August 2015 Net Worth Update   

August 2015 Net Worth Update  

What the hell is going on in the stock market these days?

Within one week the S&P 500 index dropped over 11%, however a few days later it recovered to cut that loss in half. Below S&P chart for the month of August – note the ass whoopin’ at the end.

Source: www.bloomberg.com

Source: www.bloomberg.com

It’s times like this I wish I didn’t check my personal portfolio regularly…I took a $4k hit investments in August, however, I invested a good chunk more which basically kept my portfolio even on the month.

When the stock market takes a dump like this people tend to panic a little, which is understandable.

If I planned to retire tomorrow I’d be devastated because I’d have to sell some of my investments to live off and swallow some of this $4k loss I just took.

HOWEVER…

I’m not retiring tomorrow, or any time within the next few years, so I don’t give a rat’s ass. In fact, now I can buy stocks at a discounted rate. As far as I’m concern CNN Money and their doom and gloom headlines for the month can suck it…

For those of you looking to retire soon and sweating market swings, check out PK’s article on this blog where he talks about investing for retirement.

My Light at the End of the Tunnel

I’ve talked a few times on this blog about my dividend growth strategy. The beauty of this investment strategy is it allows you to focus a lot more on dividend payouts rather than the volatile value of the stocks themselves. (Note: dividend paying companies typically outperform non-dividend paying companies, so I’m golden)

Each month I tally up the amount of dividends I receive. These dividend payments continue to grow for two reasons:

  • I’m investing money each month, so with more shares I get more dividends
  • The companies I own continue to increase the amount of dividends they are paying per stock unit

All this is great news, but it gets even better! Each time when I get paid a dividend, instead of spending it on hookers and blow (just kiddin’ Mom!!!) I reinvest them and buy even more stocks! So even in months where I may not be able to contribute new savings, my nest egg still continues to grow!

My annual dividend payments/reinvestments for 2015 will be approximately $3k. I’m planning on growing that figure to $5k in 2016. This is the beauty of having your money work for you.

Other Stuff

My mortgage is up for renewal at the end of September.

Since buying my first house five years ago I’ve gone with a variable rate mortgage, which has served me extremely well in this low interest rate environment. I do have the option of a fixed rate, but I’ve always felt lenders typically offer fixed rates at a premium (and not just to be nice). For now I’ll stick with variable.

I continue to use a mortgage broker. As PK mentioned in an earlier post (this guy just keeps writing hit after hit!) using a broker typically provides a better rate and has someone else do the shopping around for you.

Below is my net worth update figures for the month of August:

Net Worth August 2015

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9 comments

  1. I just LOVE times like these.

    I made over 50% profit when I first discovered this kind of gold mine back in the stockmarket crash of 1987. It’s “buy now at last year’s prices”. Brilliant stuff.

    Every time there is a massive hit, it’s due to panic. And it always gets worse for a bit. Then they realise that the sky is not actually falling in, and it gets better again.

    Buy when others are selling. Sell when others are buying. Perfect marketing sense.

    • Jonny

      Exactly Chris.
      I personally have never held investments during a large scale economic recession but I’d be all for one for the same reason as you.
      Stock prices are at an all time high, and they may go higher, but eventually our economic storm will come!
      Thanks for stopping by!

  2. Your website highlights the importance of savings and investments.

    A very startling survey revealed that most people over 60 have nearly no savings for their retirement and are living on the poverty line.

    Most young couples can’t save or get a mortgage because of financial constraints.Saving for the future is essential and would recommend we save at least one tenth of our earnings for the next 30 years. Your website is very informative.
    Richard recently posted…My Review on Wealthy AffiliatesMy Profile

    • Jonny

      Wow, that is a very troubling stat. I wonder what will become of them.
      Here in Canada if you contributed to our national pension plan and are over the age of 65 you and your spouse can bring in about $20k each which is $40k total. Certainly, not living la vida loca, but possible to survive…if you don’t have massive debts.
      I would say 10% saving is a good starting point – if you can get that figure up to 20% you’ll be laughin’ all the way to the bank!!!
      Cheers

  3. Hi, I’m currently only saving in funds, if that’s the correct term for it in english.. ? And I have a little bit of money stored away for times like these – And wondering what I should be looking for when I want to start investing in stocks. What do I start looking at? Are there any No-Go’s? Thanks, I’m a bit of a newbie.. Just here to learn :)

    Jonas

    • Jonny

      Hey Jonas – just by asking that question I would say you’re way ahead of most people.
      So you’re mostly saving and keeping that money in a bank account earning very little interest.
      There next step is to determine whether you’re comfortable investing in your own (which is a whole lot easier than it sounds) or if you want to use an investment advisor.
      Advisors cost more but can be worth the extra cost of they’re skilled. Make sure you use an advisor that comes highly recommended.
      If you want to invest on your own I suggest finding an online discount brokerage that operates in your country. There’s a ton on info on this site to help you along and I’m always more than happy to help if you have questions :)
      All the best,

  4. Hi Jonny!
    Very informative post! Although I don’t much on the stock market, but I was able to understand everything that you said.

    Actually I really want to learn to start to invest in the stock market but most of the sites that I have gone into are too complicated to understand.

    What would you recommend I do to get head start in investing in the stocks? I will really appreciate your response. Thanks!

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