Q3 Net Worth Update

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Q3 2017 Net Worth Update – Inaugural Edition:


Total Net Worth:  $1,421,033

Taxable Investments:  $247,546

Taxable Investments are primarily invested with Fidelity and split between some old individual stock holdings and a combination of iShares and Vanguard Index ETFs. We’ve slowly been transitioning my holdings over to more index funds to lower costs and avoid the temptation of trading individual stocks.

Tax Deferred Investments:  $988,803

Tax Deferred Investments are the combined totals of two 401k accounts, two Roth IRA accounts, an HSA account, and a deferred compensation plan which resembles a 457. We are aggressively funding the deferred compensation plan for the tax savings and attractive payout schedule for early retirement.  This plan allows for deferral of up to 50% of wage income and the plan makes monthly payments over 15 years once separation from the employer occurs.  The funds are a company asset, but held in trust and invested in two Vanguard Index Funds.

Home Equity:  $172,286

Home equity is valued as the difference between a December 2015 appraisal and the current mortgage balance.

Other Assets: $12,398

Other assets are our two vehicles and a couple of collectible items, all of which are valued on their liquidation value.

Changes for Q3:

  • We decided to take $17,000 distribution from our HSA plan. This is the accumulation of medical expenses we’ve paid out of pocket and were saving receipts. We made this change because of the investment fees inside our employers HSA plan offset the tax savings (0.5% for an index fund!?!?). We still contribute the maximum to this plan each year and have around $55,000 left in the HSA, more than enough for four years of medical expenses.
  • We sold two individual stock positions we could get out of without tax implications and reduced another position through a contribution to our Fidelity Charitable Account. This plus investments increased our total allocation towards index funds by 2%

What’s not included in the Net Worth Calculation:

  • Home Sale Expenses: Our home is valued at a December 2015 appraisal. I assume some appreciation will be offset by the expenses of selling this house. We will sell this home and move upon retiring.
  • Pension Value: I have vested in a traditional pension I can start drawing at 55. This pension is not inflation adjusted and is not granted to my heirs if I were to pass away. Due to this, I am not including the pension value in my net worth calculation. I view this as a nice buffer to the 4% rule.
  • Restricted Stock: A portion of my compensation is in restricted stock that vests every four years. I forfeit this restricted stock if I leave the company, so I view this as future compensation. If the company were to have a change of control or I could be laid off prior to early retirement, this becomes due and payable.  It also becomes payable upon death, but lets not go with that option.

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