August 2008 Score Card — Part I: Net Worth

Our net worth actually rose a little bit last month!

What I remembered of the stock market in August was that it was as volatile as it has been lately: up 100 points one day, down 200 points the next. So it’s hard to tell how the stocks and mutual funds we invest in did for us last month because I didn’t see any breakthrough from any of those stocks (except FRE). If you have followed my net worth update long enough, you know how much we rely on our investments to pull up our net worth. When the stocks are doing fine, we can see a jump on our paper wealth. If the market heads south, losing tens of thousands a month isn’t rare.

Anyway, for the third time so far in 2008, our net worth gained in August. Without considering anything related to house and cars, our nest egg grew $14,339,95 (2.53%) last month to a total of $580,250.42, without getting too much help from the stock market.

Here’s a quick look at each element that I am tracking every month:

• Credit card balance(-): After a huge 37.24% jump in our credit card balance in July (because of some one-time charges), we see the total balance decreased a little bit in August, by $400.91 (1.68%), to $23,519,60, which is still quite high. The difference between July and now is that in July the charges were on the bills. Now it’s time to pay them off. When I do the update next month, a big drop will show up in our net worth calculation.
• Cash(++): The $7,202.83 (10.86%) increase in our cash last month is the largest among all categories because of some extra incomes in August. I don’t expect that to continue this month, however. Nonetheless, the temporary increase is enough to push our cash to a total of $73,509.37, most of which is in Capital One. I am debating whether to get an account with DollarSavinsDirect, which pays 3.75% APY or at Capital One through Costco which also has a 3.75% yield, but has a bonus. Of course, if I decide to go for the higher yield, I will need to close one account (at least one, maybe two).
• Taxable accounts(+): The stock market’s zig-zag last month indeed did a little for us. When the trades settled, we added $2,403.94 (0.93%) to our taxable investment accounts, which have a total market value of $259,724.49. As I mentioned a little earlier, the only significant movement in our investments last month was from Freddie Mac [[FRE]]. As you may remember, I bought 16 shares of FRE back in July. That investment turned out to be a pretty bad one. But I didn’t stop. When the stock hit an all-time low a week before, I bough another 38 shares using my play money at Zecco. Putting these two trades together, I didn’t make any money, but didn’t lose much either.
• Retirement accounts(+): What happened to our retirement investments was similar to what happend to our taxable accounts: little change. However, because we contributed more in our 401(k)s, the gain of $3,932.72 (1.67%) is also a little higher. At the end of August, the total balance in our 401(k)s and IRAs is $238,860.41. with all contributions going into 401(k) accounts.
• 529 plans(+): Our daughters’ 529 plans added $519.43 (3.35%) to a total of $16,019.55 on August 31st. Though the entire gain came from our monthly $600 contribution, I am pretty happy with how the college savings accounts are doing so far.
• Bonds(+): Our investments in I-bonds increased by $100 (0.72%) to $13,914.08. This number isn’t very accurate because I noticed that software I used to track Treasury Bonds hasn’t been updated yet.

Despite the gain, our net worth still shows a loss of $27,871.93 YTD. That’s a drop of 4.58% so far in 2008. Comparing to the same period in 2007, we increased it $17,177.30 (3.05%).

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