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June 2009: My Net Worth Update and Personal Finance Report

Published 6/29/09 (Modified 3/9/11)
By MoneyBlueBook

A few days ago, the legendary and super talented pop icon, Michael Jackson, suddenly and inexplicably passed away at the age of 50 due to cardiac arrest. After a long and glorious (but controversial) entertainment career that spanned 40 years and included the world's best selling music album of all time - "Thriller", the self anointed King of Pop was finally laid to rest in peace. Perhaps it was his enormous talent or his seemingly gentle nature, but I have always managed to overlook his eccentricities, the oddness of his perpetually changing skin color, and the lurid details of the tabloid controversies that followed him - particularly the allegations of child molestations and quirky behaviors and activities at his infamous Neverland Ranch. For me, I grew up as an adoring fan - enjoying amazing hits like "Black and White", "Billie Jean", "PYT", "Thriller", and "Jam". I will always remember Michael Jackson for his music, his stunning liquid pop locking dance moves, the ground breaking music videos, the moon walking, and his one of a kind "hee hee" falsetto squeals. Inevitably, artists in the future will continue to pay homage to Jackson by attempting to emulate his moves and his songs, but there will never be another one quite like him ever again.

Unfortunately, the story of Michael Jackson is also one of great tragedy. Aside from the eccentricities of his life and the untimeliness of his death, the man was a text book case on how absolutely not to live one's life. Despite building a massive music empire with an iconic brand unto himself, and despite raking in more than hundreds of millions of dollars as one of the most successful pop music artists of all time, Michael Jackson was more than $500 million in debt at the time of his death, according to The Wall Street Journal. Despite his celebrity fame as a money making machine, a great deal of multi-million dollar financial and legal troubles followed him his entire life. Well known for his insatiable and outrageously lavish shopping sprees for toys and priceless antiques, he leaves behind a mega mountain of debt and an unfinished comeback tour he had hoped would cure his financial troubles once and for all.

Unfortunately, even if Michael Jackson had lived on for many more years and had successfully raked in millions more from his concerts and performances, I still believe he still would have eventually left this Earth utterly in debt and plagued with financial issues. The man was an absolute music god, but a complete failure in the personal finance department. Living to great excess and spending grossly beyond one's means with no accountability, and perhaps blindly assuming the financial windfalls will never end - are recipes for financial disaster. It's not just the celebrities either. Even those who suddenly win the lottery and find themselves instant millionaires have the potential to lose it all if they aren't careful and diligent with their investment strategies, savings, and even income tax responsibilities. Hopefully we can all learn something valuable about the need for proper personal financial management from the tragic life and unfortunate passing of Michael Jackson.

My Current Net Worth and Financial Status Update Compared To Last Month

Assets Balance $ Change % Change
Cash $33,968 -$234,097 -87.33 %
Stocks $392,056 $247,484 171.18 %
Bonds $0 $0 -
Retirement (401K, Roth, IRA) $14,583 $202 1.40 %
Car and Vehicle Value $0 $0 -
Real Estate and Home Value $0 $0 -
Other Real Estate $0 $0 -
Total Assets: $440,607 $13,589 3.18 %
Debt and Liabilities Balance $ Change % Change
Credit Cards $5,612 $1,136 25.38 %
Car Loans $0 $0 -
Home Mortgage $0 $0 -
Student Loans $26,836 -$147 -0.54 %
Total Debt $32,448 $989 3.14 %
Total Net Worth
$408,159 $12,600
3.19 %

Tracking My Income and Expenses With Free Budgeting Tools

Working that full time job, and finding ways to generate a steady income stream and make money are important endeavors, but so is finding an efficient and cost effective way to track those expenditures as well. There's no way any reasonable person can expect to save money for the long haul if he or she is spending more than what he or she makes. You can't expect to save or plug up those cash leaks if you don't know where your daily funds are going. While I utilize a wide variety of account aggregator programs like Yodlee-powered Fidelity Full View and free Quicken Online to chart my bank account and credit card balances, I utilize various free budgeting software tools to help me track my spending habits.

Seeking Growth Opportunities In The Stock Market Via ETF's

Investing in exchange traded funds (ETF's) is the easiest way to put your money to work in the stock market without the expenses of mutual funds or the volatility risks of individual stock picking. Frankly, I've given up trying to buy and invest in individual companies, acknowledging that there is just too much unpredictability and uncertainty with any one particular company's operations and disclosures. I've been burned too often and am finally starting to learn my lesson after all of these years. For now on and indefinitely into the future, I intend to stick solely with broader index funds that track major market indexes and industry sectors.

This month, I've finally transferred the vast bulk of my cash and savings account balances into my online brokers in anticipation of imminent index fund trading opportunities. However, I've yet to invest the funds and they continue to sit as brokerage cash reserves, waiting for me to pull the buying trigger. Call it market timing if you wish, but I'm just waiting for a good opportunity, or at least until the market settles down a bit more. I think the massive and irrationally exuberant run up in March is due for a significant series of pull backs between now and September.

Checking My Free Credit Reports and Free FICO Credit Score

For many years now I've lived in apartment rentals, hopping from one place to another as my various jobs necessitated. However, while I am currently still a renter, I'm gradually contemplating the prospect of becoming a first time home buyer within the next 6-12 months. It's actually somewhat ironic since only 1-2 years ago, I was griping vehemently that home prices had soared to such ridiculous levels that the American dream of owning a home was starting to fly beyond the reach of most average citizens. It's interesting how much the housing market has deteriorated (finally approaching rational equilibrium) and how significantly my personal financial balance sheet has improved since then.

