# Our wealth goals, journey, and targets



## nobleea

I thought I would start a thread so we can track our progress, put our goals down and have a bit of accountability. The back-story is available here:
http://canadianmoneyforum.com/showthread.php/79-Introduce-Yourself!?p=202356&viewfull=1#post202356

*Long term goals:*

Achieve 500K net worth at 35 (achieved mid-Sept 2013)
Achieve 1,000K net worth at 40
Partial retirement for me at 50.

*Goals for 2014:*
Net worth over 725K by the end of the calendar year
Paid off mortgage (fixed portion) in September
Purchased lot for subdivision and residential infill by end of calendar year
Take at least one month off in parental leave and possibly travel a bit with the new family.
Replace my car with something bigger, safer.
Open TFSA's for both of us.
Open RESP for the new addition and start contributing immediately enough to get full CESG.
Increase XIRR on non-reg portfolio from current 2.7% to 7%.

*Current state:*
Our gross household income is around $240K, not including bonuses. Bonuses are inconsistent, but healthy when they do occur. When my wife goes on maternity leave in early 2014, this will obviously drop, but she wants to teach summer school (3 weeks, $7K). If we put a gap in between maternity leave and her parental leave, this does not run afoul of EI rules.

*Assets:*

House - $453,050 (assume inflation increases of 0.25%/mo, 3%/yr.)
SUV - $25,425 (2013 model year. I depreciate it $175/mo which matches current asking prices)
Car - $2,825 (2000 model year. I depreciate it $75/mo. It's my commuting vehicle in the city)
Non-Registered Portfolio - $182,450 (smith maneuvre portfolio)
Work RRSP (mine) - $106,500 (contribute 5% of salary, company matches)
Pension (wife) - $40,250 (just her contributed amount)
Wife RRSP - $14,500
TFSA's - $0
Cash - $1,300 (two bank accounts)
Miscellaneous assets - $20,600 (camera gear, sporting gear, gift cards, electronics, etc)

*Total Assets $847,000*

*Liabilities:
*
House mortgage - $91,500 (Prime-0.80%)
HELOC - $191,500 (Prime+1%, readvanceable used for Smith Maneuvre)
SUV Loan - $12,500 (0.5%)
Credit cards - $2,700 (this is not a balance, but the amount due. we pay off every month, but a true snapshot must include this)

*Total Liabilities $298,200*

*Net Worth: $548,800*

We've been averaging 30-40% year over year growth in our net worth for a few years. Hopefully it can continue, but at some point it will have to level off a bit.

I will be updating the numbers around the 9th of every month, starting in December. I welcome any questions or suggestions.


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## Four Pillars

You're doing well - good financial position and great income. I assume you are mid-thirties or so?

One point about the goals - some of them are not really in your control. I wrote my thought here:

http://www.moneysmartsblog.com/shooting-down-goals

Specifically the investment return and net worth stuff. I'd rather use things like "pay down mortgage by X$ by Dec 1, 2016" or "Contribute $N to TFSA by end of 2015.

Yes, you can affect investment returns to a limited degree, but if the markets tank - so too probably does your portfolio.


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## nobleea

Hi FP,

Thanks for the comments. You are correct, some times goals become unrealistic in that they are outside of one's control. They may reach the goals, but generally it was just because they existed, not because of something they did.

I can agree that the goal of XIRR to 7% is mostly outside of my control. Perhaps I should label that one as a Target, instead of Goal.
The Net Worth goal is still fairly accurate as 80-85% of the gain comes from savings. Granted, a drop in the markets would offset any gain in savings by a drop in portfolio value. So perhaps that becomes a Target as well.

As for ages, yes, I am 35 and the wife is 32.


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## nobleea

*December 2013 Update*

Small progress this month. It was an expensive month, costs-wise, as I bought flights for Xmas, reno items for a home gym in the basement and pretty much all the nursery items we require, and some winter tires/wheels for the wife's suv. Two of the stocks that make up a decent portion of my RRSP and non-reg portfolio took a bit of a dive over the past month (one of them my company stock). Nothing to be concerned about as they've been on a pretty decent run over the past year and I expect it to continue through 2014. I have also started to clear off some of the HELOC in order to make room for a lot purchase for residential development. This requires selling some stocks in the non-reg.

*Assets:*

House - $454,308 (+0.25%)
SUV - $25,075 (-1.4%)
Car - $2,750 (-2.7%)
Non-Registered Portfolio - $93,566 (-49% selling positions to clear off HELOC)
Work RRSP (mine) - $109,113 (+2.4%)
Pension (wife) - $40,975 (+1.8%)
Wife RRSP - $14,650 (+1.0%)
TFSA's - $0 (N/C)
Cash - $4,000 (+308%)
Miscellaneous assets - $20,600 (N/C)

*Total Assets $765,037

Liabilities:*

House mortgage - $82,955 (-9.3%)
HELOC - $111,230 (-41.9%)
SUV Loan - $11,325 (-10%)
Credit cards - $6,715 (this is not a balance, but the amount due. we pay off every month, but a true snapshot must include this)

*Total Liabilities $212,225*

*Net Worth: $552,812 (+0.7%, +$4,012 month over month, +42.4% year over year)*


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## inverstmentmentjinja

Are you employee or business owner , 240K seem above average of Canadian households


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## nobleea

inverstmentmentjinja said:


> Are you employee or business owner , 240K seem above average of Canadian households


My wife and I are full time employees. I do run a small photography business on the side, but it amounts to about 10% of the income above. Certainly an upper-middle class income.


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## nobleea

*January 2014 Update*

A decent month in December. I tried to push through as many prepayments on the mortgage as possible to reach the 20% yearly max, but was only able to get to 19.1% for the year - a decent amount to be sure. I received a year end statement for my wife's pension plan showing her contributions being a bit higher than I had assumed, so there's a bump in her pension amount (just her contributions). I have 4 weddings booked for 2014 and that's likely all I will take with a new child to show up in a few months. I am planning on taking parental leave this year, likely all of Nov and a bit of Dec. We plan on renting a villa somewhere in the caribbean (or hawaii) and do nothing. The mortgage will have been paid off for a few months by then, so we should have cash saved up to cover it.

*Assets:*

House - $455,444 (+0.25%)
SUV - $24,900 (-0.7%)
Car - $2,675 (-2.8%)
Non-Registered Portfolio - $94,234 (+0.7%%)
Work RRSP (mine) - $112,000 (+2.6%)
Pension (wife) - $44,360 (+8.3%)
Wife RRSP - $14,650 (+1.0%)
TFSA's - $0 (N/C)
Cash - $5,080 (+27%)
Miscellaneous assets - $20,750 (+0.7%)

*Total Assets $773,709*

*Liabilities:*

House mortgage - $77,414 (-7.2%)
HELOC - $111,230 (N/C)
SUV Loan - $10,450 (-8.4%)
Credit cards - $3,960 (this is not a balance, but the amount due. we pay off every month, but a true snapshot must include this)

*Total Liabilities $203,054*

*Net Worth: $570,655 (+3.2%, +$17,843 month over month, +36.9% year over year) *


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## nobleea

*February 2014 Update*

Well January was good in terms of things we had control over, such as reducing debt, but not good in terms of things we didn't have control over, namely the equity markets. We have a newborn showing up in 2-6 weeks, so things will certainly change around the house. Wife is already on medical leave (full pay) plus her employer has 6 weeks EI top up after birth, which is a nice benefit. We are on track to pay off our mortgage in September this year. The payments from that point to the end of the year will be used for a new (used) car for myself and paying for flights and accommodations while on parental leave somewhere warm later this year. Booked another wedding for 2014 (Oct) and some corporate photography. In January, I also did my annual photo fundraiser to raise money for Canadian Cancer Foundation. People get free photos in exchange for a donation, I match it and donate the whole thing. $1700 donated this year, $1650 last year. February and March is normally an exciting time since that is tax season, and for some reason I actually love doing it. This year will be especially nice as we have a large medical expense claim that should yield a nice refund.
I'm not bothered by the small drop in net worth. Out of the past 65 months where I have been tracking NW, I've had 16 months where it's gone negative on a monthly basis, but it's climbed 350% over that period, so I'll stick with the long term view.

*Assets:*

House - $456,582 (+0.25%)
SUV - $24,725 (-0.7%)
Car - $2,300 (-16%)
Non-Registered Portfolio - $58,450 (-38%)
Work RRSP (mine) - $108,998 (-2.7%)
Pension (wife) - $45,260 (+2.0%)
Wife RRSP - $15,500 (+5.5%)
TFSA's - $0 (N/C)
Cash - $1,625 (-68%)
Miscellaneous assets - $20,700 (-0.2%)

*Total Assets $736,900

Liabilities:*

House mortgage - $69,011 (-11%)
HELOC - $84,650 (-24%)
SUV Loan - $9,575 (-9.1%)
Credit cards - $4,900 (this is not a balance, but the amount due. we pay off every month, but a true snapshot must include this)
*
Total Liabilities $168,436*

*Net Worth: $568,254 (-0.4%, -$2,401 month over month, +31.3% year over year) *


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## Four Pillars

Looks good!

One of the problems with net worth is that as your investment portfolio grows, the equity market swings influence the NW changes more and more to the point where the NW changes become meaningless. 

ie you make $20k of contributions or debt repayments, but your portfolio goes up or down by $80k. 

I found NW most worthwhile when I was starting out. At that time I had mostly debt and very little savings, so the net worth increases were a very good proxy to measure the debt repayment.


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## nobleea

Four Pillars said:


> One of the problems with net worth is that as your investment portfolio grows, the equity market swings influence the NW changes more and more to the point where the NW changes become meaningless.


That's a good point. Once the equity portion of the NW reaches a certain %, I might switch to a 3mo or 6mo rolling average for net worth calculations. That should smooth out big drops and gains without hiding the trend.


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## OurBigFatWallet

Well done, nice work so far! We are in a similar position as you. We live in Calgary. My wife is a teacher and I work in oil and gas as an accountant. Planning on having kids in the near future. Just curious what types of rewards programs do you use? Looks like you have the cash flow to be earning some decent rewards. We use the scotiabank momentum visa infinite and it works well. Also how will you handle childcare once your wife goes back to work? Some people have family look after their kids, some use day homes (expensive down here)


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## nobleea

OurBigFatWallet said:


> Well done, nice work so far! We are in a similar position as you. We live in Calgary. My wife is a teacher and I work in oil and gas as an accountant. Planning on having kids in the near future. Just curious what types of rewards programs do you use? Looks like you have the cash flow to be earning some decent rewards. We use the scotiabank momentum visa infinite and it works well. Also how will you handle childcare once your wife goes back to work? Some people have family look after their kids, some use day homes (expensive down here)


Thanks. For rewards program, I use as many as possible but don't go out of my way to get extra points. Our main CC is the MBNA World smartcash, which isn't as good as it used to be, but cash back is still great and no annual fee. I'll be looking for a better cash back card this year and will get the wife's card transferred over as well. The travel rewards cards would work well for us, but they all seem to have yearly fees which I'm not a fan of.

Childcare, not sure yet. The plan right now is my wife will return to work part time, something like a 0.6FTE. Her mom will be retiring in that time and that is certainly an option we're comfortable with. I've budgeted $600/mo for childcare if it doesn't (for 2 days a week).


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## OurBigFatWallet

Good plan. For cash back you may want to consider the scotia momentum visa infinite if you spend a decent amount on gas and groceries. Annual fee is $99 though so only worth it if you spend a lot on groceries and gas to recoup the fee. I've never had MBNA but heard they took a dive when TD bought them out. My wife will also likely go on 0.6 or 0.5 FTE depending on what's available. You're lucky if you can have family help out (we don't have any family in town). Best of luck in your journey and be sure to keep updating on your progress


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## nobleea

*March 2014 Update*

February was a good month. Got a small bonus which went against the mortgage. Equity markets did well, with my company stock up 30% in the month (I am overweight on it). Our baby still has not shown up yet, due date was last Saturday. Received all the tax slips this month and it looks like we'll be getting a net refund of about $3,500 once I get around to filing in March. This month was the biggest single month gain ($-wise) in net worth I've had since I started tracking, though the majority of it is due to equity gains. In regards to my idea to do some infill development, a lot came up (still for sale) in a very nice area of town that is wide enough to split. Checked out some builders and got budgetary pricing on construction costs. I think the numbers work out very favourably, but it would mean selling a house in the 1.1-1.2 mil range and those don't sell quickly. Have to be able to carry something like that for a 6 month listing I think. I have a friend that has 3 infills on the go (side job from his main job) right now with one almost finished and to be listed this month. I would like to see how his experience goes first and learn from his mistakes/tips, etc. As for our house, we plan on start looking for a potential lot in late fall. No rush, if nothing comes up, we can wait for a year for the perfect lot (lot being a small, older house in our current neighbourhood for tear-down). The city is making changes to the zoning in mature neighbourhoods, which would allow for more freedom in the house design, so I would wait until that passes (2014) anyways.

*Assets:*

House - $458,000 (+0.25%)
SUV - $24,550 (-0.7%)
Car - $2,225 (-16%)
Non-Registered Portfolio - $66,796 (+14%)
Work RRSP (mine) - $123,357 (+13%)
Pension (wife) - $46,160 (+2.0%)
Wife RRSP - $15,700 (+1.3%)
TFSA's - $0 (N/C)
Cash - $1,508 (-7%)
Miscellaneous assets - $20,700 (N/C)
*
Total Assets $758,900

Liabilities:*

House mortgage - $61,364 (-11%)
HELOC - $85,128 (+0.6%)
SUV Loan - $8,700 (-9.1%)
Credit cards - $4,180 (this is not a balance, but the amount due. we pay off every month, but a true snapshot must include this)

*Total Liabilities $159,372*

*Net Worth: $599,524 (+5.5%, +$31,270 month over month, +37.2% year over year)*


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## DividendLuvr

Looks fantastic, nobleea! You are killing the mortgage. And best wishes for the impending addition to your family.

If you are still looking for a good cash back rewards card, I might suggest MBNA Rewards World Elite. It's 2% cash back on all purchases with an $89 annual fee. Thing is, they waive the fee for the first year and also give you 10k welcome bonus points ($100 value), so they effectively wind up covering the fee for two years. I love this card for the time being, but will cancel it and move on to another option after two years.


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## nobleea

*April 2014 Update*

March was a life changing month for us, as we welcomed our daughter in to this world on the 9th. She was 7lb 13oz and full of hair - mom and baby are doing great and she's already giving us 5hrs of sleep a night. I opened an family RESP for her this month and am waiting for it to be converted to the e-series at TD before contributing, but we'll have no problem doing the max for this year to get the full CESG. As a bonus, AB gives a $500 grant at birth in the RESP. I do not plan on including the RESP in the net worth calculations, but may include the balance separately. It will be a couch potato type investment. We may some good progress on the mortgage, still on track for it to be gone in September. Equity markets were generous this month with one of the stocks I am overweight on up 30% in the month. Got a small promotion so that my pay scale and title reflect my actual work, this came with an 8% raise. Looking back at our goals for 2014, I don't believe I will be able to buy a new(to me) vehicle this year. According to the cash flow, it will likely be in mid-January, close enough I guess. I will be taking a month off in parental leave - we are likely going to go to Maui for 3 weeks. I can open TFSA's for both of us, but will have nothing substantial to contribute until 2015. With the house paid off, both TFSAs will be maxed out in 2015.

*Assets:
*
House - $458,000 (N/C Keeping it constant for the next year)
SUV - $24,375 (-0.7%)
Car - $2,150 (-3.4%)
Non-Registered Portfolio - $74,236 (+11%)
Work RRSP (mine) - $123,708 (+0.3%)
Pension (wife) - $47,060 (+1.9%)
Wife RRSP - $15,750 (+0.3%)
TFSA's - $0 (N/C)
Cash - $876 (-42%)
Miscellaneous assets - $20,700 (N/C)

*Total Assets $766,755

Liabilities:*

House mortgage - $51,030 (-17%)
HELOC - $85,381 (+0.2%)
SUV Loan - $7,825 (-11%)
Credit cards - $3,718 (this is not a balance, but the amount due. we pay off every month, but a true snapshot must include this)

*Total Liabilities $147,955*

*Net Worth: $618,800 (+3.2%, +$19,276 month over month, +39% year over year)*

Chart of monthly net worth amounts since I began tracking them attached.


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## nobleea

*May 2014 Update*

April went by in a flash and thank goodness as the weather was all over the place. Our EI maternity benefits showed up today, finally, in a nice retroactive amount. I have money assigned to our daughter's RESP, just have not contributed it yet since TD sent our e-series conversion forms back over a missing void cheque. I haven't checked yet to see if the change has been made. My stocks were all over the place this month - one down 21%, another up 22%. Made some more progress on whacking the mortgage down, on track to having it paid off in mid-September. We had a fair amount of expenses this month - booked 3 sets of flights (some on points) for travel to California, Ontario and Maui, and booked a vacation home. Still have some more travel expenses to go. I have found a few infill lots that we like in our neighbourhood. This would be for our next home. The lots aren't for sale, but everyone has a price. They all have small, old homes on them that are currently rentals, owned by people in their 60's. Nice big pie lots whose backyards face south. Will probably cost us in the 350-400K range for the lot, and then another 450K or so to build the house. We'll sell our current house when it's time to move (expected spring/summer 2016). I hope to end up in the new place with a mortgage under 250K which will take us 5-10 yrs to knock out. The question I toy with now is whether to get a builder to take care of the whole thing, act as GC myself, or some combination. Even with the screw ups that will inevitably happen and the additional time from acting as your own GC, the savings can be substantial.

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
SUV - $24,200 (-0.7%)
Car - $2,075 (-3.6%)
Non-Registered Portfolio - $71,148 (-4.3%)
Work RRSP (mine) - $132,772 (+7.3%)
Pension (wife) - $47,500 (+0.9%)
Wife RRSP - $15,504 (-1.6%)
TFSA's - $0 (N/C)
Cash - $5658 (+646%)
Miscellaneous assets - $20,700 (N/C)

*Total Assets $777,457

Liabilities:*

House mortgage - $41,766 (-22%)
HELOC - $85,627 (+0.3%)
SUV Loan - $6,950 (-13%)
Credit cards - $5,085 (this is not a balance, but the amount due. we pay off every month, but a true snapshot must include this)

*Total Liabilities $139,428*

*Net Worth: $638,029 (+3.1%, +$19,229 month over month, +36% year over year)*


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## james4beach

Congrats on your baby!

You're doing great. With a net worth over 600k you're not going to have any problems if you keep managing this well. A few suggestions.

Be careful how you value the SUV on the asset side. What would you get in the used vehicle market if you sold it hastily? Be conservative with the number for the SUV.

I'm scratching my head about why your TFSA(s) are empty. Do you realize you can do a contribution-in-kind, and move things like stocks (or anything else) you already have _into_ the TFSA without selling it first? This is a beautiful tax shelter. Just take a look at your T3 and T5 tax slips. Are you paying tax on anything there? If so, see if you can transfer it into a TFSA.

Your cash amount strikes me as a bit low, given that you have plenty of total money, and you're a 2 people with a new baby. I recommend boosting cash. In fact I would suggest putting money into a GIC ladder, and sheltering that within the TFSA. The idea here is that you will totally shelter the interest income, and GICs will be maturing every year or so providing you available cash should you need it.

Your HELOC balance looks pretty high at 86k. I realize you've probably got a low interest rate, but why borrow ANY money --- why pay any interest at all -- when you have so much money? The bank of course will tell you it's a smart way to borrow etc but they're just trying to make business for themselves.

The point I'm trying to get at is, when you have enough money (which you do) I don't see why you should have any loans. I think the reality is that while you have strong net worth position, your liquidity is poor... not much cash or equivalents sitting around. This can be problematic for instance during job loss or a weak stock market, when suddenly you'll be forced to liquidate assets like stocks to make ends meet.

I think you should boost your liquidity and reduce your reliance on unnecessary loans like HELOCs. You're paying interest on loans, but you shouldn't even need those loans.

Personally I don't think it's wise to be heavily invested in your own company stock. The problem is that you're concentrating your risk exposure to your employer. If the company has trouble, then both your job and your stock investment are at risk. It's putting a lot of faith in the company. Back when I was receiving company stock, I immediately liquidated it as soon as I could to minimize my exposure to my employer. (By the way they did in fact lay us off, and the stock declined at the same time)


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## james4beach

Here's another question: What is your total cash & liquid investments? If you lost your job or suddenly need emergency money, how much do you have without having to sell your stock or long-term investments? You don't want to have to sell stock investments... it's going to kill your future returns.

I don't recommend relying on the HELOC for emergency money. Strictly speaking, HELOCs are callable loans. The bank can ask for the money back (unlikely) or they can prevent you from borrowing additional amounts (more likely).

Your house and SUV/car are not liquid. Your non-registered portfolio holds stocks... but do you have investments that could be sold for cash in a pinch, like short-term bonds? The RRSP and pension are obviously locked in too. How about your misc assets, can any of them be converted easily to cash in a pinch?

Otherwise you only have 6k of liquidity, not nearly enough for 3 people to live off for any amount of time.

There are many options to improve your liquidity. More cash, more high interest savings, maybe cashable GICs (I have some at my credit union).


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## nobleea

james4beach said:


> Congrats on your baby!
> 
> You're doing great. With a net worth over 600k you're not going to have any problems if you keep managing this well. A few suggestions.
> 
> Be careful how you value the SUV on the asset side. What would you get in the used vehicle market if you sold it hastily? Be conservative with the number for the SUV.
> 
> I'm scratching my head about why your TFSA(s) are empty. Do you realize you can do a contribution-in-kind, and move things like stocks (or anything else) you already have _into_ the TFSA without selling it first? This is a beautiful tax shelter. Just take a look at your T3 and T5 tax slips. Are you paying tax on anything there? If so, see if you can transfer it into a TFSA.
> 
> Your cash amount strikes me as a bit low, given that you have plenty of total money, and you're a 2 people with a new baby. I recommend boosting cash. In fact I would suggest putting money into a GIC ladder, and sheltering that within the TFSA. The idea here is that you will totally shelter the interest income, and GICs will be maturing every year or so providing you available cash should you need it.
> 
> Your HELOC balance looks pretty high at 86k. I realize you've probably got a low interest rate, but why borrow ANY money --- why pay any interest at all -- when you have so much money? The bank of course will tell you it's a smart way to borrow etc but they're just trying to make business for themselves.
> 
> The point I'm trying to get at is, when you have enough money (which you do) I don't see why you should have any loans. I think the reality is that while you have strong net worth position, your liquidity is poor... not much cash or equivalents sitting around. This can be problematic for instance during job loss or a weak stock market, when suddenly you'll be forced to liquidate assets like stocks to make ends meet.
> 
> I think you should boost your liquidity and reduce your reliance on unnecessary loans like HELOCs. You're paying interest on loans, but you shouldn't even need those loans.
> 
> Personally I don't think it's wise to be heavily invested in your own company stock. The problem is that you're concentrating your risk exposure to your employer. If the company has trouble, then both your job and your stock investment are at risk. It's putting a lot of faith in the company. Back when I was receiving company stock, I immediately liquidated it as soon as I could to minimize my exposure to my employer. (By the way they did in fact lay us off, and the stock declined at the same time)


Thanks for the comments james. The SUV value is probably bang on for used car value. In a hasty sale, maybe knock a couple grand off. I can see no reason for a hasty sale.

Haven't gotten around to TFSA's yet. Contribution in kind wouldn't work. The non-registered account is remnants of a smith maneuvre (which explains the LOC balance). If I contribute in kind, I lose the tax deductibility of the HELOC. The net interest rate on the HELOC is lower than the mortgage rate, hence our attack on that.

I believe both our jobs are secure enough to not worry about a large cash savings. My wife is an award winning teacher. There'd have to be a >20% cut in staff across the Board before she was in jeopardy. My position is secure. I am close to being an international subject matter expert on the product. The product is a 2billion/yr niche of which my company has over 50% of the market. It's one of the crown jewels of the company. Even if the worst happened, a lay off would come with a healthy severance package and my skill set would be sought after.

On the topic of emergency funds, I sit on the side of the fence that believes that a HELOC is fine for such a rare event. Once the mortgage is paid off, if one of us lost a job, nothing would happen. We would be fine just on one income. We both have disability coverage through work. Doesn't cover everything, but there's a big enough gap between our income and expenses that it's not an issue. Not listed on the balance sheet are future receivables. Not sure how I would put that in. This is for weddings and portrait sessions booked/contracted for 2014, but not paid yet. If I were to lose my main job and get no severance, those bookings would be enough to carry us through the year (wife can't get laid off right now as she's on maternity leave).

Engineers are very by the numbers. I think I understand the risks well, but also understand the probability of said risks. One thing I do have to address soon, is some additional life insurance for both of us. It'll be Term10, as we'll be self insured after that.

In regards to company stock of course holding it increases risks, however I do not plan on keeping it forever. Somewhere in the 4-12month range. When our stock was languishing a year and a half ago, I was begging to be put on the stock incentive program, even offering a cut in pay to do so. Didn't happen unfortunately. If they stick to their plan, 50-100% gain from here over the next 12months is likely.


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## nobleea

*June 2014 Update*

Before you know it, May is over. Another solid month. We now have our daughter's RESP account set up and funded. Has about $1500 so far, should be around $3500 by the end of the year. Speaking of which, I thought it would be time for an update on our goals for the year.

_Net worth over 725K by the end of the calendar year_ No problem reaching this. Should be closer to 775K
_Paid off mortgage (fixed portion) in September_On track for payoff Sep 4.
_Purchased lot for subdivision and residential infill by end of calendar year_ Found our lot (across the street), have to agree on a price.
_Take at least one month off in parental leave and possibly travel a bit with the new family._ Booked for 5 weeks. Heading to Maui for 3 weeks in Nov.
_Replace my car with something bigger, safer._ Doesn't look like we'll have saved up for this until late January 2015
_Open TFSA's for both of us._ I can certainly *open* the TFSA's, but won't be able to fund them this year. But I guess the goal was open the account, so that's doable.
_Open RESP for the new addition and start contributing immediately enough to get full CESG._ Opened, will have full amount for sure.
_Increase XIRR on non-reg portfolio from current 2.7% to 7%_ XIRR has increased to 5.3%. I think 7% is achievable, though it's out of my hands.

I sent some unsolicited offers to purchase some lots we like in the neighbourhood this month. The one we like the most got back to me and is interested in selling. An unorthodox approach, but seems to have worked. Older couple that has it as a rental. We'll see if we can nail down a price and then we would take over the renters til their lease is up. Designing and building my own home (not me actually building it of course) has been a dream of mine since I've been 13 or 14. If we do go ahead, I would use our HELOC as downpayment, and then mortgage the remaining 50% of it since it'll be a tear down. Buying the new place was in the plans, but with no exact date, so it may throw off some of our repayment plans and schedules. I want to leave some room on the LOC for rezoning fees, design costs, etc, though I guess there would be some rental income in there as well.

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
SUV - $24,025 (-0.7%)
Car - $2,000 (-3.6%)
Non-Registered Portfolio - $75,544 (+6.2%)
Work RRSP (mine) - $140,337 (+5.7%)
Pension (wife) - $47,500 (N/C she's on EI, not contributing)
Wife RRSP - $15,500 (N/C)
TFSA's - $0 (N/C)
Cash - $3105 (-45%)
Miscellaneous assets - $20,700 (N/C)

*Total Assets $788,191

Liabilities:*

House mortgage - $33,240 (-26%)
HELOC - $77,662 (-10.2%)
SUV Loan - $6,075 (-13%)
Credit cards - $4,276 (this is not a balance, but the amount due. we pay off every month, but a true snapshot must include this)

*Total Liabilities $121,253*

*Net Worth: $665,358 (+4.3%, +$27,239 month over month, +42% year over year)*


----------



## nobleea

nobleea said:


> I sent some unsolicited offers to purchase some lots we like in the neighbourhood this month. The one we like the most got back to me and is interested in selling. An unorthodox approach, but seems to have worked. Older couple that has it as a rental. We'll see if we can nail down a price and then we would take over the renters til their lease is up.


They got back to me on Sunday. We met for coffee today and nailed down a price, terms and possession. It's much less stressful without a realtor. Certainly dealing with someone who views the house as an investment makes it easier. They're much less emotionally attached to the property and can be objective about it. Possession in mid-Aug. There's renters in place, but they're month to month. I hope they are willing to stay until Mar 2015. If not, maybe I will try and find someone else. Will stop by the lawyers over the next week to formalize the deal. The price we agreed to was less than I was expecting to pay and about what they expected to receive, so everyone's happy.


----------



## My Own Advisor

"The price we agreed to was less than I was expecting to pay and about what they expected to receive, so everyone's happy."

Sounds like congrats are in order!

Well done with killing the debt nobleea. Your assets (outside home value) are great as well. You should be a millionaire (in terms of net worth) within a couple of years.

I haven't calculated our NW in some time...I'm more focused on killing the debt by X amount and contributing to my RRSP and non-reg. portfolio by Y amount - but the outcome of both of those things will be a higher NW for sure.

Keep up the great work!


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## nobleea

Thanks! Definitely focusing on the debt (as you are doing as well) and the rest takes care of itself. Living well below your means certainly helps too. Not that our lifestyle is terribly low, but our means are much higher.

I estimate we'll be passing the 1mil NW sometime around Aug-Sep 2016. Depends on what happens with this house of course.


----------



## nobleea

*July 2014 Update*

This month, the contract was signed for the new place. You will see the deposit amount for the current value of the new house. It's in trust with the lawyers. We take possession middle of August. I've been doing some casual shopping around with some builders, and I'm fairly confident we'll be able to get what we want for the price I had in mind. When all is said and done and our old house is sold, I hope to be left with a mortgage on the new place of $350K or less. I've been working on some plans (it is my intention to design the house myself), but it will probably take 3 months until we've got something to share with a builder. On the networth side, didn't make a whole lot of progress. I believe some of that was due to the CAD$ which surged a bit. We'll make up for it next month, I promise. We still plan on paying the mortgage off on the first house in September, though we'll have a second house and new mortgage to show for it.

