When I started this blog I promised myself to be transparent with figures, unafraid to show both the successes and failures. No time like the present to deliver on this and sum up how my net worth changed over the 2018. Below figures are my actual net worth figures for everything that I track.
Before we dive in, let’s define net worth for those amongst us who are unsure what it is. Simply speaking, net worth is the value of everything you have that can be priced up (properties, cars, art, jewellery is you track the value, savings, stocks etc) minus all your debt. Your income, debt monthly payments and expected investment dividends are not part of this. It’s literally the stuff you have minus the cash you owe on it.
The figure is not a perfect way to define wealth but is an easy one to wrap your mind around it and if you track it, it also provides a good indicator of how you are getting on financially. Needless to say, it is better if your net worth is positive simply because in a personal catastrophe scenario you can sell things on and hopefully be ok. If your net worth is negative in a similar catastrophe scenario (loss of income or ability to generate income) and your possessions don’t pay for themselves, your debts will eat away the value of your estate.
So that’s that for definitions.
When I started tracking my net worth towards the end of 2013, my net worth was negative. My student loan tipped it over to -£10,780. Sad times, honestly. I paid it off by the end of 2014 resulting in a positive net worth of right around £4,000. In 2015 this increased by another £10,000 or so. In 2016 I purchased the remaining share in my property resulting in my net worth hitting right around £55,000 at the end of the year. Now onto 2017 – it was a busy year during which I sold my first home for £280,000 and purchased my current home for £275,000 and poured a lot of money into making it somewhat comfortable. I sold and purchased right at the end of a growth cycle – this means that property prices have been pretty stagnant since that time.
My detailed net worth at the end of 2017 looked like this:
I had two pension pots and was actively contributing to the Scottish Widows one. My other savings were slowly being rebuilt after massive expenses throughout Q2, 3 & 4 to upgrade my new home. My income at the time sat around £46,000 – £47,000 before tax. My net worth doubled, mainly because of the property sale.
My 2018 net worth is this:
Despite being exceptionally challenging, 2018 has not been terrible. I changed jobs, giving me slightly more budget to add to savings. I closed off all large and expensive projects and I am going into 2019 without a massive list of expensive to-dos. It’s a nice way to end the year.
Stay tuned for the 2019 net worth projection, coming up in early January.
Next on the blog, a review Adam Kay’s book ‘This is Going to Hurt: Secret Diaries of a Junior Doctor’. Without telling much more, if you ever wondered about working for the NHS (National Health Service), you should read this book.