What changed when you started tracking your net worth?


#1

Rockstars!!!

I’ve got a question for you.

For those who are tracking your net worth :chart_with_upwards_trend: (and can remember what life was like before you started tracking). Answer one or all of these questions…

How did you feel before you started tracking your net worth and after?
Was it a huge, life changing, “lightbulb” moment? (Please explain your answer)
What have you been able to achieve as a result of tracking your net worth?

Looking forward to your answers.

(For possible inclusion in a post for my personal site this Monday. If you would like me to link to your site just leave your site URL. Perhaps link to where you track your net worth? That would make sense. If not, no big deal, I’ll just use your first name only.) http://howdoimoney.com/


#2

I added it up once a couple years into my career and was happy to see my assets were larger than my mortgage and student loan debts. That was a relief.

About five years later, I started tracking more closely as I approached the “two comma club.” I was hooked.

When I started to receive as much or more frustration than gratification from my job, I started comparing my net worth with my annual expenses, and that’s when I discovered the FIRE movement. The realization that I could maintain my lifestyle without continuing to work was a game-changer, as was the fact that I arrived at that point in under ten years.


#3

I am amazed at the difference it makes, especially when we establish money goals and are working towards financial independence and early retirement. We started tracking our net worth about 2.5 years ago, and I wouldn’t necessarily say that it was a lightbulb moment for me. Instead, it was simply a data point to be used in pursuit of my goals of early retirement.

Good topic!


#4

I’m just starting out now. My lightbulb moment was when when I went to buy something a couple of days before payday and realized I could not afford it.

I’m currently debtfull. Next is worthless. Then net worth.


#5

It’s been about 3 years since it really hit home that our net worth was growing beyond what was normal for our age bracket. Before that we were still frugal but there was no net worth monitoring or goal. As I’ve started to take more notice of the amount and the freedom of choice it provides my life has changed for the better. It certainly has given me more confidence to take risks.


#6

I started about 8 years ago after reading the book, Your Money or Your Life. I actually calculated it and put it on graph paper each to see the movement (now it’s on a spreadsheet). Tracking it really helped put our finances into perspective. Before, I tended to just focusing on the monthly cash flow, but tracking the net worth gave me a clear view of the big picture. While we were already saving when I started, tracking net worth really gave us the incentive to save even more and watch that number grow. It was at this point that we started increasing the retirement contributions each year to the point that we now max out our tax advantaged accounts.

I don’t share net worth at this point, but I blog at http://centsiblyrich.com


#7

@DerekOlsen I started tracking my NW in my mid-20’s. It was somewhat sporadic in the beginning, but at least I could see if I was making annual progress. It wasn’t until 2006 that started to do it more consistently.

I was on the fence for a long time as to whether or not I wanted to share my NW publically once I began blogging (2015). But, @J.Money was a big inspiration for me finally taking that step. Ultimately I share these numbers to give people insight to the details that most people will never discuss openly. If you’re interested you can check out my post - http://www.financiallyalert.com/im-all-in-time-to-track-my-net-worth/.

Tracking your net worth whether it’s private or public is critical to growing one’s assets. If you don’t know where you’re at, how can you know where you’re headed? It also provides motivation (positive and negative) to see your growth or decline. Ideally you build some growth momentum and ride it forward. That’s my 2 cents! :slight_smile:


#8

How did you feel before you started tracking your net worth and after?

I felt lost and fake confident before tracking it all. I THOUGHT I knew where all my money was but the reality proved me different! Afterwards it was true confidence I had and was the one thing that motivated me to actually start changing my actions because I knew that every move I made from that point forward would be reflected in my wealth. So it was a complete game changer for me.

Was it a huge, life changing, “lightbulb” moment? (Please explain your answer)

Yes!!! It forced me to take action vs just going with the flow the whole time. It became this game to see how high I could get it through all the various rates (spending less, earning more, investing, etc etc). It got me to start maxing out my 401k every year, maxing out my Roth Ira every year, and set me on a path to be more minimalist which was quite the feat for a once “collector of things” :slight_smile:

What have you been able to achieve as a result of tracking your net worth?