With a thriving buyer's market and home prices at historical lows that continue to drop, I'm in absolutely no rush to buy. While I'm still in the very early stages of interviewing real estate agents and scouting locations, I'm eager to get the ball rolling in anticipation. First thing's first - I'll need to know where I stand credit report and credit score-wise. Fortunately, there are a variety of ways to get my three free credit reports from Equifax, Experian, and TransUnion, and obtain my free FICO credit score from myFICO.com via a variety of cancellable trial offers.

Currently, I also utilize myFICO ScoreWatch to track my credit score changes and avoid identity theft. Recently my FICO score dropped down to 791 (scale of 300-850), due to an increased credit utilization on one of my reward credit cards. Hopefully after paying it back in full my FICO will return back into the 800's. As a prospective home mortgage rate seeker now, I want to boost my credit score as much as possible for the next few months.

Buying A New Home - Detached Single Family Home Or Town House?

As a newbie first time home buyer, I'm still scratching my head and going back and forth between the pros and cons of buying a detached single family home versus buying a town house. I've already ruled out condominiums as I feel they make comparably worse investments for the long run with all things being equal - so right now my focus is on free standing houses and townhomes. As a single guy who probably won't be getting married anytime soon for the next few years, I don't really need all of the extra space that a detached home could conceivably provide, however I do like the extra privacy and parking conveniences that one affords. This is definitely one decision I'll be pondering for quite some time as I spend my next few months talking to real estate agents and pouring over listings on real estate sites like Trulia.com and RedFin.com. Advice anyone?

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13 Responses to “June 2009: My Net Worth Update and Personal Finance Report” 

  1. DoneToZen says:

    Just wondering: why is that you don't save as much money in tax-advantaged retirement accounts when you obviously have such a high income?

  2. Raymond says:


    Well I'm self employed. I don't have a matching 401k plan available to me through an employer. While I do contribute regularly to my IRA accounts, the contribution amounts are rather limited for me. Thus the vast majority of my savings go into bank accounts and index funds rather than tax deferred retirement accounts.

    Currently I run a few small businesses from my home office and have not yet set up my own SEP IRA account system. Perhaps I will in the near future.

  3. Rajeev Singh says:

    You doing good bloke!!

  4. Steve Brown says:

    So, Raymond, how old are you now? Seems like you very heavily weighted in stocks.

  5. MoneyEnergy says:

    How about cashflow numbers? Are those div-paying stocks you have?

  6. Eric Newton says:

    DoneToZen: An irony of making high-incomes is that the tax-deferred options typically close down to you over certain amounts. I'm actually close to the Roth IRA max income levels myself, and do everything I can to stay below that line to make the relatively meager 5K contribution to a roth.

    Raymond: You do know of the first-time home buyers' credit? 8000, adjusted by income between 75K - 95K. You can claim last year's income or this year's, I would suggest this year's, since you were out gallivanting around ;-) (if it wasnt for pleasure, i apologize)

    On the stock market, your probably right about a big pullback, I've got tight stops on my positions, and sometimes already they trigger off, which helps minimize risk, but also has the effect of not maximizing profit...

    ETFs will do you good, since the "big hand of government" keeps making big changes in the market, you can look at sectors of the market and pick ETFs (possibly leveraged, which is convenient) that invest in those sectors. Another nice thing about some ETFs, they are short... but ironically these guys wont drain your account if the market goes up, you can only lose the amount you put into it... quite different from regular shorting, where if you made a bad move, you could potentially end up owing a lot more than you risked.

  7. Bulldog Gin Co says:

    Wow, that is quite a big jump invested in the stock market after a 35% rally. You feel ok with that? I wouldn't be able to take it, and have $340,000 in a CD at 4.2%, and already have enuf exposure through my company ($155,000) stock and 401k ($175,000). There's no way i can dump another $340,000 into the market.

    At 4.2%, the $340,000 will guarantee to grow to $420,000 in 5 yrs. I'm happy with that.

  8. AMH - Life & Annuity Quotes says:

    Retirement and estate planning are so often overlooked for some reason. Some of the most prosperous celebrities have passed leaving their estates in ruins for the beneficiaries.

  9. Bob says:

    Just curious, why move 90% of assets into the stock market in one go? Why not put invest in seperate tranches, just in case the market pulls back, like today with Dow down 223.32. Safer in tranches no?

  10. Raymond says:


    Although I shifted substantial assets into my brokerage accounts in one fell swoop, the majority are simply sitting pretty as brokerage cash reserves. They remain un-invested. I don't plan to start investing steadily or seriously until the Fall at the earliest. Volume in the markets is incredibly light right now...and investors seem pretty uncommitted in terms of direction. Frankly, while I'm less pessimistic than I was at the start of this year, I don't really buy this sudden recovery at the moment. Beware these bear market rallies...they will pummel and leave you holding the bag if you are an active trader.

  11. Bulldog Gin Co says:

    Raymond - Phew! Glad you didn't dump it all in the market in one go. Friday's decline was brutal. Prob I have with money sitting in the brokerage account is that my broker pays no interest compared to a regular bank.

  12. Journey says:

    You look great on paper. Congrats!

  13. Greenman says:


    Correct me if I misread your statement about mainly putting your money in taxable investment forms. While IRA's are a good savings tool for most, for higher income earners who are self-employed ...please look into solo 401(k) plans. The contributions are much more favorable than an SEP-IRA. This plan was designed for small business owners like ourselves. Best wishes.

    ~ G

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