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
New house lot - $10,000 (deposit amount)
SUV - $23,850 (-0.7%)
Car - $1,925 (-3.9%)
Non-Registered Portfolio - $30,644 (-60%)
Work RRSP (mine) - $139,021 (-0.9%)
Pension (wife) - $47,500 (N/C she's on EI, not contributing)
Wife RRSP - $15,500 (N/C)
TFSA's - $0 (N/C)
Cash - $3322 (+7%)
Miscellaneous assets - $20,700 (N/C)

*Total Assets $751,633*

*Liabilities:*

House mortgage - $28,644 (-14%)
HELOC - $43,282 (-44%)
SUV Loan - $5,200 (-14%)
Credit cards - $3,205 (this is not a balance, but the amount due. we pay off every month, but a true snapshot must include this)
*
Total Liabilities $80,349*

*Net Worth: $669,983 (+0.7%, +$4,625 month over month, +41% year over year) *


----------



## nobleea

*August 2014 Update*

Not a whole lot to report this month. We just got back from a 1wk trip to California for a wedding and our first trip with the little one. Most expenses were already prepaid. We go to the lawyers on monday to sign the paperwork for the new house/teardown. Take posession next Thursday. Have to get insurance worked out today on the new house. Wife worked her 2.5 weeks of summer school in July, we lost a couple weeks of maternity EI because of it, but the pay more than makes up for it. She's now on parental leave for EI. Made some good progress on paying down the mortgage. The current one will be paid off on Sep 12th, though unfortunately we'll have a new mortgage to show for it by then. The appraisal on the new place came in fine dollar wise, though they estimated the house had 20yr economic life left, so the bank would only allow a 20yr or shorter ammortization. So be it. Went 2yrs fixed at 2.54% which seems to be reasonably competitive for a big bank rate in Alberta. Through our main bank, so that's nice. That term should be up for renewal roughly when the new house will be completed.

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
New house lot - $10,000 (deposit amount)
SUV - $23,500 (-0.7%)
Car - $1,900 (-1.3%)
Non-Registered Portfolio - $29,452 (-4%)
Work RRSP (mine) - $138,533 (-0.4%)
Pension (wife) - $47,500 (N/C she's on EI, not contributing)
Wife RRSP - $15,500 (N/C)
TFSA's - $0 (N/C)
Cash - $1,037 (-68%)
Miscellaneous assets - $20,700 (N/C)

*Total Assets $747,499*

*Liabilities:*

House mortgage - $13,886 (-52%)
HELOC - $43,211 (-0.2%)
SUV Loan - $4,325 (-20%)
Credit cards - $3,835 (this is not a balance, but the amount due. we pay off every month, but a true snapshot must include this)

*Total Liabilities $65,527*

*Net Worth: $680,940 (+1.6%, +$10,957 month over month, +39% year over year)*


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## cashinstinct

Congrats for everything !

Considering your high incomes and potential retirement income, TFSA should be the next step in your plan. 

For example, do you have lots of unrealized gains or losses on your non-reg porfolio? You could transfer the positions to a TFSA account if they have small gains (or sell positions and transfer $$$ if they have losses).

I did this recently when I realized the $$$ I had to contribute to my TFSA was in my non-reg investments.


----------



## nobleea

cashinstinct said:


> Congrats for everything !
> 
> Considering your high incomes and potential retirement income, TFSA should be the next step in your plan.
> 
> For example, do you have lots of unrealized gains or losses on your non-reg porfolio? You could transfer the positions to a TFSA account if they have small gains (or sell positions and transfer $$$ if they have losses).
> 
> I did this recently when I realized the $$$ I had to contribute to my TFSA was in my non-reg investments.


Yes, I certainly want to get the TFSA going. Our non-registered investments are leveraged, so donating in kind (or selling and donating) would lose the tax deductibility of the investment loan, so that would be repaid first, leaving nothing to transfer.

It is hard to decide how much should go to invest and how much to debt repayment. The last 5 years we have focused on paying off the mortgage with all free cash going towards that. So now it's sort of become habit to want to pay down debt. With a new house coming up, that will be a new mortgage to pay down as well. I think we will set the new mortgage up to pay off in 10 years, and any spare cash after that will go to TFSA first, then after that get split between RRSP/non-reg and spending. We'll have 62K of unused TFSA room starting in 2015 so that should take us a couple years to fill up.

I've always thought that debt pay down is good as it's after tax dollars. Our mortgage rate is low and would equate to a before tax return of 3.5%. Guaranteed, that's not bad. Any other investment is pre tax (even RRSP, which is tax deferred). I'm of the opinion that our RRSP's will likely be comfortable (combined with wife's DB pension) and we may get in to an issue with larger mandatory withdrawals than wanted (and thus higher taxes). So it makes sense to max out the TFSA through the years and non-reg after that.


----------



## cashinstinct

I understand your position on your non-reg portfolio. Your loan would not be tax deductable if investments are in TFSA... I am not sure it should be a "show stopper" to consider the transfer or not. You could repay the loan like you will do with the mortgage.

It makes sense to max out TFSA first in your current situation with cashflow left after paying mortgage. It depends how soon you want to fill up the TFSA.

Either way, being able to save this much is a good problem to have


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## nobleea

For example, over the next 2 years, we'll have a decent balance on the LOC for new house expenses (downpayment, design fees, some construction, etc). The rate for the forseeable future is 3.5%. Putting cash flow against that would be a guaranteed 3.5% after tax return. 
Putting cash flow in a TFSA would probably get 5.5% return including dividends but not guaranteed. Since it's tax free on the way out, that would also be an after tax return. If one expects the market to correct at some point short term, then the debt paydown seems smarter. I don't see the point in using the TFSA as a bank account to save money. It should be for investing.


----------



## cashinstinct

For sure, when I say fill up TFSA, I mean with investments. 1.3%-2% interest when you have a 3.5% LOC does not make too much financial sense (it might be psychologically good for some people for emergency fund, but it's not a financial decision).

Enjoy your new house project.

Paying down debt is a good investment for sure


----------



## nobleea

*September 2014 Update*

In August, we took posession of the new house. Renters are still there and they decided to rent out the garage as well, so that brings in a little extra cash. I expect we'll keep them there til April. I have a house design all sorted out and have passed it on to a drafter to finalize. I designed it all in a high end 3D cad software myself, so all she does it makes appropriate drawings for permits. Makes it pretty cheap. The city is making changes to allowable building heights and we'll design for the new height, which is supposed to be voted on and approved in Q1 2015, but who knows if they'll keep to that schedule. Other than that, we've just been attacking the mortgage on our house, which will be done this month. We forgot to fill in some paperwork for EI (parental leave), so we haven't received any for 6 weeks. It'll be back paid once they confirm it's all good. Probably late Sept. We are going have a decent amount of free cash coming in over the next two years. For now, I was just going to put it against the LOC and wipe it out before we move in to the new place. Other thing is to keep it invested somewhere else until the renters move out at which point the LOc is no longer tax deductible. The rate is 3.5%, which as an after tax rate, is not a bad rate to be paying down when it's non-deductible.
Non-registered and RRSP accounts took a bit of a hit of the past couple of weeks due to weakness in energy prices. It looks like we have a few months of good networth growth (~36%/yr) and then it'll drop down to a more reasonable number (~16%) but that's still a nice number to have.

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
Rental house - $375,000 (purchase price)
SUV - $23,500 (-0.7%)
Car - $1,900 (N/C)
Non-Registered Portfolio - $29,450 (N/C)
Work RRSP (mine) - $145,277 (+4.8%)
Pension (wife) - $47,500 (N/C she's on EI, not contributing)
Wife RRSP - $15,500 (N/C)
TFSA's - $0 (N/C)
Cash - $1,050 (+0.1%)
Miscellaneous assets - $20,700 (N/C)

*Total Assets $1,119,937

Liabilities:*

House mortgage - $6,056 (-52%)
Rental mortgage - $300,000 (new)
HELOC - $111,154 (+157%)
SUV Loan - $3,450 (-20%)
Credit cards - $2,900 (this is not a balance, but the amount due. we pay off every month, but a true snapshot must include this)

*Total Liabilities $423,560*

*Net Worth: $694,302 (+2.0%, +$13,362 month over month, +39% year over year)*


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## My Own Advisor

Very impressive for your age. Any long-term plans for the rental?


----------



## techcrium

Hey OP,

I'm curious: what is your networth and income progression?

e.g. 
25 - networth
26 - networth
27 - networth
etc


----------



## nobleea

Thanks. The current rental (that we just bought) will be torn down and we'll be building a new family home on it. We just bought it for the lot. It's right across the street from us. Our current home will be sold once we move in to the new one. There's no way keeping it makes sense given it's value and what it would rent for.


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## humble_pie

excellent illustration of first-rate management in every direction.

careers, photography, growing a family, house design, real estate management ... noblea, is there anything at all that you are not gifted at?


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## nobleea

That's a good question. I can tell you were I was at 23 when I graduated and started work, and I can tell you where we were from 30 and onwards, but the middle part is a guess.

Age Income NW
23 $48K -$45K
25 $55K* $0K*
27 $64K* $40K*
30 $140K* $162K
32 $150K $175K
34 $200K $334K
36 $280K $694K

* indicates guesses to the best of my recollection
My wife and I joined our finances when I was 30. She graduated uni and just got her first job at that time, and didn't bring much, maybe 20K (though no debt). Income and NW from 30 onwards indicates family values.


----------



## nobleea

humble_pie said:


> excellent illustration of first-rate management in every direction.
> 
> careers, photography, growing a family, house design, real estate management ... noblea, is there anything at all that you are not gifted at?


I'm not very good at golf. It's an expensive 'sport' to suck at. I've tried to learn the guitar and haven't had the diligence to excel at that.


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## My Own Advisor

Mid-30s and ~700k NW. Pretty damn good. Income helps, but you still need the discipline.


----------



## nobleea

My Own Advisor said:


> Mid-30s and ~700k NW. Pretty damn good. Income helps, but you still need the discipline.


You think so? Thanks. I always thought we were a bit behind given age and income. My wife started her career a bit later and I know there's a few things had I done differently would have added close to a hundred grand to the NW. We're both quite frugal and while our quality of life is decent (lots of travel), we live WELL below our means. No cable, one cell phone that is a pay and talk line, no landline, cars that are on average 8yrs old, rare dinners out, short commutes. Within our group of friends, we are probably mid-pack in terms on NW and income so that keeps things humble and helps with the discipline.


----------



## nobleea

*October 2014 Update*

September wasn't the best month, and October isn't looking up either. I called in to pay off the remaining balance of the mortgage ($1711 at the time) and BMO indicated a $45 early penalty would be due, despite being within my prepayment privileges. So I said pay off $1710 instead, leaving a $1 balance. The next automatic payment will wipe it out. We had some problems with parental leave EI, they haven't paid us since July. We called again and the agent indicated that they had made an error and would force the retro payment within a day. That's a $5K amount (included in the numbers below). House plans continue, I am planning on sending out for quotes in October. Had to pay for our vacation rental this month - we are going on a 3wk vacation to Maui later this year, hence the big CC bill. The big hit in the NW came from the markets. My accounts have an energy focus, and that has not fared well the past month. I'm indifferent as I don't need the money for anything. Wouldn't mind putting some more in to the market, but I think it might be a bit premature for that. The car loan will be paid off in a couple months (it was a 2yr term) and that will free up almost $900/mo. With the mortgage paid off, that frees up $3850/mo of fixed payments. We also cancelled our land line and redid the insurance recently to save another $80/mo total. We have started looking at day care for our daughter for next year. My wife is planning on going back to work part time Feb-June then full time from Sep-onwards. Dayhome rates are about $50/day and there are a few within walking distance that have availability. We live in the core of the city which doesn't have the baby boom that the suburbs do here in Edmonton.

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
Rental house - $375,000 (purchase price)
SUV - $23,325 (-0.7%)
Car - $1,900 (N/C)
Non-Registered Portfolio - $21,518 (-27%)
Work RRSP (mine) - $133,828 (-7.9%)
Pension (wife) - $47,500 (N/C she's on EI, not contributing)
Wife RRSP - $15,500 (N/C)
TFSA's - $0 (N/C)
Cash - $8,150
Miscellaneous assets - $20,700 (N/C)
*
Total Assets $1,107,706*

*Liabilities:*

House mortgage - $1 (-99%)
Rental mortgage - $299,029 (-0.4%)
HELOC - $110,182 (-0.9%)
SUV Loan - $2,575 (-25%)
Credit cards - $8,050 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)

*Total Liabilities $419,837*

*Net Worth: $685,484 (-1.3%, -$8,818 month over month, +29% year over year)*


----------



## nobleea

I was looking back at our goals for 2014 and it doesn't look like we're going to achieve all of them.

*Goals for 2014*:
Net worth over 725K by the end of the calendar year - _*Going to miss this one by 10-20K though it is still a possibility*_
Paid off mortgage (fixed portion) in September - _*Achieved*_
Purchased lot for subdivision and residential infill by end of calendar year - *Purchased a lot for infill, though for our own purposes not spec. I'll say it was achieved.*
Take at least one month off in parental leave and possibly travel a bit with the new family. - _*Booked, heading to Maui.*_
Replace my car with something bigger, safer. -_* Doesn't look like it's going to happen. My current car is ticking along fine and is just used inside the city.*_
Open TFSA's for both of us. - *I could open them to meet this goal, but nothing to contribute right now. So we'll miss this one.*
Open RESP for the new addition and start contributing immediately enough to get full CESG. -* Achieved. We'll have almost 4K saved up before her first birthday.*
Increase XIRR on non-reg portfolio from current 2.7% to 7%. - *This one is still possible, depends on how the stocks do. I give it a 30% chance.*

So currently looking like we'll achieve 50% of them. I will have to be more realistic and specific with the goals for 2015. They should still be tough goals to reach, or else it's not much of a challenge. Maybe 75-80% completion would be good.


----------



## nobleea

*November 2014 Update*

In October, we managed to pay off debt faster than the drop in equities, so we managed to have a gain in NW for the month and it looks like that will continue for the next 6 months (gains). House plans are done and I sent off to 5 builders with my own spec in October. 2 of them came back far too high on preliminary pricing, so there's 3 that I will be working with to get a detailed quote. We are leaving on our holiday in a week (gone for 3 weeks). It is technically parental leave, so I've been working out the details on that. Due to delays in processing, I won't get my two EI cheques until I'm back at work in December, but oh well. My wife has started working at the gym again, teaching fitness classes. It's only one class a week and that is well within the allowed amount while on EI, but it's a free workout, comes with a free gym membership, and daycare is free during that time. We've booked dayhomes for three days a week starting in February. Two more payments on the car loan, and then that's done. Working on a good list for goals for 2015, but it will depend on what can be arranged for house construction, etc.

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
Rental house - $375,000 (purchase price)
SUV - $23,150 (-0.7%)
Car - $1,900 (N/C)
Non-Registered Portfolio - $20,706 (-3.8%)
Work RRSP (mine) - $133,828 (N/C)
Pension (wife) - $47,500 (N/C she's on EI, not contributing)
Wife RRSP - $15,500 (N/C)
TFSA's - $0 (N/C)
Cash - $2,322
Miscellaneous assets - $20,700 (N/C)
*
Total Assets $1,101,296*

*Liabilities:*

House mortgage - $0 (Paid off)
Rental mortgage - $298,077 (-0.4%)
HELOC - $104,037 (-5.6%)
SUV Loan - $1,700 (-34%)
Credit cards - $3,360 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)

*Total Liabilities $407,170*

*Net Worth: $691,236 (+0.8%, +$5,752 month over month, +24.5% year over year)*


----------



## nobleea

*December 2014 Update*

November was a horrible month for investments, but a great month otherwise. Financially, we took a hit from the slide in the markets, made worse by a heavy weighting in energy. I'm fairly non plussed about the whole thing. I could borrow to invest to take advantage of it all, but I don't think we're done yet with this slide, and even then, I'm fairly confident I would like to avoid leveraged investing for now. We'll keep on going with the debt repayment, now focusing on the HELOC. I am pretty sure I will be getting a new-to-me car sometime in the next 3 months. The current one is making more and more weird noises. 15K can get a 1yr old Fusion or similar which seems like a pretty good deal. November was a great month because we spent most of it in Maui. I took a leave of absence and went on EI parental leave (technically, we are both unemployed an on EI at this time) and we spent just over 3 weeks in Maui, relaxing and playing with our 8month old. We got there on points, stayed in a condo and cooked at home, plus split costs with the grandparents who came down as well for part of it, so overall it was not a super expensive trip. Just got back yesterday and already dreaming of the next beach destination. I have some more concrete numbers from builders for the new house. They're coming in between 500-600K for the house, which is a bit higher than I had hoped, but pretty well in line with what a custom infill costs around here (200-250/SF). It includes a second floor on the detached garage which will be converted to a rental garage suite when that becomes legal. Should net us about $500/mo after taxes and costs. Going to the bank tomorrow with the plans to get preapproved for financing, which shouldn't be an issue. I've created a sensitivity matrix to look at our financing needs and possible monthly payments based on a bunch of possible selling prices for our current house, some variations on the build price, and interest rates of 3.1 to 4.3%. I think the required mortgage will come in somewhere around $425K. We will be doing a 15yr amortization.

Daughter's RESP is at $3150 now, though not included in the numbers below.

I will be updating our 2014 goals and sharing the new goals for 2015 later this month.

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
Rental house - $375,000 (purchase price)
SUV - $22,975 (-0.7%)
Car - $1,900 (N/C)
Non-Registered Portfolio - $9,000 (-56%)
Work RRSP (mine) - $129,291 (N/C)
Pension (wife) - $47,500 (N/C she's on EI, not contributing)
Wife RRSP - $14,500 (-6.5%)
TFSA's - $0 (N/C)
Cash - $2,251
Miscellaneous assets - $20,700 (N/C)
*
Total Assets $1,084,069*

*Liabilities:*

House mortgage - $0 (Paid off)
Rental mortgage - $297,103 (-0.4%)
HELOC - $103,087 (-1%)
SUV Loan - $825 (-50%)
Credit cards - $3,357 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)

*Total Liabilities $404,372*

*Net Worth: $676,545 (-2.1%, -$14,661 month over month, +21.8% year over year)*


----------



## nobleea

2014 Goals/Targets

A summary of our goals for 2014. We went 4 for 8. Not great, though two of the goals are things I didn't have full control over.
*
Increase Net Worth to over 725K.*
Missed this one by 50K. Still increased our net worth by 120K, which is no small amount.
*
Pay off fixed portion of house mortgage.*
Completed in October. We paid off about 83K in one year. Proud of this achievement.

*Purchase a lot for infill.*
Completed in August.

*Replace my car with something bigger, safer.*
I thought I might be able to keep the current one going for a while, but she's on a downwards spiral and there seems to be more and more jacked up trucks driving around here.

*Take at least one month off as parental leave and go somewhere.*
Complete, took 4 weeks off as parental leave and went to Maui for 3 weeks.

*Open TFSAs for me and wife.*
Did not complete. This would have been an easy one since I didn't specify any funding of the TFSAs.

*Open RESP for daughter and get full contribution in.*
Complete. Whether I get the full contribution remains to be seen depending on the deposit amount for December and when the contribution shows up.

*Increase XIRR on non-registered portfolio from 2.7% to 7%.*
Big fail on this one. It was very close in the middle of the year, but then things went south.


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## nobleea

2015 Goals/Targets

A listing of our targets and goals for 2015, to be completed before Dec 31, 2015.

Sign up for additional term life insurance for myself and wife.
Open TFSA for me and wife and fund with $2K each.
Pay off SUV loan.
Reduce HELOC balance by 60K
Reduce photo business to have more free time (<4 weddings, <20 other sessions)
Start new home construction and maintain construction cost under $575K
Finish up renos on current home to list in spring 2016, spending <$10K
Buy back wife's maternity leave pension amount from her RRSP
Go on international vacation with family
Replace my car with something newer, safer

I hope for the networth to be around 800K to close out 2015, but I won't put that as a target, since I don't have control over a lot of the components, but also because I'll have a house under construction, which is tough to value.


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## My Own Advisor

Impressive stuff....NW around $800K to close out 2015.

You have a number of goals and it's great to see how motivated you are. 

We're also thinking about goals for 2015...need to write about those at some point. 

I look forward to your updates nobleea!


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## gladaki

Impressive...I need to be on financial track....doesnot have any saving


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## nobleea

I got the year end update from the wife's pension. Things are better than I had assumed. The Termination benefit (if she were to quit or go somewhere else) is about double what I had listed as value, so that is a nice bump. I think the termination benefit is the one that makes the most sense since there is a decent chance that she will not finish her career with this school board (or as a teacher). It's made up of a transfer to a LIRA and a cash payout. I'll account for the taxes on the cash payout when I update next month.


----------



## nobleea

Well two days in to 2015 and I've already got 2 of the 10 goals completed.
We paid off the SUV loan. It was a 24 month loan.
I bought a new to me car. 2013 Fusion. I paid 13750. Full warranty and winter tires. Only has 20K on it too. Considering the car would have sold for about $24K when it was bought, that's a pretty steep discount. 
I believe I'll be able to sell my old car (2000 accord) for $1400. That's a bit less than the value I have listed in the NW statement ($1900), but not too far off. That car ended up costing me $91/month in depreciation and repair costs. That's really not bad. I expect this new car will be closer to $100/mo in depreciation and repair costs.


----------



## nobleea

*January 2015 Update*

December went alright. Our equities continued to slide, but we got a one time bump from an updated value of the termination benefit on my wife's pension plan. I think that's the best estimate of the value of the pension since that's guaranteed, even if she was to quit tomorrow (the value reflects taxes as well as the full amount can't be transferred to LIRA for some reason). Wife got a promotion to assistant principal when she goes back next month. She'll still only be working 3 days a week. I don't think she wants to work full time until all our kids are in school. As mentioned above, I bought a new (to me) car. Not too expensive and full warranty. I think the gas mileage will be a shade worse than the old car, but very similar. The renters in the tear down received their notice at the end of the month, so we'll be able to tear that house down in the first week of April. We already have a family interested in our current house (friends of friends) as they have been looking to move in to a renovated place in the neighbourhood for some time and go to the local school. We indicated if we did list it, it would be in the 500-550K range, and they were fine with that. We're likely 18mo away from selling, but nice to know we already have bites. I picked up a copy of Ufile 2014 and ran some preliminary numbers. I'm not sure how the family income splitting is going to work, but should be useful for us in that my income was twice that of my wife in 2014 due to maternity leave. If we get a good chunk of that $2000, then we'll come to a few hundred owing between the two of us. December wasn't a cheap month as we had a couple pricey dinners (christmas with friends and anniversary), xmas gifts, and new car.

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
Rental house - $375,000 (purchase price)
SUV - $22,800 (-0.7%)
Cars - $15,150 (Two cars for now)
Non-Registered Portfolio - $9,380 (+4.2%)
Work RRSP (mine) - $129,366 (+0.1%)
Pension (wife) - $88,900 (termination value)
Wife RRSP - $14,000 (-3.6%)
TFSA's - $0 (N/C)
Cash - $2,600
Miscellaneous assets - $20,700 (N/C)

*Total Assets $1,138,722

Liabilities:*

House mortgage - $0 (Paid off)
Rental mortgage - $296,147 (-0.4%)
HELOC - $115,084 (+11.6%)
SUV Loan - $0 (Paid off)
Credit cards - $6,360 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $417,591*

*Net Worth: $717,634 (+6.2%, +$41,659 month over month, +26.8% year over year)*


----------



## nobleea

*February 2015 Update*

January was on the whole, not a bad month, assets up, liabilities down. I sold my old car - it went for $1200. Given the number of calls I received and the fact that it sold the same day as I listed it, I probably could have got an extra $200 out of it. Oh well, fast cash deal to a nice guy. Received our property tax assessments from the city. Our rental/tear down property was assessed at $404K, so I appealed that (since we bought at 375K). Should be a slam dunk reassessment, saving a bit in taxes. Wife went back to work on a part time basis - 3 days a week. Equities continued to be very volatile during the month, but in a general positive direction. I had to fight the urge to borrow from the LOC and buy some depressed equities, and though it would have turned out great, I don't think it's a good time for me to do this. There will always be more opportunities and I'd like to wait until we're in the new house and everything is squared away before we start adding more risk like that. I broke my ankle playing hockey at the end of the month, which really sucks. Find out this week whether I need surgery or whether its healing properly. Really makes life challenging. Can't shop for groceries, shovel the driveway, or really help out with the baby. Haven't been off work though. Speaking of work, we are definitely seeing a downturn, more so at the corporate level rather than our product line, but we've still been asked for cuts. A few layoffs (poor performers/dead wood) and a 10% cut in our budgets. Will be interesting to see what happens with our bonus from 2014. It should be coming as our product line beat all estimates, but they may reduce it given the current condition. It is supposed to be in the 20-25% range and they've already paid out 10% throughout the year. On the house front, had another couple approach us, this time interested in buying the tear down house from us to move to their lake lot (rather than us tear it down). I wouldn't charge them anything, but I'm doubtful they'll be able to get the house out easily as it's surrounded by tall trees. Worth a look so it doesn't go to the dump. I think we are going to benefit from possibly the lowest mortgage rates ever when it comes time to set up our new house mortgage. I'm still undecided on the amortization period for the final mortgage. Was originally thinking 15yrs or less so that it's done when I retire, but might do 20 or 25yrs to free up more cash flow for investing. Doing some preliminary looks at travel for this summer. We're leaning towards Iceland and Scotland for a couple weeks. There are direct flights from Edmonton to Iceland now.
In addition to the numbers below, I also track some other metrics. We currently have a Debt to Asset ratio of 0.36 (I have a target of 0.3 for this, which we are unlikely to achieve until the current house is sold and we're settled in the new one). I also track Debt to Equity ratio which is currently at 0.57 (target is 0.5 and again won't achieve it til 2H2016). We have debts of about 175% of our gross income, but this includes mortgages. Without the mortgages, we're at 2% of our gross income. The two houses, combined, put us at a Price to Income ratio of about 3.2ish. The combined LTV on the two places is 49%.

As an aside, our daughter's RESP account is currently at $3,900, she turns 1 in a month. This value is not included below.

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
Rental house - $375,000 (purchase price)
SUV - $22,625 (-0.7%)
Cars - $13,700 (Just one car)
Non-Registered Portfolio - $7,084 (-24%)
Work RRSP (mine) - $140,998 (+9%)
Pension (wife) - $88,900 (N/C termination value)
Wife RRSP - $15,381 (+9.9%)
TFSA's - $0 (N/C)
Cash - $896
Miscellaneous assets - $20,700 (N/C)

*Total Assets $1,146,964

Liabilities:*

Rental mortgage - $295,189 (-0.4%)
HELOC - $113,154 (-1.7%)
Credit cards - $4,853 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $413,196*

*Net Worth: $729,888 (+1.7%, +$12,254 month over month, +28.7% year over year)*[/QUOTE]


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## nobleea

*March 2015 Update*
A lot of things happened in February. Negatives balanced with positives. First of all, my company announced company-wide furloughs from Apr-Sep which means we'll get paid 10% less during that period, but get one day off every two weeks. We're not living paycheque to paycheque, so the drop doesn't bother me, but it does mean I get 11 extra long weekends over the summer. I've always said I would trade a raise for an extra week of vacation/year, so this is my chance to try that out. I have no concerns about my position, group, or the product line we work in - it's still very profitable. It's just optics. Would have looked bad for everyone in the company to take furloughs except for us because we're special. To balance this, someone got injured at my wife's work which means she gets a temporary promotion to assistant principal and has to work 4 days a week instead of the 3 we started with when she came off maternity leave. So that bump in pay more than offsets my loss. On the photography business side, 2015 is shaping up to be really slow, and I can't really complain. More family time. I expect my income from that will be substantially less than last year (50% or more). One of my goals for 2015 was to reduce the amount of time spent on this business anyways.
Ankle has healed fine, I can walk on it now. No surgery was required. One month of rehab and physio and I should be back to normal. We've picked a builder for our house and are just finalizing the contract and having it reviewed by lawyers. Tenants are moving out in a few weeks and then the fun begins. Construction probably won't start til early May, but that's fine. More time to salvage and sell items from the house and clear out the yard of trees/bushes we're not going to keep. We have one family keen to buy our current home. I might look at selling them a call option on the house if they're really interested. We're sending out a letter to residents within 60m of our build informing them of the work. At the bottom there's a note that our current house will be for sale in a year, if your friends want in to this neighbourhood, etc. I expect that will get a couple interested parties as well. Ideally we would sell the house without a realtor. We've been told many times by total strangers that our house is the best looking reno in the neighbourhood.

*A couple questions for the readership here:*
From now until the time we take posession of our new place, we'll have about 100K of free cash flow. The original plan was to put it against the HELOC to minimize interest costs, but I am thinking it might be better to invest it instead and leave the HELOC where it is. It will get paid off when we sell the current house anyways. The rate on the HELOC is 3.35%. I know I've lived the safe life of paying down debt for the past 5 years, but I feel our investments are a bit light as a result. What do you think?

Second question. Originally, I was planning on minimizing the mortgage on the new place and having a 15 or 20 yr ammortization. That would be a 450K mortgage. But to follow up on the concern of light investments, we can always push out the ammortization to 25yrs to increase cash flow. Or even get a bigger mortgage (up to 750/800K) and use the excess funds to kick start our investments. I expect we'll be able to get a 5yr fixed rate in the 2.5-2.55% range. It would be hard, but not impossible, to figure out the mortgage interest that is deductible as a result. If at the end of the 5yr term, rates increased substantially, I can always use the investments to buy down the balance. I always thought a 750K mortgage would be insane, but if it came with a house and 300K of stocks, maybe not such a bad thing? It would probably be a combination, like a 650K mortgage and a 25yr life to increase monthly cash flow and kick off investments.

What are your thoughts on those questions? Too risky? Aggressive but worth it? Obvious?

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
Rental house - $375,000 (purchase price)
SUV - $22,450 (-0.7%)
Cars - $13,550 (-1.1%)
Non-Registered Portfolio - $4,096 (-38%)
Work RRSP (mine) - $146,335 (+3.8%)
Pension (wife) - $90,000 (+1.2%)
Wife RRSP - $15,381 (N/C)
TFSA's - $0 (N/C)
Cash - $1,214
Miscellaneous assets - $20,600

*Total Assets $1,150,994

Liabilities:*

Rental mortgage - $294,214 (-0.3%)
HELOC - $109,794 (-3.1%)
Credit cards - $2,283 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $406,291*

*Net Worth: $740,607 (+1.5%, +$10,719 month over month, +22.1% year over year)*


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## nobleea

*April 2015 Update*
In the last month, the renters left from the tear down and we signed a contract with a builder. Demolition is planned for last week of April/first week of May. In the meantime, I have some trees to cut down and try to sell/salvage as much of the house as possible. The city assessors stopped by this week to look at the tear down. I appealed our tax assessment (they said 405K). Should be a slam dunk since I actually bought it right around their assessment date. Saves a bit in taxes for the next year or two. Found out at work that I will be getting a bonus for 2014 after all. Instead of cash, they will be paying it in restricted stock which vests in 1 and 2 years. I have the balance included below, but it will not show up as an asset until it vests. We replaced the windows in the basement this month which went on the credit card. The windows were 60yr old and didn't open with so many coats of paint. Inefficient and unsafe. That was included in the 10K I had planned to spend this year to get our current house ready for sale. Next up will be carpet in the basement. Booked flights to go to Vanc Island in the summer for a bit of a family reunion. It's a long way to drive.
For the next year, we should be averaging 10K/mo gain in net worth. The goal of hitting 800K of net worth in 2015 seems very achievable at this time, with an outside goal of hitting 1M by end of 2016. The next goal would be 1M in investable assets when I am 40 (gives me 4 years).