I went from $50,000 net worth to $500,000 in 8 years! And really outside of the first few years of trying to figure it all out, i’ve just been letting the machine do its thing and I keep feeding it…

(link to RockstarFinance.com please if you end up using any of my stuff!)


#9

Tracking my net worth, its been less then a year, but there hasn’t been a big change in my life. I guess it has given me an idea of where I am at in the whole journey.

The part that really made a difference was tracking my spending. It really helped me know where my money was going and I felt much more in control of my future, that was the light-bulb moment.

So far no major achievements other then feeding the accounts and being able to watch them grow. Again, its been less then a year.


#10

Before: Scattered. Just saved in the double digits, but wasn’t focused on a goal, other than the savings rate.

After: Became hawk-eyed when it comes to how spending was affecting our overall position, at least as far as the controllable were concerned (I don’t sweat the ups and downs of the market…it is what it is, all that matters is being in it with company shares and ETFs). Now, if we spend, I understand that it better matter, because we’re giving up something equally tangible: accrued level of “liquid courage” aka FU money many times over.

It’s changed from thinking of money as a mere tool to money as having the potential to change how we think and live at a fundamental level.


#11

Before: I started tracking my net worth years ago on an informal basis (not written down or on a spreadsheet). Once I formalized it, things changed and I often think maybe not for the best :flushed:

Now I’m obsessed as I often get with many of my money goals. I’m in the two comma club and have a number in mind for early retirement (somewhat early) between age 55 and 57. I invest a ton of money (well above 15%) and we live well below our means which is still a comfortable life. We’ll have our house paid off in two years and and then I’ll throw a lot more money into real estate and investments. Here lies the problem: I’m constantly questioning purchases, even the small ones and I create anxiety for myself. It also causes some friction in my household. I often think I need to be committed due to my obsessiveness. :stuck_out_tongue_winking_eye:. If an uplanned purchase comes up, I freak out. I can’t possibly take money out of my savings if it’s unplanned.

So has it helped me? No. I need to find a balance and enjoy life a little as well. It’s not that I don’t give in to purchases or take my family on nice vacations. I just get crazy in the head about it. How do I let this go? Not sure. My website is http://kaz-lifebalance.com. (Go figure as I’m struggling to find balance)


#12

I was always a good saver but never tracked anything…my money was there but always a bit chaotic. Seeing it all in front of me was paramount to me getting out of my shit storm…

My light bulb moment was the catalyst for me to start tracking. I was almost 500k in mortgage debt, slowly losing my “retirement plan” rentals to short sales, and in the process of a divorce…I was at my physical and emotional bottom. Tracking was my checks and balance to prove to myself I would survive it. Every month seeing those numbers go up - even if it was $100 - gave me motivation to continue moving forward. In fact, I just wrote about this in a 3 part series on my blog. Start HERE if you’re interested. :slight_smile:

I have seen my net worth grow exponentially. When I started tracking my expenses on top of the assets, I was able to cut in areas I didn’t even realize were a problem…mainly Whole Foods and wine soaked lunches with the ladies (I was fancy!). Since then I have worked to push the gap between income and expenses by working 40% more and spending less (I buy boxed wine now!). This year I am averaging a 75% savings rate. I would not have had the motivation if I didn’t have my nifty spreadsheet to see it all there in black and white…and blue, green, red, and purple. :slight_smile:

Great topic!!


#13

Scary, but I started tracking my net worth 20 years ago in my early 30’s, and can’t imagine NOT having this “annual metric” to follow. It’s a great way to visualize the fact that all of the “little” decisions you make throughout the year do, in fact, lead to wealth creation. I created a free networth template on my site, feel free to share it with your readers if you think it brings value. Here’s the link:


#14

Nice template - way nicer than mine! You’re so right - tracking helps with the little things. The meal here or coffee there that makes you realize how much those things add up at the end of the year. I’ve only been tracking 5 years but I love going back to see how far Ive come and I love a new month when I get to fill in all the numbers in a column or even better a new page for the new year. So fun!! :nerd:


#15

Thanks everyone!!!

I was able to include most of the quotes in the post!

http://howdoimoney.com/trackyournetworth/