February 2012 Canadian Budget Binder Net Worth Update
Welcome to the Canadian Budget Binders February Net Worth Update of 2012. I would like to have this posted by the end of each month or at the earliest the beginning of the following month.
We’re a married Canadian couple in our mid thirties with no children living in the Greater Toronto Area. We post our finances and budget for all to see although we remain anonymous. We do realize having children costs money so your budget may differ from ours from that perspective.
At the end of the day if you make more or less money, have more or less debt, or have children a budget is a necessity for everyone. If you want to save money and not spend more than you make you need a budget.
Our numbers are small compared to what some people stash away but we don’t care. We care about what we save and you should only care about what you save. No one is going to pick your family up from the ground but you, so care about your own life first- forget what your neighbour has!
This blog is about learning from each other, our mistakes, our triumphs and how Canadians can keep themselves above water in tough economic times.
Thanks for being a follower of our blog and we hope you enjoy and learn from the vast degrees of experience and knowledge all the fans bring to this site.
Cheers
Mr.CBB
What’s Been Happening In February??
We have made some significant changes to our budget since last month. The budget spreadsheet has gone through a huge overhaul and we are now testing it out for the next month or so. That we will be able to tweak it if need be. Hopefully we will be able to roll this out to our subscribers shortly.
Some changes you will see to our Net Worth are reflective of the Budget Changes I talked about earlier here.
As of today March 1, 2012 our Investments have dipped about 0.52% which is kinda crappy but it is what it is, at the moment. I’m sure tomorrow will be a better day. We are down about $335.21 today compared to yesterday February 29, 2012.
Some Changes and Insights
- Instead of putting all the money left at the end of the month into our savings account we are now saving monthly for items we know we will need to pay for throughout the year
- We have set up another savings account to put this money in. We will use this money to pay bills as they come in.
- Our Emergency Savings account is now true and we don’t have to worry about paying anything out of it unless we go far over our budget.
- We are now adding in our vehicles as part of our Net Worth after much thought. In reality if we had to sell them today they would bring in some money.
- We are also keeping a $460.00 buffer in our Chequing account at all times.
- We have chosen not to add in assets inside the home to our totals thus far.
- We contacted our real estate agent again to get a true market Value on our home if we sold it today so I am now using this price in my mix.
Our Goal each Month
- Simply, to put as much by as we can now to save for the future whilst enjoying the present. To spend less than we net each month. At the end of the day we are not competing with our neighbors or anyone for that matter. I believe once you have that mindset saving will be much easier.
Our Assets:
- Chequing Account Cash: $460.00- This is our buffer always in our chequing account. The amount in the account at any given time goes up and down.
- Savings Account- $ 1006.35- This is money we have but we will use at some point for bills. We accumulate money here each month in anticipation of certain expenditures.
- Emergency Savings #1-$42,000.00
- Emergency Savings #2-$15,295.00
- Emergency Savings #3-$48,300.00
- Pension(s)- $24,242.43
- Registered Retirement Savings Plan (s) (RRSP) $55,067.94
- Tax Free Savings Account (s) (TFSA) $12,776.37
- Vehicles-$15,000.00 – This is estimated value of both our vehicles if we sold them today.
- Principal Residence- $329,000.00
Total Assets: $543,148.09
In today’s market the house is worth about $329,000 as we purchased it under market value $265,000.00 due to repairs: painting, roof, new flooring in all bedrooms and kitchen in 2009.
I found this article on the Housing Bubble in Canada in January interesting as it highlights Canada’s housing prices are overvalued by 29% relative to income. Eventually we may start to see prices on homes in certain areas come down if they haven’t started already. Who know’s??
Our Liabilities:$163,654.92 (mortgage only)
$543,148.09 (Assets)-$163,654.92 (Liabilities) =$379,493.17
Our Total Net Worth: $379,493.17
How did you make out with your finances this month?
How will you make changes for the next month?
Share your comments here as I would love to read them.
Happy Saving Everyone!
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I tried a bunch of different types of investments, but Derek Foster’s book “The Lazy Investor” really was a game changer for me. He is one of the youngest people to retire in Canada and laid out a simple method to do the same.
More details:
Thanks I’m actually just getting ready to log in to the Library online so I’ll see if they have it. I’m currently reading “The Millionaire Next Door”. Cheers for the information I appreciate that mate!
Lol. “Millionaire Next Door” is my second favourite book on money and is on my blogs reading list! It’s a bit dry, but a must read.
I’m just in the first chapter. So far no surprise about your neighbour might look like they have nothing but they are well off. We don’t tell anyone about our finances, nor do we live like we have any money. I mean I don’t think we are rich but we certainly aren’t skint. It’s no surprise as well that many people who do have money have it because they spend less then they make.
I’m looking forward to reading the rest of this book. I’m just ordering the one you mentioned in the previous post from the library if they have it.
I look forward to hearing what you think of “The Lazy Investor”. It’s hard to find good investing books written for Canadians, by Canadians.
I ordered it so as soon as they ring me I will pick it up. I’m reading 2 books right now so hopefully I can squeeze another in. Cheers Mate.
A few questions… why do you have 3 emergency funds? Are they in 3 different accounts and is that money earning any income? Looks like you have $105,595 in emergency funds. You could buy some preferred shares and collect about $5k in dividends per year. If you need some money, just sell some shares. Or heck, even stick it in an ING account!
I see you have listed your house as an asset worth $329k and listed your mortgage as a $163,654 liability. Don’t forget if you sold your house today you would also have realtor fees, and may even have to pay your bank a fee for paying off your mortgage early. You wouldn’t walk away with $165,346.
Garth Turner had a post recently by a home owner that was shocked by all the fees involved with the sale of a home.
Hi,
Thanks for your post.
To answer your questions our Emergency Funds are in 3 different accounts yes. When we got married we both had savings in different accounts. We are not sure what to do with this money yet so that is why it’s sitting there. Likely we will maximize our TFSA, renovations, pay down mortgage and invest. This is all currently in the works.
Yes we are aware there are Realtor fees if we used the services of a Realtor however we likely would do FSBO and pay ourselves the commission. I was at one point contemplating the purchase of a Property Guys franchise and firmly believe in selling on our own first.
Yes I am aware that if I had to pay my mortgage off early there would be fees for this but I’m not at this moment. I don’t really see the point in selling our house to spend more on a bigger house or even pay more for a smaller house for that matter.
I hope that answers your questions.
Cheers mate!
Oh great. Makes sense. I just hate to think of $100k plus sitting on the sidelines. People always say I should have an emergency fund, but I have my money invested and growing. If I have an emergency, I can always sell some stocks.
I know what you mean yes. The money will be put to good use shortly but in the meantime it is what it is. I wish I was much more educated on stocks and investing but for the mean time I rely on an advisor. I would love to do all my own investing. How did you learn what you do?
You seem to be in very good shape. I’m very impressed at your emergency funds – quite high, and not one but 3 of them.
Yes, I know it’s a bit odd. We do want to complete renovations on the house and the rest we are still trying to sort out what to do with. We will be maxing our TFSA’s with some of that money soon. We could pay down the mortgage, buy a rental home. Not sure what to do yet. We work pretty hard to keep ahead and anyone can do this. Thanks for your post Ellen.