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
Rental house - $375,000 (purchase price)
SUV - $22,275 (-0.7%)
Cars - $13,400 (-1.1%)
Non-Registered Portfolio - $3,725 (-10%)
Work RRSP (mine) - $151,567 (+3.6%)
Pension (wife) - $91,000 (+1.1%)
Wife RRSP - $15,381 (N/C)
TFSA's - $0 (N/C)
Cash - $2,118
Miscellaneous assets - $20,600
RESP: $4,517 (Not included in Assets)
Restricted Stock: $18,000 (Not included in Assets)

*Total Assets $1,153,085

Liabilities:*

Rental mortgage - $293,205 (-0.3%)
HELOC - $104,434 (-5.1%)
Credit cards - $7,737 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $405,376*

*Net Worth: $747,709 (+1.0%, +$7,102 month over month, +20.9% year over year)*


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## nobleea

*May 2015 Update*
Quite a bit of progress in the last month, even if it might not show on the balance sheet. The restricted stock bonus was finalized and the number of shares awarded was higher than I was expecting. It's not included in the assets until it vests, but still nice. Builder started on all permits and plot plans. By this time next month, we should have a hole in the ground. The city approved garage suites early last month, so we changed our plans to include one. Whether we go ahead with it will depend on what the incremental price is on the garage as the roof line is a fair bit more complex. For now we would just leave the space unfinished. I am hoping the incremental price will come in around $25K. It would then be another $25K to finish it as a DIY. Financing on the new place was approved, though the bank made us jump through many hoops and is having us refinance our current house as well as take out a personal LOC, just in case we have troubles between draws. I don't expect they will be needed. They will be appraising the lot and our current house today, so we'll see what they say. I may change the house/lot values listed below if they are off substantially, but I don't think they will be. In terms of building a custom house, I'd say the financing has been the most frustrating/annoying thing so far. On the plus side, we did manage to salvage quite a bit from the house. In the last month, about $3500 worth including some pretty high end audio gear that got sold on ebay. That money is all sitting in paypal (not included below). Finally closed out the smith maneuver account. A good learning experience overall, I think we just broke even. It's not for me at the moment. Started putting money aside for the TFSA, we had a goal of $2K each in the account for this year, which will be doable. They will be maxed out by the end of next year. The TFSA and future non-reg investments will go to a couch potato strategy (80%) and 20% individual stocks. Signed up for two new credit cards (one each) to get the 25K free aeroplan points (each) sign up bonus. We'll cancel during the year before the annual fee kicks in.

The goal of hitting 800K of net worth in 2015 seems very achievable at this time, with an outside goal of hitting 1M by end of 2016. The next goal would be 1M in investable assets when I am 40 (gives me 4 years).

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
Rental house - $385,000 (purchase price+funds paid to builder so far)
SUV - $22,100 (-0.7%)
Cars - $13,250 (-1.1%)
Non-Registered Portfolio - $0 (-100% closed out the Smith Maneuvre)
Work RRSP (mine) - $151,848 (+0.2%)
Pension (wife) - $91,500 (+0.5%)
Wife RRSP - $15,381 (N/C)
TFSA's - $600 (+100%)
Cash - $3,274
Miscellaneous assets - $20,600

RESP: $4,635 (Not included in Assets)
Restricted Stock: $21,640 (Not included in Assets)

*Total Assets $1,162,072

Liabilities:*

Rental mortgage - $292,220 (-0.3%)
HELOC - $108,695 (+4.1%)
Credit cards - $5,850 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $406,765*

*Net Worth: $755,307 (+1.0%, +$7,598 month over month, +18.4% year over year)*


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## My Own Advisor

Nice work! I said as much on MDJ but will gladly say it again here! 

"Finally closed out the smith maneuver account."

I think this is a great call...you don't need that with everything else that is seems to be going on. Keep it simple, this you know 

I hope to max out our TFSAs by the end of this year but we'll see, that new $9k for us will be very tough to save for now given our other financial priorities but it's worth a shot!


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## nobleea

My Own Advisor said:


> Nice work! I said as much on MDJ but will gladly say it again here!
> 
> "Finally closed out the smith maneuver account."
> 
> I think this is a great call...you don't need that with everything else that is seems to be going on. Keep it simple, this you know
> 
> I hope to max out our TFSAs by the end of this year but we'll see, that new $9k for us will be very tough to save for now given our other financial priorities but it's worth a shot!


Thanks MOA. I think that the Smith maneuver has a spot, possibly sometime in the future. But at the present time, there's just too much going on and too much messy paperwork and trails to take care of. I've also learned that for me, unless I have a very rigid, written investment plan, my investments wander, usually to riskier investments. On the aggregate I don't lose money, but I would've made just as much, if not more, sticking with a couch potato. I also found that I am a little more carefree with invested money when it is borrowed HELOC money, rather than hard earned money deposited after each paycheque. Once we're in our new place and the old one is sold, we'll sit down and think about what is the most effective way to grow investments.


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## showmethemoney45

Keep it up! Good work, I enjoy reading your updates :rugby:


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## nobleea

*June 2015 Update*
Unfortunately, we are still working on financing for the new house. This has been the biggest challenge of this process to date. Getting development and building permits was faster and easier. The main sticking point is the value of the lot. The appraiser is not rating it very high (lower than the lot value of the original appraisal when we bought it). We could proceed as is, but it would be challenging during the draws as I have to cover the 20% LTV up front, and with less equity in the lot, that means more cash from me. His appraisal doesn't match reality (off by 40-50% based on comparables), so I'm sure they'll get it figured out. We are going to proceed with the garage suite. I have a design I like and the builder has indicated the incremental on the suite will be about 30-35K (depends on whether the city requires sprinklers or not). To finish it out myself would be 30K. So that's a rental unit cost of about 65K and a net income of $500/mo including vacancy. Continued putting money in the TFSA, we had a goal of $2K each in the account for this year, which will be done this month. Nothing else will go in this year after that amount. The TFSA and future non-reg investments will go to a couch potato strategy (80%) and 20% individual stocks. Booked most of our flights, hotels, cars for our travel this summer. Going to try out airbnb for a couple locations.

The goal of hitting 800K of net worth in 2015 seems very achievable at this time, with an outside goal of hitting 1M by end of 2016. The next goal would be 1M in investable assets when I am 40 (gives me 4 years).

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
Rental house - $385,000 (purchase price+funds paid to builder so far)
SUV - $21,925 (-0.7%)
Cars - $13,100 (-1.1%)
Work RRSP (mine) - $153,086 (+0.8%)
Pension (wife) - $92,500 (+1.1%)
Wife RRSP - $15,381 (N/C)
TFSA's - $3550 (+492%)
Cash - $2,948
Miscellaneous assets - $20,500

*Total Assets $1,166,609

Liabilities:*

Rental mortgage - $291,254 (-0.3%)
HELOC - $108,698 (N/C)
Credit cards - $7,229 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $407,181*

*Net Worth: $759,428 (+0.6%, +$4,121 month over month, +14.4% year over year)*


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## peterk

Awesome man, I hope to be just about where you're at when I'm 35 as well. Around ~1M net worth (8 more years).

Air BnB is awesome. Used it 3 different times now all successfully. Watch out for cleaning fees charged or cancellation policies set to "strict". Some people try to charge as much as a whole night's stay in cleaning fees! That is particularly egregious if you're only booking for a few nights. That and the service fee can bring the total up surprisingly fast.


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## nobleea

Booked a few nights in Edinburgh on airbnb where it was more of a location/price thing.
and 4 nights in iceland where there really wasn't much else in terms of options. can't really do the shared accomodations thing with a toddler.


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## janus10

I hope you get to see the Northern Lights in Iceland. I keep seeing packages from Toronto to Iceland for that very sight. Crazy that I still haven't seen them in my lifetime. Some day...


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## nobleea

janus10 said:


> I hope you get to see the Northern Lights in Iceland. I keep seeing packages from Toronto to Iceland for that very sight. Crazy that I still haven't seen them in my lifetime. Some day...


We get some pretty decent Northern Lights here in Edmonton in the winter. I don't think they're very good in iceland in the summer.


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## peterk

Seeing how Iceland is only 2 degrees below the Arctic Circle, I doubt it :biggrin:.

It's already not getting completely black at night now here in Fort Mac.


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## nobleea

*July 2015 Update*
Still waiting on financing from the bank for the new house. It has been over 3 months now. I've started talking to independent brokers and they're shocked it's taken so long. At this point, I'm not sure whether it's worth starting the process over again with a broker, or just letting the process finish at the bank. One thing's for sure, I won't be staying with BMO when the construction mortgage is up. I think the development permits are approved or will be this week and then the building permits should happen right after that. I guess the upside is that nothing could really have happened in earnest as far as construction goes until the development permit was received. Continued putting money in the TFSA, we had a goal of $2K each in the account for this year, which is now done. The RRSP took a hit due to the markets and my company stock taking a hit. Haven't been doing much of any photography this year, both due to lack of leads but also not much spare time with the kid. Missing it a bit and having the extra cash coming in was always nice. Lot of travel coming up here with weddings in AB and BC, visits to Shuswaps and the island, travel to Iceland/Scotland, and possibly a trip in October to Honduras. With furloughs that have happened at work, and will likely continue for the rest of the year, I have about 8 weeks of vacations to use up this year. I checked the selling prices of our two cars this month to ensure they're correct on here. One's a few hundred too high, the other maybe a grand too low, so I'll leave them where they are.

The goal of hitting 800K of net worth in 2015 seems achievable at this time, with an outside goal of hitting 1M by end of 2016. The next goal would be 1M in investable assets when I am 40 (gives me just under 4 years).

I've attached a chart of the net worth from the time we started tracking it.








Our daughter's RESP has been open for a year now. Balance is just under 5K and the XIRR to date is 13.8%. Happy with that. The balance is not included in any of the assets below.

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
Rental house - $385,000 (purchase price+funds paid to builder so far)
SUV - $21,207 (-0.7%)
Cars - $12,925 (-1.1%)
Work RRSP (mine) - $150,205 (-1.9%)
Pension (wife) - $93,500 (+1.1%)
Wife RRSP - $15,381 (N/C)
TFSA's - $4,160 (+17%)
Cash - $4,355
Miscellaneous assets - $20,500

*Total Assets $1,165,892

Liabilities:*

Rental mortgage - $290,265 (-0.3%)
HELOC - $107,998 (-0.6%)
Credit cards - $3,691 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $401,954*

*Net Worth: $763,938 (+0.7%, +$5,053 month over month, +14.0% year over year)*


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## showmethemoney45

try Dan Heon at www.danheon.com.
We have done at least 15 mortgages or refinances with him for our rental properties. I have tried a few times to negotiate with the bank directly and I'm always disappointed with their crappiness. We always go back to these guys as they are experts!


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## nobleea

*August 2015 Update*

We finished the first part of our summer holidays (road trip through BC). Got to see a lot of relatives and friends, but certainly hectic. Surprisingly, our trip to Iceland and Scotland (this week) will be less hectic as I've got nothing really planned. My company extended our furloughs for another month, so that's an extra couple days of 'holidays' I have to take before the end of the year. It's been so popular, that many people would prefer to keep the system in place indefinitely in the summers. Our little product line is doing well, profitable and hiring again, but the overall company is struggling with the industry as a whole. Had some issues with the city and our planned garage suite - mostly due to small layout issues which have been addressed now. Other than that, not much else to report. TFSA's down a bit, RRSP up due to FX changes, but the gain is being masked by my company stock price dropping. As a result of this financing, they appraised our current house. It came in at 480K. I don't know if those values are considered before or after selling fees like realtor fees, but regardless, it's pretty close to the current estimate for our house. We'll find out for sure obviously when we sell it later next year.

The goal of hitting 800K of net worth in 2015 seems achievable at this time though it's going to be tight (within a few thousand). I do not think a NW of 1M will happen in 2016, maybe 2017. The next goal would be 1M in investable assets when I am 40 (gives me just under 4 years).

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
Rental house - $387,000 (purchase price+funds paid to builder so far)
SUV - $21,032 (-0.7%)
Cars - $12,500 (-3.4%)
Work RRSP (mine) - $153,043 (+1.9%)
Pension (wife) - $94,550 (+1.1%)
Wife RRSP - $15,381 (N/C)
TFSA's - $3,964 (-4.7%)
Cash - $3,043
Miscellaneous assets - $20,500

*Total Assets $1,169,632

Liabilities:*

Teardown mortgage - $289,294 (-0.3%)
HELOC - $102,943 (-4.9%)
Credit cards - $1,100 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $393,337*
*
Net Worth: $776,295 (+1.6%, +$12,357 month over month, +14.0% year over year)*


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## nobleea

*September 2015 Update*

Back from the second part of our summer holidays and back at work. We had a week in Iceland and a week in Scotland. Iceland is breathtaking - highly recommended for anyone who likes the outdoors and epic scenery. In Scotland we loved Oban and Edinburgh, though the scenery was underwhelming compared to Iceland. House permits are fully approved as is financing, and construction has just started with the city dropping our sewer line so we can get a 10' basement. If everything clicks, they should get the house locked up before the snow settles. Though being Edmonton, the snow could settle anywhere from early October to early January.The financing has several levels, with a construction draw mortgage for the lot and house. However, due to the fact that I need to have the 20% down and the fact that I will be paying the builder monthly rather than in 3 or 4 draws, I will be using our current HELOC to pay and then paying it down with the draws. Unfortunately, later on in the building process (between the 3rd and 4th/final draw), the HELOC won't be enough, so I have a refinance on our current house approved and ready and that will give us enough to finish. They also signed us up for a personal line of credit (25K). The different financing products all have different rates, so it'll be a bit of a juggling and forecasting act to optimize which one to use when to minimize interest costs. The rates range from 2.55, 2.69, P+0.5, P+1, to P+4. Drop in net worth is mainly due to the markets with my RRSP taking the hit. We moved over some of my wife's RRSP to her pension to buy back her maternity leave service. We got back 0.75yrs. Not much else going on, the fun part starts with construction. Didn't like signing papers to borrow up to $1.2mil (combined) so the pendulum usually swings the other way and I start cutting back on things elsewhere. (We don't need to actually borrow that much, that just the total value when you add everything up)

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
Rental house - $400,000 (purchase price+funds paid to builder so far)
SUV - $20,857 (-0.7%)
Cars - $12,325 (-1.4%)
Work RRSP (mine) - $146,316 (-4.6%)
Pension (wife) - $109,000 (+15%)
Wife RRSP - $2,500 (-84%)
TFSA's - $3,800 (-4.1%)
Cash - $2,780
Miscellaneous assets - $20,500

*Total Assets $1,176,078

Liabilities:*

Teardown mortgage - $288,321 (-0.3%)
HELOC - $116,053 (+12.7%)
Credit cards - $7,550 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $411,924*
*
Net Worth: $764,154 (-1.6%, -$12,141 month over month, +10.0% year over year)*


----------



## nobleea

*October 2015 Update*

Construction on the new home has started in earnest. We have a foundation now and it is waterproofed and backfilled. I don't know if the house framing will start this week, if not, certainly the next week and it shouldn't take long to lock it up. I am keeping a running tally of all the changes that affect our final cost. The goal is to keep that under 5% of what the original target was (that would be about 30K over). I don't expect much else on the house, though the garage could have some depending on how far we want the builder to take the rental suite to. Originally I was going to finish it myself, but we may get the builder to install the heating and some or all of the plumbing rough in. There are some things I can take back in order to save money. The most obvious one would be installing the decking myself. I will be installing a submetering system for the garage suite. This allows me to measure the gas, water and power they use and bill accordingly. It's a revenue-grade system and quite inexpensive - under $1000. I can monitor it all online, with daily useage. Quite slick. I will probably add a few channels so that I can record the actual gas use by my furnace, electrical power used by a hot tub (if we end up installing one), and actual solar insolation hitting the house with an open slot for solar power generated if we install a PV system.
The city has a grant program that provides up to $20K for homeowners building garage suites, as long as it is rented to someone making less than $35K/yr for a period of 5 years. I am considering applying for this (I have a couple months to decide yet). The plan was always to rent to university students who wouldn't make that much anyways, so it seems like a good way to offset costs. The city puts a caveat on file until the 5yrs is up and you have to provide documents every year to prove you qualify. There is no requirement for rent, so market rent is still allowed.

On other financial things, I am in the process of getting signed up for additional life insurance, and really that's about it. The usual gyrations in values from the markets, but I'm not concerned. We are tossing around the idea of doing an all inclusive week in December the week before Xmas. It's actually quite cheap then. Cuba, Dominican, Mayan Riviera...something like that. I've been to all of those already. The inlaws would join us.

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
Rental house - $410,000 (purchase price+funds paid to builder so far)
SUV - $20,682 (-0.7%)
Cars - $12,150 (-1.4%)
Work RRSP (mine) - $150,393 (+2.8%)
Pension (wife) - $110,050 (+1.4%)
Wife RRSP - $2,500 (N/C)
TFSA's - $3,650 (-4.0%)
Cash - $3,361
Miscellaneous assets - $20,500

*Total Assets $1,191,196

Liabilities:*

Teardown mortgage - $287,327 (-0.3%)
HELOC - $134,431 (+15.8%)
Credit cards - $2,744 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $424,502*
*
Net Worth: $766,694 (+0.3%, +$2,540 month over month, +11.9% year over year)*


----------



## nobleea

*November 2015 Update*

House construction slowed a bit. They are putting up the first floor walls today. The garage foundation and all other piles have been poured. Hoping for lockup with shingles on before Christmas. We are going to have to do our first draw on the construction mortgage before the end of the year to lock in the rate (2.59% fixed, 5yr but the 5yr doesn't start until we take posession). Booked a trip to Mayan Riviera with the inlaws for a week before Christmas. Went through the physical/medical exam for life insurance for myself. I went with 300K extra, 10yr term. I expect we'll be self insured at the end of that term. My wife should get hers set up before the end of the year. This is in addition to what we are covered for through work, which works out to about 1mil each (work+additional).

On our current house, I am continuing the get it ready (slowly) for showings and sale, likely sometime in late spring. We already have 4 parties that have expressed strong interest. I am thinking about doing a sealed big auction or similar, combined with a sealed reserve price. Might advertise it on MLS to get additional interest, but we should be able to not require a realtor for this sale. Or I might just list it on MLS through one of the cheap vendors and change the commission structure to show my displeasure with the realtor industry. Maybe something like 0% for the first 450K and 15% thereafter (for the selling agent).

As we are coming upon the end of the year, I'll have to take a look at finishing up as many of the financial goals as I can for 2015. It looks like I can do about 75-80% of them. I'll also have to put my thinking cap on for new goals for 2016.

*Assets:*

House - $458,000 (N/C Keeping it constant for the next year)
Rental house - $410,000 (purchase price+funds paid to builder so far)
SUV - $20,507 (-0.7%)
Cars - $11,975 (-1.4%)
Work RRSP (mine) - $156,721 (+4.2%)
Pension (wife) - $111,100 (+1.4%)
Wife RRSP - $2,765 (+11%)
TFSA's - $3,650 (N/C)
Cash - $3,838
Miscellaneous assets - $20,500

*Total Assets $1,191,196

Liabilities:*

Teardown mortgage - $286,350 (-0.3%)
HELOC - $129,588 (-3.6%)
Credit cards - $8,133 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $424,071*
*
Net Worth: $774,983 (+1.1%, +$8,289 month over month, +112.1% year over year)*


----------



## OurBigFatWallet

Good stuff. Not sure if this has been covered already but what is the investment strategy for the RRSP and TFSA?


----------



## nobleea

Thanks for the comment.
RRSP: this is through a work plan at Sunlife, so I don't have a whole lot of choice in the funds available. It's about 80% across a few funds (international, US, CDN, Bond) and the rest in my company stock.

TFSA: This will be growing substantially in 2016. The focus is 80% in low cost ETF (Int, us, cdn, bnd) and 20% in individual stocks. I have yet to write down a plan for the stocks, but likely market cap must be above XXX.


----------



## nobleea

*December 2015 Update*

The construction on the new house is going full on. They are trying to get a lot done while we have this mild weather here in Edmonton. By Christmas, both the house and garage will be locked up, basement slab in, decks done, and some rough ins complete. The refinance on our current house takes effect tomorrow. That will give us access to 80K more equity for this house construction process. In preparation, I maxed out our current HELOC and have the left overs sitting in the bank account for now. Just to ensure I have funds available for the builder should the refinance funds take longer to show up. Going to initiate the first draw on the construction mortgage before the end of the year. Doing so close to Dec 31 will give me ammunition for property taxes for next year. The city bases the assessment value on the condition of the home on Dec 31. So that's a solid data point if the city estimates it high.

Put some carpet in the basement of the current place. Really makes it shine. I have to redo the floor in the kitchen, and then that's all the big expenses for the current house. We are likely going to have possession available on the new house in July, so the current house would be listed in late April I think.

Been working on a list of goals (both financial and personal) for 2016 and will share them, as well as how we did on the 2015 goals, next month which will be the wrap up of 2015.

*Assets:*

House - $458,000 (N/C)
Rental house - $512,000 (purchase price+funds paid to builder so far)
SUV - $20,332 (-0.7%)
Cars - $11,800 (-1.4%)
Work RRSP (mine) - $155,400 (-0.8%)
Pension (wife) - $112,150 (+1.4%)
Wife RRSP - $2,765 (N/C)
TFSA's - $3,462 (-5.2%)
Cash - $86,197
Miscellaneous assets - $20,500

*Total Assets $1,382,606

Liabilities:*

Teardown mortgage - $285,351 (-0.3%)
HELOC - $300,812 (+132%)
Credit cards - $9,739 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $595,902*
*
Net Worth: $786,704 (+1.5%, +$11,721 month over month, +16.3% year over year)*


----------



## nobleea

As we're at the end of the year, it's time to look back and see how we did on our goals.
*
2015 Goals/Targets

A listing of our targets and goals for 2015, to be completed before Dec 31, 2015*.

*Sign up for additional term life insurance for myself and wife*. 50% Complete. Wife's insurance will be done next year.
*Open TFSA for me and wife and fund with $2K each*. Complete. Exceeded by a bit.
*Pay off SUV loan*. Complete
*Reduce HELOC balance by 60K.* Umm. Not Complete? I mean the HELOC is completely gone, but replaced with a mortgage, so I don't think that counts.
*Reduce photo business to have more free time (<4 weddings, <20 other sessions)*. Complete. 1 wedding, 15 other sessions.
*Start new home construction and maintain construction cost under $575K*. Not going to happen. At the time of writing this goal, we weren't thinking about a garage suite. They changed the rules in the spring. We added one in, which added costs. Without it, we're looking to be pretty close to that 575K goal.
*Finish up renos on current home to list in spring 2016, spending <$10K*. Not complete. Still have some work to do, but most is done.
*Buy back wife's maternity leave pension amount from her RRSP*. Complete
*Go on international vacation with family.* Complete
*Replace my car with something newer, safer*. Complete.

*I hope for the networth to be around 800K to close out 2015, but I won't put that as a target*. Close, but doesn't look like we're going to hit this one. Maybe 790K. There's issues with construction draws, when they get paid to me, any holdbacks by the lawyer, etc. Going to be some wild gyrations month to month until Aug 2016 or so.

So overall between 65-70% success rate on the goals. Not bad, but I feel 80% is a better target.


----------



## nobleea

Our goals for 2016. Some financial, some personal, some organizational.

*Contribute 30K to our TFSA's and go with a tax-efficient couch potato strategy with 80% ETF and 20% individual stocks.
Move in to new house and sell old/current one for $475K net or more.
Finish landscaping on new house.
Spend 5hrs/week on new hobbies and gym time.
Read at least 16 books, both fiction and non fiction.
Get wife signed up for term life insurance.
Start and use family calendar on google docs.
Start weekly meal planning and try out 3 new recipes/month
Create household budget, track on a monthly basis and look for opportunities for savings.
Track utility consumption and reduce usage in new house to 4.5GJ/mo gas, 450kWh/mo power, 12m3/mo water.*

Being an engineer, the utility consumption is going to be particularly interesting for me. There are things that can be done during construction as well as lighting, fixture, and appliance selection that can have an impact on consumption. Our current house is half the size of the new place, but was built 60 yrs ago so I think there's room for improvement. For gas consumption, the average home in Edmonton uses 10GJ/month. We currently use about 6.5GJ/month. I think 4.5GJ/month is possible. For power consumption, the average home in Edmonton uses 600kWh/month. We currently use 570kWh/month and I'm confident with new appliances and LED lighting we can get to 450kWh/month. For water consumption, the average home in Edmonton uses 16.3m3/month. We currently use 14.7m3/month. A European household of the same family size would use about 11m3/month. A target of 12m3/month is possible but will require all our irrigation to be done through rain water capture (I have a system designed for this). The above targets are only for our household and would not include the separately metered garage suite. Additionally, the power consumption is before any solar PV credits. I am tossing about the idea of a 4.5kW solar PV array on the garage roof which would likely make our net power consumption zero on a yearly basis. It would be cheaper in the long run to just pay the 2.5c/kWh premium for green power through a company like Bullfrog power and offload the capital and maintenance costs and issues.

I think our net worth will end up somewhere around 840-850K at the end of 2016, but won't put it as a goal. 2016 is very much a fog with possible furloughs, maternity leave, construction issues, problems selling the house, etc.


----------



## nobleea

*January 2016 Update*

Finally got all the paperwork in order for the first construction draw. It's not shown below yet, since the funds haven't been advanced. Hopefully the future draws won't be as onerous. Financing has easily been the most convoluted part of this house build process. The garage and suite is fully locked up right now, but the house is still waiting for windows. Looks like we're on track for a move in sometime in summer. This should work well with selling our current place. The credit card bills are high this month due to some work expenses that are yet to be reimbursed, and putting all the kitchen cabinets on the CC (Ikea kitchen sale).
We really enjoyed our vacation to Mexico before Christmas. Just got back from a weekend in Canmore, plus some skiing. Nothing else on the plate until the summer with just domestic travel this year

Christmas wasn't too expensive this year, which was nice. We do usually go out for a nice dinner with friends on NYE, and our anniversary is right after, so that sort of makes up for it. Our daughter's uncle gave her an amazing gift this year. As part of paying us back for the several years he lived in our basement rent free when going to university, he is giving her $1K a year for her RESP, going forward. This was unexpected, but very appreciated. Our daughter isn't even 2 and already has close to 8K in her RESP. We're not going to change what we contribute to it as a result though.

The increase in the TFSA's is due to a contribution, and not gains (ha!). The plan is to contribute 2750/mo to the combined TFSA's, increasing by 2.5%/yr. We are going to max out in 2016 or early 2017 at which point the contributions will go to non registered. This is our planned early retirement fund to tide us over until pensions/RRSPs/CPP gets drawn on.

One of the *somewhat* exciting things about the new year is new tax software!! Really. This is something I look forward to. With child care expenses in 2015, plus some medical expenses above the limit, I think we're going to see something back. Right now, I'm thinking about $1800.

Both our vehicles popped off bumper to bumper warranty this month. One has 45K, the other 34K on it, so they're going to be good for a while.

I think we're going to be bouncing around the 750-800K net worth for the next 6 months. I am hoping to end the year at 850K.

*Assets:*

House - $458,000 (N/C)
Rental house - $628,000 (purchase price+funds paid to builder so far)
SUV - $20,157 (-0.7%)
Cars - $11,782 (-1.4%)
Work RRSP (mine) - $148,859 (-4.2%)
Pension (wife) - $113,500 (+1.2%)
Wife RRSP - $2,600 (-6%)
TFSA's - $5,908 (+71%)
Cash - $51,172
Miscellaneous assets - $20,500

*Total Assets $1,458,221

Liabilities:*

Teardown mortgage - $284,369 (-0.3%)
Current Mortgage - $384,000 (new refinance)
Credit cards - $13,362 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $681,731*
*
Net Worth: $776,490 (-1.3%, -$10,214 month over month, +8.2% year over year)*


----------



## nobleea

*February 2016 Update*
Good progress on the house last month. All rough ins are done and they are putting the siding on now. We *might* be at drywall by the end of February, but we'll see. I think we're still on track for a possession some time in July, maybe a shade earlier. Getting our current house ready for sale with touchups and fixes. Some time in March, I am wanting to talk to the various groups that were interested in a private sale. It will be interesting to see what happens with it. I don't want it to be on the market for too long and renting out is not something we want to do. It does have great curb appeal and I'm not being biased. We have a bill from the builder coming in any day for January which should be around 60K but that is not reflected in the house value, or the cash. We will likely have to do another draw in late February in order to pay the bill for Feb.

Continued our monthly TFSA contributions. We also had a very small inheritance come our way, which was unexpected. A few thousand which was split in to TFSA, RESP, and savings.

Got the annual statement from my wife's DB pension. Have adjusted the value in the networth statement to reflect the termination benefit, which accounts for the majority of the gains this month.

After punching in rough values for income taxes, I think we'll get a lot more back than I originally thought. Somewhere between 3-5K due to the tax credits for kids and the last year of the income splitting.

*Assets:*

House - $458,000 (N/C)
New house - $640,259 (purchase price+funds paid to builder so far)
SUV - $19,982 (-0.7%)
Cars - $11,450 (-1.4%)
Work RRSP (mine) - $144,764 (-1.4%)
Pension (wife) - $140,334 (+23.6%)
Wife RRSP - $2,600 (NC)
TFSA's - $8,902 (+51%)
Cash - $76,515
Miscellaneous assets - $20,500

*Total Assets $1,523,539

Liabilities:*

Construction mortgage - $322,260 (New)
Current Mortgage - $383,405 (-1.6%)
Credit cards - $6,441 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $712,106*
*
Net Worth: $811,433 (+4.5%, $34,943 month over month, +11.2% year over year)*


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## OurBigFatWallet

Nice progress. How is the housing market holding up in Edmonton lately? Prices seem stubbornly high in Calgary especially for the higher end homes. I have also run some rough estimates on the taxes and it looks like a refund coming. It's nice families still get the income splitting when filing for 2015


----------



## nobleea

OurBigFatWallet said:


> Nice progress. How is the housing market holding up in Edmonton lately? Prices seem stubbornly high in Calgary especially for the higher end homes. I have also run some rough estimates on the taxes and it looks like a refund coming. It's nice families still get the income splitting when filing for 2015


On the whole, prices for condos have been dropping twice as fast as houses. I haven't noticed any higher inventory than normal in our neighbourhood, but it usually comes on in the late spring. As with the last downturn, demand (and prices) aren't necessarily uniform across the city. I think that outlying areas tend to have a bigger drop then core areas. Although maybe with the price of gas and less people on the roads due to layoffs, the commute times aren't a consideration anymore. The nice thing about Edmonton is that 30-40 mins is considered a long commute.


