Our Net Worth

Why Earning More Money Won’t Solve Your Financial Problem : August 2018 Net Worth Update (+$6986.97)

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Why earning more money won't solve your financial problem-1



So you’re earning more money and happy about it but what you do with that money is the REAL celebration because a dollar sign is nothing more than a number that can be worth more or worth less.

Most often when people search for answers they look for the dollar sign because they believe that money will solve their financial problem but this always isn’t the case. Instead of celebrating the windfall celebrate the win which is knowing where all your money has gone, where it is going and what you have to look forward to.

That’s the impressive part of finance.


Help me solve my financial problem


When I’ve spoken to people about debt which can be a tough topic to bring up the conversation of earning more money comes up. Someone always has ways to kick in some cash under the table, a second job prospect or a business opportunity all to ease financial burdens.

When minimum wage went up in Ontario to $14/hr at the beginning of 2018 there were celebrations because that meant more earning power. Sadly, that didn’t last long as just about everything has been going up in price and even groceries are slated to take a jump in price once again to keep up with cost pressures.

Recent cost pressures on the industry, including rising minimum wages in some provinces, increased fuel and transportation costs and an ongoing trade war with the U.S., will soon result in some price inflation, said the chief executives of Metro Inc., Loblaw Companies Ltd. and Empire Co. Tuesday at Scotiabank’s back-to-school conference in Toronto.

There are people who celebrate financial windfalls, salary increases or a new job with a higher hourly rate because the dollar sign subconsciously soothes us from debt. The more money we see the better we feel and believe that everything will be alright and that things are looking up. But, what are you really doing about that debt?

You might think I’m trying to take something that is positive for people and dumping it in a hole but ironically I don’t have to do that because people do that themselves. Not everyone, but for those of you who aren’t doing anything but paying bills and hoping for the best you may find that you could have, should have and may want to do more.


Solve the problem or band-aid it


Who cares about net worth? Why bother budgeting? These two questions are not uncommon in my world as a financial expert however I’m not always successful in obtaining a win from those who want the answers.

You see, for the people who are tracking numbers they already see their financial picture and ways to improve it. Knowledge is key but even for the doer’s their must be ‘action‘ which means doing something about it. Knowing and doing are two different things and together are a celebration on its own.

On the other hand those who do not budget or track their net worth they estimate their success by how much money is left in the bank or other financial institution or investments. The dollar sign takes precedence over the meat of the matter which is the answers to three questions which everyone should know the answers.

  1. How much debt do I have?
  2. How long before I pay it off?
  3. How much will it cost me? (short-term, long-term)

If you are one of those eager investors out there that won’t pay off debt because the interest is low and you believe you can make more money otherwise this isn’t about you. The people I’m interested in reaching are those who put off financial responsibility for the easy way out but often suffer in the end.

Ask yourself these questions…

  • What have I done with any extra income I have earned?
  • How much money have I put towards debt so far this year?
  • How much interest have I paid on my debt?
  • When will my debt be paid in full?
  • What other ways can I pay my debt off faster?

If you are struggling to answer any of the above questions then your financial homework is left incomplete and I’m sure you can remember what happened when you didn’t finish your homework in school, you risked failure. You will also fail at finance if you don’t get on top of things and stop pretending that earning more money will solve all of your financial problems because for lots of people, it won’t.

Know your debt, tackle your debt and set clear goals before you start planning that dream holiday, buying that home, renovating and splashing cash just because you think it will be a long-term cash flow. I’m sure anyone who has suddenly lost their job for whatever reason would stand up right now and tell you how fast things can go wrong.

Even though I received a salary increase for the 2018/2019 year of just over $5000 it helps us grow our investment portfolio and eventually I will reach the top cap of our salary tier. The thing is, I can’t rely on it. Your job, your health and everything else in between can go wrong so any money that is earned MUST be put to good use and your financial health evaluated on a monthly basis.

