December 2009 Score Card — Part I: Net Worth
Jan 05, 2010 
Sun
How time flies.
Now that 2009 is officially in the books, it’s time to look back last month and the whole last year to see where I was this time last year and where I am now.
Despite the 120-point drop of the Dow on the last trading day of the year, December 2009 turned out to be another positive month as the benchmark gained slightly, up 0.8% for the month, while the S&P 500 added 1.78% and the Nasdaq rallied 5.81%. As the stock market kept advancing, so did our net worth. In December, we reached another milestone and moved one step close to my goal that I mentioned two month ago. At the end of December, we had a net worth of $900,473.02, up $28,176.87 or a moderate 3.23% from a month ago.
A breakdown of the net worth looks like this:
- Credit card balance(—–): Our credit card balance was cut by a quarter last month as I paid off the remaining of a credit card. Though the 0% APR loan won’t be due in more than two years, I decided to pay it off as I want to improve my credit score by the time when we buy a house in spring. Too many cards with balance was cited in last credit report as the only negative factor to my credit score. Hopefully, paying of the balance and stop using another card can move me closer to 800. On December 31, 2009, we had $4,257.37 on all credit cards, a reduction of $1,551.69 (26.71%) from previous month.
- Cash(+): As I used some cash to pay off the credit card, we put less money in savings accounts last month. At the end of the month, we had $226,135.26 in all savings and checking accounts, another record for us. The increase from last month was $2,982.34 (1.34%). I was thinking of getting a new savings account since we have a large amount of cash and all the accounts I have now pay only 1.50% APY. But I gave up the idea because, from what I noticed, banks still cut rate, even though at smaller steps.
- Taxable accounts(+): Our taxable investments beat the S&P but underperformed the Nasdaq last month. On paper, we had a total of $321,397.39 in stocks, mutual funds, and ETFs. Comparing to November 2009, the market value increased $4,900.78 (1.55%). After purchasing two IPO stocks in November, I didn’t make new stock purchases last month, but I did add a few more shares when 7 Days Group Holdings Limited (SVN) dropped to $11.50. From now on, I probably won’t move new money to brokerage accounts since I want to keep the cash for house downpayment, but the regular monthly purchase of mutual funds and some DSPP stocks will continue.
- Retirement accounts(+++++): For the second straight time, we did much better with our retirement accounts than taxable accounts, which is quite interesting, though the total monthly contribution to retirement accounts is also bigger. At the end of the month, the market value of our 401(k) and IRA accounts was $308,763.99, gaining $17,347.95 (5.95%) from November.
- 529 plans(++++): For four months since September, we got a huge help from the Ohio CollegeAdvantage 529 plan referral program. Like all good things, the program ended last month andI am grateful to those who used my referral to open an account. As a result of the referral program and performance of the market, our 529 plan market value reached $29,519.79 , an increase of $1,470.23 (5.24%) from November.
- Bonds(+): Our investment in bonds grew $100 (0.61%) last month to $16,584.24 due to our monthly purchase of $100 I-Bonds.
Now let’s see how we did in 2009.
When 2009 started, it appeared to be the worst time for many in a long, long time. And when the stock market subsequently hit multi-year low in March, I was pretty upset to see our net work got smaller and smaller. But I stayed the course and took advantage of the market slump to grab some shares at prices I considered as ridiculously low. Now looking back, 2009 was actually a pretty good year given the losses we had in 2008 and March lows were indeed bottom of the market. My strategy of keeping investing through the tough times instead of bailing out paid off. Year-to-date, our net worth has nearly doubled with an increase of $427,712.71 (90.47%). If comparing to the February low, the gain is an even more impressive 102%.
It was a bumpy road for us the past two years, but I am glad we did quite well so far. Next target, spend the money we have saved so far to buy a home before May, if possible, to get the credit the government is offering.
Why so much cash!? How do you plan to use it?
The cash is for our next house downpayment. I am going to need all the cash soon
Wow, this is VERY impressive Sun, great job! And good work selling your house earlier this year in this tough market.
I will have to say that I’ve seen several similar net worth increases in 2009 (not of your absolute $ value size though), which goes to show that not everybody is hurting, and in fact, many are flourishing.
Just imagine how much more people would make if the last 2 years were “normal”? Hence, I’m bullish for the future, and specifically this year.
Only $100,000 to go until you hit 7 figures! Whoo hoo!
Best, Sam
I am very excited that we are that close to $1M, though we are also going to use a large amount very soon.
We benefit from staying the course, though we were hit pretty hard last year. Now those stock and mutual fund shares that we purchased when the market was very bad will contribute even more when the market fully recovers and starts to grow again. Also, we are lucky that we still have our jobs in this tough economic environment. It will be hard if either one of us lose the job.
All I have to say is that I am highly jealous of your NW figure, as I am at a negative. That’s okay. I am climbing out of it and am determined to hit at least a mid six figures NW in my lifetime.
Great job! And good luck with house hunting.
Congrats on your progress! Almost to the $1million mark. Even though it’s not as much as it used to be, it’s a great hurtle to get over and felt great when we did it!