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Thursday, 2 January 2014

Net Worth: December 2013

Another rather poor month for the Australian stock market that reduced the value of my leveraged share portfolios, but the value of my SMSF account increased due to the unhedged exposure to international share markets boosting the value of our High Growth Index Fund investment in A$ terms. The continued rise in the Sydney real estate market boosted the estimated market value of our house, which also added to my net worth total this month. It is now approaching the pre-GFC high reached in mid and late 2007, but of course, is still well below this level in real terms (ie. if adjust for inflation). My parents have decided to transfer the title of their hobby farm property (that I was to inherit) to me immediately, as that will mean that five years after it has been 'gifted' to me its value will no longer included in the 'asset test' used to determine the rate of aged pension they receive. Although they are both about eighty years of age, my maternal grandparents lived until their mid 90s, so transferring the property title now may still give them a higher pension for a decade or more, rather than leaving it to me in their will. It will also mean that I take over paying the council rates and other costs of maintaining the property, which will also boost improve their budget. There will be some costs (that I will pay) involved in transferring the title (the largest cost being the State government 'stamp duty' charge) to my name, and I should get a couple of valuations done by registered appraisers so I have a sound basis for the 'cost base' that will apply for any capital gains tax due when/if the property is eventually sold by me or my sons (I need to see if the title can be registered in both my name and that of my sons, or will have to be left to them in my will as they are both minors). I probably won't include the value of this 'hobby farm' in my NW figure, as it is a 'one off' windfall gain, and would mean my NW graph does not reflect the performance of my savings and investment strategy over time. So, like the fact that my 'net worth' figure doesn't reflect our households 'net worth' (as it doesn't include the value of DWs investments, retirement savings or her half of the value of our home), this should be born in mind when comparing my graph to those of some other PF bloggers.

Assets$ Amount$ Diff% Diff
Stocks *$218,651-$762n/a
Retirement$571,635$9,6191.71%
Properties$475,210$8,8101.89%
Debts ^$ Amount $ Diff% Diff
Home Mortgage(s)$102,376-$7-0.01%
Net Worth$1,163,120$17,6741.54%
* the Stocks figure is portfolio value - margin loans. The LVR is around 80% overall.
^ doesn't include the ~$675,000 of investment loans, as these are already deducted when calculating the value of my geared stock portfolio.

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