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## nobleea

*March 2016 Update*
New house and garage now have full siding on them. Insulation and drywall should be complete by this time next month. We did our second draw on the construction mortgage. Third draw is scheduled for late April. It is looking like we can move in during the last week of June. I'll know in March whether we're going to have to list our current house with a realtor or whether we can sell privately which is much simpler. At work we are on furlough for the entire year, which means a lot of days I have to take off. It has been real helpful in having time off to do house work, and later when we move to the new place, time to get set up and do landscaping. Met with the builder to go over numbers as we have passed the 50% completion. Obvioulsy our costs have increased, as they always do in a custom build. Looks like we'll be between 5-8% over our original budget which isn't too bad all things considered. I had hoped to keep it less than 5% over.

Continued our monthly TFSA contributions. It feels good to have a long term plan with defined monthly steps to get there and feel like you're making progress on such a nebulous goal as 'early retirement'.

Completed and sent off income taxes for the family. I think our net back is about $4-5K, which is more than I was expecting.

I will be getting some deferred bonus that was due from 2014. It was forced to be held in company stock, which has taken a beating, and I have to pay taxes on it when it vests, but that should be $2-3K in April/May. Plus we found out that our bonus plan will pay out cash for 2015 as we hit most of our targets (seems odd for being in the oilfield, but you can have different targets in a bust like this like safety, inventory reduction, cost reduction, etc). That will be somewhere between 3-10K after taxes. Will find out more next month.

Our daughter turns 2 this week. Hard to believe. She has 9K in RESPs, not included in the values below.
I've been fairly diligent in tracking our monthly spend by category. It looks like we spend about $5900 a month, not including investments. With a bit of belt tightening, we could survive on one income. Mind you, that wouldn't leave much for additional investments or RESPs. But if it came to it, with any severance I would receive, we could survive on just my wife's income for a couple years without touching savings. Or make it through a maternity leave with me unemployed.

*Assets:*

House - $458,000 (N/C)
New house - $751,661 (lot price+funds paid to builder so far)
SUV - $19,807 (-0.7%)
Cars - $11,275 (-1.4%)
Work RRSP (mine) - $144,104 (-0.5%)
Pension (wife) - $142,000 (+1.2%)
Wife RRSP - $2,775 (+6.7)
TFSA's - $11,910 (+34%)
Cash - $112,884
Miscellaneous assets - $20,500

*Total Assets $1,675,216

Liabilities:*

Construction mortgage - $471,104
Current Mortgage - $382,727 (-1.8%)
Credit cards - $9,600 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $863,431*
*
Net Worth: $811,785 (+0.04%, $352 month over month, +9.6% year over year)*


----------



## nobleea

They've announced that they're moving to double furlough until mid July. That's as low as they can go (32hrs/week or work) before we're all moved to part time and benefits change. Plus, they've suspended the matching RRSP contribution (5%) for the foreseeable future, I would guess until end of the year. That's the one that hurts the most. But in total, that's a 25% pay cut from what I was making this time last year.
I will have to tone down on some of the monthly TFSA contributions to make up for it. Should still be able to contribute over $35K to the TFSAs this year, but not as much as I was originally hoping. Oh well, better than being unemployed.


----------



## 1980z28

You have done well

Good luck with the rest of your days


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## My Own Advisor

"I will have to tone down on some of the monthly TFSA contributions to make up for it. Should still be able to contribute over $35K to the TFSAs this year, but not as much as I was originally hoping. Oh well, better than being unemployed."

That's still amazing.

VERY well done.


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## scorpion_ca

I got 10% pay-cut along with 5% RSP, 6 sick days and time off for doctors appointment suspension last year. We all should be grateful that we still have a job.


----------



## nobleea

scorpion_ca said:


> We all should be grateful that we still have a job.


Absolutely. None of my friends have been hit, but I know that once you're out of a job, it's going to be very hard to get back in to a similar one, at least here in AB. there's always someone out there who's better than you.
I'm grateful that I have a job that still pays well, but also grateful that we've set our life up that even with a 25% drop in my pay, our lifestyle is essentially unaffected. We could probably handle another 30-40% drop in my pay before things started to bite. A bit less than that if we are not able to sell our current house.


----------



## peterk

nobleea said:


> But in total, that's a 25% pay cut from what I was making this time last year.
> I Oh well, better than being unemployed.





scorpion_ca said:


> I got 10% pay-cut along with 5% RSP, 6 sick days and time off for doctors appointment suspension last year. We all should be grateful that we still have a job.


Yeap, times are tight. We lost our $20k annual bonuses. I ain't upset...


----------



## nobleea

peterk said:


> Yeap, times are tight. We lost our $20k annual bonuses. I ain't upset...


Oddly enough, I believe we'll be getting our bonuses from 2015. The metrics changed from "did we hit our profit targets" to "did we suck less than our competition". In our case, that was yes. I'm not banking on it and have no plans for it, so if/when it does show up it will truly be a bonus.


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## nobleea

*April 2016 Update*
The new house is insulated and I believe they're doing the eaves and soffits right now. Blower door test is scheduled for Monday to check air tightness, then drywall can start. Should be able to get most of the rough/final grade, fencing, and pathways done in May/June before we move in. Still looking like we can move in during the last week of June, possibly a bit earlier. A lot of time was spent during the month getting our current house ready for listing. We have 5 parties that have contacted us already and this is just through word of mouth. Showing the place to a couple of them tomorrow. Hopefully we can wrap this up with a quick private sale. The value I have listed below for our current house is $1K more than the city assessed value. General consensus is that a house in good condition will sell for 5-15% over the assessed value around here. I'm expecting that we can get a sale price between 472-488K in a private sale.

When we take possession, the garage rental suite will just be insulated and drywalled. No flooring, cabinets, appliances, etc. So that is something I will have to do. I would rather work on the yard, getting it well on its way while the weather is nice, and come back and finish the suite in the fall. I've planned for rent to start flowing in on Jan 1, but who knows. Maybe it'll be sooner, maybe it will take me longer to get organized.

Continued our monthly TFSA contributions. It feels good to have a long term plan with defined monthly steps to get there and feel like you're making progress on such a nebulous goal as 'early retirement'.

Got tax returns back. I guess our child care cheques from the government change in July from the current $160 to looks like about $27/month.

My bonus from 2014 has finally started to vest (it was/is restricted stock). Not much, but it's about $2K that I had this month that I didn't have last. The same amount will vest in 2017 and 2018.

*Assets:*

House - $458,000 (N/C)
New house - $847,766 (lot price+funds paid to builder so far)
SUV - $19,632 (-0.7%)
Cars - $11,100 (-1.4%)
Work RRSP (mine) - $147,786 (-0.5%)
Pension (wife) - $143,500 (+1.2%)
Wife RRSP - $2,765 (N/C)
TFSA's - $15,296 (+28%)
Cash - $22,543
Miscellaneous assets - $19,500

*Total Assets $1,690,213

Liabilities:*

Construction mortgage - $470,610
Current Mortgage - $382,126 (-0.2%)
Credit cards - $10,310 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $863,046*
*
Net Worth: $827,167 (+1.89%, $15,382 month over month, +10.6% year over year)*


----------



## OurBigFatWallet

Nice work, Nobleea. Would love to see some pics of the new place once it's done (or even before then). That is great if you can sell the house privately, sounds like it's a nice place with a competitive price if you've got that much interest just from word of mouth. The housing market here seems to be steady, not dropping nearly as much as the doom and gloom headlines make it seem. Anything above $700k seems to be seeing the biggest drops while (from what I hear) houses at $500k and below are still getting lots of action. My guess is a lot of people bought above what they could actually afford and now are either moving out of town due to a loss of job or staying and downsizing to something more affordable. I assume its the same there?


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## nobleea

OurBigFatWallet said:


> Nice work, Nobleea. Would love to see some pics of the new place once it's done (or even before then). That is great if you can sell the house privately, sounds like it's a nice place with a competitive price if you've got that much interest just from word of mouth. The housing market here seems to be steady, not dropping nearly as much as the doom and gloom headlines make it seem. Anything above $700k seems to be seeing the biggest drops while (from what I hear) houses at $500k and below are still getting lots of action. My guess is a lot of people bought above what they could actually afford and now are either moving out of town due to a loss of job or staying and downsizing to something more affordable. I assume its the same there?


Well we had two showings today and got one offer out of it. The other showing will most likely make an offer as well. There are another two parties interested that have yet to see the place. Not sure how I would handle a multiple offer situation. When the dust settles, it looks like we'll be on the higher end or exceed the range I posted previously.

Yes, houses under 500K in good locations are not a problem to sell. Anything above that is still selling in the core areas, but the outer burbs are seeing a bit of a drop in prices. We've sort of seen it before in previous slumps. When the slump is present, demand drops a bit, and the demand that remains gets focused on core, mature areas, rather than the newer suburbs. People start thinking, well maybe that new school they promised won't get built for a while in a downturn, or we'll be living in a construction zone for much longer, etc.


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## nobleea

*May 2016 Update*
Well, lots to report this month, all of it good. First, our current house is officially sold. We sold it to friends of friends in a private sale for $485K. It is an unconditional offer now. I have adjusted the house value to 480K to reflect some repairs that have to be done and closing costs. I believe if we had listed it through a realtor, it would have listed for around 520, selling right around 500. Minus the realtor fees, and we're at the same net minus all the hassle. 485K is right in the range that I thought I would get as a private sale.

New house is drywalled and they should be painting next week. By this time next month we should have all cabinets in as well as flooring. Still looking like we can move in during the last week of June. Possession on the current house is July 22, so it should work out fine. Completed the third draw today, which explains the higher cash balance. The 4th and final draw cannot be done until we have an occupancy permit and the house is 97% complete. One thing that I am mulling over is how much of the approved mortgage amount we draw down. We're approved up to 784K, but with the sale of our house, we'll only need somewhere around 560K. There is some amount needed for landscaping and the garage suite completion, plus a new sofa and mattress/bed frame. At the moment, I am leaning towards drawing down a significant amount (say 740K) and putting the excess in a non-registered account (after maxing out TFSAs) and use that to kickstart our early retirement fund. Some of the mortgage costs (for the investment, as well as the garage suite) would be deductible, but the accounting is messy though not impossible. The other option is to minimize the new mortgage as much as possible and save up the early retirement fund the old fashioned way. Or of course, some intermediate amount between the two options. I do have a desire to do some infill development at some point, so having that money accessible makes that more likely. I don't think I'd have a problem with a nearly 3/4mil mortgage, especially with what would be around 250K in TFSA and non-registered investments. If we do, then we can always use our pre-payment privileges to transfer the investments to the mortgage and pay it down.

When we take possession, the garage rental suite will just be insulated and drywalled. No flooring, cabinets, appliances, etc. So that is something I will have to do. I would rather work on the yard, getting it well on its way while the weather is nice, and come back and finish the suite in the fall. I've planned for rent to start flowing in on Jan 1, but who knows. Maybe it'll be sooner, maybe it will take me longer to get organized. I took a 4 week landscape design course, finishing during the month and have a detailed plan of what the yard will be looking like. I hope to have all the big things in this year, but some things may have to wait until spring 2017.

Somewhat unexpectedly, we were paid out a bonus for 2015. I wasn't expecting one, and certainly not one of the size we got. Net was around 13K. This went mostly to the TFSA, with some in to our backyard savings fund which now sits at 9K.

Our daughter's RESP balance passed 10K. It is not included in the assets below.

Due to the large gain in assets this month, I took the opportunity to drop the 'Miscellaneous Assets' amount which is stuff like furniture, sports equipment, photography and electronic equipment. I plan on eliminating most of it from the balance sheet over the next couple years with the exception of photography equipment which has a good second hand market and prices can be easily determined. We should finish out the year somewhere between 925-950K and crossing that Million$ mark middle of next year.

The best news for the month is that we our expecting our second child sometime in early November.

*Assets:*

House - $480,000 (Selling price minus costs)
New house - $882,381 (lot price+funds paid to builder so far)
SUV - $19,457 (-0.7%)
Cars - $10,925 (-1.4%)
Work RRSP (mine) - $145,180 (-1.8%)
Pension (wife) - $146,000 (+1.7%)
Wife RRSP - $2,868 (+3.7)
TFSA's - $26,041 (+73%)
Cash - $73,126
Miscellaneous assets - $17,500 (Dropped by 2K)

*Total Assets $1,803,477

Liabilities:*

Construction mortgage - $554,500
Current Mortgage - $381,485 (-0.2%)
Credit cards - $6,300 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $942,285*
*
Net Worth: $861,192 (+4.11%, $34,025 month over month, +14.0% year over year)*


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## 97acuratl

Congrats on the new addition and selling the house. I am sure it is nice to get over the stress of selling the old house.


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## OurBigFatWallet

Wow lots of changes. Congrats on the new addition to the family


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## My Own Advisor

Indeed. Congrats on the upcoming family addition 

I know I should include 'Miscellaneous Assets' with my NW calculation but I don't bother. I don't even include our cars. I focus on investments, house and workplace pensions only. This keeps things simple for me. I have a small brain that only takes in so much information 

Back to you, _you're doing very well. _You should be proud. I assume with the mortgage debt, and upcoming improvements to the house, the RRSP is your only real "retirement" account? You're not using your TFSA for investing purposes - more of a place to hide (tax-free) cash for the short-term?

Just curious...

Keep up the great work.


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## nobleea

My Own Advisor said:


> I assume with the mortgage debt, and upcoming improvements to the house, the RRSP is your only real "retirement" account? You're not using your TFSA for investing purposes - more of a place to hide (tax-free) cash for the short-term?
> 
> Just curious...


The plan is a little more elaborate than that. We'll have the following sources of income once we stop working, though it all starts and stops and various ages. And we'll stop working at different ages.
CPP - for both of us, likely the max amount, say we start it at 65. Depends on our health.
OAS - for both of us, if it's still around we will get some as not all of it will be clawed back
Wife's pension - starting at her age 55. size will depend on if she works to the magic 85 number or retires earlier. if she goes the full distance, it would be a decent amount, on the order of 50K in today's dollars
My RRSP - will likely convert to RRIF around my age 70 and draw down as needed
TFSA/non registered - this will be used to tide us over from early retirement until when all the above starts to kick in. the plan is to build it up and then draw it down to nothing somewhere around my age 65.

I expect my RRSP to top out around 1mil and our TFSA/non registered accounts to top out somewhere between 800-1000K.
I plan on retiring early, somewhere between 45 and 49. I should not need to earn income in the 20 yrs that follows, but i likely will in some unrelated field to what I'm doing now. She'll likely retire somewhere in her early 50's. The hardest time will be the period between when she retires and her pension kicks in. The early retirement fund will be invested on the more aggressive side compared to the timeline that we intend to use it. If we get average returns, we get to retire early, if we get above historical averages, we get to retire even earlier. If we go significantly below historical averages, then the early retirement date gets pushed back a few years, but still well before when most would pull the chute.

Of course, plans can change, people can get sick, lose jobs, divorces happen, priorities can change, etc etc. But I like having plans and lists. Having a detailed plan with specific monthly activities that can be shown to help us get there makes it far more likely to achieve them. I'm also a firm believer in the law of attraction which I think has served me well. Every vision/goal I've had for the past 20 years has come to be, often earlier than I had hoped. Maybe I'm not dreaming high enough!


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## CrazyEights

congrats on the changes is your life. Always good to hear positive stories from those that share in the CMF community!


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## borisdavenport

this is nice discussion and very helpful for guys having a budget planing...


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## nobleea

*June 2016 Update*
Our progress continued this month, with one set back. My wife found out she was not given a contract for teaching summer school this year, so I had to take that income (about 4.5K net) out of the cash flow projection. There's still a chance, but it's a pretty low chance. Managed to contribute about 9K to the TFSAs, which also saw some nice gains during the month. My work RRSP also saw a bit of a turnaround thanks to the market. It doesn't grow as much as it could due to the suspended matching company rrsp contribution. I expect that will kick back in sometime this year.

New house has all cabinets installed and I think flooring and trim is going in over the next couple weeks. Waiting on some fence posts to get installed, along with final grade, and then I can start on the landscaping in earnest. The weather has not been cooperative with heavy rains for an hour or so every day, which makes it too muddy for the landscapers to get in.

One thing that I've received a couple messages on is potentially writing up a summary of the process and challenges of a custom new home build. I will do that later this year once it's all wrapped up. Will include some pictures as well.

The costs for the rest of the house are going to start to come fast and furious for the next couple months. Like 20K+ a month credit card bills for landscaping, fences, appliances, furniture, cabinet installs, countertops, plus replacement furnace for old house. I did apply and receive a Tangerine CC which gives 4% cash back on home improvement and furniture purchases until mid-Aug, which should work out perfectly. The final draw will be done once I have an occupancy permit which should be first week of July. *One thing that is up in the air is how much to request on that final draw. The bare minimum would put us at a final mortgage balance of around 610K and the maximum would have us with a mortgage balance of 784K (obviously with a spare 174K in cash to invest). What do you think?* The extra funds could be invested in our early retirement fund, or could be used in part to start a spec infill build which is something I would love to do. That is a big mortgage though.

We have a road trip planned in August to BC and maybe the US. Family visiting and wedding in Sep in ON, then that's about it for the rest of the year. Once baby is born, we'll likely do another warm trip for a few weeks. Certainly Hawaii, maybe Arizona as well. This would be late winter.

*Assets:*

House - $480,000 (Contract price minus selling costs)
New house - $955,967 (lot price+funds paid to builder so far)
SUV - $19,282 (-0.7%)
Cars - $10,750 (-1.4%)
Work RRSP (mine) - $150,543 (+3.7%)
Pension (wife) - $149,000 (+2.0%)
Wife RRSP - $2,868 (N/C)
TFSA's - $35,942 (+38%)
Cash - $9,859
Miscellaneous assets - $17,500 

*Total Assets $1,831,441

Liabilities:*

Construction mortgage - $554,660
Current Mortgage - $380,880 (-0.2%)
Credit cards - $19,174 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $954,714*
*
Net Worth: $876,727 (+1.9%, $15,960 month over month, +15.5% year over year)*


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## nobleea

*July 2016 Update*
My wife found out for sure she would not be teaching summer school this year, so that's unfortunate. She also took a new job at a different school. It will be 5 days a week from her current 4, but same work and pay. Mind you it's only for 6-8 weeks before she goes on maternity leave. As part of the change, she had to hand in her phone (paid for by the school) and we had to get her one. Really pained me to do so, but she's not going to be content with a pay and talk plan, so got the cheapest data plan available at Koodo. Happy wife, happy life.

Work is going well, they've indicated we'll be moving back to 10% furlough rather than the 20% that it is now, so the extra money will be nice, plus by the time it kicks in we'll have moved in and I won't really benefit from the extra time off. I suspect by Q1 2017, we'll be back at full pay and full RRSP match. If I was to ever get laid off, and my wife not go back to work after maternity leave, I believe we could live for well over 5 years off our severance, TFSAs and cash savings before we'd have to touch RRSPs or sell the house. I would rather not, and I'm confident that won't happen either. 

Getting down to the final stretch on the new house. We'll be officially moving in on the 23rd of July, but probably can start moving some stuff over to the basement and garage already. Had to get an amendment on our current house contract and pushed the closing date back a week. Waiting on approval for the final grade, and then all the yard stuff can progress like irrigation, sod, plantings, mulch, concrete edging, etc. Have to go shopping for appliances, bedroom set, and dining set for the patio yet. Plus cabinets for the garage and the suite above the garage. My brother moved out here temporarily, so he's probably going to help out with the suite finishings as he has experience with this.

We've decided that we are going to draw the mortgage to $750K. The TFSA's will be maxed out this year, and we'll have about 100K available to start a spec infill property. The neighbours on one side have kind of talked about splitting their lot, and if I can convince them to sell me one of the split lots, that would be perfect. Revitalization of the neighbourhood has picked up steam, with 5 infills (including ours) on the go on our block alone right now. In the net worth statement, I will be listing our new home value as the actual purchase price that we paid, or 1.095M, whichever is less. I will keep it there until we sell it, or it gets reappraised by the bank. I don't know what it would sell for on the market. There's never been a house sell for over 1mil in the neighbourhood, but there are probably half a dozen already that would if there were ever listed (homeowners doing infills, like us). Trying to limit the bias, I would say the property as a whole is likely the nicest in the neighbourhood for now. I will try to get it in a local magazine if possible. Getting a house/property that I've designed and had built in a magazine has been one of my goals for the longest time. Probably since I was 15.

I will probably take some flak for having a very large mortgage (750K) and an expensive house (1.1mil). However, I think we're still doing well, and if you add up all the savings we put away each year (RRSP, pension, TFSA, RESPs), I suspect we're at close to 35% of our take home pay. It will be lower in 2017 with maternity leave. I think a value of 35-40% is pretty healthy.

*Assets:*

House - $483,250 (Contract price minus selling costs)
New house - $964,664 (lot price+funds paid to builder so far)
SUV - $19,107 (-0.9%)
Cars - $10,575 (-1.6%)
Work RRSP (mine) - $146,660 (-2.6%)
Pension (wife) - $152,000 (+2.0%)
Wife RRSP - $2,868 (N/C)
TFSA's - $35,878 (-0.2%)
Cash - $7,303
Miscellaneous assets - $17,500 

*Total Assets $1,839,805

Liabilities:*

Construction mortgage - $554,660
Current Mortgage - $380,235 (-0.2%)
Credit cards - $25,516 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $960,411*
*
Net Worth: $879,394 (+0.3%, $2,667 month over month, +15.1% year over year)*


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## nobleea

*August 2016 Update*
Pretty chaotic month with trying to finish up and clean out of old house, move in to the new house, then pack up and head out for a two week road/camping trip. We're all moved in now, though not set up in the new house with crap and boxes everywhere. It's going to be a slow grind for the next few months getting everything organized and settled. The house is complete (obviously), but the landscaping is not. We've had terrible weather for the past 2 months with heavy rains almost every other day. I have a nice canola field growing in the yard now until we can get grade approved and get some sod down. The garage suite needs cabinets, flooring and trim and then it is complete as well. I suspect that won't be happening until October. Maybe I'll take a few days off and really go hard on it.

The bank drew the mortgage up to the full approved amount (784K) rather than the 750K I wanted, so that's unfortunate. I can pay it back down again with the excess, but the payments are now fixed at the higher amount. Topped up our TFSA's and combined with the monthly contributions we make, they will both be maxed out by the end of the year. Moved 100K in to a non-reg account which will sit in a HISA or similar. This is for a potential spec residential infill. If I get scared and can't start something within the year, I'll put it against the mortgage to drop the balance down.

The final bills for the house haven't come through yet, but I've made an estimate and it's already reflected in the values below.

The drop in our net worth relative to last month is primarily due to purchase of new furniture/tv's, which I am now considering to be an expense and thus won't show up on net worth statements.

*Assets:*

House - $1,090,000 (Price paid)
SUV - $18,932 (-0.9%)
Cars - $10,400 (-1.6%)
Work RRSP (mine) - $154,381 (+5.3%)
Pension (wife) - $155,000 (+2.0%)
Wife RRSP - $2,894 (+0.9%)
TFSA's - $80,067 (+123%)
Non-Reg - $100,000 (New)
Cash - $40,338
Miscellaneous assets - $17,500 

*Total Assets $1,669,512

Liabilities:*

Mortgage - $783,699
Credit cards - $12,656 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $796,355*
*
Net Worth: $873,157 (-0.7%, -$6,237 month over month, +12.5% year over year)*


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## nobleea

*September 2016 Update*
Still waiting on the final bill from the builder. I've assumed it will be 35K and the numbers below reflect that assumption. Higher and the NW takes a hit, lower and we gain. The bank balance is higher than normal to give some leeway in case the bill is higher. The excess amounts will go against the mortgage. Still no progress on the landscaping as we keep on failing our final grade - one of the challenges during an infill since the neighbouring properties have crap drainage and we're not allowed to flood them during a rain storm. I am thinking the sod and plants will not go in until the spring. We've started with a home maintenance savings account, saving $250/month. The house is brand new, so there should be nothing for several years, but it's something to save for and it can be an emergency fund if necessary. $250/mo is about 0.5% of house value per year (obviously not lot value).

Wife is back at work full time and will be for a couple months until maternity leave starts. I'm trying to get everything sorted out with the house before the baby shows up. I am hoping I can get 80% of the remaining work on the garage suite done in the next 2 months, even if we're not ready to rent it out til January.

I'm starting to think that taking advantage of our available RRSP contribution room might not be a bad idea. I think it's somewhere around 130-140K between the two of us (mostly me). I will be transferring over all of my TFSA money to an RRSP before the end of the year, and probably most of the wife's as well. Should result in a 20-30K tax refund next year which can be used to top up the TFSA, or repeat with the RRSP until the contribution room is gone. I would think within 3ish years, we'd have close to 250K in combined RRSP/TFSAs (non-work items). I believe we will pass the $1mil net worth mark sometime in June 2017. The next goal would be $1mil in investable assets which I would think will take another 5-6 years. We are continuing with saving 35K a year over and above our savings through work.

*Assets:*

House - $1,090,000 (Price paid)
SUV - $18,757 (-0.9%)
Car - $10,225 (-1.6%)
Work DC Pension (mine) - $154,152 (-0.1%)
DB Pension (wife) - $158,000 (+2.0%)
RRSPs - $4,894 (+69%)
TFSAs - $79,393 (-0.8%)
Non-Reg - $100,602 (+0.6%)
Cash - $30,941
Miscellaneous assets - $17,500 

*Total Assets $1,664,553

Liabilities:*

Mortgage - $768,660 (-2.0%
Credit cards - $8,937 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $777,597*
*
Net Worth: $889,956 (-1.6%, +$13,799 month over month, +16.1% year over year)*


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## OurBigFatWallet

Great progress as usual. I enjoy reading your updates. Are you able to change the grading yourself based on their feedback or does it require a contractor? How does parking work for the garage suite, do they park in the garage (shared) or street parking?


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## nobleea

OurBigFatWallet said:


> Great progress as usual. I enjoy reading your updates. Are you able to change the grading yourself based on their feedback or does it require a contractor? How does parking work for the garage suite, do they park in the garage (shared) or street parking?


Actually, a couple hours after I posted this, the landscaper told me we had finally passed. So I'm going to take a few days off over the next couple weeks and we should have irrigation, lighting, sod, edging and some trees shrubs in.

The garage is a triple and for our use only. There is a large surface parking area beside the garage. The way things are laid out, I can't see the suite entrance, patio, parking area or windows from our house and they can't see our house.


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## nobleea

*October 2016 Update*
Still waiting on the final bill from the builder. I've assumed it will be 35K and the numbers below reflect that assumption. Higher and the NW takes a hit, lower and we gain. We finally passed our grading and in a few weeks, we've gotten sod in, concrete edging, irrigation, landscape lighting, back fence and the vast majority of shrubs, trees, ornamental grasses, etc. I did most of it myself. Good thing, as we had our first snow fall last week (mostly gone now). The hit to the NW is primarily the landscaping stuff - boulders, sod, etc.

With the house now complete, the city has updated our assessed value. I thought they would have waited until Dec when they update everyone's, but I guess closing out the building permits triggers this. They assessed it at $808,500. I won't be fighting that as that's lower that I was expecting it would come in at. Good for me, lower taxes, but still a large change in taxes paid. I don't know what the house would sell for. We've discussed it and it would take $1.5M or more to get us to sell in the next couple years after all the work we've done.

Started getting a few utility bills coming in. It will take a full winter to make the call, but it looks like we're going to hit our targets for gas, water, and power consumption. Power might be close, but gas and water are below the targets I had which are 30-55% lower than the average Edmonton household. I just turned the heat on in the garage and suite to avoid pipes freezing, so that's going to increase the gas use a bit.

Wife is now off on medical leave, we still have 4-6 weeks to go until baby is born. Nursery is all ready, and aside from a few touchups needed from the builder, the inside of the house is also all done in terms of decorating, setup and unpacking. I haven't touched the garage suite yet, but will be taking a few half days off here and there to see what I can get done.

Started transferring over TFSA money to RRSP. I'm done for this year. I will still have 60K+ of contribution room so can repeat this for the next 2 years. I was surprised to see that my wife has over 30K of contribution room - I assumed it would be nothing with the work pension. So we'll take care of hers this year as well. This will create a 25-30K tax refund next spring to put back in to RRSPs and TFSAs. Put almost 10K lump sum payment against the mortgage. Would like to continue with at least 10K lump sum every year. Won't make a huge difference to the large balance, but it's something.

Will be looking to book a trip to Maui soon to take place in Feb/Mar. I've heard you can book a flight for a baby that's not born yet, but have yet to try it out.

*Assets:*

House - $1,090,000 (N/C)
SUV - $18,582 (-0.9%)
Car - $10,050 (-1.6%)
Work DC Pension (mine) - $156,297 (+1.4%)
DB Pension (wife) - $161,000 (+1.9%)
RRSPs - $47,148 (+1050%)
TFSAs - $40,247 (-49%)
Non-Reg - $100,395 (-0.2%)
Cash - $2,225
Miscellaneous assets - $17,500 

*Total Assets $1,644,183

Liabilities:*

Mortgage - $757,506 (-1.5%)
Credit cards - $6,811 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $764,317*
*
Net Worth: $879,866 (-0.8%, -$7,090 month over month, +14.8% year over year, +$113K year over year)*


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## nobleea

*November 2016 Update*
We received the finally bill from the builder last week and it was substantially higher than I was expecting. Like much higher. I went through it with a fine tooth comb and there were some errors that they have to fix which should drop it a bit, but still a big hit to the NW. Cleared out the remaining TFSA to pay for it, so will have to build that back up over the next year. Our final bill brought the construction total to about 13-15% higher than the estimate we had going in. It was a cost+ agreement, so we are paying for the work regardless. There's no way a builder would have signed up for a fixed price for such a custom build in the heart of the city. Schedule-wise, it was a few weeks from the original target, so really nothing in the grand scheme of things.

Wife is off on medical leave, and the baby is due any day now. I haven't touched the garage suite yet, but will be taking a few half days off here and there to see what I can get done. There is a similar garage suite a couple blocks away that just finished and went on the market. He's asking $1250/mo or $1725/mo furnished as a short term rental. I don't think he'll get those numbers, but it's a good sign if he does. I am expecting $1000-1050/mo and many would say ours is a nicer space.

At work, we've been notified that our single furlough (10% reduction in pay, 1 unpaid day off every 2 weeks) is set to finish at the end of the year. It will be nice to get that cash back only to lose it to the restart of CPP and EI deductions. Still no timeline on when our matching RRSP contributions will kick back in. I am assuming July next year. They will be reinstating single furlough just for Q2 2017 as that is typically the slowest season for the oilfield in Canada. Fortuitously, that also happens to be spring time when it would be nice to have time off to finish the yard. Another hit to the NW was booking our trip to Hawaii for February. Flights and accommodations are the reason for the large CC amount. Again, we pay it off every month.

