GMGM’s Net Worth
Money is an interesting topic among Americans. It controls many peoples lives and we’ll talk about it abstractly all day but simply asking someone how much they make is very much frowned upon. Probe any further than that and you’re more likely to get a slap in the face than an answer. Of course, it depends on who you’re talking to and the context of the situation, but the fact is many people suck at money and not many want to talk about it. In a future post I’ll discuss why the money taboo is ludicrous but for now, let’s take a look at where I’m at, and my goals for the future.
Overall net worth (as of 1/14/17): $44,867.54
How did I do this calculation? Determining your net worth is as simple as using the following formula: assets – liabilities = net worth
What’s an asset? An asset is any financial account or item of value that you own. For example, my checking account balance and investment accounts, were factored in as assets. If I owned a boat or piece of land, they would be considered assets as well. A liability on the other hand is simply any debt that you have outstanding. This means credit card debt, car loans, student loans, and so on. It is in fact possible to have a negative net worth, and many people do, especially coming out of college with student loans from school and an entry level job.
So, how did I get to where I am currently at? There are a few key factors. First and foremost, I have no student loan debt. Until I graduated college, I didn’t realize how much of a blessing this was. I owe this to my parents. They worked hard to save and I picked a relatively low cost school so they were able to cover the entire bill. I realize how lucky I am and how common it is to have to take out loans but this helped the most by far. I also plan on discussing debt in future posts, but for now just understand that this is the reason I am not -$35k+. Also, thanks again to my parents, I had an investment account that was just over 20k by the time I graduated college. Again, I am benefiting from a bit of good fortune not everyone else has but it’s not a million dollar trust fund either. Throughout my years of working in high school and saving some birthday checks, I was also able to accumulate a savings account of 4-5k by my college graduation which was promptly put into an investment account.
Between no debt, the original investment account balance and my savings I graduated school with about $25k. A few months later, I landed an engineering job with a solid starting salary. This was then “adjusted” around the holidays. Because I was told to keep it confidential I will not share the exact number just to keep from pissing anyone off or getting myself into trouble, but it’s in the range of 55-60k. Since I started working, I having been living with my parents, by choice, and saving a crap ton of money. Everything past the starting 25k has pretty much come from my job.
So What’s the plan from here? Continue to save. I’ve set a timeline for myself with the ultimate goal of accumulating $500,000 in net worth in 10 years, starting from September 2016. In 1-2 months I plan to be 10% of the way there, at $50k. Here are some other target dates:
August 2018 – $100,000
January 2021 – $200,000
February 2023 – $300,000
January 2025 – $400,000
September 2026 – $500,000
If you need any motivation to start saving more, my recommendation is to begin tracking your net worth. As soon as I started to do that and gave myself goals to work towards, it became a fun game instead of a stressful reality. Need any clarification or have any questions for me? I’m an open book. Leave a comment below.