May 2007 Score Card — Part I: Net Worth

Reporting time again!

The momentum we saw in April continued in May as we experienced another record-setting month. This time, the S&P 500 Index joined the Dow to close at the highest level in its history. For the month, the Dow gained 491 points, or 3.74%, the S&P 500 rose 44 points, or about 2.96%, and the NASDAQ added 73 points, good for about 2.88%.

With the cooperation from the markets, we managed to grow our net worth in May at a moderate rate. As of May 31, 2007, we have a net worth, excluding house and car related items, of $517,206, a gain of $13,172, or 2.61%, compared to what we had a month ago.

Here’s how the number adds up:

• Credit card balance: The credit card balance is almost flat as compared to April. Actually, it grew a little bit ($282, or 0.45%) in May, which was largely because of the nearly $1,000 charge I put on my credit card for the car repair. At the end of the month, we have a total of $60,462 on our credit cards. Though the number seems to be very high, about $58,000 was borrowed at 0% APR from several credit cards. Nothing to be alarmed here.
• Cash: Our cash dropped $8,129 or 10.14% in May after I moved $5,000 to my Firstrade account to buy some Altria (MO) shares and another $1,000 to Zecco. Last month, I opened online savings account at FNBO Direct and moved almost all the cash to the newest account to take advantage of the 6.00% APY promotional rate. On May 31, we have about $72,062 in a number of bank accounts.
• Taxable accounts: These are our regular investments outside retirement savings accounts and we invest in stocks and mutual funds in these accounts. As compared to a month ago, the increase in market value in our taxable investments is $11,425, or 4.99%, to a total of $240,481. The biggest story in the past month to me was the sharp drop of XFML shares. For the month, the stock lost $4.30, or nearly 40%, after the company was hit by scandals and law suites. Hopefully, XFML will be cleared soon to remove the cloud.
• Retirement accounts: The net gain in our retirement accounts (401(k)s and IRAs) is $9,538 (4.51%) in May. I have planed to open a traditional IRA account and move the excess IRA contribution to it for some time, but didn’t really get time to do it yet. Hope I can get it done this month so it won’t drag too long. As of yesterday, the total assets in our retirement accounts are $221,234.
• 529 plans: Our daughter’s 529 plans continued to be the biggest gainer for the month as the market valued changed from $7,487 in April to $7,960 in May. That’s a 6.32% increase. Out of the $473 net change, $300 came from our regular monthly contribution.
• Bonds: After the recent drop of T-bill rates, I have thought about canceling the weekly purchase, but didn’t pull the plug. Though the rates have rebounded a little in recent weeks, they are still about 30 basis points below the peak reached on March 22 and far below the 6.00% APY from FNBO Direct. I should seriously consider stopping the investment for now.

Year-to-date, our nest egg has increased $58,213, or 12.58%.