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Wednesday, 1 September 2010

Net Worth Update: August 2010

The stock market weakened considerably during August, resulting in lower valuations for my geared stock portfolio and our Self-Managed Superannuation Fund. Property valuations also declined slightly, and the latest average sales figures show an even greater decline will impact next month's NW figures. However, with the latest Australian economic growth figures showing robust growth (around 3.3% pa) I expect 2010 overall to show modest or no growth in house prices, rather than the US-style crash in property prices some pundits have been predicting for the past couple of years.

While it is interesting to plot the daily gyrations of the stock market and monthly ups and downs of the real estate market, it is probably more useful to concentrate on sticking to my budget, looking for additional areas to reduce expenses, and leave my retirement and investment savings plans running on autopilot. Better to focus on the small effects I have control over, than worry about the big effects on my NW that are outside my control (since I don't intend to change my asset allocation on the basis of recent performance diverging from historic averages).

Assets___________$ Amount______$ Diff_____% Diff 
Stocks_*___________$8,330_____-$3,531___-29.77 % 
Retirement_______$330,494_____-$4,054____-1.21 % 
Properties_______$919,801_____-$2,824____-0.31 % 

Debts____________$ Amount_____$ Diff_____% Diff 
Home Mortgage(s)_$364,018________-$54____-0.01 % 

Net Worth________$894,607____-$10,355____-1.14 %

* the Stocks figure is portfolio value - margin loans. As my portfolio value (and margin loan debt) is around $500,000 relatively small movements in the stock market produce huge percentage swings in the net value of my stock portfolio each month.

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