Even with adding $1,200 to investments accounts our investments went down by $7,800 and our total net worth went down by $5,925. We're still over the $500,000 mark, but cutting it close. In February we're expecting a nice bonus and a tax refund, which will help towards our annual goals, but a lot still depends on the stock market. As you may expect, we also have some home improvement projects planned and are striving to find the right balance between investing, saving, and spending.
The market had a rough start to the month and has only recently posted some strong daily gains. In fact, as I was leaving the office on Friday one of the TV's was tuned to CNBC and they had a headline that read something to the effect of "Safe to get back into stocks?" OH, BROTHER. I know that somewhere out there someone sold out of all their stocks at the mid-January lows, and already could be thinking about getting back in, having missed several percentage points of gains since selling. This is the exact behavior successful investors avoid, but it inevitably happens when you have people turning to financial news channels looking for advice and those same news channels cater to viewers by providing 'actionable' news. If the news channels really showed you how to build wealth, the ratings would be terrible because it is so boring.
Our trading activity in January was limited to one small transaction where I moved some money into the stock market that had been sitting in some bond funds that hadn't gone down like the overall market. I am working on transitioning our assets entirely out of bonds in line with the philosophy outlined in Simple Wealth, Inevitable Wealth, and the recent stock market decline provided an opportunity and reminder to do so.
With that little rant out of the way here's where we stand in the net worth department:
Our cash balance went down slightly as we had some large expenses, such as our auto insurance, which we pay in full every six months. We've always paid a bit extra on our mortgage, but beginning in January we have increased the amount of additional principal payment we'll be making. We've wrapped up our taxes and anticipate receiving a refund in February that will help replenish our cash reserves, but will also be used for investing.
Going forward, I plan to update my net worth more frequently and to use this as an opportunity to discuss some of the other financial decisions we make throughout the month.