2016 summary of finances

[kork13]

This year has been remarkably prosperous for us, to the point that I was shocked when I finally tallied everything up tonight.

- Total Net Worth: $536k, +40.8%
- Financial assets only: $362k, +19.5%. Investments returned 6.5%.
- Real estate: $610k value, $178k equity. Sold one house & walked away with ~$5k, turned our home into a rental & paid down $8,500 in principle, then moved to Alaska and bought a new house with a 20% DP, plus we got it for ~$15k/4% below appraisal. And GREAT NEWS!! -- The rental house is now under its first lease, as of today! It took longer than we'd have liked (~2 months), but winter is a tough season for new rentals, at least in Oklahoma...
- Debts: Besides the two mortgages, we bought a new car for my wife in August with a 50% loan. We'll be paying it off in March (-ish), just to free up the cashflow, and we both hate being in debt.

The most important milestone IMO for us this year was seeing our retirement assets climb up above $250k ($263k at this moment), between both of our Roth IRAs & TSPs. At age 30/31, I'm very happy & extremely grateful that we're doing as well as we are.

Next year will likely be somewhat financially draining... We'll be paying off DW's car loan, and I'll be trading in my car (a "cheating" VW Golf Diesel) for a replacement car, but gratefully that'll only be $2k-$3k out of pocket. We want to do some remodeling/improvements to our new home. We also want to pay down the rental's mortgage ASAP (hopefully within 3-5 years), and also need to rebuild our taxable investments, which we drained in order to purchase our new home. Oh, and my wife is pregnant with our second baby, due in early June! It'll be an interesting year... Cheers!

[MonkeyMama]

Net worth is up $61,000 for the year, or 12%.

Paid down mortgage by $8,000; the rest is investment contributions and gains.

Our household income (salary) hit six figures for the first time. (If you count other income streams, I am sure we have been at this income level for a while. I didn't work as much OT and we didn't do as many side hustles this year, but my spouse picked up some more regular work. So that is why the salary category got a boost). Seriously, like our salary income was $100,200. Just squeaked by.

[MonkeyMama]

Oh, and my wife is pregnant with our second baby, due in early June! It'll be an interesting year... Cheers!

Congrats! On the net worth gains AND the new baby!

[disneysteve]

This year has been remarkably prosperous for us

my wife is pregnant with our second baby, due in early June!

Congratulations on the successful year and the baby on the way. How exciting!

bought a new house with a 20% DP, plus we got it for ~$15k/4% below appraisal.

Not to be a Debbie Downer, but the appraisal really doesn't mean anything at all. The house is worth what a buyer is willing to pay and a seller is willing to accept and that's it. Some houses sell below appraised value. Some sell for more than appraised value. The appraisal is more for mortgage and tax purposes.

[kork13]

Not to be a Debbie Downer, but the appraisal really doesn't mean anything at all. The house is worth what a buyer is willing to pay and a seller is willing to accept and that's it. Some houses sell below appraised value. Some sell for more than appraised value. The appraisal is more for mortgage and tax purposes.

True of course. But lacking other means, the appraisal is at least an indicator. I'm basically just saying that we got a good deal on the house. The family we bought the house from very intentionally priced it low because they were retiring & moving to the lower 48 about a month after they put it on the market...."motivated seller" if you will.

[disneysteve]

"motivated seller" if you will.

That's always the best kind.

We had something similar when we bought our house. It had been under contract 2 times before we came along and both times the deal fell through. The husband had been transferred out of state. We showed up pre-approved for the mortgage and with no contingency clause because we didn't have a house to sell first. The price had been knocked down a couple of times and we were in the right place at the right time.

[rennigade]

We were able to crunch the numbers this morning. These are both of our accounts combined...

Retirement: $492,536.65
Index Funds: $71,565.47
Cash: $76,968.97

Total: $641,071.09


We maxed our roth/401/tsp, with contributions it went up $97,145...so we contributed 47,000...in gains it went up $50,145. Our retirement accounts were up around 11%.

We did buy a house this year at $220,000. We put $100,000 down in cash...so our cash account took a major hit.

Even with that $100,000 expense...all around we were up $17,400 between contributions and growth.

Net worth

$641,071 (retirement/cash/taxable)
- $120,000 (mortgage)(I dont include house in NW but this is debt)
----------------------------
$521,071 (net worth)

[msomnipotent]

I stayed up late last night trying to figure this out. Two of my husband's retirement accounts will not let me see anything other than the current balance, so I can't have a definite number on how well we did. Out of 7 accounts, one lost money and one only made 2%, but the rest did pretty well. I'm still disappointed in the balances. My husband has been telling me that we had about $500,000 in his retirement accounts, only to find out that we actually have less than half of that. Including everything except our cash, coins, and the money I have hidden that my husband doesn't know about , our net worth is just shy of $500,000. I was expecting a negative balance once I saw his retirement balances, so I guess this is a good surprise. Not really, though.

