How to Increase your Net Worth by $15,000 by going on Vacation

How to Increase Your Net Worth by $15,000 by going on Vacation

18-Jan

Checking 4,714.80
Savings 51,983
Real Estate
Rental Property 1 Savings 10,686
Rental Property 2 Savings 3,920.73
Rental Property 2 Checking 2,052.42
Rental Property 1 Zestimate 739,518.00
Rental Property 2 Zestimate 173,000

INVESTMENTS
Lending Club 3,347.79
Roth IRA 19,812.63
Vanguard 24,735
TSP 48,931

Liabilities
CC 1 61.44
CC 2 194.27
CC 3 79.76
Car Loan 0
Rental Property 1 Loan 647,119.08
Rental Property 2 Loan 158,973
Net Worth 286,275.35

Last month was a whirlwind with the holidays and our annual trip to Kauai. After evaluating my finances and overcoming the urge to hold a large sum of cash in a savings account, I paid off loans, moved money around and enacted automatic withdrawals. I’ll go over what I changed in the past 5 months to increase my net worth by $15,000 in 3 months. Back in September my net worth was at $269,000.

1. Pay off debt.

I recently bought a used car, a 2015 Nissan Rogue for my new duty station since it snows here a lot and I’ve been using my high school 2004 Chevy Malibu for most of my twenties. While I did have enough cash to pay for it at once I took out half of the price ($8,000) on a low interest loan. I paid a couple of hundred/month but just the fact that I had this loan annoyed the hell out of me. I didn’t dip into my savings to pay off the rest of this loan, each paycheck I threw $1,000 to the remaining balance which last September was $7,872.

Getting my title from the bank for my car was EXTREMELY satisfying. But of course there is a problem with the HVAC system and is blowing COLD air into my passenger area which is not helpful in -32F wind chill during the ‘bomb cyclone.’

Cars are horrible investments and I hope to someday never own one. But until we get flying, driver-less cars from Tesla I’ll have this god damn used SUV.

2. Rent out a Unit

I recently moved into a fixer upper house and was slacking on cleaning/moving out of the duplex I was in. I was also worried renting this place out in the winter would be challenging but I found a great tenant within a week! I tried using Facebook in addition to Zillow/Trulia/Hotpads/Craigslist. Now I can buffer up my savings for that property since while I was living in it I was paying out of pocket for any repairs/maintenance. My plan is to save three months of extra rent from this unit and then start putting a portion of each rent towards the Principal.

3. Index Funds

I transferred my mutual funds from my primary bank to Vanguard and investing in a Target Retirement Account since pretty much every Personal Finance blog I’ve read encourages using Vanguard for their low fees and I’ve seen about $2,000 in growth just my moving it around! I also increased my automatic withdrawal from my checking account each month to go into this fund and lowered my TSP withdrawal.

4. Extra Mortgage Payments

I additionally started throwing an extra $30 to each mortgage payment which I don’t really miss or even notice each month. I also decided to give an extra $5,000 to the San Diego Rental Property and an extra $3,000 to my CT Duplex.

This is all in the context of traveling across the world, boarding my two dogs and eating out constantly! There are a lot of small things you can do to put money that is not growing any interest in your savings account to use. Paying off debt, usually with the highest interest first is the best thing you can do plus, invest, invest, invest! Whether that be to your 401(k), Roth, or Rental Properties.