I hope that you’re finding value in your journey towards financial independence through our blogs. To hold ourselves even more accountable, we would like to share our Net Worth once every few months.
Recent life developments
We were blessed with a baby boy in April. This is life altering event and the joy we feel is unlike anything we’ve felt before. Mrs. Frugal New Canadian has decided to take off the year to help with raising our baby boy. I, out of laziness, have also decided to take 3.5 months off starting April. I am also considering moving roles and potentially not going back to the office.
This brings me to how we’re managing our finances. Well, we saved for about 4-5 months prior to going on leaves. Canada is kind and helps parents who have worked a certain number of hours with Employment Insurance payments. This is such a boon for parents who want to spend time with their newborns and not worry so much about their slashed incomes. Unfortunately, neither of our companies provide a top-up. Our incomes therefore are less than half what we netted prior to going on leaves.
Exclusions from our liquid net worth calculations
I excluded our primary residence from our net worth calculations. We only purchased our home a couple of years ago and the pandemic has helped increase our equity in the house exponentially. The market seems to be showing a bit of a correction right now, but we don’t treat this home like an investment.
If we were to enter the market with a rental, I would consider the equity in the investment property in our net worth calculations. I also excluded physical assets such as our vehicles and jewelry from this assessment.
All the money in our emergency fund that we’re living off right now is also not included in our net worth calculation. This is our non-TFSA savings i.e. our emergency/mat pat fund.
Overall, the net worth calculation is simply for the more liquid assets we hold such as mutual funds and stocks.
What we did differently the first quarter of 2022
Our pace of equity investments has slowed down as you can imagine and will continue to slow as the year progresses. We did, however, decide to buy some blue-chip tech stocks as an investment for a future real estate property. The outlook is about 4-6 years and not short term.
The markets have been unkind to say the least this year. Our initial investment of $7K into the ‘New Home Deposit’ is down over a $1,000 already.
The Numbers !
In Conclusion and Next Steps !
Well, it’s going to be hard for us to keep building wealth this year, but I do want to reach $100K by the end of this year. This means that we need to add over $25K in the next 6 months or so. With lesser income flowing in this year, this target maybe a bit difficult to reach by the end of the year. A lot, however, also depends on how the global equity market responds in the coming months. Fingers crossed.
We’re also going to open a RESP account for the baby. Once again, I will not be counting this amount towards our liquid net worth assessment.
I will keep post another update in a few months. I, also, am a fan of tracking dividend payouts etc. so I will start a series on that, but this will be later in the year.
Keep safe!