If you are a follower of my blog and have read the net worth report of January, you should be shocked by the number. I am, too. Yeah, it’s that bad. Since I’ve started writing my net worth reports in October 2017, my net worth has dropped every single month and this month was a heavy loss!
Overall, I’ve lost more than 4,000€, so it has nearly been cut in half. It sounds even more terrible because I told you guys, that this month should be the first increase since then.
However, before you leave and think I totally messed up, I want to share with you a brief overview, why this has happened.
- Last month I haven’t considered that I need to pay the rent and the deposit for our new apartment in February.
- I expected that the bill from my first freelancing project in January would be paid in February, but the money will probably come in on the 2nd March as this is the date where they have to pay by contract. So when this post is published, I hopefully have more than 6,000€ from that company.
- My stocks fell very much due to the market correction in February.
These are just some things that are going on right now. I will get more detailed in the sections below.
So without further ado, let’s dive in.
My total net worth
Note: All Dollar values are calculated with Googles exchange rate from Euro to Dollar on the 2nd March 2018! I prefer EUR over Dollar as it’s easier to compare my performance without a dependency on the recent exchange rates. The monthly changes in dollars are not calculated from the last month but from the exchange of the according EUR values.
My total net worth of this month is 5,809.94€ ($7,130.77)! [Change: -2,426.08€ ($2,977.63)]
First, let me give you an overview of my different accounts:
- Checking account: 516.28€ ($633.65) [Change: -1,447.81€ ($1,776.96)]
- Freelance checking account: 1,200.00€ ($1,472.81) [Change: +1,200.00€ ($1,472.81)]
- Freelancing savings account: 0.30€ ($0.37) [Change: +0.30€ ($0.37)] Forget that account in my last net worth reports
- Savings account:
- Emergency fund: 0.23€ ($0.28) [Change: -1,200.00€ ($1,472.81)]
- Apartment savings: 0€ ($0) [Change: -1,150.20€ ($1,411.69)] Account was removed
- Car savings: 0€ ($0) [Change: 0€ ($0)] Account was created
- Working equipment savings: 200.02€ ($245.49) [Change: +50.00€ ($61.37) ]
- Wedding savings: 1,063.17€ ($1,304.87) [Change: +50.00€ ($61.37)]
- Vacation savings: 500.09€ ($613.78) [Change: -100.00€ ($122.73)]
- Depot account (investing [ETF]): 1,139.75€ ($1,398.86) [Change: -43.14€ ($52.95)]
- Investing cash account [ETF]: 4.41€ ($5.41) [Change: +0.24€ ($0.29)]
- Depot account (investing [DGI]): 1,165.77€ ($1,430.80) [Change: +208.28€ ($255.63)]
- Investing cash account [DGI]: 19.92€ ($24.45) [Change: +6.55€ ($8.04)]
Terrible, but well, we need to get into. My checking account is pretty low now. I didn’t receive a payment this month, so this means I’m not getting paid since the end of January and there it was just half of my student job salary. I was expecting the money of my freelancing business to be in my bank account already but I hope it will be tomorrow (2nd March).
To cover all of my costs, I transferred 200€ from my vacation account which was increased by 100€ through my monthly contributions before. I will fix this as soon as I got the salary.
My freelancing account seems like I’ve made some money but you see the same amount decreased in my emergency fund. In Germany, we, as business owners, need to make a VAT tax payment for a month at the 10th of the following month. It took me a while to set all of this up but the money can be charged on a daily basis and as I’ve charged nearly 1,000€ VAT in January and only paid 60€, I was expecting a huge payment from this account. However, I should get that money back as well.
I eliminated my apartment savings by spending all of them for the deposit and the kitchen. It’s great to be able to pay this without taking a loan or so. Therefore, I now will start saving for my first car in another account.
The other accounts were mostly as expected, except the drop in my investing accounts because of the market correction.
Net worth detail: Income
Overall income: 400.00€ ($490.94) [Change: -571,14€ ($700.98)]
In more detail my income looks like this:
- Support from my parents: 400.00€ ($490.94) [Change: 0€ ($0)]
This month, I haven’t received any payments expect of the small amount from my parents. This is also the last month they will provide me that cash support as I now have a full-time job.
As mentioned before, the company I’m working for seems to be very accurate and pay the bills on the very last day. Somehow I understand that because they can let the money work in their favor and wait until they have the money from the clients I’m working for. They are just in the middle and put me in contact with those companies. On the other hand, I was expecting the money to be in my bank account 1-2 days before the end of the contract deadline. Well, I know this for the next month and February has only 28 days while they have a payment period of also 28 days.
Next month should be much better and easier as I will probably get paid for January and February.