Now that I have control of his retirement account, I expect 2017 to be much better than this year.

[disneysteve]

My husband has been telling me that we had about $500,000 in his retirement accounts, only to find out that we actually have less than half of that.

Now that I have control of his retirement account

Some concerning statements there, for sure. Do you think he was intentionally lying about the balance or did he just really not know what he had?

It's so important for couples to sit down regularly and go over the finances. Now that I have the 2016 numbers, I'll sit down with my wife and show them to her so she sees how we're doing and knows what has changed, good and bad, during the year. And we don't only do that once a year. We have "financial dates" periodically.

[Outdoorsygal]

-I grossed a little over twice as much as I did last year. Count Ebay & Amazon sales and it's more than that.

-Nothing yet but my company said by the 1st we'd have info about the new 401K plan.

-Planned the future for investing 17K for 5-6 years (depending upon how fast inheritance comes in). So 100K inheritance for our son with some left-over for us.

-California passed their own retirement plan for all employees who have 5+ co-workers. http://www.treasurer.ca.gov/scib/ Unvailable for1+yrs but from ages 52-56,
I'll donate 50% of my paycheck. This plan doesn't adhere to ERISA rules like all other retirement plans so I'm not overly confident w/it.

We will be very poor but I am not counting the property/house flipping which we will live off of to some extent.
So who knows...but that isn't taxable income so we will still qualify for a medicare savings program at age 65+
Not saying we'll take it but it's a nice safety net if needed.

We'll start taking distributions based on life expectancy at age 70 1/2 assuming we coverted part of the 401k.
The other part of the 401k (100K) our son will inherit. It appears converting that portion to a ROTH IRA will only screw him over bigtime tax wise.
It appears inheriting a ROTH IRA is NOT a good thing unless you are very poor.
It's only usually or often good, tax wise, for the person who owns it. But bad for the beneficiary of the inherited retirement acct.

.

[Nutria]

-I grossed a little over twice as much as I did last year. Count Ebay & Amazon sales and it's more than that.

I'll donate 50% of my paycheck. This plan doesn't adhere to ERISA rules like all other retirement plans so I'm not overly confident w/it.

Then why contribute 1/2 of your paycheck?

We will be very poor but I am not counting the property/house flipping which we will live off of to some extent.

Since profits from property flipping are part of your income stream, you should count it.

[Outdoorsygal]

Then why contribute 1/2 of your paycheck?

Good question
Seriously I might not do it. The specifics for this secure choice plan hasn't been complied yet, only the law was passed. So we'll see.

Since profits from property flipping are part of your income stream, you should count it.

Yes I just cannot guesstimate how much it could possibly be. It's like a new under the table business.
Hopefully we can do $500-$1000 a mo. making $10K-$12K just moving aka flipping houses every few years.
$500 more per month at the very least would make it worth it

[Nutria]

Yes I just cannot guesstimate how much it could possibly be. It's like a new under the table business.
Hopefully we can do $500-$1000 a mo. making $10K-$12K just moving aka flipping houses every few years.
$500 more per month at the very least would make it worth it

Do you put the proceeds in a separate account and then feed -- for example, and assuming a flip every three years -- 1/36th of the proceeds into your checking account each month?

[Outdoorsygal]

Do you put the proceeds in a separate account and then feed -- for example, and assuming a flip every three years -- 1/36th of the proceeds into your checking account each month?

This isn't popular here but it's likely the money would go into a bank acct then be withdrawn slowly in cash and the cash stored in the safe.

I've been watching the MLS listings and about every 12-14 months a real a deal comes up. But I cannot count on that.
I think we'd need to jump on it quickly and use the sellers real estate agent.
We will make at least 30-50K on the property we bought a few months ago.
My goal is to meet others who are doing the same but aren't bigtime into it. Just want to move every few years to make a little money

[Nutria]

This isn't popular here but it's likely the money would go into a bank acct then be withdrawn slowly in cash and the cash stored in the safe.

Well... it's not the wisest choice for storing cash.

1. Fire.
2. Flood.
3. Tornado.
4. Robbery. (When you're out, they take 30 minutes to break it open.)
5. Depreciates even faster than 1.25% CDs.

We will make at least 30-50K on the property we bought a few months ago.

My goal is to meet others who are doing the same but aren't bigtime into it.

The competition?