Sunday, September 30, 2007

Thoughts on networth as of 9/30/2007 ~$717,500

A quick assessment by my not quite up-to date entries in Quicken indicate a networth very close to $717.5k - excluding $5k in expense on the company credit card.

My currently projected year end n/w is $709.5k, anticipating a $10k tax expense before year end. In October I'll need to pre-test my tax returns to see what I'll actually owe. It should be interesting as Big Company tries to equalize local state tax obligations. Apparently they will help pay for accounting services to address this. I wonder how it will really work.

It's about $30k more than I had expected before our relocation to Chicago. I suspect the following items to have contributed:

1. delayed decorating expenditures - the sellers left their window treatments behind
2. delayed purchase of furniture - we bought less expensive family room furniture and have delayed purchasing anything new for our living room, master bedroom, kitchen and finished basement.
3. we have delayed wiring the house for ethernet, except for a connection to the kitchen.

We have made some additional expenses, unplanned for:

1. outside decorative lighting and outside electrical sockets - about $600.
2. extended natural gas for outside bbq / grill - included in basement estimates.
3. extensive basement waterproofing - we had foundation cracks filled - some were behind finished walls - expensive to fix. The waterproofing work seems to have held well - about $3000 (high estimate).
4. family visits and unexpected travel - about $1600.
5. swimming pool repair and larger than expected maintenance expenses - about $1600.
6. repair of our roof - about $3,600.

Another interesting tax obligation will be relocation reimbursement. Some of my reimbursements, such as association fees are taxable, but big company is supposed to gross up for those. Once again, I wonder how it really works.

I expect another $3000 - $4000 in expenses to refurnish my office and purchase bookshelves for our extensive collection. I anticipate my office becoming something of a family library. Only $1500 or so is included in our projected cash flow. We'll see how things work out by year end.

As to thoughts on end of year projections:

a. They don't included September interest payments.
b. They don't include projected interest payments.
c. They exclude any forcasted market performance.
d. They estimate an outstanding tax obligation.
e. They assume I'll manage to remain employed - my performance has been exemplory year to date, but my immediate leadership has changed, one wonders if they'll appreciate or feel threatened by what has happened.
f. They assume I won't break down and buy several flat screen TVs - something I'm dying to get, but feel too uncomfortable doing.

Until we either sell the old house or receive raises, our overall cash flow is about -$1500 per month. This is extremely distressing to me. The thought perhaps limits our interest in home improvements and certainly inhibits our planned investments. My wife's contract does provide for an automatic raise, which would cover this gap, however, we'd have to wait a year for it to effectuate. We certainly have the cash to weather the difference, however, I'm hoping my employers recognize a shred of my contribution and give me a reasonable raise - I am skeptical - I fear political obfuscation will lead to others successfully claiming credit for my accomplishments. If this happens, I will look elsewhere.

One thing to note, we were very successful in increasing our investments this year - mostly due to savings: maxing out our 401k contributions, plus a nice match from my wife's employer +$40k; extra cash invested +25k. About 12% return on investments (estimated), put us at over $516k in invested assets.

I still have to correctly enter our real estate transactions into quicken as well as my wife's 401k roll-over. I'm not sure there should be a significant difference, but we'll find out soon enough.

Regards, makingourway


Anonymous said...

Wow, that's awesome achievement for your networth. I just bought a house too, and I am afraid my cash flow will be drastically reduced to your level. So I feel for you. Good luck with the houses.

Anonymous said...

Good luck with the house sale! That has got to be stressful; sounds like a prudent thing to delay some of the purchases though until everything shakes out and you all know exactly where you stand post house sale.

Over $500k in invested assets is a very nice place to be!