I'm back in the red. I almost blew a gasket calculating this month's net worth. No more credit card debt (yay!). But the start-up business costs and the new car put me in the red for the first time since October 2007. I could feel my heart racing as I wrote out the three big debts:
Car 1: 9K (13K last month)
Car 2: 30K
Business: 10K
That's a lot of money, 49K in debt. Negative net worth again. But it's not that bad. The negative net worth is mostly an artifact of the very conservative way I calculate net worth. I don't include non-cash assets. So, that means the 50K in cars (conservative) is not valued, and the 25K in business assets and inventory (also conservative) are not included.
Not so long ago, I was staring at 80K in student loans out of grad school. That was truly terrifying. This time I have the stuff to back it up!
Today, every debt I have correlates to a thing that could be sold for far more than I owe. I feel like I've come a long way.
I choose to focus on the positive, and the positives in my negative net worth are really quite staggering:
* all debt is now secured in stuff with substantial equity
* at 25 and 26, we have 45K in retirement, which is quite a lot, even in PF blogs
* business debt is the (small) price we paid for fiance's freedom in self-employment
* we donated a 5K car and lots of smaller amounts, more this month than all of last year
So, I'm proud of my negative net worth!
4 comments:
You have a lot to be proud of. Congratulations !!
Congrats!! I don't include non-cash assets either :)
$45k is impressive
I'm only at $17k lol... long ways to go to catch up!
Conservative is a good way to go with estimating debts and assets, especially considering the cars depreciate fairly rapidly (plus, there is always the chance of getting in a major accident; insurance would probably cover it, but you still might have to pay your deductible, plus your insurance rates might go up...). Nice job with the retirement savings. Everything I read says that saving for retirement early in one's working life is so much more productive than saving later in life.
Congrats!
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