If you believe you have a high net worth that means you have likely achieved many of the goals you have set out for yourself financially. That’s great.
Nothing happens over night unless you win the lottery or something extraordinary happens in your life financially.
For most people we put a little bit of money in the buck and hope that it continues to grow into our retirement years so we have something to look forward to.
High net worth
What is a high net worth?
It’s all relative to what your income might be, your savings ability, your debt load, your investments, your age etc. Sometimes we hear that our net worth is high but really it may be high to someone else but not to us because our goals are set and we are aiming to achieve them.
When I think high net worth I think being able to live comfortably for the rest of my life being able to do the things that I want to during retirement. I’m working hard now to make sure that the money is there so we don’t have to worry.
Not everyone will look at our net worth as being high, we don’t in comparison to our long-term goals. We look at other couples who are similar in age and have what we believe is a high net worth but comparing your net worth will never work.
I wrote a post once about how comparing your financial numbers is a big but for the sake of argument an measure to see how others in your age group may be doing. Everything in your financial bank depends on your life.
In essence, we all have our own personal beliefs of what a high net worth is and what will make us sleep better at night.
In fact, some people could care less what their net worth is and would rather just track how much actual cash they have in the bank. They feel that anything other than cash could sink in a heartbeat so it’s not money in your hands until it’s real money in your bank account.
Whether net worth is important to you is for you to decide no matter what way you look at it. What you set as a high net worth or a long-term goal is financially is set by the way you choose to live your life and how you use your finances.
It’s your money at the end of the day and if you want to have more, then make your money work for you.
However you choose to do that just know that everything that deals with money comes with risk. Money can come in one door and out the other in an instant.
What is a high net worth to you?
Understanding net worth
What Does Individual Net Worth Mean?
Net Worth is a snap shot of your financial health sort of like a picture or debt to net assets. In simple terms it’s a total of the value of your assets minus your liabilities.
Determining net worth
Figuring out net worth is fairly easy as long as you know your personal numbers or monthly finances.
Net Worth is simply adding up all your assets (what you own) then taking away your liabilities (what you owe) which will give you a net worth number.
Understanding your net worth will help you determine if you are on track to meeting or beating your personal financial goals. It doesn’t get any easier than that.
Do you know how to calculate your own Net Worth?
Now you can stop asking yourself, how do you find out your net worth because it’s easy to determine.
Why not go ahead and calculate your own using our Free Money saving Tool Net worth Calculator (Canadian Budget Binder 2012)
Below are our 2014 target goals some of which are the same from 2013 and many which are new for 2014. I don’t like to move on to new goals if I have other goals that are unfinished but I also like breathing room and play time if you know what I mean.
I hope by posting them each month it motivates me like it has this past year to get stuff done and reach our target goals with some form of ease although nothing in life is that simple.
I find it’s much easier to be held accountable when I share what we need to do with all of you.
Do you set goals for your year?
Our short-term goals 2014
- First is to pay off our mortgage in full as of April 2014.
- To renovate the upstairs bathroom
- Re-model the spare bedroom (ie: decor, furniture)
- Start working on putting in the new flooring in the living and dining room
- Install a central vacuum system
- Purchase a new washer and dryer
- Purchase all new kitchen appliances
- Purchase 2 medium-sized freezers
- Finish the landscaping in the front and back yards.
- Invest more in our TFSA, RRSP etc.
- Continue to meal plan, create new homemade meals- I’m always whipping up something new in the kitchen (check out all my new recipe index on the blog)
- To sow and grow more vegetables/herbs in the garden to save money
- Learn more about passive income
- To read a new personal finance book
- Learn more about Search Engine Optimization and blogging and how to manage my blog.
Our long-term goals 2014
- Finish renovating the entire kitchen
- Finish renovating the entire master bathroom
- Save for a holiday
- Start planning basement renovations (bathroom, bedroom, family room, laundry room, office, storage area.
- Look at new ways to invest our money ie: rental units
- Continuing to educate ourselves on personal finance and investments
- Continue to network with other like-minded people
- Continue in my new career in hopes of it becoming long-term permanent
Our financial numbers
When budgeting anything is possible, we are proof of that although we still have a long way to go in our journey.
These are our numbers and our goals, not a means of comparison towards your own goals to others target goals.
We don’t care how much money others make or if they have a high net worth or if it is lower than ours as it’s not a competition.
I hope our experiences perhaps will help guide you along your financial path working towards debt freedom.
Not everyone has the same path in life. Some of you may have had to start over like I did or go to school a second time and now have OSAP loans to pay back.
Others may have divorced, lost money in the stock market or other investments, lost a job, fell ill and so on but you can’t let that stop you, I didn’t.
Some of you may have been given trust funds, paid-for homes, paid educations or perks in life that give you a financial kick-start and that’s OK too. Remember what I said, “It’s not about how much money you make, it’s how you save it”.
Focus on you and don’t let the evil eye of money jealousy or keeping up with the Joneses cloud your vision. No one cares about your money as much as you do so don’t waste your energy trying.
The only reason people accumulate wealth is because they know how to save or invest it wisely even if they did inherit money or win the lottery.
The smallest improvements should mean big strides in working towards reaching your goals.
Sometimes we have to fail in order to learn and we’ve all been there. Money can be an evil force for some people especially those who are negative towards their own situation.
I urge you to be optimistic and little by little with determination you too should see improvements, that is if you want that to happen.
Our net worth
We are always looking for ways how to increase our savings and by tracking our net worth these numbers below show us how well we are doing in terms of meeting our target numbers or what areas we should put a bit more focus in.
As you will have noticed by now, there are two graphs this month. This is intentional and is all part of the changes that happened at the end of year 2013 and beginning of 2014.
The first table shows the increases in Net Worth as per usual. January was a good month with a helping hand from a falling dollar which increased the part of our net worth currently held in UK Sterling.
The second table shows exactly the same amount of changes with the addition of a reduction in vehicle values. As almost all cars depreciate in value, then it was always going to be inevitable that I would have to reflect it in the net worth statement sooner or later.
We have also increased the house value due to smaller houses on the same street going for a figure of $349,000 on a fairly regular basis with no signs of trouble.
This news is fantastic, but I have gone ahead and shaved off 10% as that is what is suggested the housing market is over valued at.
This new net worth figure of $565,306.28 will now be used as our base figure for the forth coming year.
If at any point the housing market crashes, then an appropriate figure will be replacing this new house value.
Net worth updates 2013-2014
Below you can click the links to read past net worth updates to see if we were on target or if we struggled with some of our numbers.
There are two Jan 2014 bars in the above chart, they represent the two increases posted above in the two tables. The first Jan 2014 figure is the normal increase in net worth and the second illustrates the increase in house value and depreciation in vehicle value.
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