Yesterday's Thursday Talkback question was whether your finances were worse, better or about the same as this time last year. One of my readers, Kara, asked me the same question. I knew that my finances had improved over the last year but I had not sat down and actually looked at the numbers in detail. I pulled out the records for April 2007 and compared the numbers with April 2008 and here's what happened. The numbers have been rounded off for clarity.
- April 2007 - $446,694
- April 2008 - $449,543
- Result: Increased $2,849 or 0.64%
Liabilities (including Mortgages):
- April 2007 - $399,711
- April 2008 - $376,591
- Result: Reduced $23,120 or 5.78%
Liabilities (not inc Mortgages):
- April 2007 - $62,990
- April 2008 - $45,652
- Result: Reduced $17,338 or 27.53%
- April 2007 - $46,982
- April 2008 - $72,953
- Result: Increased $25,971 or 55.28%
Doing this exercise was surprising to say the least. I was a little upset that my Assets didn't break the 1% mark but I was ecstatic to realize that realize my Net Worth had increased over 50%. I was also happy to see that my non-mortgage debt decreased by almost a third. I think part of the reason I did not have a bigger increase in the assets category was due to losses in my retirement and brokerage accounts. Considering some of the financial pains some people are going through, I certainly cannot complain.
What have I done to improve my finances?
- Used a budget to manage my outflows and spent less than I earned.
- I paid off my lingering credit card debt. I no longer pay any credit card interest because I only charge what I can afford to pay in full when the bill comes.
- I saved as much money as I could.
- I planned for Emergencies by saving money in a separate account.
- I planned for irregular expenses by adding up the total amount and dividing by 12. I then saved that money each month in a separate account.
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