Net worth detail: Expenses
Overall expenses: 2,698.01€ ($3,311.38) [Change: +1,291.58€ ($1,585.21)]
In more detail my expenses look like this:
- ATM money: 260.00€ ($319.11) [Change: +110.00€ ($135.01)]
- Rent: 630.00€ ($773.22) [Change: +630.00€ ($773.22)]
- Mobile phone contract: 136.84€ ($111.49) [Change: +105.85€ ($129.91)]
- Insurance: 88.39€ ($108.48) [Change: +1.29€ ($1.58)]
- Spotify subscription: 4.99€ ($6.12) [Change: +4.99€ ($6.12)]
- Credit card payments: 115.23€ ($141.43) [Change: -304.01€ ($373.12)]
- Amazon: 46.87€ ($57.53) [Change: -24.01€ ($29.47)]
- Development stuff: 219.79€ ($269.79) [Change: +19.79€ ($24.29)]
- Blogging stuff: 0€ ($0) [Change: -40.02€ ($49.12)]
- Train tickets: 8.15€ ($10.00) [Change: -96.45€ ($118.38)]
- Miscellaneous: 1,090.68€ ($1,338.64) [Change: +787.08€ ($966.01)]
My expenses went up again, but well, now I have to pay a rent. I also made the deposit and we had to buy the kitchen of the previous tenant. This means only for our new apartment I had to pay 1,890€. This means, without that, I would have performed pretty well and even dropped my expenes by roughly 600€.
My insurance went up a little because my health insurance company increased their monthly rate. This position will increase again next month as we need more insurances and I also have to switch to a private insurance company otherwise I will have to pay more than 700€/month for the state-mandated health insurance. The private one will only cost me 265€ but has its drawbacks as well.
I needed a new mobile phone contract for my Apple Watch to have an eSIM in it (only one company offers this). This is a payment which makes sense for me as a mobile developer.
Net worth detail: Investments
My investments look like this right now.
- Dividends received: 0.24€ ($0.29) [Change: -4.09€ ($5.02)]
- Fees paid: 10.25€ ($12.58) [Change: -8.40€ ($10.31)]
- Taxes paid: 0€ ($0) [Change: -0.82€ ($1.01)]
- Stock value: 2,305.52€ ($2,829.66) [Change: +165.14€ ($202.68)]
- Money in my cash accounts: 24.33€ ($29.86) [Change: +6.79€ ($8.33)]
I increased my dividend growth stock portfolio by a very interesting reinsurance company. However, this is somewhat a risky move as this is the second reinsurance company in my portfolio of just 4 stocks overall. I will need to diversify more in the upcoming months.
The market correction in February leads to a noticeable smaller increase in my total stock value. However, I’ve purchased stocks for 283.20€ and I am happy when the market drops a little because this will give me the chance to find some bargains. Maybe next month I can use this to add even more shares to my portfolio.
This month I didn’t screw up the order by making a foreign country order and therefore paid less in fees.
I only received dividends from my ETFs but starting in March there will be a streak of 5 dividend-paying months in a row from my dividend growth stocks.
I don’t know how the next months are working out but I guess I can increase my contribution to at least 500€ (300€ currently) per month. This will help me to accelerate the process of accumulating dividends even more.
Note: I won’t tell you what companies exactly I’ve purchased. The reason is, that I don’t want to influence any person to buy a company that I buy. Your circumstances are maybe totally different and a good buy at that time could be bad now. I also think that I am far from being an expert and I don’t want you to judge and buy a company because of my opinion. Anyway, I will add guides on how to pick successful DGI companies soon. For now, check out this post to learn more about the strategy.
Net worth detail: Financial goals of 2018
Let’s compare my financial goals of 2018 with my situation in January:
Note: For simplicity, I have cut my financial goals a little. I tend to write them down as whole sentences after the SMART principle. If you want to know what’s that about, make sure to check this post.
I was able to increase my portfolio volume but as mentioned in the report last month, I don’t think this is an important goal I should follow. I am seeking for (safe, huge, and growing) dividends. Therefore, it’s much more important that I was able to increase my annual forwarded dividend by 13.20€.
The rest went pretty low but now I am able to start saving for my very first car which should be achievable in the next 6 months.
What do I expect the next month(s) to be?
The one bad thing this month was that I didn’t receive my paycheck. But this means it will come in the next days and if the client, I am working for right now, is approving my next bill tomorrow, I will be able to get the payment for January and February in March which would be something like 14,000.00€.
But this comes with the side effect that I have to pay a large sum of taxes and make again a lot of upfront payments. Anyway, I can put the money back in the vacation savings account and finally start working on my emergency fund again. I will try to build that at the same time as I am saving for our first car.
For my freelancing work, the company booked me for a longer time (end of February was the original plan but now it’s mid of April). As soon as I have my first payment, I should be in a very good spot and that I have a safe working place for the next one and a half months would make it even better.
It’s still a lot of guesswork until I finally see how much taxes I need to pay. But Mrs. Budget will also take some of our coming expenses and they shouldn’t exceed 1,500€/month (without taxes) for me. I hope, in a full working month, I will be able to keep $3,000 for savings, spending and investing. But I also have to take care of the other months. We will see how this works out.
I also cut some of my expenses but I will talk more about it next month. In general, I’m expecting my net worth to grow rapidly starting in March.
So how was your net worth behaving in the last month? Let me know by leaving a comment in the comment section below.