Llama Money

After a tough September, a strong October is a welcome sight.  Don’t get me wrong - there were some extremely tough financial areas in October, that I’ll get to shortly.  But my wife and I stepped up work on our side business and had a record month there, which more than offset the negatives. 

For the first time since issuing net worth reports, I’m able to give a yearly comparison as well.  In fact, I started this site on Nov 1, 2007 - just over a year ago.  Somehow I managed to forget!  So, Happy Birthday Llama Money!

And finally one last change.  I’ve gone back to separating my business assets and liabilities from my personal ones.  The only confusing area is taxes.  Since I owe taxes on my business ( which I account for monthly to keep things in line ), there’s a large tax liability each month.  I keep the money for this in my personal savings account.  To make sure the number lines up nice, I simply put the tax liability as part of my personal net worth - to offset that cash that’s spoken for already.  K, enough blabbering, let’s look at the ups and downs.

Liquid Assets

My personal liquid assets dropped by 13.5% for the month, though they gained 456% vs Oct 2007.  The reason for the drop is largely because of stock losses - my mutual funds and individual securities tanked spectacularly.  I added a well-priced ounce of gold to my metals portfolio, so that helped offset weak metals prices.   I’m not sweating this drop, mainly because of the newly separated business section.  "Real world", I don’t feel that I have less liquid assets than before… and I probably don’t. 

My Cars

A huge reversal here - mainly in my Civic Hybrid.  With the new "low" gas prices, it simply isn’t worth as much as it was last month.  People have such short term memories, don’t they?  Gas is dropping in large part because of the election.  Isn’t Bush doing a great job, keeping gas prices low?

No matter the reason, reality says that my cars are worth less this month, so I took a big hit here.  Moving away from positive equity once again, and not a direction that I like to go in.

My House

1%.  No surprise here.  Topped $19k for the first time, at least on paper.  I may have to look into revaluing my home.  Here in souther Texas, we didn’t have the insane run-ups in pricing that the coasts saw… but reality may mean a lower valuation is in order here.  I’ll look into this later on this month.

Retirement

Negative 19% for the month.  Ugh.  At least my accounts are up 12% for the year - though that’s due to contributions alone.  I don’t want to do the math to see how much money I had to invest to see that 12% "gain" - I’ve no doubt it’s scary.

Business

I had a record month in business earnings.  About double my best prior month - so it’s something to celebrate.   I’m still sitting on a bit of inventory that I need to move… but I’m not worried.  I have enough cash on hand to cover any outstanding bills, which is all that really matters.  I’ve begun dabbling in selling certain commodities online…. and I’m sure prices will rebound so I can unload my current and inbound inventory.

Overall

A 5.5% gain in the face of a horrific month for all my investments is pretty solid.  Even though my personal net worth dropped by almost 16%, my business gains overshadowed the losses.  My net worth is still below the high I set in August, but I hope to overtake that this month. 

For a really crazy number, look at my total NW year over year - up 184%.  Not too shabby for a single year of blogging about money.  If I wasn’t paying attention, how bad would that number look?  Awareness is a person’s most powerful tool with regards to his or her finances.  If you know where you’re doing well, and where you need work, it’s so much easier to improve on your rough spots.  If you don’t know where you are, how can you know where you’re going?  Stay tuned, and hopefully we’ll see a record November 2008.

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