Wednesday, December 3, 2008

How much are you up or down? One ugly chart, and one that's not so bad

When I calculate my net worth for the month, the data get fed into some dynamic charts that I've created, to provide a visual representation of my progress over time. I've posted these charts a couple of times, but this month's output really stopped me in my tracks. Behold the majesty of my retirement investment performance since I started tracking in April of 2007:

Despite contributing roughly $18,500 to my retirement accounts since April 2007, my investments have gained only $2,171.50 in value.

Yippee.

Now, I need to point out a couple of things here:
  • This chart only shows the month-end value of my investments - I haven't done any adjustments to show "what $10,000 invested on April 30 of 2007 would be worth today", or the like. This is a very basic "what was my investment portfolio worth on X date?" view of my RRSP's value over time.

  • This graph starts at a value of $36,087.43 - Although a quick look at the chart makes it look like I've come full circle, there is actually another 6 years of progress prior to April 2007 that got me up to that point. I have to keep in mind that I'm really "up" by $38,258.93 over where I was at the beginning of my career (namely $0).
Since the beginning of the year, my retirement investments are down by 7.9%. I'm OK with that, since this money is for the long term, but it still hurts to see such a pronounced drop-off over such a short period.

A post at Clever Dude made me stop and think about how I'm really doing this year. True, my investments are down (by a lot), and my net worth has been slowly declining the last couple of months as a result. However, I've been making consistent progress on paying off my revolving debt, and tucking some cash away in my Emergency Fund and Freedom Account. As a result, my net worth is actually up by 71.8% over where it was at the end of 2007, my revolving debt is down by 32.1%, and my cash savings are up by 96.0%:

There's no question in my mind that I'm moving in the right direction, and although net worth has been stagnant the past few months, I'm laying a very solid groundwork for the future. By starting with a small base, and sticking to the plan, I've survived a huge drop in the market and actually grown my net worth by over 70%. That's not too shabby.

How is your big picture looking? Is market performance overshadowing the rest of your financial life, or are you seeing small changes add up to something better?

1 comment:

debt relief said...

Yes, it's a sad and scary chart. And according to several news reports the worst may still be ahead.