$$$ KPO and CZM $$$: 2020 Net Worth

Sunday, January 3, 2021

2020 Net Worth

Let me start by wishing everyone a Happy New Year! 2020 has been an incredible year for us and manage to achieve/do most of what we had planned to do. You can take a look at last year update here - 2019 Net Worth. We took 1 month off from work and did a RTW trip to Mexico, Peru, Bolivia, Brazil, and Switzerland in February before COVID got really bad/serious. Unfortunately, travelling to Hokkaido and Scandinavia/Northern Europe with our family did not happen. I got my promotion and change job after a few months resulting in a double bump in salary. Recession sort of happened but our portfolio still manages to hit more than half a million with a V-shaped recovery. The best thing that happened to us is the addition to our family - Baby Ong!

I do not think leisure travel is going to resume anytime soon and with a baby, we are definitely not planning to travel, hence no grand travel plan although we have about half a million miles now @_@" As a parent, our mentality has changed, it is no longer about ourselves and it's always about the baby. Anyway, this is what we hope to achieve for year 2021:
1. Baby Ong grows up healthily since health is wealth!
2. We are still on track to a 1 million portfolio by age 34. It is currently at 613k without leverage and 669k with leverage and the target for this year is 720k without leverage. 
3. Given the low interest environment, we are looking to increase the use of leverage "safely" and hopefully be able to accelerate the growth of our portfolio. I first blogged/explored the possibility of using it in 2018 (Leverage - A Double-Edged Sword) but only took the plunge and used it last year and it has been working well for us so far. Shall blog about it separately next time.

Our net worth update is an annual event but I blogged about it a few months back when we reached a milestone - 1 Million Combined Net Worth By Age 30.

Let me introduce the concept of net worth and its importance once again for the new readers.

Net worth can be calculated by taking all the assets and subtracting away all the debts/liabilities. This is the classic comic where everyone is actually poorer than the beggar who has a net worth of $2.73. Your friends/colleagues may be living in a huge condominium, driving some fancy car but it could all be financed by debts. There is absolutely nothing wrong with that as long as their income allows so but anything can happen! Do not be the The "Poor" Pilot With Multiple Properties. You can refer to the following article on the importance of net worth by InvestmentMoats - Don’t Track Your Expenses or Budget First. Plot Your Net Worth Instead

This is all the money we have in our savings accounts. Regular readers will know we are investing aggressively that we hardly keep/hold onto cash. No emergency fund as well which I do not recommend since it is personal finance 101. We felt that there's no need for it at the moment, will probably work start saving when we get older.

Our Cash: ~ $22,000

Every month, I will try to show CZM her net worth in order to motivate her to work harder towards financial freedom. However, she would always say I inflate her net worth because I included CPF. lol. I am sure some of you may have the same mentality but like I always tell her, CPF is our money and should be included as our retirement planning.

Our CPF: ~ $322,000 (OA + SA + MA)

I have yet to blog about our portfolio performance and although we outperformed STI for this year, the portfolio underperformed when compared against SPY and IWDA. Having said that, the return through the use of leverage is not being captured and should be higher. Anyway, our overall time-weighted return is 5.82% and XIRR is 5.33%.

If you are interested in the smart portfolio tracker (StocksCafe) which I am using as shown above, sign up using my link for a longer trial period :) Refer to our Referrals page for more information.

Majority of our portfolio are tracked using StocksCafe except for Endowus which is about 12k and we have about 56k of leverage/debt.

Our Investment: ~$613,000

I believe that property should be included in the computation of net worth. If one excludes the value of the property, the money (cash/CPF) you use to pay for the loan/mortgage will be no different as disappearing into the thin air or throwing it into the sea. Hence, I will be valuing the property based on the total payment (interest + renovation cost) till date. This ensures that our money will not "disappear" and act as a floor/minimum amount (total payment + remaining loan + markup/profit) to sell in the future.

I can imagine people selling their house at market value + markup, thinking that they made money from the sale but it is totally possible that market price + markup < total payment + remaining loan. Does this make sense or is it too confusing? lol.

Anyway, the cost of our HDB + the payment made so far is ~514k and the current outstanding loan is 364k.

Our Property: ~$150,000


Our Net Worth: ~$1,107,000

Here you go! Our net worth pie chart, it looks pretty yummy to me :) 

We have also clocked >1,000,000 page views! Thank you very much to all our readers!

Alright, I digress too much. Are you tracking your net worth?

You might be interested in these blog posts too:
2017 Net Worth: ~$510,000
2018 Net Worth: ~$640,000
- 2019 Net Worth: ~$886,000
- 2020 Net Worth: ~$1,107,000

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4. Instagram - KPO_and_CZM (Did you see those delicious food photos to the right --> Unfortunately, you can't see it on mobile.)

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