Give Yourself Credit: Net Worth Update (or is that downdate?)

(Sorry this is a day late! Server wasn’t working yesterday.)

I’ve been keeping track of my household net worth and updating the number every month.

Well, this month it’s just depressing. The total is down 15 percent over last month and down 9 percent overall since March.

Several factors play into this trend:

  • This month, half of Little Cheap’s school tuition was due. Again, budgeted for and saved for, but depleted savings.
  • I’m self-employed, and June was a really slow month. Most of my clients pay me on a 30-day basis. This means that checks for June work come in at the end of July, meaning that my August cash flow is determined by my June workload. Cruelly, this means we have little cash for extras this month, which is on track to be the busiest of my business’s eight-year history — just when some luxury would be nice! On the other hand, October will be swell.
  • Mr. Cheap just got the paperwork for his student loans for summer and fall tuition, meaning our debt load just increased by that amount.

All in all, it’s a one-two-three-four punch to our net worth. Don’t even tell me what’s been happening to our retirement account values during the past week’s stock-market tumble.

Some of this discouraging trend is related to our stage in life. In the short term, I’ll be back to normal-to-strong income for my business starting next month, and we can get back to making serious progress on our personal debts, which will help our net worth. In the long term, Mr. Cheap won’t be in grad school forever — and starting next year, he’ll be earning full-time again, so we can power up our savings.

It’s good to keep an eagle eye on finances. And it’s good to take the long view, as well. If you’re interested in the latter, check out this post from Free Money Finance, looking at one family’s trends over 10 years of starting a family and buying homes. It’s enlightening — and an exercise I might undertake sometime.