Credit Card Debt
If you’re a new reader, let me start out as usual by explaining the credit card debt. I’m actually taking money from 0% APR balance transfer offers and instead of spending it, I am placing it in high-yield savings accounts that actually earn me 4% interest or more, and keeping the difference as profit. Along with other deals that I blog about, this boring activity helps me earn extra side income of thousands of dollars a year. Recently I put together a series of step-by-step posts on how I do this. Please check it out first if you have any questions. This is why, although I have the ability to pay the balances off, I choose not to.
Retirement and Brokerage accounts
There were three paydays in April for us based on a biweekly pay schedule. In addition stock prices are up about 6% from my last update on April 1st, making this month extra juicy. I estimate that capital gains accounted for ~$6,000 of the net worth increase. We also made our IRA contributions for 2007 before the April 15th deadline ($4,000 x 2), as well as $4,451 in 401k contributions in order to be on track to max out this year. All these things together made the value of our portfolio jump a lot.
Cash Savings and Emergency Funds
We did a bad job on increasing our cash savings, due to a big hardwood flooring purchase on top of the late decision to contribute to non-deductible IRAs. Taking into account the increased credit card balances, our net cash actually shrank. Need to fix this next month.
I’ve decided to switch to a simpler way to track home equity, as the previous method was a bit confusing. I have my estimated home value in the asset column, and my remaining loan balance in the liabilities column. The difference is home equity. I don’t use a Zillow estimate because that would put my house at nearly $700,000 in value, and although that sounds nice it’s not very accurate.
You can see our previous net worth updates here.
By Jonathan Ping | Goals | 5/5/08, 6:05am