember that little trip to France? Yeah, a lot of the spending for it happened in July. I also had zero income in July. Zero. Oof. So, of course, this meant that my cash position decreased. But this was a one-time thing, and I had planned for it and had the money to take this time unpaid to travel.
- My car needed pretty serious work done. I drive an older car and I’ve been pretty lucky in the 7 years I’ve owned it that it has needed relatively little money put into it. Well, this week is was time to pay the piper. After leaving my car unused for 8 weeks while away and being due for maintenance anyway, I ended up having to fork over about $2,400 for car repairs. Which was awful, but several people who know way more about cars than I do assured me that my car should go for many many more miles after this maintenance, so I’m hoping it was a good investment.
Now that I’m back in the states, I’m focusing my energy on August and working on making it a great month for my budget. Fingers crossed that I have better news to report next month!