I’m not sure how some people do it because I’d be all over the place not knowing what is happening with our finances and perhaps some may think I go overboard but I don’t think so. A simple monthly budget, tracking system (saving receipts) and calculating net worth monthly really is the basics of finance.

The point of this post today is just a reminder that “It’s not about how much money you make, it’s how you save it” and if you don’t know how you save you really should make that a priority in your life.

Discussion: What was the best and worst financial decision you’ve ever made?


Our Net Worth August 2018


August 2018 Net Worth Losses and Gains

Where did all of our money go this month?

I always like to remind myself that any increase is better than a decrease in our investments portfolio which is why I like to think long-term. We are risk takers when it comes to investing which we are fine with which has seen some lovely financial gains for us over the years. Like anything we are always on the seat of our pants as any investor should be.

You will notice that our cash and savings went into the negative in August and that is because I topped up my TFSA and RRSP so I’m no longer behind. Essentially the money was moved from one category to another. I’m all caught up and moving forward now which was a long-haul but I’ve reached my goals and now have to worry about continuing to do so for the future.

Last month I mentioned a house on our street had come up for sale that was similar to ours and it finally sold. It took about 3 weeks on the market and they got what they wanted, $659,000 which is average for our city.

Just to get into an old town-house starts at over $300,000 and where new townhouses are just as expensive as an older detached home such as ours. Mind you it seems that most of the new houses that are being built are hitting the million dollar mark but there’s no way we would even think about moving in to one of them.

Can you believe it’s almost October? Wow, this year is flying by so fast.

That’s all for now…

Chat to you all soon.



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.

We credit the growth of our net worth due to patience, perseverance, using a monthly budget and not giving up. Your numbers may go up and down but don’t let the numbers scare you rather understand why and move on.

If you would like to use our budget I offer a FREE downloadable budget which I created and that you can use at home just like we do. I don’t charge for it because I want you to save money not spend more!

There are tonnes of other free printable lists offered at Canadian Budget Binder to help you achieve some of those financial goals and build your net worth.


Calculate Your net worth


August 2018 Preceding 12 Months Net Worth

Do you know how to calculate your own Net Worth? We like to calculate our net worth every month so we know if we are still on track. Some people calculate it yearly or quarterly but it’s up to you and how informed you want to stay when it comes to your financial health.

Net Worth is only an estimate and not everyone uses the same type of figures to tally it up. Some of you may not include vehicles like we do or leave out assets inside the home like we have. You might be that person that believes that your house should be excluded. It depends on what you want to calculate or what you can sell today and make money on for tomorrow.

Figuring out net worth is fairly easy as long as you know your personal numbers or monthly finances which means you need to do your homework. 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.

How to Determine Net Worth?

Net Worth = Assets – Liabilities

Why not go ahead and calculate your own using our Free Money saving Tool Net worth Calculator (Canadian Budget Binder 2012)


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, suffered job loss, fell ill or injured on the job etc. but you can’t let that stop you from achieving your financial goals.

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”.

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 have a negative attitude towards their own financial situation.

I urge you to be optimistic and little by little with determination you too should see improvements, if you want that to happen.


Net worth updates 2018


Click the links below to read 2017 net worth updates to see how we made out following our own budgeting and investing rules.

That’s all for this months net worth update but please check in at the beginning of  September 2018 to see how we made out in August 2018 with our financial portfolio.


It’s Not About How Much Money You Make It’s How You Save It

Don’t forget to Subscribe to CBB and Check out our 2012-2018> Monthly Budget Updates

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One Comment

  1. I love the opening section of this post; earning more money won’t solve your financial problems. Most raises are so small for most people it doesn’t really move the needle, but over the years those raises add up to serious money. While those small raises roll in year after year, people inflate their lifestyle to match those small raises. At the end of a decade, they have nothing to show. I have made a habit of banking all my raises for the last year. Even if I only increase my automatic Vanguard contribution by $25 per month, that is still a win for me.

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