Comments on: Monthly Net Worth Update – September 2009

By: 0% APR Offers: Sometimes it makes sense to borrow from credit cards - The Gabfest

Tue, 06 Oct 2009 16:46:42 +0000

[...] read about another blogger (mymoneyblog.com) who advocates taking the money from 0% APR offers and putting it in savings accounts. His strategy was more effective a couple of years ago when banks were offering 4-5% interest on [...]

By: Financial Samurai

Financial Samurai — Sat, 03 Oct 2009 09:31:54 +0000

How did you decide to add $27,000 in the value of your home? That is an illusion.

By: Alex Burda

Alex Burda — Tue, 22 Sep 2009 08:13:34 +0000

Cash is King!
Although many financial advisors may not agree at the moment I always love the safety of having cash on hand. There is a certain feeling of control when you know that bills can be paid on time or even in advance. Cash may not provide a good interest rate from the banks but if more banks had held a larger proportion of capital in cash reserves then maybe the Global Financial Crisis may not have hurt so many people.

By: NY GUY

NY GUY — Mon, 21 Sep 2009 17:25:10 +0000

At Bill,

You saying you wouldn’t park money into equities, contradicts what Johnathan is doing with his money in his retirement accounts. He feels it’s safe to wage his retirement savings on the stock/bond market but does not feel safe to invest beyond his retirement funds? Surely this guy does not need that large of an emergency fund, times are hard and certain streams of emergency might be tight but even still you’d be able to tap into the following…HELOC, personal loan, roth ira principal withdrawl, liquidate equity portion and other sources of funds.

He seems to have a large income between himself and wife, yet plays it very very conservative in his approach to financial independence. I read this blog and envy him on his choices and savings abilities, but if I had his income I would certainly be absorbing much greater risk to aquire wealth.

seems his risk tolereance only goes up when he uses ‘toy money’ such as his investments in online person to person loans and such. Other than that he plays it very safe.

All that said, when your income is so high you can afford to take less risk and slowly conserve and build wealth as he has been.

Godspeed

By: Financial Samurai

Financial Samurai — Sat, 19 Sep 2009 06:20:54 +0000

Howdie Jonathan – I wrote a new entry called “Your Net Worth Is An Illusion” and provided a positive shout out to your blog. Hope you enjoy it and appreciate it!

Best

Financial Samurai

By: Your Net Worth Is An Illusion! Sorry To Spoil The Party! | Financial Samurai

Sat, 19 Sep 2009 06:20:06 +0000

[...] do think it is fantastic that sites such as DINKS Finance, Consumerism Commentary, and My Money Blog are so transparent with their finances. I also agree with Money Monk’s post regarding cash [...]

By: Pat

Pat — Thu, 17 Sep 2009 14:19:24 +0000

Being the conservative accountant type, I’d probably not increase the value of the house until it is very obvious that home prices are more stable. No way would I increase it 6% in a month. I use about a 15% discount in my own Net Worth statement on the value of my home. But, in my area of the country, houses don’t fluctuate much, so it’s pretty easy to calculate.

By: Coupon Man

Coupon Man — Wed, 16 Sep 2009 18:30:15 +0000

It’s probably tough to estimate home value in this market, since you never really know until you try to sell. However, if you don’t plan on moving, your home price probably isn’t too important.

By: AnHonestMillion

AnHonestMillion — Sun, 13 Sep 2009 03:38:27 +0000

Regarding a home’s value, I always just tracked it as the price I paid initially and left it alone until I realized the sale amount. This is because the estimates didn’t affect how I budgeted or invested and clouded the movements of the other accounts where I could actually make an impact.

Not to say I didn’t check the valuation tools for fun and to decide whether it was time to sell and the price to list at.

By: Damian P

Damian P — Sat, 12 Sep 2009 22:15:39 +0000

how can you guys fault him for having 20% of his debts in cash? The fact is that most people, when they lose their job, tighten the belt severely and start resorting to doing stupid things like tapping retirement accounts, selling cars, etc.

Now if he continues to accumulate on top of $125K and has no additional need its a different story, but for now I think he’s doing the right thing.

You never know when a good opportunity is going to come along, so you should ALWAYS keep some semblance of cash on top of your “emergency” living funds in my opinion.

By: aggressive saver

aggressive saver — Sat, 12 Sep 2009 17:03:22 +0000

i’d guess the tax assessor gets valuations based on price per square foot of comparable sales in the area and multiplies that by the square footage of your property.

By: Wealthy Blogger List – September 2009 Update | Suburban Dollar

Wealthy Blogger List – September 2009 Update | Suburban Dollar — Thu, 10 Sep 2009 13:24:55 +0000

[...] My Money Blog [...]

By: Jonathan

Jonathan — Thu, 10 Sep 2009 02:58:04 +0000

Valpo Mike – I doubt the tax assessor has the time or resources to check Zillow for each house. However, if you plan on make a dispute for lower property taxes, they might verify actual bedrooms.