My plan to do spec infill in our neighbourhood looks like it might need to wait for a bit. The larger final bill for the house took a fair amount of the seed money I'd need. I expect I would need 100-120K to get started, plus access to another 20-30K for cash flow issues. So I'm about 45K short right now. There's a few friends I would consider partnering with, but it will depend on whether I can find the ideal lot. Financing doesn't look like it will be an issue after talking it over with our mortgage broker.

*Assets:*

House - $1,130,000 (N/C)
SUV - $18,407 (-0.9%)
Car - $9,875 (-1.6%)
Work DC Pension (mine) - $155,257 (-0.7%)
DB Pension (wife) - $172,500 (+7.1%)
RRSPs - $49,444 (+4.9%)
TFSAs - $35 (-99%)
Non-Reg - $65,000 (-35%)
Cash - $5,781
Miscellaneous assets - $17,500 

*Total Assets $1,626,299

Liabilities:*

Mortgage - $760,500
Credit cards - $11,920 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $772,420*
*
Net Worth: $853,879 (-3.0%, -$25,987 month over month, +10.2% year over year, +$79K year over year)*


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## scorpion_ca

How do you sleep at night in a million $$ home where the mortgage is around $760,000? :05.18-flustered:


----------



## My Own Advisor

As long as you have a steady job - you're golden nobleea! 

That mortgage (>$700k) would scare the [email protected]#$ outta me. 

We have a mortgage approaching $150k and even that's too high for my liking; I fear a job loss when I have debt.


----------



## nobleea

scorpion_ca said:


> How do you sleep at night in a million $$ home where the mortgage is around $760,000? :05.18-flustered:


The market value is above what I have listed, I was being conservative. I don't know what it would sell for. Probably not 1.5M, but likely over 1.3M. The mortgage is just over 3X our family income. Under 3X once we start renting out the suite.
The fact that we will be able to have a good lifestyle, max out RRSP, RESP, and TFSA contributions, plus have an additional 10-30K a year available for other investments or debt repayment makes me less concerned. For sure the mortgage is a big number. If we weren't able to do all those things above, I'd have troubles sleeping (or we wouldn't have built this).
In the event of me losing my job, we would be able to keep everything we have and live just off my wife's salary. Additionally, with my history and position with the company, any layoff for me would come with a severance of likely 100K.


----------



## OurBigFatWallet

That is encouraging news that your furlough at work is coming to an end. I'm guessing that is at least partially due to the increase in oil prices lately. Hawaii will be fun and February is a great time to go. What island are you going to?


----------



## scorpion_ca

You are a brave man....Hope everything will be fine.


----------



## nobleea

OurBigFatWallet said:


> That is encouraging news that your furlough at work is coming to an end. I'm guessing that is at least partially due to the increase in oil prices lately. Hawaii will be fun and February is a great time to go. What island are you going to?


The furlough was for all of Canada, and yes we are seeing signs of a pickup. Our little product line could have done without the furlough since we've been profitable for pretty much the last 15 years.

We're going to Maui, where we went after we had a baby last time. I'll probably just be using holiday time this time around rather than going on EI parental leave like last time.


----------



## nobleea

*December 2016 Update*
Everything is paid up with the builder. So no huge changes in the coming months, financially at least. I've been working on the garage suite and should have it ready for showings in mid-January. Have to buy flooring and appliances yet, which will probably be 5K ish.

Biggest news of the month was that we welcomed our son at the end of November. Everyone's doing great and he's a good sleeper which allows me to do a couple hours of work on the suite every night. Have his SIN already, so hope to get his RESP set up pretty soon.

I haven't done any paid photography since early October, which is just fine with me given the house work and new addition. I do have a couple weddings booked for next fall and I'll be doing family mini-session marathons in spring and fall - those are good for about 4K net each event.
We expect to have over $40K of free cash to invest or pay down debt in 2017. I will probably put the majority in to RRSPs.
I started listing our house maintenance account balance in the balance sheet. We put $250 in to it every month to cover longer term capital replacements on the house and bigger ticket maintenance things. Don't expect to have to touch it in any way for 3-4 years.

Excited to get a copy of Ufile and start our taxes! We're expecting a refund in the 16-20K range this year. That is included in the 40K free cash flow above.
Next month, I'll post an update on our 2016 goals and how we did and share our 2017 goals as well.

*Assets:*

House - $1,130,000 (N/C)
SUV - $17,900 (-2.8%)
Car - $9,700 (-1.8%)
Work DC Pension (mine) - $159,023 (+2.4%)
DB Pension (wife) - $175,000 (+1.4%)
RRSPs - $49,178 (-0.5%)
TFSAs - $1,883
Non-Reg - $54,418 (-16%)
House Maintenance Account: $998 (new)
Cash - $8,649
Miscellaneous assets - $17,500 

*Total Assets $1,623,800

Liabilities:*

Mortgage - $757,715 (-0.4%)
Credit cards - $4,990 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $762,705*
*
Net Worth: $861,097 (+0.9%, +$7,218 month over month, +9.5% year over year, +$74K year over year)*


----------



## My Own Advisor

Impressive NW.

"Partial retirement for me at 50."

Is that still the plan? 

Good idea to start building up the capital fund for the house. Houses are expensive to maintain!


----------



## nobleea

My Own Advisor said:


> Impressive NW.
> 
> "Partial retirement for me at 50."
> 
> Is that still the plan?
> 
> Good idea to start building up the capital fund for the house. Houses are expensive to maintain!


Yes, that is still the plan. Sometime between 45 and 50, less than 10yrs away. When I say partial retirement, I mean finish my current career. I'd start a second career. Start a business, write a book or movie, part time consulting...who knows. Doesn't have to make a lot of money as we'll have enough saved up to carry us over until pensions and real retirement (plus my wife's income). And no, the mortgage will likely not be paid off by then.


----------



## My Own Advisor

I hear ya...re: "second career".

That's our plan as well, pull the plug and hopefully work on our own terms at age 50, part-time or seasonal work.

We'll see


----------



## OnlyMyOpinion

My Own Advisor said:


> I hear ya...re: "second career". That's our plan as well, pull the plug and hopefully work on our own terms at age 50, part-time or seasonal work.
> We'll see


MOA, I believe that by the time you're 50 you will be able to sit at the kitchen table in your underwear, update your very helpful website, logon to see how much advertisers paid you last week, and then go and search for the latest warm vacation packages. :applouse: :applouse:


----------



## nobleea

*January 2017 Update*
New year, same us. I continued to do a lot of work on the garage suite, with a full time job, a newborn and a toddler. So progress is good, but not prompt. I have a little bit of painting left, all the trim, and then tiles and then it's ready. Paid for appliances, flooring, countertops in December, hence the big CC bill. Also a rental car for our Hawaii vacation next month. Since we'll be gone most of Feb, I don't expect I'll be able to get someone to move in until March or April. I am forecasting a rent of around 1K. And a total cost of the suite of just under 90K.

Got our son's RESP account set up (TD e-series) and he's got 1K in there already. Daughter (almost 3) has just over 12K in hers. We'll be able to max out their CESG matching contributions for 2017, but not sure I can catch up on his contributions from 2016 (he benefits from a full years worth since he was born late in 2016). Once the combined RESP balance exceeds around 35K I'll switch it to a self directed brokerage to get lower cost ETFs. Their RESP values are not included in our NW statement. Wife is on EI maternity leave now. We've already been talking about when she goes back to work as there are special rules about how many hours/months you have to work before taking maternity leave again. She'll likely go back in September at a 0.75FT position. It looks like we'll be able to save/invest about 2K a month while my wife is on EI. This gives me a certain level of comfort that even on one salary and EI, we have lots of breathing room. 

Finally got an update from my wife's DB pension program, and as usual I've been estimating the commuted value on the low side. The big bump in NW is solely due to that. The commuted value is the payout value should we leave and go somewhere else. Heavily dependent on interest rates which is why it grows so fast at the current low rates.

Picked up UFile and ran through some numbers already. Looks like we'll get a refund in the 18-19K range as it stands right now. I'm toying with the idea of contributing a bit more to RRSPs to increase that. That gets us a bigger tax refund this year and also increases our Universal Child benefit cheques since that is based on net family income.

Received our new city tax assessment in the mail and it's not pretty. 1.016M they say. There is an error in it as they've assumed we have a finished basement, which we do not. With that error fixed, we should no longer be the most expensive house in the neighbourhood. I don't want to be. There are certainly nicer and bigger houses in the neighbourhood, but none of them have a lot like we do nor the garage suite. Regardless, we're looking at a tax bill of $8500 which is about what I had estimated.

By spring time, we should be ready to make a move on an infill property. The more I get exposed to it through this building process and through friends doing it (and others in the neighbourhood), the more confident I get. The plan right now is to buy a tear down, split the lot, and try to sell one of the split lots. Once that's done, do a spec infill on the other.

We will be passing the million$ NW in 2017 for sure now.

*Assets:*

House - $1,130,000 (N/C)
SUV - $17,725 (-1.0%)
Car - $9,525 (-1.8%)
Work DC Pension (mine) - $159,590 (+0.4%)
DB Pension (wife) - $209,500 (+19.4%)
RRSPs - $49,488 (+0.7%)
TFSAs - $1,883 (N/C)
Non-Reg - $54,836 (+0.8%)
House Maintenance Account: $1,234 (+24%)
Cash - $12,811
Miscellaneous assets - $17,500 

*Total Assets $1,665,178

Liabilities:*

Mortgage - $754,980 (-0.4%)
Credit cards - $14,216 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $769,196*
*
Net Worth: $895,982 (+4.1%, +$34,885 month over month, +15.4% year over year, +$119K year over year)*


----------



## My Own Advisor

OnlyMyOpinion said:


> MOA, I believe that by the time you're 50 you will be able to sit at the kitchen table in your underwear, update your very helpful website, logon to see how much advertisers paid you last week, and then go and search for the latest warm vacation packages. :applouse: :applouse:


Heck I hope so....

My wife is searching for the latest warm vacations now!!!! $$$


----------



## coolbeans

nobleea said:


> Once the combined RESP balance exceeds around 35K I'll switch it to a self directed brokerage to get lower cost ETFs.


I've been thinking about doing this. We are just over that $ number in our RESP accounts. We'd go from an effective MER of 0.41% to 0.15%, which would be $100 savings per year right off the bat. Looks like it's a $125 transfer fee (I'm assuming per account) though. I think Questrade might cover some of that transfer cost.


----------



## OurBigFatWallet

Wow that sounds quite busy. I can't even get half that amount of work done and I don't have a newborn or toddler. For the tax assessment do you have to pay that as a lump sum or can you pay monthly? Here in Calgary we have the 'tipp' program where you can pay monthly. 

For the DB - have you considered a buyback for the year of service (mat leave) and if so do they give an estimate?


----------



## nobleea

OurBigFatWallet said:


> Wow that sounds quite busy. I can't even get half that amount of work done and I don't have a newborn or toddler. For the tax assessment do you have to pay that as a lump sum or can you pay monthly? Here in Calgary we have the 'tipp' program where you can pay monthly.
> 
> For the DB - have you considered a buyback for the year of service (mat leave) and if so do they give an estimate?


I'm famous for having too many things on the go and starting new things before I finish the old ones. Or infamous.

Yes, we can and do pay the taxes on a monthly basis direct withdraw from our bank account. I can't understand why anyone would do it any other way. This new tax bill won't hit us until Jul 1, it's always 6 months behind.

Yes, we will certainly be buying back the year of service for the DB. We did that for our first child. I think it ended up being 13.5K last time for 11 months of service. She had enough in a separate RRSP, so it just got transferred over with no out of pocket money. This time it will be about 9 months, but I think it will be more than the last time due to higher pay and lower interest rates, which I think have a big impact on that value. We still have about 3K in that separate RRSP, so that will cover some of it but we'll still have to come up with 10-12K of cash. *Not sure if that contribution is considered tax deductible??*
We won't be able to get an estimate of the amount until she's officially back and even then it takes 3-4 months to get sorted out. Most public institutions seem to be 5-10 yrs behind the private sector in terms of efficiency and systems for benefits and retirement. So much useless paperwork.


----------



## OurBigFatWallet

Generally they are tax deductible, but you'll want to make sure you get a slip for whatever contributions you make. Some employers can be really slow at getting information out efficiently so it can be frustrating. Almost as frustrating as trying to call CRA any time of the day in March/April  

Monthly tax payments are definitely the way to go, and Enmax just started to allow payment via credit card so I put the monthly utility bill on the credit card and earn some rewards


----------



## nobleea

OurBigFatWallet said:


> Monthly tax payments are definitely the way to go, and Enmax just started to allow payment via credit card so I put the monthly utility bill on the credit card and earn some rewards


Getting power bills on the CC would be nice. Usually necessities like that aren't eligible to CC.


----------



## nobleea

*February 2017 Update*
Doing this update a bit early as we are off to Maui tomorrow for a couple weeks. With any luck, winter will be essentially over by the time we get back. Will be booking a trip to Vancouver soon as we have a family reunion to go to in June. The new airline newleaf has some good deals, like $140 return incl taxes from Edmonton to Vancouver, which is probably half the typical good price. They only fly certain days, but they've been good for Edmonton in general.

Did a bit more work on the garage suite. Between a toddler and baby, one night of sports, trivia/wings with friends, photography and regular work, I only get about 4 hours a week that I can truly work on it. Baseboards and tiles still to do and then ready to rent. I've already had serious interest from friends of friends. We're also going to do a bit of work on our basement. We have relatives coming to visit and he's a drywall boarder/taper. We'll probably finish the gym room as he can help drywall. I looked at getting the whole basement ready for him, but the electrical was going to be pricey - just over 5K, and not something I needed right now. The gym flooring is expensive, but other than that, we have enough leftover drywall, trim and electrical that the cost to finish is not significant.

I have a realtor friend sign me up for a variety of new listings alerts for the neighbourhoods I'm interested in for a spec infill. I've talked to builders and some other developers and have a pretty good idea of costs and profitability. I will probably sketch out some designs and get input from a couple realtors on a range of selling prices in the areas I'm interested in. We're looking at a 1750-1800sf SFH with detached garage. Depending on the neighbourhood, time of year, and local market, it could sell for anywhere between 660-825K. I'm estimating a before income tax/after all expenses profit of between 50-95K. I have full confidence in my ability to create something that stands out without being too unique, and is attractive to the buyers I'd be looking for. Too often spec infill tries to be plaid and bland in order to appeal to many, but ends up truly appealing to no one. I've started the conversation with an accountant too. If we end up partnering with someone, then we'll likely have to incorporate. If we go alone, the first couple projects might work better as sole proprietorship. RRSP contributions and a bit of debt repayment which saves the corporate fees, or at least delays them until they're necessary. The goal is to purchase the lot in the spring, start construction early fall, and have it ready to list for the spring market in 2018.

I will give some thought to our goals for 2017 while on holidays.

*Assets:*

House - $1,130,000 (N/C)
SUV - $17,550 (-1.0%)
Car - $9,350 (-1.8%)
Work DC Pension (mine) - $162,615 (+1.9%)
DB Pension (wife) - $214,500 (+2.4%)
RRSPs - $49,791 (+0.6%)
Non-Reg - $58,671 (+7.0%)
House Maintenance Account: $1,485 (+20%)
Cash - $5,922
Miscellaneous assets - $17,500 

*Total Assets $1,667,526

Liabilities:*

Mortgage - $753,086 (-0.3%)
Credit cards - $9,007 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $762,093*
*
Net Worth: $905,433 (+1.1%, +$9,501 month over month, +11.6% year over year, +$94K year over year)*


----------



## OurBigFatWallet

Good progress as usual. Yes, it's been nice being able to pay utility bills on the credit card. Now if only I could do the same with my mortgage payment 

A consumer group just issued a warning about Newleaf so you may want to consider that when looking at flights. http://www.cbc.ca/news/canada/british-columbia/consumer-warning-newleaf-flair-air-1.3968761

I called my CC company and asked what would happen if they (Newleaf) went out of business after I booked a flight and they said I'd be out of luck. 

There are always new infills here being built, but they don't come cheap. Usually $850k and up. What are the dimensions of a typical SFH infill lot in Edmonton?

Enjoy the vacation - great time to be getting out of the cold weather


----------



## CrazyEights

Great work Nobleea as per usual.

OBFW - the dimensions of a typical SFH lot in Edmonton kind of vary depending on neighborhood. 
Some neighborhoods, its about 33' x 131' deep. City of Edmonton has passed bylaws that allow for lot divisions, allowing 'skinny homes' to be build on 25' lots. This is what nobleea is looking into I believe. This would make the home approximately 5 metres wide.


----------



## nobleea

OurBigFatWallet said:


> Good progress as usual. Yes, it's been nice being able to pay utility bills on the credit card. Now if only I could do the same with my mortgage payment
> 
> A consumer group just issued a warning about Newleaf so you may want to consider that when looking at flights. http://www.cbc.ca/news/canada/british-columbia/consumer-warning-newleaf-flair-air-1.3968761
> 
> I called my CC company and asked what would happen if they (Newleaf) went out of business after I booked a flight and they said I'd be out of luck.
> 
> There are always new infills here being built, but they don't come cheap. Usually $850k and up. What are the dimensions of a typical SFH infill lot in Edmonton?
> 
> Enjoy the vacation - great time to be getting out of the cold weather


I ended up not getting around to booking the Newleaf flights. Not worried about them, just had too much going on getting ready for our holiday. Anyways, Westjet matched their prices, so I booked with them.

The typical infill lot in Edmonton consists of a 50' lot being split in to for two 25' wide lots. Depths range from 110-150'. These will all be alley-serviced properties where the garage will be detached, in the rear. In some neighbourhoods you can get wider lots to split, like a 60' or 80' lot, but those are generally in the more posh neighbourhoods where it's hard to find a cheap tear down and you might get more resistance from neighbours (which makes no sense).

Detached home infills can go for anywhere from 550K-1.5mil depending on finish, size and location.


----------



## nobleea

*March 2017 Update*
Back from our Hawaii trip and back in to the swing of things. It was a great trip, though I wouldn't say it was relaxing traveling with two kids under 3. Not stressful, and definitely super fun, just not sit at the pool and nap or read a book relaxing. The kids were great on the flights - they fly really well. Booked a flight to Vanc in June for a reunion. Great deal on WJ who matched newleaf's prices. We'll be heading to BC for a week or two in July or Aug as a road trip. Possibly a beach vacation later in November as well. We'll see how things go.

I only have a few more tiles to put in the garage suite and it's done. I will be posting ads for it this week and seeing how it goes. I'll post the ad here so you can all see it as well. I'm really happy at how it's turned out. I'm thinking of a rent of $1050 incl gas and water, but not power. Surface parking is included but they will not have access to our backyard or garage. There is a private deck off the suite for the unit.

NW Gains this month are pretty well spread out with increases in RRSPs and decreases in debt. No unique one time events or costs/gains, so that's nice. We did get a successful reassessment of our property tax value. They had is listed as having a finished basement, which it does not. Called the assessment group, they sent someone out to take pics and then dropped the assessed value by 80K. Ends up saving about 700-800$/yr in property taxes. I have found that appealing or talking to the city about your tax assessment has been very productive. I think I've got drops in assessed value about 4 times in the past 10 years for various properties.

Still continuing down the path of spec infill. We've been pre-approved by the bank for a ridiculous amount. I was shocked when she told me the amount, considering our current mortgage. I've been continuing on the due diligence path for such a project, looking at a cash flow model of all the expenses that are necessary, plus trying to estimate XIRR, or at least a range of returns on my money. I think after tax it would have to be over 20% to make the risk worthwhile. Cash flow wise, the toughest time would be at the first draw when I have to pay off the lot mortgage and have enough equity to cover 20% of the finished house value. I can't really get quotes on a house build until I've purchased a lot since the lot shape and orientation will dictate the house design (at least they should if done properly). I am poking around currently on a pie shaped lot that might work. Price is a bit high, but I might try a low offer if the lot dimensions work out.

Other than that, not too much to report. An $18K+ tax refund coming our way, hopefully before the end of March. A few grand in restricted company stock which vests in early April and will be sold asap. None of those amounts show up in the numbers below since the money has not been received yet.

The kids' RESP balance is currently at $14,677. It is not included in any of the numbers below. XIRR is just about 10% and it's in an e-series couch potato format. XIRR is assuming the CESG as contributions, not investment gains.

*Assets:*

House - $1,130,000 (N/C)
SUV - $17,375 (-1.0%)
Car - $9,175 (-1.8%)
Work DC Pension (mine) - $168,390 (+3.6%)
DB Pension (wife) - $219,000 (+2.0%)
RRSPs - $50,473 (+1.4%)
Non-Reg - $59,704 (+1.8%)
House Maintenance Account: $1,526 (+2.8%)
Cash - $1,152
Miscellaneous assets - $17,500 

*Total Assets $1,674,329

Liabilities:*

Mortgage - $751,029 (-0.3%)
Credit cards - $4,910 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $755,939*
*
Net Worth: $918,390 (+1.4%, +$12,957 month over month, +13.1% year over year, +$107K year over year)*


----------



## OurBigFatWallet

Nice progress, thanks for the info on lot sizes. That is a big tax refund coming your way. For some odd reason Newleaf no longer flies out of Calgary (for now anyway). Looking forward to seeing the ad for the suite


----------



## nobleea

nobleea said:


> Still continuing down the path of spec infill. I am poking around currently on a pie shaped lot that might work. Price is a bit high, but I might try a low offer if the lot dimensions work out.


We ended up making an offer 10% under list (or 20% under list when they first listed it). A bunch of back and forth countering but couldn't come to an agreement. Still interested in it, but they'll have to adjust their expectations. I give it a 60% chance that we get it.


----------



## nobleea

nobleea said:


> We ended up making an offer 10% under list (or 20% under list when they first listed it). A bunch of back and forth countering but couldn't come to an agreement. Still interested in it, but they'll have to adjust their expectations. I give it a 60% chance that we get it.


We did not get that one, but have just about finalized an agreement on a purchase from a FSBO in the same neighbourhood.

In the meantime, I have a bit of cleanup and finish work to do on the suite, but I think it's ready enough to post. I'll update the pics as it's truly finished, but this should give you an idea.
http://www.kijiji.ca/v-1-bedroom-ap...he-loft-in-holyrood-available-may1/1250203284
We already have a couple solid leads through word of mouth.


----------



## Spudd

If it's metered separately for power, why don't you have the tenant sign up for their own account with the power company instead of you charging them something different every month? Just seems like that would be easier to manage.


----------



## nobleea

Spudd said:


> If it's metered separately for power, why don't you have the tenant sign up for their own account with the power company instead of you charging them something different every month? Just seems like that would be easier to manage.


Because it's not an official Epcor (utility) meter. Costs quite a bit to get a second one installed. I purchased an inexpensive meter that clamps on to their main breaker line that can provide day by day consumption.
http://www.ekmmetering.com/ekm-metering-products/electric-meters-kwh-meters.html
I'll just prorate my bill based on their consumption. They're getting a deal out of it by not having to pay the full fixed fees.
That company has gas and water meters as well that you can monitor through the same package, but gas and water are cheap.


----------



## Spudd

Oh, that's cool, I had no idea that exists!


----------



## OurBigFatWallet

The place looks great, and based on the number of hits for the ad you'll have no problem finding a tenant


----------



## nobleea

An update on goals for last year and the list so far of goals for 2017. Right on time considering we're in April already...
*
2016 Goals:*
Increase Net Worth to 840K - *Completed* in late April
Move in to new house and sell old one for 475K net or more - *Completed*, sold for $485K minus legal fees, July
Finish landscaping on new house - *Completed*, sod, rocks, concrete edging, trees and shrubs all in
Spend 5hrs/week on new hobbies and gym time -* Incomplete.* Didn't even come close
Read 16 books - *Incomplete*. I didn't keep track, but it was probably 6-8 books
Wife signed up for life insurance -* Incomplete*.
Start and use family calendar on Google Docs - *Complete.* What a difference having a shared calendar that we can both access anywhere.
Track utility consumption in new house and reduce consumption to 4GJ/mo gas, 450kWh/mo power, 12m3/mo water - *Utility tracking is complete. Consumptions did not meet goals*. Gas is well above at about 9.6gJ/mo. That includes a heated garage and garage suite, plus a much larger house. Aside from adding a gas sub meter, I can't think of a way to remove the garage suite consumption. Power is averaging 575kWh/mo. I thought this would be lower. I think I can get it under 500 once I get the suite submeter in place. Water consumption is well below our goal. Averaging 8.6m3/mo which is almost half of the average household consumption in Edmonton. Since the majority of our consumption is in the summer, I think I can lower it even more. A tenant in the garage suite will bump it back up. As it is, all our utility consumptions are below the household averages for Edmonton, so I am happy with that.
Start weekly meal planning and try out 3 new recipes/month - *Very spotty.* Achieved maybe 50% of this before the new kid showed up.
Create household budget, track on a monthly basis, look for opportunities for savings - *Complete*. Tracked expenses for a year.
_
Overall, I give us a 60% success rate._

*2017 Goals:*
Increase Net Worth to 1 Million
Start Spec Residential Infill project or put money against mortgage
Get wife signed up for additional life insurance
Finish and rent out garage suite, cashflowing at least $500/mo
Max out yearly RESP contributions for both kids and get CESG grants
Reduce average monthly power consumption to 500 kWh or less
Complete gardening and enjoy yard
Increase non-meat/vegetarian/vegan meals to 2/week or more


----------



## nobleea

*April 2017 Update*

Progress continues on many fronts, which makes me feel good about everything.

The garage suite is effectively finished and I've had about 8 people come through to look at it. At least 3 of them are solid options. One is looking for May 1, but most are June 1. For the right tenant, the wait is worth it. The unit shows very well. I specifically didn't state the square footage in the ad, and no one has asked about it as the unit feels far more spacious than it actually is. If I advertised that it was 645 sq ft, some might get scared away as that seems pretty small. The application form is detailed and I will be inquiring with references. Plus they will apply for a credit report and send me a copy (I'll reimburse them for the report fee). After thinking about it, I would have been much better off had I paid someone to finish the suite for me. It could have easily been done for Sep 1 last year and I'd have collected 8-9 months rent at 1050 per. Someone could have finished it for 5-6K (over and above the parts/supplies which I purchased anyways) and I'd have had a lot more spare time. I was optimistic, as many are, about how much time it was going to take and how much free time I would actually have to do the work.

On the spec infill development front, we made some moves during March. Early in the month, we made an offer on a nice pie lot that was split-able. List price was 485K (down from 550) and we offered 435K. Various counters and we stood at 440 and them at 450 so the deal didn't happen. It eventually sold for 450, which in hindsight would've still been a good investment given the size of the lot. So I continued with the plan, which was to target desirable lots which were in poor condition, find the owners through land titles, and submit unsolicited offers. I have 20+ lots identified in the neighbourhoods I'm interested in and sent letters off to the first 3. Surprisingly, 2 of the 3 actually got back to me. One said they were interested, but my price was too low, and the other we managed to strike a deal at 440K. It's still a conditional offer, but I'm 90% positive it's going to go through. It's a corner lot with a south facing backyard. Nice street with several million+ homes either up or going up. A good friend who has done spec development successfully many times before will be partnering with me if necessary to build the second house as we won't be able to afford two builds. Ideally we'd start the build in mid-Sept but that might be a stretch. The hold up is usually land titles in registering the new split lots. That can take a few months. Goal would be to get concrete in before freeze and have houses ready to list in April for busy spring selling season. I'm sticking with my original estimate of a before tax profit of 50-95K per house. Profits would go in to RRSPs (we have 80K+ of available room), so taxes are deferred.

Other than that, got about 18.5K back in tax refunds this month and 2.4K worth of company shares vested from an old bonus program. Our company stock is finally doing well, up 34% on the year. The snow is all gone here and the garden centres will be opening soon. I've still got a few plants and shrubs to plant but I'm really looking forward to that. Plus the Oilers are in the playoffs in a good position, so everything seems to be going right.

*Assets:*

House - $1,130,000 (N/C)
SUV - $17,200 (-1.0%)
Car - $9,000 (-1.8%)
Work DC Pension (mine) - $172,242 (+2.3%)
DB Pension (wife) - $219,000 N/C)
RRSPs - $50,529 (+0.1%)
Non-Reg - $76,044 (+27%)
House Maintenance Account: $2,048 (+34%)
Cash - $3,382
Miscellaneous assets - $17,500 

*Total Assets $1,696,945

Liabilities:*

Mortgage - $749,126 (-0.3%)
Credit cards - $4,785 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $753,911*
*
Net Worth: $943,034 (+2.7%, +$24,644 month over month, +14% year over year, +$116K year over year)*


----------



## nobleea

*May 2017 Update*

The garage suite is now rented. We were happy with the applicants, but personally knew the references of one of the applicants and coincidentally it was the applicant I felt most comfortable with. Young female, PhD student at the university. Rented at $1050 for a year and moves in in a couple weeks.

Our deal on the spec infill is finalized with deposit paid to the lawyers. It closes May 31. Financing is approved on a HELOC as a bare lot - I managed to get 65% LTV at Prime+0.5%. It's a great neighbourhood - lots of infill and new builds going up. Our friends live on the same street and about 1/4 of the Oilers roster lives in the neighbourhood. I have a partner who will be buying one of the split lots off me once it is formally split - likely in August. Price will be whatever the max is that he can get it appraised at. I would guess somewhere between 270-300K. We will be building the homes at the same time, same builder, designer and realtor. Profits (or losses) will be split 50/50 after all expenses are repaid. I have added a line item in the NW tracker for Infill equity.

Been spending a lot of money and time filling out our backyard. Mulch, gravel, dirt, shrubs, perennials, lattice, firepit, sprinkler control, etc etc. I still have some work to do, but it looks fantastic. The big CC amount this month is due to that.

RRSP's are doing great right now and after looking at ads, I think our monthly depreciation on our vehicles is a bit high. I won't change it, but when we do sell the vehicles there would be a positive variance between 'book' value and sell price. Kids' RESPs are valued at $16K combined. They are not included in the numbers below.

Oilers playoff run continues, so even though everyone is usually cheery and happy in spring, it's way more this year. I can't justify playoff tickets ($400 ea min), but we did go to one of the watch parties. That's where they sell out the arena to watch an away game on the big screen. Cheap ($5) and the crowd is just as loud during anthems, goals, as it would be during a home game. No yelling and swearing at the non-existent refs and players, so it's a little more family friendly.

If I want to meet my target of partial retirement at 46 or so, I think I'm going to need to do the following:
Get the mortgage down to an amount that my wife can qualify for it on her salary alone, on a 10-ish yr term.
Have 400K saved up to draw down as necessary during the period from 46-66, when I will start drawing on my main work RRSP.
Have 200K saved up in seed money for any business I want to start.

