Net Worth Holding Steady

Okay, so my last blog post where I said it was okay for me to spend money because what’s the point of saving money if you never spend it?

Well, I feel a little bit sheepish about it now. Why? I finally looked at how our net worth changed over 2018.

I used to do yearly updates on my net worth, but then I got married and we combined our finances and I didn’t feel like it made as much sense to share it. Well, I decided to check again.

I didn’t have exact numbers handy from last year (since I only just decided I should do a comparison to last year). So I logged into our joint Mint account (does anyone still use Mint? I’m too lazy to try out something new). And looked at what our assets and debts were at the end of last year and compared them to 12 months later.

And…they’re not great. Well, actually, it’s better to say, they look great at a glance, but compared to last year, they look not so impressive. Because we pretty much held our net worth steady (it grew by about $10k).

$10k growth over a year is also nothing to sneeze at when you’re just starting out. Or if you don’t have a high income. Back before marriage + kids + house, I was increasing my net worth by $40k, $50k, or $60k.   But expenses now have had a significant impact.

So, by comparison, this smaller increase for a family with two incomes later in our careers should mean we should be growing our net worth even more.

But we didn’t. Ready for my reasons (excuses?)?

• The stock market has been all over the place. I saw a lot of folks talk about how their portfolio dropped a lot due to recent stock market losses. So even though we maxed out our Roth IRAs and contributed to our 401ks (including getting our matches) our retirement portfolios didn’t do so well.
• Our house lost value. Honestly, I include the house value (as estimated by Zillow) on my net worth as counter to our mortgage, but since we’re not planning on selling it any time soon, I’m not too worried.
• Speaking of our mortgage, one of our major expenses every month is our mortgage payment. Between the cost of the house itself (principal and interest) plus our high property taxes, we spend a lot every month.
• I made less than my full salary. I’m lucky enough to have a flexible schedule at work, so between my doctor appointments before the baby was born, the extra time needed each day for pumping after the baby was born, plus the general chaos of being a working mom, I don’t get my 40 hours of work a week. So, I get paid less (for working less). In addition to my schedule, I was also on maternity leave for 12 weeks, which was only partially paid.
• Healthcare. Having a baby is expensive, even with health insurance. We easily hit the family deductible in our High Deductible Health Plan, then had other medical expenses beyond that for the whole family.
• Daycare. We paid for a full year for my daughter and 5 months for my son. We spent about $36k on childcare in 2018.

How do we expect to do in 2019?

• The stock market is still uncertain. But we’re in it for the long haul and actually in the process of rebalancing our portfolios, so we’ll see how it goes
• Home value? Another one we’re not sure about (but not significant unless we wanted to sell it)
• We still will be paying down our mortgage at the same rate
• We should have a higher income this year. Between a raise for my husband, and me working more hours, we should be making more. No maternity leave, plus once my baby turns a year old he can start drinking cows milk so I won’t have to pump at work anymore. With my daughter, I ended up fully weaned from the pump by 13 months.
• We hope to have much lower healthcare expenses this year, but will still be maxing out our HSA contribution.
• Daycare will cost us even more this year with two kids in full-time care all year. Luckily when the baby moves to the toddler room his “tuition” will drop somewhat but we’ll still be paying around $45k in 2019 for childcare.
• Going to try to look at other ways to save money. While we’re stuck with some large fixed expenses every month, there are still some things we could cut down, like lunches out and lowering our cable bill.

So, a lot of unknowns in terms of how our investments will look at the end of this year, with an increase in income but also an increase in childcare expenses. But we knew that daycare would be a lot, and we’re grateful that we have this care and can (sort of) afford it for the next few years until the kids start going to the public school.

We also realize that personal finances don’t always go on a straight path. Everyone encounters ups and downs, whether due to luck or conscious decisions. Having kids was important to us, and we wouldn’t trade them for anything. So these next few years of high expenses are worth it to us (and one of us staying home with the kids would cost us more, especially in the long run, and we find tremendous value in having them go to daycare).

How did your net worth fare this past year? Were you hit hard by the stock market mess? Any unexpected changes (big money or life wins/losses)? If you wrote about your net worth recently, feel free to share a link to it in the comments.