Hogan and Mike – I think the problem is in the technique itself. I always get comments like yours when the home values pop up a bit, but some other months the price will drop 10% or more twice in a row. This method depends a lot on local comps, so it probably undershoots and overshoots as new sales pop up. If you have a better alternative, I am always open to suggestions.

By: Hogan

Hogan — Thu, 10 Sep 2009 02:26:39 +0000

I know you qualified the value of your house but no house in California is going up 5.5 % in a month especially with all the equity stripping over the last twenty years pushing more homeowners into foreclosure and all the junk mortgages handed out like candy pushing up the values of homes no longer available

By: Valpo Mike

Valpo Mike — Thu, 10 Sep 2009 01:57:30 +0000

Hi Jonathan – Any concerns about the data on zillow (if you provided updates) will eventually be seen by the assessor and show up on the tax appraisal? My house on zillow is way off on bedrooms and bathrooms, but I fear updating it might lead to trouble down the road. Thanks

By: Ryan

Ryan — Wed, 09 Sep 2009 21:50:49 +0000

Jonathan, I could not agree more with you on the cash reserve strategy. I have an even bigger pile in cash right now just because of the market and economy situation. So far it is doing better than other investments if computed over 1 or 2 years. The only thing that I think is worth considering is to park half of it in something like BND which is relatively stable and earns a bit more than your “high yield” savings account.

By: Mike

Mike — Wed, 09 Sep 2009 19:30:52 +0000

I’m a fairly new reader of your blog and give cudos for such good work. I am curious to your process of the market value of your home. I see you have been consistant but it really just pops out, as you said, and somewhat difficult to digest that your home value increased 6% estimately in a single (1) month during the worst housing bubble bust in maybe all of mankind. What are your thoughts and confidence that this method accurately gauges your housing worth since it’s based from comps?

By: rob

rob — Wed, 09 Sep 2009 19:03:13 +0000

roth ira is a good emergency fund – mine will be huge after converting next year – minimizing tax implications by not working and stashing everything in home biz LLC S-Corp for that period. life is good not having lost anything on a house and dollar-costing into the market huge since december 08. still have 50k heloc and 40k cash on the side for emergencies – never use emergency fund in stocks or housing

By: Jonathan

Jonathan — Wed, 09 Sep 2009 16:57:38 +0000

That’s the thing about emergency funds. You put them in the stock market, and it tanks, which is exactly when unemployment doubles and you get laid off! How often does the market soar and you can’t find a job for 6 months or more… Same concept – You put them in HELOC, and it gets frozen right when you need it! Cash is king in this case.

Credit cards are a 0%, as stated. As long as my cash is doing better than inflation, I am happy. As my assets grow, my emergency fund will look smaller and smaller as compared to rest of assets.

By: CS99

CS99 — Wed, 09 Sep 2009 16:50:07 +0000

Helocs can be revoked by the lender unless they are drawn and therefore make poor sources of emergency funding. They could be the proverbial fianancial umbrella, where the loaner asks for it back when it rains (as a reminder, regulators are debating raising the capital ratios on financial firms which could discourage lending to some extent as banks will have to hoard more capital to safeguard defaults). I don’t think too much cash is a problem now. An intereting twist on a rule of thumb is “monthly expenses x unemployment rate x 100″.

By: chedv

chedv — Wed, 09 Sep 2009 13:05:05 +0000

It looks like you’re about even on your house now, that’s good news. How about taking 50K in cash and paying down on your mortgage and then turn around and apply for a HELOC. Use this as an additional emergency fund. Possibly get a rate of Prime, Prime +1 and leave it at a $0 balance.

By: Tyler

Tyler — Wed, 09 Sep 2009 12:14:19 +0000

Why in the world would you have over a years worth of expenses sitting at 3% interest while you have credit card debt at 5% that you could pay off while easily maintaining a great emergency fund. Am I missing something?

By: Krishna

Krishna — Wed, 09 Sep 2009 06:05:16 +0000

If you rent an apartment instead of having a mortgage, and you have your on-the-side consulting S-Corp running from the apartment, can you deduct part of the rent from as expenses?

By: Sarah

Sarah — Wed, 09 Sep 2009 02:32:19 +0000

Always nice to see this going up for you

By: Jonathan

Jonathan — Tue, 08 Sep 2009 23:20:21 +0000

- The emergency fund is in cash because what’s the point of potentially earning an extra few % a year when you have to withdraw when its down by 20% or even 50% at times. There’s still both upside and downside to the current stock market.

- You can definitely take the home office deduction as an S-Corp. Whether you actually satisfy all of the many rules and have valid proof for IRS standards is the harder question.

- LLC vs. S-Corp: See here:

http://www.mymoneyblog.com/arc.....efits.html