So my estimates are that I need about 950-1000K over the next 7.5 yrs over and above our normal mortgage payments. I'm confident I can save up 30K a year no problem just from cash flow (but likely more). If our spec infill project works out as planned, then I would need to do about 2 houses a year to meet my goal.

*Assets:*

House - $1,130,000 (N/C)
Infill Equity - $20,000 (new)
SUV - $17,025 (-1.0%)
Car - $8,825 (-1.8%)
Work DC Pension (mine) - $176,615 (+2.5%)
DB Pension (wife) - $219,000 N/C)
RRSPs - $51,792 (+2.5%)
Non-Reg - $57,685 (-24%)
House Maintenance Account: $2,354 (+15%)
Cash - $1,394
Miscellaneous assets - $17,000 

*Total Assets $1,701,828

Liabilities:*

Mortgage - $747,166 (-0.3%)
Credit cards - $47,960 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $755,126*
*
Net Worth: $946,702 (+0.4%, +$3,668 month over month, +10% year over year, +$86K year over year)*


----------



## Sm5

nobleea said:


> ... I have a partner who will be buying one of the split lots off me once it is formally split - likely in August. Price will be whatever the max is that he can get it appraised at. I would guess somewhere between 270-300K. We will be building the homes at the same time, same builder, designer and realtor. Profits (or losses) will be split 50/50 after all expenses are repaid.


Make sure your counsel papers this appropriately (even if it costs a few bucks). You'd be surprised how often these type of arrangements 'go sideways' where people thought they would not, or were too 'frugal' to document things appropriately. They end up paying the price in such a situation.

Not saying it will end up that way, but better safe than sorry.


----------



## My Own Advisor

Couldn't agree more Sm5.

@nobleea, you're doing great and have lots of things on the go. Amazing stuff. "If I want to meet my target of partial retirement at 46 or so, I think I'm going to need to do the following:
Get the mortgage down to an amount that my wife can qualify for it on her salary alone, on a 10-ish yr term."

Totally agree with this one. While your assets are great, if something happens to your job (hopefully not) or your wife's ability to earn an income (hopefully not), your plans are severely compromised. I would definitely now start aggressively killing debt. That's a big pile. With your assets, and growing pensions, in 10 years you are set. But, debt will hold you back if it's not under control.


----------



## nobleea

*June 2017 Update*

Tenant for our garage suite moved in during May. Haven't heard a peep from her and the only thing we see of her is when her car is parked on the gravel pad. Will be interesting to see how the utilities change now that the tenant is in full time.

Our backyard is pretty much done and it looks fantastic. We've had decent rain over the past month, so the lawn is super lush and green and I haven't even connected the sprinkler system yet. Mozzies are bad, but apparently this year is supposed to be better than most. We spent a long weekend in Vancouver visiting family and friends. Aside from the flights (super cheap) and car rental, we didn't spend anything.

Took possession of the tear down house last week. It is definitely a tear down - inside is in poor shape. There's about $500 worth of stuff that can be salvaged/sold (appliances, furnace). Utility disconnects have already been scheduled and we're hoping to tear down in late July/early Aug. Our lot split application has been submitted and should be a rubber stamp, just takes time. The two lots next to us are being also being demoed and split and the lot behind us is being demoed and a single home going up. House plans are underway and should be ready to submit for permits as soon as the split is registered. As soon as the split happens, I will sell one of the lots to my partner, likely around 285K, closing in August. Once that is done, that should be enough to push us past the 1Mil NW mark. I am fairly confident we can get these homes completed by April next year.

To simplify all the partnerships, HELOC, etc for the infill, I will just have one line item in Assets for Infill Equity.

*Assets:*

House - $1,130,000 (N/C)
Infill Equity - $66,702
SUV - $16,850 (-1.0%)
Car - $8,650 (-1.8%)
Work DC Pension (mine) - $176,861 (+0.1%)
DB Pension (wife) - $219,000 (N/C)
RRSPs - $52,276 (+0.9%)
Non-Reg - $105
House Maintenance Account: $2,538 (+7.8%)
Cash - $11,788
Miscellaneous assets - $17,000 

*Total Assets $1,701,485

Liabilities:*

Mortgage - $745,256 (-2.5%)
Credit cards - $5,009 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $750,265*
*
Net Worth: $951,050 (+0.5%, +$4,348 month over month, +8.5% year over year, +$74K year over year)*


----------



## nobleea

*July 2017 Update*

Got our first utility bill with a complete month of our tenant being on it. Power was 584kwh for June. I don't have a number to compare since last June we were still in our old house. The city average is 600kwh per household, so we're still going well considering we have a 4 family household and an apartment on that bill. I'm going to guess the power is a 50% increase over just us. I do have a sub-meter to measure this, but I haven't installed it yet. City rules only allow one secondary suite per lot. I could have fit 2 in without a sweat and would have if they allowed it.

All utilities are disconnected at the tear down. All the non-usable trees have been cut down. I've salvaged everything I can - you always find something weird. $720 worth of salvage stuff. This one had 25 bags of unopened fiberglass batt insulation stuffed in the attic rafters. Normally you would take them out of the bag and install them - not here. Bags were probably 30-40yrs old but no problem selling them. Looking to do the demolition in a couple weeks. We've picked a builder and we're still on target to break ground in Sept. He's quoted a 5 month completion. He also has a large line of credit that we can use rather than struggle with financing, which set us back a month or two when we built our house. We'll still get a mortgage, but won't be held hostage by the bank and their slow approval process.

To simplify all the partnerships, HELOC, etc for the infill, I will just have one line item in Assets for Infill Equity. Until the split lot is sold, I will just calculate it as purchase equity plus money spent.

Every year, I take a look at kijiji and see what a reasonable selling price would be for our vehicles. I guess I've been too aggressive with the depreciation, as I found them to be off quite a bit. I've bumped them up and reduced the monthly depreciation amount going forward.

The work RRSP took a big hit this month. CAD$ as well as a drop in our company stock which I have not been able to get rid of. That's pretty much the reason for the NW drop this month.

*Assets:*

House - $1,130,000 (N/C)
Infill Equity - $75,942 (+14%)
SUV - $18,250
Car - $9,500
Work DC Pension (mine) - $169,994 (-3.9%)
DB Pension (wife) - $219,000 (N/C)
RRSPs - $50,941 52,276 (-2.6%)
Non-Reg - $105
House Maintenance Account: $2,467 (+7.8%)
Cash - $3,560
Miscellaneous assets - $17,000 

*Total Assets $1,715,611

Liabilities:*

Mortgage - $743,288 (-0.3%)
Credit cards - $5,805 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $749,093*
*
Net Worth: $947,699 (-0.4%, -$3,351 month over month, +7.8% year over year, +$68K year over year)*[/QUOTE]


----------



## nobleea

Just an update on our little venture. House is knocked down and the lot is fenced off. I wanted to get it knocked down sooner rather than later for liability issues. While I did get a separate policy on the property, my current house policy will only cover me if it's a bare lot. So I feel better now that I'm covered for liability under two policies.

Our builder has suggested, and we've agreed to, an alternative arrangement for financing. Essentially, the builder buys the lot off us for full market value and puts that plus all costs on his LOC. Before doing so, we sign a purchase agreement with him to buy the completed houses back at a specific cost, 1 yr in the future. We are free to sell the contract and assign it to someone else during that time, obviously at a higher price. Since it will only take 5 months to build, but we can keep the costs on his LOC for up to a year, we shouldn't have to front any money aside from a few grand a month. We'll end up paying probably ~4K more in interest costs, but that is preferable to going back and forth with the bank for two months to try and get approval on a spec development (pushing construction further in to the winter season). My bank mentioned that they don't fund spec developments anyways, so I'm sure the broker forgot to mention that.

Waiting on an appraisal on the lots, but I would guess combined they will come in at around 560-600K (we bought it for 440). The lot sale would go through in Oct/Nov and would result in a little bump in the NW. It also helps to smooth out income taxes as the lot sale/gain occurs in 2017, while the house sale/gain will occur in 2018. We will have to charge GST on the lot sale.


----------



## nobleea

*August 2017 Update*

Spent a week in BC for our holidays. Every time we go there, I start dreaming up a plan on how we could have a lake front property to enjoy and use. Then reality sets in. It's a shame AB doesn't have nice recreational lakes.

My wife goes back to work in a couple weeks. She'll be at something around 0.8FTE. No crazy changes to our regular finances.

On our infill project, the lot split was approved by the city, a bit earlier than I was expecting, and now just has to get registered at land titles. The process was quite easy and the survey company did everything for me. House designs are done and we're just getting formal pricing on the builds. Assuming everything is good, they should able to start digging in October. As per the last update, the developer will be buying the lots off me, likely in November. I am guessing this will be for 575K or so. Once that's finalized, I'll start to bump up the infill equity, prorating it over the remaining time until closing. I'm getting nice renderings and a fancy website made up and will put large signs on the property advertising for sale. I think there's a decent chance at least one of the houses can be pre-sold prior to completion. Once one of the houses is under contract, I'll be looking at starting the process all over again assuming the profits (both actual amount and XIRR) reflect a good return on my money and time.

To simplify all the partnerships, HELOC, etc for the infill, I will just have one line item in Assets for Infill Equity. Until the split lot is sold, I will just calculate it as purchase equity plus money spent.

This whole process has certainly highlighted a lot of other opportunities for me. When trying to select items/finishes for the houses, several times I've either not been able to find what I want, or found it but been appalled at the prices. I've started some informal research in to what would be involved in sourcing/fabricating and offering these items for sale on a website.

*Assets:*

House - $1,130,000 (N/C)
Infill Equity - $82,219
SUV - $18,100 (-0.8%)
Car - $9,340 (-1.7%)
Work DC Pension (mine) - $169,945 (-3.9%)
DB Pension (wife) - $219,000 (N/C)
RRSPs - $51,443 (-1.0%)
Non-Reg - $105
House Maintenance Account: $2,884 (+17%)
Cash - $1,500
Miscellaneous assets - $17,000 

*Total Assets $1,701,476

Liabilities:*

Mortgage - $741,368 (-0.3%)
Credit cards - $4,935 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $746,303*
*
Net Worth: $955,173 (0.8%, $7,474 month over month, +9.4% year over year, +$82K year over year)*


----------



## nobleea

*September 2017 Update*

Wife is back at work now and actually enjoying it, she really enjoys teaching and coaching. We've requested the price to purchase back service from maternity leave, but that was complicated and time consuming last time, so may not have a price until November. I would guess 12K.

Found out that we'll need additional child care one day a week for at least one kid. Normally, the older one goes to grandparents, but they weren't super keen on taking both kids. The dayhome we go to for both kids 4 days a week does not have room for a fifth day, so we've been looking at part time nannies. Getting organized and out of the house is half the battle, so not having to worry about that is worth a bit extra. Plus she'll be able to do some laundry, tidying and cooking, which again is worth the price. Decent ones seem to be going for $14-20/hr and we've already found a great one.

On our infill project, everything is proceeding fine. Lots are split and registered with land titles. I have pricing from the builder - as always a bit higher than hoped but enough to make it work. Permits have already been applied for, so we'll probably start foundations just after thanksgiving. Still working out some final details on costs, so we've not been able to pin down a list price yet. Advertising signs are up, website is up and running (www.mdrngroup.ca). Honestly wasn't hard to put together a website and package that is better than 95% of spec developers in town.

To simplify all the partnerships, HELOC, etc for the infill, I will just have one line item in Assets for Infill Equity. Until the split lot is sold, I will just calculate it as purchase equity plus money spent.

At work, the company has indicated that raises will be coming in Q1 2018. That will be the first time in 3 years or so.

We are likely going to head to Ottawa for Christmas, so I will have to book the (expensive) flights soon.

*Assets:*

House - $1,130,000 (N/C)
Infill Equity - $88,789
SUV - $17,950 (-0.8%)
Car - $9,180 (-1.7%)
Work DC Pension (mine) - $170,268 (+0.2%)
DB Pension (wife) - $219,000 (N/C)
RRSPs - $50,879 (-1.0%)
Non-Reg - $105
House Maintenance Account: $3,129 (+8.5%)
Cash - $677
Miscellaneous assets - $17,000 

*Total Assets $1,707,243

Liabilities:*

Mortgage - $739,445 (-0.2%)
Credit cards - $9,294 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $748,739*
*
Net Worth: $958,504 (0.4%, $3,331 month over month, +8.1% year over year, +$72K year over year)*


----------



## Dmoney

Just read your diary from start to finish. Very interesting!
Before building your home, did you have any experience in development?
How difficult did you find the process - did it all go relatively smoothly or were there any major issues?
Sounds like you did much of the design work yourself - did you have any prior experience on that front?

Great looking website and designs! 


nobleea said:


> Advertising signs are up, website is up and running (www.mdrngroup.ca). Honestly wasn't hard to put together a website and package that is better than 95% of spec developers in town.


Do you plan on doing more of these infills over time?


----------



## humble_pie

nobleea said:


> On our infill project, everything is proceeding fine. Lots are split and registered with land titles. I have pricing from the builder - as always a bit higher than hoped but enough to make it work. Permits have already been applied for, so we'll probably start foundations just after thanksgiving. Still working out some final details on costs, so we've not been able to pin down a list price yet. Advertising signs are up, website is up and running (www.mdrngroup.ca). Honestly wasn't hard to put together a website and package that is better than 95% of spec developers in town.





every cmffer should visit this website, just to see these 3 magnificent houses built & under construction by noblea in edmonton

every detail is drop-dead gorgeous breathtaking perfection
every item so meticulously designed & optimized

the website itself is beautiful
even the corporate logo is a masterpiece, now how about that!

here's the website again:


https://www.mdrngroup.ca/

.


----------



## nobleea

Dmoney said:


> Before building your home, did you have any experience in development?
> How difficult did you find the process - did it all go relatively smoothly or were there any major issues?
> Sounds like you did much of the design work yourself - did you have any prior experience on that front?
> Great looking website and designs!
> Do you plan on doing more of these infills over time?


Thanks Dmoney. No, before building our house I had no experience in development. I've always been very interested in it, so whenever friends would be building, I would ask many questions and pick their brains. Now I didn't build our house per se, but I did design and pick the finishes. With permits in hand, we didn't have any issues with the build process. What we did have problems, or at least delays with, was everything prior to that. Me fine tuning the design until I was happy with it (19 iterations? 20?). Getting all builders on the same page when it came to quoting (and I thought my spec package was pretty detailed). Getting quotes in a reasonable time frame, including revisions. Biggest issue was with construction mortgage financing and approvals. Lots of delays there. Permits weren't the fastest, but I made sure no variances would be required as those can really screw up the timeline.
Design wise, I've always loved designing houses. Even at 13, I would spend allowance money on Lindal/Linwood cedar home catalogs and those compilation house design catalogs. Took a couple drafting courses in high school. Looked at taking Arch Drafting courses through the trade college as well as actual architecture school (manitoba was the closest I think). Ended up in mechanical engineering, which isn't really related. Designed a lake cabin for a friend's family during university.

I would like to continue with these infills yes. Assuming we can make enough money, my dream would be to complete 2-4 per year. Quit my current job and do this part time. Start all construction in Sept and have them finished by April. That leaves all summer to design the next ones. Luckily, design work can be done lakeside, in BC perhaps, for 2-3 months of summer. Wife (teacher) would be off anyways, as well as the kids.


----------



## nobleea

humble_pie said:


> every cmffer should visit this website, just to see these 3 magnificent houses built & under construction by noblea in edmonton
> 
> every detail is drop-dead gorgeous breathtaking perfection
> every item so meticulously designed & optimized
> 
> the website itself is beautiful
> even the corporate logo is a masterpiece, now how about that!
> 
> here's the website again:
> 
> 
> https://www.mdrngroup.ca/
> 
> .


Thanks hp. That might be a bit over the top!

Logos and branding I have always been fond of. Photography has really helped that. Photographers are visual artists and some have a background in that field. Colour coordination and branding appeal and targeting are a big part of that business. Use the wrong font and you'll be thrown to the trash heap, or worse, be stuck with a clientele that does not have the disposable income you want.


----------



## My Own Advisor

Impressive.

Those look like the houses my wife wants to buy in Ottawa, at > $1 M. *sigh* but not going to happen 

So, after the land is split, etc - what are the building costs per sq. ft. for such homes in Edmonton? Curious. 

Continued success nobleea. Very close to a millionaire at a young age.


----------



## nobleea

My Own Advisor said:


> Impressive.
> 
> Those look like the houses my wife wants to buy in Ottawa, at > $1 M. *sigh* but not going to happen
> 
> So, after the land is split, etc - what are the building costs per sq. ft. for such homes in Edmonton? Curious.
> 
> Continued success nobleea. Very close to a millionaire at a young age.


I'd be retiring darn early if I could sell them for 1M plus. These will likely go for between 770-810. If we could get over 810 I'd be doubling down and starting a few projects asap.
Not including the lot and if you back out the basement development and detached garage, the build cost for the houses is about $190-195 PSF. I've seen builders quote $150 and I've seen as high as $325 PSF. I think our personal house was about $225 PSF.


----------



## humble_pie

nobleea said:


> Thanks hp. That might be a bit over the top!




did you think the post was over the top?

me i don't think over the top. The combination of a mechanical engineer with an artist's eye for house design that is both elegant & timeless, is a rare gift.

2 questions: is there a scandinavian or bauhaus ancestor somewhere in your family tree? these influences seem predominant in your homes.

also: you don't appear to have a cost for an architect's fee. In fact there's no mention of any architect at all. Did you yourself serve in this capacity as a professional engineer? ie drafting your own elevations, working the dossier through city hall to obtain the permits, etc.

here in my municipality all applications for building permits, renovations & even repairs require an architect or a professional engineer's submission with drawings & elevations. No doubt your own municipality has similar restrictions before they grant a building permit.

which brings me to a 3rd point. In your financial profile you've sensibly included only the costs of construction mortgage, materials already purchased or ordered, etc. You've included nothing for all the sweat equity you've already invested in this trio of residences.

if one includes even a modest amount for sweat equity in holyrood house, you would easily be a millionnaire on paper. Wait until the new pair of houses are sold, the figures will turn golden!

although i have to say that, for me, the most appealing feature is that these houses were never designed & built with a primary goal of fast, easy profit. Rather they appear to have been born out of a talented entrepreneur's dedication to creating Excellence.


.


----------



## nobleea

humble_pie said:


> also: you don't appear to have a cost for an architect's fee. In fact there's no mention of any architect at all. Did you yourself serve in this capacity as a professional engineer? ie drafting your own elevations, working the dossier through city hall to obtain the permits, etc.
> 
> here in my municipality all applications for building permits, renovations & even repairs require an architect or a professional engineer's submission with drawings & elevations. No doubt your own municipality has similar restrictions before they grant a building permit.
> 
> which brings me to a 3rd point. In your financial profile you've sensibly included only the costs of construction mortgage, materials already purchased or ordered, etc. You've included nothing for all the sweat equity you've already invested in this trio of residences.


I am acting as the designer/architect. I have paid a drafter to draw up the plans with all the proper dimensions and details. If you don't need design input from them, drafters are not expensive. Yes, I have to get an engineers stamp on the drawings and truss/joist and tall wall plans. The builder (not me) takes care of these, and for many of those items, the supplier will include that from their in house engineer (truss and joists for example) in their standard price. In AB, we also have a requirement to run building envelope and energy efficiency calculations and models. There are companies that specialize in this, so you just send them the plans and specs.
I am keeping track of all my time and will calculate an average hourly rate to see what my sweat equity is worth. I would hope $500/hr or so. Which would be far better than the $1/hr I made in sweat equity off our first home we bought and renovated.


----------



## Dmoney

nobleea said:


> I would like to continue with these infills yes. Assuming we can make enough money, my dream would be to complete 2-4 per year. Quit my current job and do this part time. Start all construction in Sept and have them finished by April. That leaves all summer to design the next ones. Luckily, design work can be done lakeside, in BC perhaps, for 2-3 months of summer. Wife (teacher) would be off anyways, as well as the kids.


Sounds like a dream!
Really impressive stuff, keep up the good work!


----------



## nobleea

*October 2017 Update*

Still waiting on the buy back amount for my wife's maternity leave. The pension plan was slow last time and I expect them to underwhelm me again.

We found a part time nanny we are happy with and she's been with us for almost a month now. She has other clients, so we just pay her an hourly rate straight up as a contractor and leave it to her accountant to deal with it.

Had a nice bump in my work RRSP which is a result of our company stock doing well again and the overall market.

On our infill project, the city has indicated they are way behind on permits, so we're not going to be able to start building until November. We were planning on a winter build, so nothing changes. The website has led to 3 solid leads so far. As per the plan, the builder will be buying the split lots off us and we now have an agreed purchase price on these. This is reflected in the infill equity line item, which also accounts for the GST and taxes on the sale. That sale should close in late November. Concurrently, we'll sign a purchase agreement with them for the finished house, closing end of 2018. That gives us over 12 months to sell the house and not have it hit our books (though the project would pay the carrying costs). The completed houses were appraised at 850-860K based on comparable sales this year, but I think that's a bit generous. I'll stick with my original estimate of 770-810K sell price.

To simplify all the partnerships, HELOC, etc for the infill, I will just have one line item in Assets for Infill Equity. I am eager to start another project soon, but we have a municipal election in a week and many of the candidates are against infill for various reasons. We'll hold off on any planning for another project until there's some clarity on the new council. I suspect nothing will change.

Booked flights to Ottawa for Christmas. This is never a cheap flight and ended up being $2400 for three tickets. I'll be signing up for the Westjet MC to get the free checked bags. Looks like a decent card anyways.

Image shows our net worth progression since we started tracking it. Day 0 is when my (fiance at the time) and I moved in together.







As a result of the bump in NW from the lot sale, I have reduced the book value of our 'other assets' items by 25% which includes things like furniture, electronics, photo equipment, sports equipment, etc.

*Assets:*

House - $1,130,000 (N/C)
Infill Equity - $106,294
SUV - $17,800 (-0.8%)
Car - $9,020 (-1.7%)
Work DC Pension (mine) - $176,650 (+3.7%)
DB Pension (wife) - $224,000 (+2.3%)
RRSPs - $53,286 (+4.7%)
Non-Reg - $105
House Maintenance Account: $3,507 (+12%)
Cash - $4,055
Miscellaneous assets - $13,000 

*Total Assets $1,737,717

Liabilities:*

Mortgage - $737,465 (-0.3%)
Credit cards - $11,610 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $749,075*
*
Net Worth: $988,642 (3.1%, $30,138 month over month, +12.4% year over year, +$109K year over year)*


----------



## OnlyMyOpinion

nobleea said:


> ...we have a municipal election in a week and many of the candidates are against infill for various reasons. We'll hold off on any planning for another project until there's some clarity on the new council. I suspect nothing will change...


Wondering why you suspect nothing will change?


----------



## nobleea

OnlyMyOpinion said:


> Wondering why you suspect nothing will change?


Voter turnout for municipal elections here is usually very low, and the people that go vote generally go with the incumbent. The vast majority of incumbents who are seeking re-election are pro-infill. I guess what I meant to say was that the pro-infill mentality of council will likely not change. Anyone who seeks to cancel or put a moratorium on lot splitting and infill runs the risk of being painted as being in the back pocket of large developers, ironically. Small scale infill is exclusively done by small family run builders. Nobody builds more than 8-10 houses a year. Not having that stock means the buyers will buy a new house in the suburbs, from a large builder/developer who have all been good donators to election campaigns.


----------



## nobleea

nobleea said:


> I'll be looking at starting the process all over again assuming the profits (both actual amount and XIRR) reflect a good return on my money and time.


For funsies, I thought I would check out the XIRR on the lot purchase/sale. In absolute terms, the profit wasn't huge, maybe 40K. But my money was only at risk for 7-ish months. And in terms of hours spent to complete this portion of it, it was minimal, maybe 50 hrs.

If I count the HELOC financing on the lot as my money, then the XIRR is 10.7%. If I do the XIRR on just my money and exclude the borrowed money, the XIRR is 1,918%.

The calcs include all expenses and GST, but not income taxes and is just for my portion of the expenses and profits. As an hourly rate, that would be close to $400/hr which is about what I was hoping to target.

If I was to have done it all myself with no partner, and used just my own money (nothing borrowed), the XIRR would be around 17%. I don't think that's high enough for the risk involved, however the real value add in a project like this isn't the lot split, it's the house build. So it will be interesting to see how it changes at the end of the project.


----------



## nobleea

Finally got my wife's pension buy back offer. $11,950 to buy back about 0.6 yrs of service from maternity leave. We'll go ahead and do it. She has an old RRSP from before my time with about $2750 in it that we can use as partial payment. It's from a high priced active management company. Get this - the annualized return from inception (about 12 yrs ago) is -1.11%. Brutal. If it had just been in a couch potato portfolio, she'd have $5250 instead of $2750.

That means we'll need to come up with another 9K cash. She has the RRSP contribution room, which I assume is important for a pension adjustment. I also assume that any new cash added will come out as a bit of a tax refund next year as an additional pension adjustment though I don't know if we have the option of deferring the deduction to another year as her income for 2017 will be low due to maternity leave. If the pension adjustment has to hit 2017 taxes, maybe it's better to wait a year and request a new value in 2018. Any increases in interest rates would likely drop the buyback amount though the extra year closer to retirement would increase the buyback. I wonder if there's an easy way to model that.

_Edit: After looking at the numbers, perhaps the buyback doesn't make sense. Investment of $11,950 gets an additional $752 of annual pension income, starting at age 56 (20yrs from now). Living to age 90, the math says that's about 3.3% return. Even a conservative couch potato portfolio of 70% bonds would blow that out of the water over a 20-50yr time span._


----------



## nobleea

*November 2017 Update*

As mentioned above, we got the pension buyback offer for my wife's maternity leave. Even though it works out to about 3.3% return, a fully funded public pension is never a bad idea. We will likely go ahead with the buy back before the end of the year.

Had another nice bump in my work RRSP which is a result of our company stock doing well again and the overall market.

On our infill project, the lot sale should close end of this month. We received our permits from the city so they are starting excavation this week. We continue to get good sales leads from the website I set up. In fact, we had one family over to our house this weekend. Our house acts as a bit of a showhome as it was the same designer and developer (me). They've agreed to purchase one of our spec homes, so we'll iron out the details and formalize a contract over the next two weeks. This greatly reduces our risk and gives me confidence that the second home will sell prior to completion as well. Profit is still hard to nail down as who knows what could happen during construction, and I want to leave a reserve available if something pops up that needs to be addressed to keep them happy (due to incomplete communication or expectations), but it will fall between my original range of 50-150K. Once the second home is pre sold we will definitely start the process over again though we can't really get going until the sales close unless I get partner with another friend.

On a more important note, we've started the process to grow our family. Both of our kids were conceived through IVF, so we have started the process for another. It's very technical and quite fascinating. It's also expensive with 10K in services (it's not covered in AB), plus another 5-8K in drugs. At our age, genetic screening is included in the process. I am confident we will be able to welcome our third in 2018, but who knows as it is a complex process. We know at least a dozen friends who have had to go through a similar process. It's very common for professional couples who had university and a growing career. The large credit card amount for this month reflects the bills for this process. Our house was designed for 3-4 kids so that won't be an issue, but we will need a larger vehicle and may need a full time nanny later on if/when my wife continues her career.

We'll blow over the 1 Million mark next update.

*Assets:*

House - $1,130,000 (N/C)
Infill Equity - $106,294
SUV - $17,650 (-0.8%)
Car - $8,860 (-1.7%)
Work DC Pension (mine) - $181,762 (+2.8%)
DB Pension (wife) - $229,000 (+2.2%)
RRSPs - $54,150 (+1.6%)
Non-Reg - $105
House Maintenance Account: $3,769 (+7.5%)
Cash - $4,225
Miscellaneous assets - $13,000 

*Total Assets $1,743,827

Liabilities:*

Mortgage - $735,532 (-0.3%)
Credit cards - $20,385 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $755,917*
*
Net Worth: $987,910 (-0.1%, -$732 month over month, +15.7% year over year, +$134K year over year)*


----------



## scorpion_ca

Congratulations for becoming a millionaire next month. How many months/years would have been taken to reach there?


----------



## nobleea

scorpion_ca said:


> Congratulations for becoming a millionaire next month. How many months/years would have been taken to reach there?


When I graduated Univ in 2001, my net worth was -45K. My wife's would have been 0 (I didn't know her then).
We started tracking our combined net worth when we moved in together in mid 2008. It hit a low point of 136K in May of 2009.
Over the 100 or so months, it's been a fairly linear growth of 110K/yr.
At some point it would be nice to see a bit of an exponential growth kick in, but I don't think that occurs until you have a fairly substantial asset base.


----------



## nobleea

*December 2017 Update*

The lot sale closes this week, so I've assumed that it's done and incorporated that in to the numbers. *We've passed the 1Mil NW mark*. Though nothing has really changed. We have a pending sale on one of the infill houses, just getting the papers signed. I've included a portion of those profits in the infill equity. Not included in any of the values is the amounts set aside for GST and income taxes on this project. I think starting next month I will add a new line item. One for tax accrual on the asset side, and then another for future tax amount on the liability side. It'll be about 40K which won't be due until March-ish. We have a formal GST number - it's just a partnership between me and my wife.

As we go through this process, I am definitely taking notes of things I'd want to try differently. In terms of design, finishes, location, planning, and financing. We're definitely going to be on the lower end of the profit range I had envisioned, though above the high end of the sale price range. With some changes I think we can get well above the mid mark in that profit range (50-150K/house). One thing that is promising, though I'm not surprised with it, is that the sale price we got is almost 10% higher than other spec homes in the neighbourhood that are either finished, or at the same stage and listed. Once the sale is unconditional (this month), I'll send out a note to people who have expressed interest, put up a sold sign on the site poster and see if that pushes anyone else to make a move. The second floor on the houses is being started now and they should be locked up before the end of the month.

I have another business that I am about to start. Should be able to run it part time out of the garage, selling product over the internet. I'll share the website in a couple months when it's all set up and running. It's not a huge risk - I'm confident I can sell everything and break even if it turns out to be a total disaster. Profit could be anywhere from $250-10K a month.

Not much else to report. I've tried to make some more time for hobbies like reading books, working out, and learning guitar. It will take a few months to get in to a habit, but so far so good.

Got out of wedding photography, though I still do family stuff. Mainly too much stress and time commitment. Also, the long days and heavy cameras have caused issues with my wrist. I sold one of my big cameras and bought a small mirrorless set up. I'm hoping I'll be more likely to bring it around with me when going to the park, market, etc with the kids.

At work, they've indicated that raises will start again in the spring and it looks like there will be something of a bonus again, also in the spring. We have not bought back my wife's maternity leave service from her pension yet. Our tenant has indicated she wants to extend her lease in June, and we'll be happy to oblige.

