Happy New Year! It’s officially 2014. I hope everyone had a wonderful Holiday Season. I was fortunate enough to get to spend lots of time with my loved ones over the Holidays. Despite some stress at work and a few minor issues (furnace breaking down), I did have a wonderful Christmas.
On Monday I posted my last Net Worth Update of 2013. Just looking at the bottom line, it all seems a bit, well, underwhelming. I started this blog in February with a net worth of -$1,754. It didn’t take long to bring that number into the positives. And yet, I’m ending 2013 with only $1,216 in net worth. That’s a gain of only $2,970. What gives?
This is one of those situations where just looking at net worth can be very deceiving. I feel like overall I made tremendous gains this past year. They just weren’t gains that are obvious in the bottom line. So, where exactly did all the extra money go?
Medical: $3,000: According to the handy breakdown that Anthem provides on their website, I spent just over $3,000 this year on medical expenses. That number doesn’t include any copays at doctors offices that didn’t result in a claim, or any prescription costs. Ouch! It’s a lot of money, but I’m still feeling very lucky: I have great insurance, so my costs were definitely minimal. According to the website, my insurance paid out almost $12,000 in claims. That’s some major money for a slew of minor issues!
Porch: $3,800: I spent $3,800 to redo the roof, posts and railings on my front porch this year. Insurance contributed a small amount to this project, since hail damage was the reason the roof needed replaced. But the involvement of the insurance company also put a deadline on how soon the work needed to be done. I went ahead and replaced the posts and railings at the same time. They were old, worn, and mismatched, so it was worthwhile to do it all at once.
Sewer Project: $2,000: The city decided to bring the sewer system into my neighborhood, and mandated that everyone hook onto the new system (at their own cost, of course). The $2,000 was to pay the contractor for the work, and for permits through the city. That doesn’t include the additional $2,500 that the city is supposed to be rolling into my utility bills as a “connection fee”. At first I was a little sour about the project: There was nothing wrong with my septic system! But after talking to several of my neighbors, I realized how lucky I am. Many of them couldn’t afford the project, and had to look into loans, or refused to comply all together, knowing it might end up costing them their home. One of my neighbors had major septic issues 6 months before the new sewer system was done. They had to dig up their whole yard, and spent thousands of dollars replacing parts of the system, just to turn around and spend thousands of more dollars on the sewer. Writing a check and mowing around the dirt mound really doesn’t seem so bad now.
Misc.: $2,000+: In addition to the big expenses of 2013, there was the $800 I spent on the Holidays, the $175 I spent when my furnace went out, several hundred dollars I spent when I bought my new Ford Escape, and hundreds of dollars for the Spring Semester of classes (my employer reimbursed me for $3,000, which covered most of my tuition, but there was still fees, books, parking, etc). I also spent ~$300 on my new phone.
No denying it, 2013 was a costly year for me! I had over $10,000 in “extra” expenses this year. Knowing that, I can’t help but feeling lucky. Sure, that’s money that I’ll never see again. Overall it adds nothing to my bottom line. But, most of it was necessary spending. And I’m amazed to say that I had no problem coming up with that money. I budgeted, I set money aside, I stayed the course, and I wrote checks like it was no big deal. There wasn’t the stress and worry about where the money would come from. I didn’t have to juggle this bill to pay that one. No late or missed payments. It was all easy and seamless.
That’s what I’m hoping will carry on into 2014 and beyond; My ability to stick to a budget, set goals, and save for the future, both near and far. I made huge progress in my financial life this year, even if it resulted in minimal change to my net worth. Aside from a few projects on the house, I don’t foresee any huge expenses in 2014. Which means I’ll make even more progress in growing my worth. And, should unexpected expenses arise, I know I can tackle them. I have an emergency fund, and I have the ability to plan ahead and switch gears, if need be. And that makes all the difference!
– Cindy W.