*Assets:*

House - $1,130,000 (N/C)
Infill Equity - $110,000
SUV - $17,500 (-0.8%)
Car - $8,700 (-1.7%)
Work DC Pension (mine) - $184,592 (+1.6%)
DB Pension (wife) - $234,000 (+2.2%)
RRSPs - $54,292 (+0.3%)
Non-Reg - $105
House Maintenance Account: $3,975 (+5.5%)
Cash - $292
Miscellaneous assets - $13,000 

*Total Assets $1,756,489

Liabilities:*

Mortgage - $733,532 (-0.3%)
Credit cards - $18,285 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $751,829*
*
Net Worth: $1,004,660 (+1.7%, -$16.8K month over month, +16.7% year over year, +$144K year over year)*


----------



## milhouse

Congrats on the milestone. 
I'm impressed by your side hustles. I wish I had your drive and inspiration!


----------



## Eclectic12

nobleea said:


> Finally got my wife's pension buy back offer ... $11,950 to buy back about 0.6 yrs of service from maternity leave ... That means we'll need to come up with another 9K cash. She has the RRSP contribution room, which I assume is important for a pension adjustment.


Unless I am missing something ... her RRSP contribution room that already exists makes no difference for the pension adjustment (PA). For that matter, making an RRSP contribution also makes no difference to the PA.

Making pension contributions this tax year generates a PA. It is a factor in the formula to figure out how much RRSP contribution room was earned in the current tax year. Likely the flavour that applies is (18% x current tax year earned income) - PA to a maximum.
http://www.taxtips.ca/rrsp/rrspcontributionlimits.htm

What is available will already have previous year earned income as well as previous year PA's from pension contributions baked in.


The one time I was offered a pension buy back, it wasn't worth it so I am not familiar with the mechanics. From what I recall, I could write a cheque so I am not clear on why contributing to an RRSP then having it transferred to the pension seems to be the plan.




nobleea said:


> I also assume that any new cash added will come out as a bit of a tax refund next year as an additional pension adjustment ...


YMMV ... where one contributes to the RRSP to then transfer to the pension for the service buyback, likely one will wait for the tax return to be filed for the tax refund. Where one cuts a cheque to the employer, the employer likely has the ability to reduce the withholding tax on the income so that one gets the tax refund earlier.

The PA may be larger where one is making regular pension contributions plus does the pension buy back, in the same tax year. Other than being larger so that the earned RRSP contribution room is smaller, the impact will be the following tax year I would think.





nobleea said:


> ... though I don't know if we have the option of deferring the deduction to another year as her income for 2017 will be low due to maternity leave.


If it is a regular RRSP contribution then the deduction can be deferred to any future tax year that makes sense. This assumes that the pension plan allows the buy back to be funded by an RRSP transfer.



Cheers


----------



## nobleea

Eclectic12 said:


> Unless I am missing something ... her RRSP contribution room that already exists makes no difference for the pension adjustment (PA). For that matter, making an RRSP contribution also makes no difference to the PA.
> 
> Making pension contributions this tax year generates a PA. It is a factor in the formula to figure out how much RRSP contribution room was earned in the current tax year. Likely the flavour that applies is (18% x current tax year earned income) - PA to a maximum.
> http://www.taxtips.ca/rrsp/rrspcontributionlimits.htm
> 
> What is available will already have previous year earned income as well as previous year PA's from pension contributions baked in.
> 
> The one time I was offered a pension buy back, it wasn't worth it so I am not familiar with the mechanics. From what I recall, I could write a cheque so I am not clear on why contributing to an RRSP then having it transferred to the pension seems to be the plan.
> 
> YMMV ... where one contributes to the RRSP to then transfer to the pension for the service buyback, likely one will wait for the tax return to be filed for the tax refund. Where one cuts a cheque to the employer, the employer likely has the ability to reduce the withholding tax on the income so that one gets the tax refund earlier.
> 
> The PA may be larger where one is making regular pension contributions plus does the pension buy back, in the same tax year. Other than being larger so that the earned RRSP contribution room is smaller, the impact will be the following tax year I would think.
> 
> If it is a regular RRSP contribution then the deduction can be deferred to any future tax year that makes sense. This assumes that the pension plan allows the buy back to be funded by an RRSP transfer.
> 
> Cheers


I think we're getting wires crossed here. My premise is that PA and RRSP contribution room are essentially synonymous in the eyes of CRA. Making an additional pension contribution to cover maternity leave, when no income was earned, one would need to have RRSP contribution room. The RRSP room would be reduced by the PA the following year. And a tax refund would be available should it be claimed that same year.
There would be no contribution to an RRSP just to transfer to a pension. She does have a small RRSP already which we would look to close and transfer that money to the pension buy back.


----------



## nobleea

*January 2018 Update*

Last month the lot sale to the builder closed. Still haven't signed the sale on the one house - lots of back and forth on details. Part of me wishes that the deal falls apart and we can put this one on the market once finished - it's such a good layout and feels substantially larger than anything on the market. I think we might net more. But now's not the time to get greedy. A profitable sale is a good sale, especially for a first try. Our balance sheet is essentially clean, so we can start looking at another property soon. This includes buying a tear down and splitting it again, buying an already split lot ready to go, or perhaps even a builder that already has lot inventory available. With how long it takes to get permits, and then actually build a house, you're looking at 9-10 months lead time and that's not including any lot split work.
The current houses are just about finished all rough ins, windows are in. They'll be insulating and drywalling this month and working the siding.

Still haven't started business 2 (or 3?). Just working out some details on the product. I'll share the website in a couple months when it's all set up and running. It's not a huge risk - I'm confident I can sell everything and break even if it turns out to be a total disaster. Profit could be anywhere from $250-10K a month.

The non-registered account has our proceeds from the lot sale, plus the monies for tax accruals. It's just in a HISA until its needed again.

We spent a weekend in Jasper which was enjoyable - got a bit of skiing in. Then spent a week in Ottawa with my family for Christmas. 2018 should be a little pricier for travel. My wife's been putting the bug in everyone's ear about a group/family trip to the caribbean for New Years, which would be our 10yr anniversary. Additionally, my 40th birthday is in May, and we're planning a group trip to Vegas to fly planes, race cars, go to shows, and whatever else we can fit in.

I have been using my smaller mirrorless camera more often than I would have used my big camera. Taking it out skating, to the park, etc. Got put on a couple sub lists for hockey again and actually played a game (first in 3 years since I broke an ankle). Volleyball starts up next week. I've tried to get some physical excercise in each day, but it's tough. Always seem so tired after 9p - I just need to get in to a routine for a few weeks and then it should stick. We're also going to try and do a better job of meal planning or at least deciding who's cooking on what day.

*Assets:*

House - $1,130,000 (N/C)
Infill Equity - $31,196
SUV - $17,350 (-0.8%)
Car - $8,600 (-1.7%)
Work DC Pension (mine) - $186,739 (+1.2%)
DB Pension (wife) - $239,000 (+2.2%)
RRSPs - $54,493 (+0.4%)
Non-Reg - $99,105
House Maintenance Account: $3,993 (+0.5%)
Cash - $2,738
Miscellaneous assets - $13,000 

*Total Assets $1,786,247

Liabilities:*

Mortgage - $731,603 (-0.3%)
Credit cards - $8,089 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
Infill Tax Liabilities - $39,250 (new)
*
Total Liabilities $778,942*
*
Net Worth: $1,007,305 (+0.3%, +$2.6K month over month, +12.4% year over year, +$111K year over year)*


----------



## nobleea

*February 2018 Update*

Interesting month. Big hit to the net worth, but that is driven exclusively by the markets taking a hit and even more so by an update to my wife's DB pension. I indicated that I would use the commuted value/termination benefit of her pension when listing it in the net worth statement. I got an update from last Aug (finally - they're very slow) and it was significantly less than I had on the books. This is primarily driven by the increase in interest rates as that has a huge impact on commuted value. It sucks to see that drop, but I can't change the measurement technique simply because I don't like the answer it's giving me. The other big hit was from the markets, as I mentioned. RRSP dropped by about 5K, when I was planning on it going up 15K.

Speaking about the RRSP, I contributed an additional 2K to it to help reduce my taxes owing for last year. I have about 15K in cash in there now, so hopefully this market swoon continues a bit longer. I purchased a copy of UFile and ran through estimates in the first half of January. I was very close on everything - maybe a bit too conservative, so that worked in our favour. Obviously I don't have the full slips for everything, but I can get a darn accurate estimate by going through transaction details and the last paycheques of the year.

On the infills, the one house is essentially unconditional - they were just getting a financing appraisal done tomorrow. The other one hasn't sold. We have a fair amount of interest, but I think we'll stop marketing it for the time being until it's essentially done. Any buyer now would want to make changes which would screw up the schedule and hit costs indirectly and directly. The unsold house will probably be complete and on MLS by end of March. We did have an issue with one subcontractor (electrician) - they went out of business. Unfortunately the next lowest bid was quite a bit higher (1K on one house, 7K on the other) so that's going to deliver a hit to the profit. But that's the risk you take. I've completed plans on two more homes that I will get quoted soon. I don't have a lot purchased for them, but I would rather get a firm price on the house as the lot price doesn't have a lot of opacity to it. We'll likely just do one house and then sell the other lot once it's split. I can carry and finance one house by myself easy enough.

Still haven't started business 2. Just working out some details on the product. I'll share the website in a couple months when it's all set up and running. Profit could be anywhere from $250-10K a month. If it doesn't work, I lose a few grand.

The non-registered account has our proceeds from the lot sale, plus the monies for tax accruals. It's just in a HISA until its needed again.

We have some trips planned and booked for the year. A weekend in Jasper for some skiing with friends. A week in Revelstoke for some skiing with other friends. A trip to Shuswaps and the island for family things. A long weekend in Vegas for my 40th birthday.

Our kids' RESP's have passed a combined 21K. Around this time next year there will probably be enough in them to justify a switch to a self directed brokerage. Around 30K I think it makes sense.

Going to start putting about 1K a month in to TFSA to get that going again.

We will likely be buying a bigger vehicle for our SUV. Looking at used Pathfinders, Pilots, QX60 and new Atlas and Ascent. The Subaru one would be ideal but I doubt it will be available in time and certainly not with good financing offers. If I had to guess, we'll probably finance a new VW Atlas.

*Assets:*

House - $1,130,000 (N/C)
Infill Equity - $37,302
SUV - $17,200 (-0.8%)
Car - $8,440 (-1.7%)
Work DC Pension (mine) - $181,723 (-2.7%)
DB Pension (wife) - $207,500 (-13%)
RRSPs - $55,775 (+2.3%)
Non-Reg - $87550
House Maintenance Account: $4,315 (+8%)
Cash - $9,065
Miscellaneous assets - $13,000 

*Total Assets $1,751,958

Liabilities:*

Mortgage - $729,658 (-0.3%)
Credit cards - $10,300 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
Infill Tax Liabilities - $28,492 (new)
*
Total Liabilities $768,450*
*
Net Worth: $983,508 (-2.4%, -$23.8K month over month, +8.6% year over year, +$78K year over year)*


----------



## BigMonkey

Congrats on the milestone! Even though you dipped back below the million dollar status due to market correction. I think it will be a matter of time until you reach it again!


----------



## nobleea

*March 2018 Update*

Rebound in the markets and drop in the CAD$ had a nice impact on my RRSP. But in the long run it's just noise.

At work, we were notified (unexpectedly) that we will be receiving the full amount of our bonuses. For me, that's 20%, so a big, unplanned cash inflow, which is always a nice thing. It will probably be ~$14K after taxes, showing up in a couple months.

On our infills, one house is unconditionally sold. The other will be put on the market/MLS in a month - they are putting in the flooring right now. I've started getting pricing back on a new potential home and the numbers look like it could work at a much lower sell price which might be an easier sell in this market. I also sent out some feeler letters to a few potential lots I'm interested in, and one got back to me expressing interest. We'll see where that actually goes.

Still haven't started business 2. I'll share the website in a couple months when it's all set up and running. Profit could be anywhere from $250-10K a month. If it doesn't work, I lose a few grand. We did set up a corporation to handle this business and the infill. An accounting firm took care of everything and it was surprisingly fast and easy.

The non-registered account has our proceeds from the lot sale, plus the monies for tax accruals. It's just in a HISA until its needed again.

Our kids' RESP's have passed a combined 22K. Around this time next year there will probably be enough in them to justify a switch to a self directed brokerage. Around 30K I think it makes sense. The RESP's are not included in the Net Worth numbers.

The plan is to start putting about 1K a month in to TFSA in April, going forward.

Still looking at buying a larger vehicle. Will probably pull the trigger in May or June.

*Assets:*

House - $1,130,000 (N/C)
Infill Equity - $44,500
SUV - $17,050 (-0.8%)
Car - $8,280 (-1.7%)
Work DC Pension (mine) - $188,251 (+3.6%)
DB Pension (wife) - $210,500 (+1.5%)
RRSPs - $56,188 (+0.8%)
Non-Reg - $87550
House Maintenance Account: $4,374 (+1.4%)
Cash - $6,951
Miscellaneous assets - $13,000 

*Total Assets $1,763,692

Liabilities:*

Mortgage - $727,554 (-0.3%)
Credit cards - $12,402 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
Infill Tax Liabilities - $28,492
*
Total Liabilities $768,448*
*
Net Worth: $995,244 (+1.2%, +$11.7K month over month, +8.4% year over year, +$77K year over year)*


----------



## mycheaperenergy

Your financial report is inspiring for beginners, it just shows how perseverance pays off at the end of the day. Congrats


----------



## nobleea

*April 2018 Update*

Our cash bonus showed up today, which was nice to see in the bank account. Also got word that we're finally going to be getting raises again, I think it's been 3 or 4 years since the last one. Small, like 2%, but at least it's something. Taxes are all done, wife got back $1300 and I had to pay $6400, as well as $23K in GST remits.

Asset write-down on one of the vehicles after checking going rates on it.

Everything is chugging along on the infills. I am going to try hard to get the word out on the unsold one this month as I really don't want to pay $25K in realtor fees. We'll decide whether it should be staged once done. Regardless, if there's no action it will go on MLS later this month or early next. My unsolicited offer to buy tear downs almost worked a third time. An owner got back to me, we chatted back and forth a bit, I sent in a formal offer. They decided to go a different route, which is unfortunate as that would have been profitable just as a lot split and sell.

The non-registered account has our proceeds from the lot sale, just in an HISA for now. Started the TFSA contributions up again, $1K a month to start off with.

Still looking at buying a larger vehicle. Will probably pull the trigger in May or June. They're clearing out CX-9's at pretty good prices, so that might be something to look at.

We passed the 1Mil mark (again). Should be able to stay above it unless the markets get really crazy with all this trade war stuff. I am hoping/planning that we can pass 1.1M before the end of 2018.

*Assets:*

House - $1,130,000 (N/C)
Infill Equity - $52,350
SUV - $14,750 (-13.5%)
Car - $8,250 (-0.4%)
Work DC Pension (mine) - $185,515 (-1.5%)
DB Pension (wife) - $211,500 (+0.4%)
RRSPs - $54,892 (-2.3%)
Non-Reg - $59,226
House Maintenance Account: $4,519 (+3.3%)
TFSA: $1,003
Corporate Account/Value/Inventory: $1,000 (new)
Cash - $13,196
Miscellaneous assets - $13,000 

*Total Assets $1,749,201

Liabilities:*

Mortgage - $725,600 (-0.3%)
Credit cards - $14,824 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $740,424*
*
Net Worth: $1,008,777 (+1.4%, +$13.5K month over month, +7.0% year over year, +$66K year over year)*


----------



## nobleea

nobleea said:


> *April 2018 Update*
> Everything is chugging along on the infills. I am going to try hard to get the word out on the unsold one this month as I really don't want to pay $25K in realtor fees. We'll decide whether it should be staged once done. Regardless, if there's no action it will go on MLS later this month or early next. My unsolicited offer to buy tear downs almost worked a third time. An owner got back to me, we chatted back and forth a bit, I sent in a formal offer. They decided to go a different route, which is unfortunate as that would have been profitable just as a lot split and sell.


We managed to sell our second infill before listing it on MLS. It was through a realtor, but they came direct to us, so only had to pay half the commissions. So we were able to sell both our houses, prior to completion, at prices 5-10% higher than comparables in the neighbourhood. I would like to think that design had something to do with that. Unfortunately, our costs to build were higher than expected, which means our profit was substantially less than what I was aiming for. Half as much. It's a good learning experience and I know what I'd do differently. I have been keeping track of my time - it's between 350-400 hrs.

A tear down did come up on kijiji one block away from our current project, so I jumped on it and we close in 6 weeks. The purchase agreement allows me to start the lot splitting process prior to close, so that's already been started. The split may even be conditionally approved prior to close, which would be grand. I am going to see what kind of numbers I can get just selling the bare lots, as that would be much simpler, faster, and far less risky. I do like designing and building the houses, so I may put both options on the market (bare lots for a builder, pre-sale house for a buyer) and see what happens. Mortgage has already been approved on the purchase (80% LTV as a rental). This is the fifth house in a row that I have not engaged the services of a realtor to buy or sell. I do have a realtor friend that is submitting offers for me on MLS properties - I think we put out 3 last month, one with some back and forths but couldn't close the gap on price.


----------



## nobleea

*May 2018 Update*

Several updates. I had restricted stock that was given as a bonus several years ago. It was fully vested this month, so I sold it and cashed it out. Found out we were finally getting a raise after several years of nothing. It's a small amount, but it's something.

One of the infills is essentially done with only the detached garage and landscaping to finish. The other is 99% done. One closes in two weeks, the other in 6 weeks. As mentioned earlier, I did purchase another tear down property one block from our current project. The plan right now is to split the lot, sell one of the lots, and build a spec to sell on the other lot. But, I would be fine selling both lots to a builder if the price is right, or selling one of the lots to a partner and building specs on both of them. We close in a month, which is going to make cash flow very tight and awkward until the second current house closes 2 weeks later. We were able to get a full 80% LTV mortgage on this one so that makes things a bit easier.

We test drove a bunch of vehicles. CX-9, Pilot, Atlas, Explorer. Atlas was far and away the winner. Unfortunately, there are no used copies available, so it will have to be new. We might wait until later in June so we can take a look at the Subaru Ascent (new 7 pass) which should be out by then.

The reason we'll be needing a larger vehicle is because we are expecting our third child in October!

This is my last update in my thirties. We are off to Vegas next weekend to celebrate.

*Assets:*

House - $1,130,000 (N/C)
Infill Equity - $78,028
SUV - $14,600 (-13.5%)
Car - $8,090 (-0.4%)
Work DC Pension (mine) - $191,957 (+3.5%)
DB Pension (wife) - $214,000 (+1.2%)
RRSPs - $56,806 (+3.3%)
Non-Reg - $39,226
House Maintenance Account: $4,844 (+7.2%)
TFSA: $1,122
Corporate Account/Value/Inventory: $1,000
Cash - $3,790
Miscellaneous assets - $13,000 

*Total Assets $1,756,463

Liabilities:*

Mortgage - $723,591 (-0.3%)
Credit cards - $9,507 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $733,098*
*
Net Worth: $1,023,365 (+1.5%, +$14.6K month over month, +8.1% year over year, +$77K year over year)*


----------



## nobleea

*June 2018 Update*

Still waiting on one of the infills to close (problem with the occupancy permit). Other closes early July. Plus we have a lot purchase closing next week, so pretty hectic the next 6 weeks for cash flow. Everything seems to be sorted out, but who knows. We have to buy a new vehicle this month as well. We'll need a bigger one when #3 arrives in October, but we also need something to tow the family boat to the lake this summer. Usually the inlaws do it, but they bought a trailer RV, so they can't tow anymore. I looked at renting a tow vehicle, but that is not a cheap option and since we need something bigger this year anyways, might as well bite the bullet and get one now. With all this infill and buying, we don't have the financial flexibility to buy used, and the vehicle we want is not available used yet, so we have to finance new. Unfortunate, but I don't think you can look at it in isolation. I'm ok with paying some interest on a car loan if it means we have the cash to finance business ventures which make orders of magnitude more than the interest paid.

Turned 40. We went to Vegas with some friends. Haven't been in 7 years. Did the aerial combat thing where you fly a plane in a simulated combat - always wanted to do this. Took a few supercars out on the racetrack (Huracan, 488GTB, 911 GT3 RS) - I would do that all day, every day if I could. We all agreed it was the highlight. Had some good food, lots of pool time, watched some shows, even got to catch a bit of the Golden Knights game with Jets (outside). And no kids. Pretty fun weekend. Also pretty expensive, but I'm a firm believer in having unique, fun experiences with friends.

Ever since I graduated almost 20 yrs ago, my goal was networth of 500K by 35 and 1M by 40. I hit them both and need some new long term goals. Maybe an 8-figure Net Worth before 65?

Have all my initial inventory for the small business start up. Just need to take some pics and get the website together.

*Assets:*

House - $1,130,000 (N/C)
Infill Equity - $80,571
SUV - $14,450 (-13.5%)
Car - $7,930 (-0.4%)
Work DC Pension (mine) - $196,737 (+2.5%)
DB Pension (wife) - $216,500 (+1.1%)
RRSPs - $57,850 (+1.8%)
Non-Reg - $0
House Maintenance Account: $4,845 (N/C)
TFSA: $1,185
Corporate Account/Value/Inventory: $6,000
Cash - $39,827
Miscellaneous assets - $13,000 

*Total Assets $1,768,995

Liabilities:*

Mortgage - $721,626 (-0.3%)
Credit cards - $14,500 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
*
Total Liabilities $736,126*
*
Net Worth: $1,032,869 (+0.9%, +$9.5K month over month, +8.6% year over year, +$82K year over year)*


----------



## nobleea

*August 2018 Update*

I missed a July update, and we've been pretty busy overall. Our first two infills are sold. I still have about $25K coming back to me from the builder. Our second property closed and we are getting ready to knock to house down in Sept. I have one of the split lots listed to see if there's any interest. I'd be ok selling one of the split lots. But if not, I'll build on both. Ended up selling my car and leasing a truck. Allows us to tow the boat no problem, room for 3 car seats in the back. Way better for hauling supplies around for the infill work, which I do. Fuel mileage is almost the same as the car and even better than the 7seat SUV's we were looking at. Got 26-30mpg on the hwy on our recent road trip through BC, which is outstanding for a full size truck. The boat ended up being given to us. On the car sale, I sold it for almost exactly the depreciated amount I had in the balance sheet, maybe $75 more. I think this system works well for depreciating assets like cars.

Wife will be starting her maternity leave/STD sometime in late September which is pretty darn soon now that I think about it. Baby is due mid October. On the kid front, our two kids family RESP is worth just over $26K now (combined). It's not included in our NW balance sheet. In January or Feb next year, we'll transfer it over to Questrade and go with the VGRO all in one ETF plus some stocks on the side.

The small business I mentioned is now up and running. I need to add a few more sample photos to the website. www.mdrn.house Had a few sales already, but haven't really gone crazy on advertising yet. I've been real impressed with the Shopify platform that makes up the website backend. Slick and easy to use.

*Assets:*

House - $1,130,000 (N/C)
Infill Property - $505,000
SUV - $14,150 (-2.1%)
Work DC Pension (mine) - $198,096 (+0.7%)
DB Pension (wife) - $219,000 (+1.8%)
RRSPs - $51,866 (-10%)
Non-Reg - $0
House Maintenance Account: $725
TFSA: $0
Corporate Account/Value/Inventory: $8,500
Cash - $1,794
Miscellaneous assets - $16,000 

*Total Assets $2,145,132

Liabilities:*

Mortgage - $717,639 (-0.6%)
Credit cards - $5,735 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
Infill Mortgage - $342,034
PLOC - $24,088
*
Total Liabilities $1,089,496*
*
Net Worth: $1,055,636 (+2.5%, +$25.8K month over month, +10.5% year over year, +$100K year over year)*


----------



## Eclectic12

nobleea said:


> *August 2018 Update*
> ... *Total Assets $1,768,995 ...
> ... Total Liabilities $1,089,496 ... *
> 
> *
> Net Worth: $1,055,636* ...


I seem to be missing something as subtracting the totals for liabilities from the total for assets gives a net worth of $679,499.
Taking out the CC liability that is always paid off will improve it a bit but not substantially.

The large liability increase versus the June update seems to be the Infill Mortgage as well as the PLOC. The Infill Mortgage seems to be accounted for by the Infill Property asset but PLOC does not seem to be (which may or may not be accurate).


Cheers

*PS*
I'm not sure what to make of some of the percentages in the asset section. For example, "DB Pension (wife)" shows a larger number in August but has a negative percentage while the "RRSPs" has a lower number with a positive percentage.


----------



## nobleea

Eclectic12 said:


> I seem to be missing something as subtracting the totals for liabilities from the total for assets gives a net worth of $679,499.
> Taking out the CC liability that is always paid off will improve it a bit but not substantially.
> 
> The large liability increase versus the June update seems to be the Infill Mortgage as well as the PLOC. The Infill Mortgage seems to be accounted for by the Infill Property asset but PLOC does not seem to be (which may or may not be accurate).
> 
> 
> Cheers
> 
> *PS*
> I'm not sure what to make of some of the percentages in the asset section. For example, "DB Pension (wife)" shows a larger number in August but has a negative percentage while the "RRSPs" has a lower number with a positive percentage.


You're right. I've edited it. The Assets number was incorrect. Previously, I've shown just the equity amount of the infill, rather than the nitty gritty asset and liabilities. It's been switched for full disclosure.
The percentages were input in to the wrong assets. They've been switched around now.


----------



## nobleea

*October 2018 Update*

Guess I'm doing an update every other month from now on. Not much to report. Still waiting on baby 3 to show up - likely some time next week or the week after. Wife has been on leave for the past few weeks. EI will start later this month. We will be doing the regular 12 months, rather than the extended 18 months they have on offer now. She's going to be doing something like 14 months or leave, so we get more money by taking the full amount for 12mo then nothing for the remaining, vs the 18 month payout option which just takes the regular 12month payments and averages it over the extended time period. There was a seat sale to Hawaii, so we booked that for Feb which is something we've done after every new baby. Grandparents from both side and my sister and her fam will also be there. High CC amount for this month reflects airline tickets and one VRBO booking.

On the infill side, looks like we're going to go ahead with house 3 - the builder will be taking the other split lot for themselves. I am projecting a profit of between 6 and 59K, depending on how weather goes, whether it sells fast, whether a realtor is required, etc etc. Again, I do this because I love designing houses. I don't need the money and if I didn't make any, I'd be ok with that. Learned a lot the first time and will see if I can increase the profit from the first time from those learnings.

The small business I mentioned is now up and running. It's been really interesting learning about online marketing, inventory management, what sells, what doesn't, etc. I've had sales multiple sales from 6 provinces and a couple states - advertising has only been focused on Canada. Knowing the size of the market, and my pricing vs other options out there, it's been fun trying to figure out the optimal advertising spend for decent returns. My original estimate for profit was $250 to up to 10K/month. I'm already above the bottom end of the range. I would think 2-3K is a reasonable upper end now. It's an easy setup - I haven't had to deal with one customer at all and I print my canada post labels at home so there's no waiting in line to ship either. I'll let it run for a year and see what happens.

*Assets:*

House - $1,130,000
Infill Property - $484,000
SUV - $13,850
Work DC Pension (mine) - $197,467
DB Pension (wife) - $220,500
RRSPs - $48,712
Non-Reg - $0
House Maintenance Account: $726
TFSA: $0
Corporate Account/Value/Inventory: $16,000
Cash - $3,925
Miscellaneous assets - $16,000 

*Total Assets $2,133,930

Liabilities:*

Mortgage - $713,633
Credit cards - $8,593 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
Infill Mortgage - $341,302
PLOC - $6,650
*
Total Liabilities $1,070,178*
*
Net Worth: $1,063,752 (+0.8%, +$8.1K, +7.6% year over year, +$75K year over year)*


----------



## nobleea

Haven't got time to update the NW at the moment. It's probably a little under where it was last update thanks to the markets.

We welcomed baby 3 in October. He has an RESP already with about 2K in it. The three RESPs combined are at 32K, so I'll be transferring over to Questrade for free to buy ETF's and the ability to buy individual stocks.

Infill is at an important point right now. Permits are approved and it's ready to start, but there's inklings that the market has dropped a bit. Might pull the chute before starting and just sell it as a bare lot, which gives more options to a purchaser.

We had almost 3 weeks in Maui and Kauai, which was nice. Kauai would be better to return to later in the year and when kids are old enough to do a lot more excursions.
We'll be heading to Scotland for a wedding in July. Likely just with the baby and the older kids can stay with the grandparents. We'll probably add on Ireland or Spain to the trip.

My work decided to re-institute furloughs for the next quarter, which is a 10% pay dock and 1 unpaid day off every paycheque. I was kind of hoping they would as I've gotten used to the extra time off (they added a bonus day this year, so it's 7 extra days off this year). They suspended the matching RRSP funds, again for the quarter. But oddly enough, they paid out our bonus from 2018 (which ended up being about 7%). And then decided to guarantee our bonus for 2019 AND pay it out quarterly, rather than wait til Mar 2020. So the first 5% bonus gets paid mid April and another 5% bonus every 3 months afterwards. I can't complain.

I am taking on a different role at work (same pay), which I'm excited about. Less engineering, more customer focus. It'd be great foundation work and connections if I was to ever, say, go alone and start consulting. Which is not the plan anytime soon.

But things aren't so rosy out here in general. I've had friends start to get pink slips. There's always been a bit of insurance against that working in engineering, but the downturn, especially in Canada, has gone on long enough that it's inevitable. We're laying off some in our group as well. I think I'm pretty secure, but I'd say it's not a 0% chance of getting laid off. Between 5-10% at the moment I'd guess.


----------



## scorpion_ca

What is your plan B if you get pink slip suddenly?


----------



## nobleea

scorpion_ca said:


> What is your plan B if you get pink slip suddenly?


For the short term, nothing. I've been with the company for almost 20 years, and payouts for professionals in our company and industry has been between 3.3-4 weeks per year of service. That'd be somewhere between 150-200K. Without doing anything, I think we could stretch it to 2 years.

I would likely start consulting. I have some pretty specific knowledge that is not common among producers and has global appeal. Or start a manufacturing business related to the same field I'm in now. Honestly, the prospect of getting laid off causes me no concern. It's a low risk now, and even if it was high, I'd be thankful for the impetus to start something on my own. I'd be chomping at the bit to get started.


----------



## nobleea

*June 2019 Update*

Nothing crazy on the family front. We've adjusted to 3 kids and are doing alright on a single salary, even on furlough. My wife has signed up to teach summer school for a couple weeks in June. It's good money, but we forgo EI during that time period, and have to pay for childcare for 3. But she's looking forward to teaching again, and staying on the list for summer school gigs is important. On the work front, we did get news of a small raise. Basically cost of living, but that's better than nothing. Our company went in to creditor protection earlier this year, which sounds like bankruptcy, but isn't. Sounds like it's proceeding well (it's not a CAD company) and they should emerge in a couple months with much reduced debt. The common shares are getting wiped out and replaced with new shares 99% owned by bond holders. They kept 1% of the new shares for old shareholders, which was nice of them. Stock is currently trading OTC at 5c. The all time high was around $50 just before the 2008 crash. It was $3.50 a year ago. There's been some more layoffs, both below and above me, but I am still not concerned. For now. A close friend who was laid off from a competitor recently found it quite easy to get a new job in town. Completely unrelated industry (from Drilling to Cannabis extraction).

We have a trip to Europe in July for a wedding (Spain, Scotland) though we're only bringing the baby. The older kids get to stay with the grandparents. A few camping trips around AB and BC also planned. Probably will do an all inclusive type thing in Dec or Jan before my wife goes back to work. Being a teacher there's only a couple times a year that she could do one of those trips and the prices are insane. Once my wife goes back full time in Feb, we'll probably have to look at getting a nanny as that's likely the most cost effective. Oldest will be in half day kindergarten at that point.

For the infill, some big changes. We were just about to start construction in Feb (one spec house for me, one spec house for the builder partner), and a last chance review of current sales indicated things were not going to be favourable. Sale prices, especially these infills, have dropped enough that a profit is not guaranteed. So we cancelled the build project, even with full permits in hand. I've had the lot on and off the market since then and there's been a couple offers and counters, but nothing finalized. At the moment, we are looking at doing a single home on the lot, rather than two homes. Pricing on these larger homes has not really changed, though they do take a bit longer to sell. A couple realtors have put together packages which suggest a sell price of 1.175-1.3M based on comps and size. That would result in a profit of 50-175K after all GST, realtor fees, costs, etc. The challenge is getting the financing, or more specifically, the downpayment required. I'm short about 50-60K at the moment.

The small business I've been running from the garage over the web is going alright. I've found out there is a strong seasonality trend with winter being the slowest. Some months in the summer and fall see a net income of a couple K, which is great. If I could average around 1K in profit a month, I'd be pretty happy with that given how little time it takes to do that. Around 5-7 hours a month. I've also had a couple different people ask me if I could design a garage suite for them - so maybe that will turn in to another little side business. Still doing photography on the side and that brings in an average of $1000 a month, maybe a little less than that these days. The tenant in our garage suite just re-signed another year lease, this will be her third year and it's working out perfectly.

*Assets:*

House - $1,130,000
Infill Property - $475,000
Work DC Pension (mine) - $208,375
DB Pension (wife) - $230,000
RRSPs - $45,869
Non-Reg - $0
TFSA: $0
Corporate Account/Value/Inventory: $10,500
Cash - $907
Miscellaneous assets - $16,000 

*Total Assets $2,133,930

Liabilities:*

Mortgage - $697,386
Credit cards - $3,425 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
Infill Mortgage - $338,786
PLOC - $24,300
*
Total Liabilities $1,063,897*
*
Net Worth: $1,055,155 (+2.2% year over year, +$22K year over year)*


----------



## scorpion_ca

Will it affect your DC pension plan if the company become insolvent?


----------



## nobleea

scorpion_ca said:


> Will it affect your DC pension plan if the company become insolvent?


No, it's with Sunlife. It's an RRSP so they have no control over it.


----------



## coolbeans

Hey nobleea,

We just gave our nanny 2 months notice as my youngest is going into grade 1, so we’re switching to before & after school daycare. We’ve had her with us for 4 years and she’s amazing. DM me if you’re interested. Timing and any number of other factors might not work, but she’s been part of our family and would love to pass her information along.


----------



## nobleea

*September 2019 Update*

Been a few months since I've updated, end of summer seems like an appropriate time. Mind you, we didn't really get a summer over here - lots of rain. Thankfully, we did get to enjoy some sun. Spent 10 days in Spain/Scotland/Ireland with the baby as we headed out there for a wedding. Wedding was in Scotland, but we opted to add 5 days of Spain to the itinerary and it was a fantastic decision. We stayed in Llafranc on the costa brava and day tripped to the smaller towns of Sa Tuna, Palafrugell, and our favourite Tamariu. Dublin was awesome too. Then we spent 10 days in the Shuswap area of BC, as we do every year. We are likely going to add an all inclusive trip in late Nov or early Dec with some friends, as both wives are teachers on Mat leave and this will be the only year we can travel outside of the expensive school breaks. There is also talk of me having to go to Australia for work for a few weeks sometime in the next year. Ideally it would be before my wife goes back to work in Feb so the family can tag along on the trip.

We love our family of 3 kids. Youngest is 11months old now and the oldest started kindergarten. My wife managed to get 2 weeks of summer school in, which was a nice cash bonus, even after day care and loss of some EI. The EI finishes in 6 weeks and then it'll truly be 1 salary for a few months until the end of Feb. We will start looking for a nanny to start in Jan. With 3 kids, a live-out nanny makes sense. I think it will be around 2400/mo. 

At work, things are fine even though we are going through bankruptcy proceedings. They are aiming to exit as a new company in December. Haven't really noticed anything in our day to day motions other than an emphasis on making sure assets and inventory are correct or written off prior to exiting. I would say late 2020 or in 2021, the risk of me getting laid off increases a bit. Not from company financials, more from not really having work for me to do. I don't worry about it, in fact I'm sort of looking forward to it. There's a few things I could do at the company, but I am quite an expensive resource and they don't yet have a formal position that truly uses all my skills and assets. I've been here 18years, so a severance package would be nice and it would allow me some seed money to start something new. Getting laid off is not a high risk, but it is higher now. I'd say 30% chance starting mid 2020 unless something changes.

Infill we decided to exit the property as the market is not looking hot right now. Listed it with a realtor and sold it. Just closed last week. I think the new buyer intends on doing a couple skinnies, so it'll be interesting to see how successful it is. Definitely lost money on this one. I'd say we're about break even on the whole infill venture. Just fine with me - I wanted to try it out and see if we could make money. I know what's required now, and learned a few things. It's something I still really would like to do, but I don't see us taking another stab at it for a couple years.

I have a small web business which is doing alright. I've been averaging 1500-2K in sales every month with maybe 30-35% net income. Not a lot, but again, only takes 5-8 hours a month. Photography also continues as a side job with around $5K in income this year. I still enjoy it, but I get fewer and fewer new clients - it's all return clients. I did some quick calcs earlier this year - I've had over 1500 clients over the past 10 years, which kind of floored me.

Not listed on this update is our kids' RESPs. It's a family plan with a combined balance of $38,500. We contribute just over 10K a year to it right now. It was just moved over to Questrade to take advantage of the free ETF purchases and will be moving to mostly VGRO or similar. Our oldest is 5.5 so we have a ways to go yet.

*Assets:*

House - $1,130,000
Work DC Pension (mine) - $217,162
DB Pension (wife) - $230,000
RRSPs - $48,337
Non-Reg - $0
TFSA: $1,617
Corporate Account/Value/Inventory: $12,000
Cash - $39,795
Miscellaneous assets - $16,000 

*Total Assets $1,707,682

Liabilities:*

Mortgage - $690,702
Credit cards - $4,355 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
*
Total Liabilities $695,057*
*
Net Worth: $1,012,625 (-4.3% year over year, -$45K year over year)*


----------



## nobleea

*November 2019 Update*

Not a whole lot going on the last few months. Work, back in to the swing of things with school. Still working on the search for a nanny that we'll need in early January. We did book a Mexico AI trip for January with another family. It will be one of the last times we can travel out of normal school breaks due to kids in school and my wife and her friend both being teachers. Also booked a trip to Vegas for myself and some friends. Flights are so cheap now with Swoop. Under $300 for direct flights and strip hotels for a weekend.

No crazy changes at work. Company is still looking to exit bankruptcy proceedings before the end of the year and should be leaner with very little debt. I look forward to actually making money again. I've thought about starting on a layoff plan. If it were to ever happen, it'd be nice to have a plan of action already complete as to what to focus on first, longer term things, etc. I still say it's about a 30% chance for 2020. Maybe a little higher in 2021.

Nothing going on for infills. We're all out now and no plans or money to get back in in the next 2 years. Our mortgage is up for renewal in 2021, would be nice to focus on that for a bit. We signed up for some more life insurance. Term 15 joint first to die I believe. With that, we should be fully covered for the time being. Might have to revisit if I lose my job. Also got a proper will done up with a lawyer. We will likely be finishing our basement in the spring. Will pay someone to do it, quotes are around 42K which is about what I was expecting.

We put a fair amount in to the RRSPs this season. Might do a little more. Many benefits doing it this tax year. I'll have a high income due to two annual bonus payouts this year. Plus the wife has very low income due to mat leave which has a positive impact on our child benefit cheques (since it's based on family income). The RRSP contributions plus some tax installment payments the CRA required of me means there will be a large tax refund in the spring (8-10K).

Not listed on this update is our kids' RESPs. It's a family plan with a combined balance of $42,600, it's growing nicely now. Mostly VGRO with some individual stocks, all at Questrade now.

*Assets:*

House - $1,130,000
Work DC Pension (mine) - $226,190
DB Pension (wife) - $230,000
RRSPs - $57,475
Non-Reg - $32,000
TFSA: $17
Corporate Account/Value/Inventory: $13,673
House Maintenance Account: $6,250
Cash - $12,410
Miscellaneous assets - $16,000 

*Total Assets $1,724,015

Liabilities:*

Mortgage - $685,639
Credit cards - $13,198 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
*
Total Liabilities $698,837*
*
Net Worth: $1,025,178 (+15K from last update)*


----------



## milhouse

It's kind of late now that you've booked but just wanted to caution on using Swoop. We flew on Swoop to Vegas too out of Abbotsford/YXX and it was really cheap too: $200-$250 return. However, there have been a few stories about flight cancellations and only being able to get rebooked for a flight leaving a week later or just getting a refund and figuring it out yourself which may include booking an expensive last minute flight on another airline. Being an LCC, there are very limited options offered by Swoop which likely isn't helped by their limited capacity and schedule. Obviously it's kind of luck of the draw but it sure sounds like a PITA if you are unlucky. We were kind of unlucky/lucky in that while we weren't able to land in YXX due to wind shear on our return flight, we ended up landing at YVR. They did offer to pay for own transportation back to YXX though which was only really needed by my friend who drove us there and had to pick up his car. Kind of debatable if we're willing to fly on Swoop again. However, apart from the risk, I didn't mind the flight itself even with all the nickle and diming. 
I love Vegas. Have a fun trip!


----------



## nobleea

milhouse said:


> It's kind of late now that you've booked but just wanted to caution on using Swoop. We flew on Swoop to Vegas too out of Abbotsford/YXX and it was really cheap too: $200-$250 return. However, there have been a few stories about flight cancellations and only being able to get rebooked for a flight leaving a week later or just getting a refund and figuring it out yourself which may include booking an expensive last minute flight on another airline. Being an LCC, there are very limited options offered by Swoop which likely isn't helped by their limited capacity and schedule. Obviously it's kind of luck of the draw but it sure sounds like a PITA if you are unlucky. We were kind of unlucky/lucky in that while we weren't able to land in YXX due to wind shear on our return flight, we ended up landing at YVR. They did offer to pay for own transportation back to YXX though which was only really needed by my friend who drove us there and had to pick up his car. Kind of debatable if we're willing to fly on Swoop again. However, apart from the risk, I didn't mind the flight itself even with all the nickle and diming.
> I love Vegas. Have a fun trip!


Flair is also bad at canceling flights or having ridiculously long delays. But sometimes the risk is worth it. Relatives flew Abbotsford to Edmonton for $8 on Flair. We've used them before with no issues, so it's pretty random.
I've never done swoop before. Hotel was booked as a package through swoop, so if things go south, I'd expect them to work something out on that as well. Westjet and AC Rouge also have direct flights to Vegas, but their cheapest is probably 50-100% more than we paid.


----------



## humble_pie

nobleea said:


> *September 2019 Update*
> 
> I would say late 2020 or in 2021, the risk of me getting laid off increases a bit. Not from company financials, more from not really having work for me to do. I don't worry about it, in fact I'm sort of looking forward to it. There's a few things I could do at the company, but I am quite an expensive resource and they don't yet have a formal position that truly uses all my skills and assets. I've been here 18years, so a severance package would be nice and it would allow me some seed money to start something new. Getting laid off is not a high risk, but it is higher now. I'd say 30% chance starting mid 2020 unless something changes.




congratulations on coping & thriving so well during this period of hardship challenge everywhere (not just in alberta). Resourcefulness such as yours in the face of change is truly an inspiration.


----------



## nobleea

*January 2020 Update*

Pretty quiet Christmas and break. We stayed at home and just putzed around the city. I am single parenting for a week and half while the wife is in Central America for a volunteer thing. Then I fly with kids to Mexico for an all inclusive break. I love traveling and flying, but going through check in and security and getting on a plane with 3 kids under 6 for 6 hrs is going to be a test. We have a nanny now that is working out well. She'll be FT until the end of the month and then move to PT as my wife goes back to work PT off her mat leave. At the start of the new school year in Sept, we'll consider doing FT and the deferred salary program. There's a few options, but it's something like work 3 years, get one year off paid. But all 4 years are only at 75% of your normal salary. There might be a 2yr on, 1yr off program as well at 67% of your salary.

Work continues. Company has exited bankruptcy protection as a new entity. New board, same management, something like 6B less debt. It'll be interesting to see how this year goes. They paid out the remainder of our bonus from 2019. Not expecting a raise this year, but there might be some small amount in May. 2% or something like that. I'd say there is a very high chance we have to go on furlough again for Q2. This is a 10% pay reduction for Apr-Jun with half a day off unpaid a week. We can bank the days and take them when we want. Honestly, I'd be ok if they made that permanent. The extra week and a half of holiday time is something we've all gotten used to.

I bought the latest UFile software and have already filled it out with decent estimates. Looks like the refund at the moment is close to 9K and we will probably contribute another 9K to the RRSP which will bump up the refund by another 40%. Our mortgage is up for renewal in 18 months, our current rate is 2.59%. We might try to take a couple years off the amortization. Hoping to put an additional 15-20K pre payments against the mortgage before renewal time.

Basement development is scheduled to start in mid-April. First we have to empty out the basement, which is completely full of junk and old baby clothes/toys.

Not listed on this update is our kids' RESPs. It's a family plan with a combined balance of $45,600. Mostly VGRO with some individual stocks, all at Questrade now. We contribute about $10.5K/yr which means we will eventually max out the yearly CESG (with 3 kids), but we don't appear to be there yet so there must still be some accumulated CESG room from previous years. If we can hit 100K balance sometime in 2022, we will probably be able to stop contributing and just let growth take over.

*Assets:*

House - $1,130,000
Work DC Pension (mine) - $234,034
DB Pension (wife) - $230,000
RRSPs - $60,154
Non-Reg - $28,500
TFSA: $17
Corporate Account/Value/Inventory: $15,275
House Maintenance Account: $6,222
Cash - $7,801
Miscellaneous assets - $16,000 

*Total Assets $1,728,004

Liabilities:*

Mortgage - $681,095
Credit cards - $6,137 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
*
Total Liabilities $687,232*
*
Net Worth: $1,040,772 (+16K from last update)*


----------



## roman71

*House value*

Do you expect the same value for the house as 3 years ago in Edmonton? Based on what I see, it is not realistic...


----------



## Forebiz

roman71 said:


> Do you expect the same value for the house as 3 years ago in Edmonton? Based on what I see, it is not realistic...


I agree, I use average real estate prices in Edmonton and vary my house value based on that. That being said when you build an infill it's probably really tough to peg an initial value. At one time he said that he figured he could get 1.3 for it back in 2016 so current price of 1.13 is probably still safe.


----------



## nobleea

Forebiz said:


> I agree, I use average real estate prices in Edmonton and vary my house value based on that. That being said when you build an infill it's probably really tough to peg an initial value. At one time he said that he figured he could get 1.3 for it back in 2016 so current price of 1.13 is probably still safe.


Indeed, single lot rebuilds in mature neighbourhoods are almost always owner-driven. That is, they don't make it to the market until that owner sells 10, 20 years down the road. So it's hard to quantify. The city recently assessed it at 845K, they have some errors in the assessment, but I'm not going to correct them. There was a sale last year of a similar sized new build that went for over asking, just a block away. Translating that sale price to our house would put it just over 1.25M. Houses are selling reasonably fast in the neighbourhood and people are still knocking down the small bungalow they've lived in for 10 years to build their larger dream home.
We never know what it's worth until it's sold, but based on similar properties in other hoods, I'd say a selling price could be anywhere from 1.0-1.5M. There really is that much range. The value of our house doesn't give me any stress or concern whatsoever.


----------



## nobleea

nobleea said:


> I'd say there is a very high chance we have to go on furlough again for Q2. This is a 10% pay reduction for Apr-Jun with half a day off unpaid a week. We can bank the days and take them when we want. Honestly, I'd be ok if they made that permanent. The extra week and a half of holiday time is something we've all gotten used to.


As I expected, they announced this today. Most people really enjoy it. I had already assumed it was going to happen in our cash flow model for the year, so no changes are required.

Sent in our income taxes. Should get close to 12K back due to a lot of RRSP contributions (my personal and spousal), along with charitable contributions, and a $1K carbon tax rebate.


----------



## nobleea

*March 2020 Update*

Pretty crazy times we live in!

I did a quick jaunt out to Vegas to race some cars on the race track. Soo much fun - this is the 3rd time I've done it, and I'll certainly do it again. We have a long weekend trip to visit family in ON in a couple months, but won't be much else this year. We were thinking of a long weekend down to California, but probably not a good idea at the moment.

At work, Furlough was announced for Q2, which means 7 extra days off for a 10% reduction in pay that quarter. That was last week. With the drop in oil this week, I would expect that they are going to go even further shortly. I would think furlough for the rest of the year, and maybe double furlough at some point as well. They halted the matching RRSP contributions last time it was bad, so I wouldn't count that out either. We also lost our biggest customer last week. Made a lot of revenue off them, but not a lot of profit, so it's not horrible. I won't count out further budget cuts this year, which would likely mean further headcount reduction. I put the odds of getting laid off in the next 12 months at somewhere around 30-40%.

Submitted our income taxes already. I think it's a refund of almost 12K. Lots of RRSP contributions. I opened a spousal RRSP and contributed as my income was very high in 2019 and hers was not at all. This money will be used to purchase back service from her pension from being on mat leave. We have a new nanny who works afternoons and is working out well.

I started moving a portion of our investments to cash over the past month, so we have something like $165K in cash in our various RRSP and RESP accounts that will be ready to deploy in the coming weeks.

We planned on developing the basement this year at a cost of ~$40K. Majority of the cash is already available for this, with the balance coming from cash flow. Might hold off on signing the papers for a few weeks and see how the chips fall with the oil industry.

My little web business is growing and I've been caught without enough inventory several times now. I would guess sales of $30K this year. Photography putzes along, almost exclusively in the summer and fall with 90% of the sessions being repeat clients. Our tenant (above the detached garage) will be up for her 3rd lease renewal in June. We plan on raising the rent by $75 which would essentially be inflation since we haven't touched it since she moved in.

*Assets:*

House - $1,130,000
Work DC Pension (mine) - $224,652
DB Pension (wife) - $231,500
RRSPs - $68,650
Non-Reg - $28,500
TFSA: $17
Corporate Account/Value/Inventory: $15,275
House Maintenance Account: $6,222
Cash - $13,550
Miscellaneous assets - $13,690

*Total Assets $1,732,185

Liabilities:*

Mortgage - $676,876
Credit cards - $3,405 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $7,515
*
Total Liabilities $687,796*
*
Net Worth: $1,044,389 (+4K from last update)*


----------



## scorpion_ca

How much are you down this week?


----------



## nobleea

scorpion_ca said:


> How much are you down this week?


In the last 5 trading days, not a lot. Maybe 10K if that since we got out of lot recently.
Down from the peak earlier this year, maybe 25K.


----------



## scorpion_ca

I haven't sold anything yet since I am in accumulation stage. I don't need it for at least 20 years. I am down almost 60k from the peak but also spent around 42k in the meantime. However, I haven't bought anything in 2019.


----------



## nobleea

nobleea said:


> At work, Furlough was announced for Q2, which means 7 extra days off for a 10% reduction in pay that quarter. That was last week. With the drop in oil this week, I would expect that they are going to go even further shortly. I would think furlough for the rest of the year, and maybe double furlough at some point as well. They halted the matching RRSP contributions last time it was bad, so I wouldn't count that out either.


As I expected, they just announced double furlough now for Q2. So we get 1 day a week off, unpaid. So we're working essentially a 0.8FTE. They also suspended the matching RRSP contributions (5%). If 2016 is anything to go by (the last time they did this), the suspension will be in place for almost a year. I could see the double furlough continuing past June given the current condition of the oil industry. The program is Canada-specific. I am going to inquire about transferring out the group RRSP (Sunlife) to a self directed RRSP. Any transfers out used to result in a 12 month suspension of matching contributions, but if it's already suspended, I don't see any downside.


----------



## scorpion_ca

What do you think about this time? I think it would be worst than 2008 and 2014/2015.


----------



## nobleea

For Alberta, absolutely, it will be much worse than those two. At the current prices of Western Canadian Select Oil, there's no future for the oil industry in AB. Who knows if the price will stay there. I would guess that Russia might start wavering a bit on their price war as the virus appears to be starting to hit them hard.


----------



## andrewf

I hear Russia is confiscating a portion of savings accounts to fund their budget.

This is pretty grim for the energy industry. It will take a while for demand to pick back up with so much of the economy idled.


----------



## nobleea

nobleea said:


> We planned on developing the basement this year at a cost of ~$40K. Majority of the cash is already available for this, with the balance coming from cash flow. Might hold off on signing the papers for a few weeks and see how the chips fall with the oil industry. Our tenant (above the detached garage) will be up for her 3rd lease renewal in June. We plan on raising the rent by $75 which would essentially be inflation since we haven't touched it since she moved in.


We're also not doing either of these. The basement development will not happen this year as I'd rather deploy the cash in the market in a month or two, plus it's not recommended to have various contractors traipsing through our house for 8 weeks. I'll finish off one or two rooms myself to get some use out of it. I have lots of time to do that now! And the government has banned rent increases for the forseeable future, so that's not in the cards either. She's a student so it's not like she's going to lose her job.


----------



## milhouse

nobleea said:


> For Alberta, absolutely, it will be much worse than those two. At the current prices of Western Canadian Select Oil, there's no future for the oil industry in AB. Who knows if the price will stay there. I would guess that Russia might start wavering a bit on their price war as the virus appears to be starting to hit them hard.


I really feel for everyone in Alberta as it seems to have been a tough slog, unable to get any momentum out of the oil funk the last few years and now this price war.


----------



## nobleea

*April 2020 Update*

The wild times continue...

Obviously no travel is likely for the end of this year. I booked some campsites for July in the hopes things will be open by then. If not, it's all refundable. We have a credit with Swoop airlines for a cancelled flight.

Things are not great at work, obviously with the price of oil. Sales are down something like 50% worldwide. I will say we were very lucky to get our chapter 11 filing done and complete earlier this year. No way it would have happened now. There's been layoffs, as recently as this week. I made it through this round, but I am not confident I'll make it through next round. I earlier said the odds of getting laid off in the next 12 months to be 30-40%. I would now say there's a 10% or less chance of me finishing the year employed with this company. We're on double furlough now (essentially a 0.8 FTE position), and they're not matching our RRSP anymore. I started the process to transfer out as much as I could from our work RRSP to my personal RRSP. There's no fee and it's been done rather fast. I think $152K was the most I could transfer out.

We applied for a HELOC on the house. Better to apply for one now then after I lose my job. I intend to use most of it to invest in beaten down stocks. Money should be available next week. As part of the process, they had to appraise the house. With the market and being in AB, they were extremely conservative with the value. As such, I've dropped the value of our house by $50K to reflect reality.

Got my wife's updated pension amount, and understandably it's gone up due to very low rates. That has offset the house value drop. Given the risk of me being laid off, we'll probably bump her up to full time next Sept when school gets back in (she was half time this year).

We were going to pay someone to develop our basement this year, but that's not going to happen. Instead, the money was put in to a TFSA and stocks were bought. I've started on one of the rooms in the basement and might do another before the year is out. Still have our tenant, not able to raise rent anymore this year. The risk of her not paying rent is quite low since she's a student and her parents are quite well off I think. Her lease is up end of May, so we'll see what happens.

With the RRSP transfer, we'll have about 160K of cash to deploy in the markets over the next month. Plus another 75K from the HELOC. And up to 50K additional if we really want to go all in.

*Assets:*

House - $1,080,000
Work DC Pension (mine) - $216,088
DB Pension (wife) - $279,800
RRSPs - $66,695
Non-Reg - $0
TFSA: $33,072
Corporate Account/Value/Inventory: $13,850
House Maintenance Account: $5,350
Cash - $2,922
Miscellaneous assets - $16,000

*Total Assets $1,713,777

Liabilities:*

Mortgage - $673,305
Credit cards - $3,511 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
HELOC - $0

*Total Liabilities $676,816

Net Worth: $1,036,961 (-$8K from last update)*


----------



## scorpion_ca

What type of stocks/ETFs do you purchase? 

What is the likelihood of getting a job within six months if you lose your job this year? Shouldn't you be reducing your debt instead of taking more debts now?


----------



## nobleea

scorpion_ca said:


> What type of stocks/ETFs do you purchase?
> 
> What is the likelihood of getting a job within six months if you lose your job this year? Shouldn't you be reducing your debt instead of taking more debts now?


Have bought MGM, VIAC, TECK.B, RDS.B, CAE, BMO, DIS and a few others. The bulk of my work RRSP transfer will go in to VBAL or XBAL.

The likelihood of me getting a job at similar pay within 6 months is 0%. Likelihood of me getting any job, regardless of pay within 6 months is probably 60%. But I wouldn't be scrambling for any job. With my wife's income, EI, rental income, web business income, and child benefit payments, our family income would probably be close to 140K+. I'm confident I could start consulting/contracting in my field for international clients to make some money. There's a dozen other things I have in mind to start earning income and none of them involve me working for someone else again.

With some lifestyle cuts and cost savings, a 12-16 month severance package, and our incomes that are still remaining, I reckon we could last 4-5 years before I actually needed to get some work.

I've been hoping for a crash similar to 2008 to happen again as those that went against the grain and borrowed to invest then are sitting very pretty right now.


----------



## nobleea

*May 2020 Update*

Still more layoffs at work. There's a little more clarity on the new structure. I can see a path forward now. If I'm still working there by the end of summer, then I think my employment outlook starts to look substantially better. Working from home is not very efficient, though we have a day every week of furlough, so I've been taking it mostly out of guilt to make up for my lack of efficiency. Nice to be around the house and the kids though. Talking with my colleagues that got laid off, I have a pretty good idea now of what a severance package would look like in my case if it were to happen. 160-190K, plus 2 months of paid benefits is what I have planned for.

Managed to transfer over my portion of my work RRSP to a self directed account. They would not let me transfer over the employer contributed amount. Most of the transfer went in to XBAL. The rest in to stocks. As I indicated previously, we got a HELOC on the house set up and I drew it down for some leveraged investing. We have about 15K of cash yet to invest, and if things get really crazy, there's another 50-100K of margin/credit available.

Our garage suite tenant is renewing for another year. Same rent as we're not allowed to increase it right now, but dropping the rent was never brought up at all, as I was expecting.

*Assets:*

House - $1,080,000
Work DC Pension (mine) - $98,610
DB Pension (wife) - $281,300
RRSPs - $195,588
Non-Reg - $32,286
TFSA: $70,970
Corporate Account/Value/Inventory: $14,000
House Maintenance Account: $5,350
Cash - $3,022
Miscellaneous assets - $16,000

*Total Assets $1,797,126

Liabilities:*

Mortgage - $670,431
Credit cards - $5,629 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
HELOC - $70,526

*Total Liabilities $746,586

Net Worth: $1,050,540 (+$14K from last update)*


----------



## Walksing

a severance package is really attractive, wonder if you can share how many years service you are with your employer


----------



## nobleea

Walksing said:


> a severance package is really attractive, wonder if you can share how many years service you are with your employer


It will be 19 years this summer. I started with them when I graduated university.


----------



## nobleea

*June 2020 Update*

Wow, things have been crazy in the markets. I started my pandemic portfolio about 2 months ago, and early last week the whole portfolio was up 35%. Many stocks were within pennies of my preselected sell prices (Ford, MGM, CAE, DIS). Now a week later, things have dropped considerably though that portfolio is still up 16%. This NW update would have been 50K higher if I had done it a week ago. That's volatility though! I'm not bothered. Even after the drop last week, this is a new all time high for us.

Still employed. I can see it staying that way until Sept/Oct. Our CEO abruptly left this week, which we think was due to a disagreement with the new board (new board after exiting bankruptcy). The thought is the CEO was planning for long term growth, looking at potential acquisitions when things were down. And the board (old debt holders) just want their money back, and quick. Our double furlough ends this week, but I think they keep single furlough (10% pay reduction) in force for a while longer. Now in an ideal situation, any layoff would occur in the first two months of the year as there wouldn't be such a tax hit. But as we get longer in to this year, the risk increases that there would be a massive tax hit on the severance given that my income would be close to 320K for the year (almost full year of regular income plus just over a years severance, all paid out in current tax year). If that were to happen, I would have to move as much in to RRSPs and then withdraw as needed the next year when income was lower. I think we have about 140K of RRSP contribution room so that is good insurance if we need it.

My little web store continues to grow. I expect there will be a couple months this year where the monthly net income from that will exceed my work salary. I can see it growing to the point where it brings in 50-80K profit per year. I've started the process for another web store which would go live around the end of this month. Some friends and I have been looking in to the possibility of setting up local, medical grade PPE manufacturing, it's pretty capital intensive and obviously we'd only go forward if it looked promising at pre-pandemic pricing and volumes. The good thing is that polypropylene (one of the main materials for most PPE) is being or soon to be manufactured less than an hour from here, so a '100% Alberta made' story is possible.

Otherwise, not much to report. Wife took a new job at a different school. It's now a 7min walk to school rather than a 15min drive.

*Assets:*

House - $1,080,000
Work DC Pension (mine) - $102,497
DB Pension (wife) - $287,000
RRSPs - $216,420
Non-Reg - $33,364
TFSA: $76,575
Corporate Account/Value/Inventory: $21,250
House Maintenance Account: $5,475
Cash - $1,691
Miscellaneous assets - $16,000

*Total Assets $1,840,272

Liabilities:*

Mortgage - $665,587
Credit cards - $7,610 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
HELOC - $75,000

*Total Liabilities $748,197

Net Worth: $1,092,075 (+$42K from last update)*


----------



## Valueinvestor

Congrats on the success of your web store; what has made it successful so far and how did you know it would be a successful niche market?


----------



## nobleea

Valueinvestor said:


> Congrats on the success of your web store; what has made it successful so far and how did you know it would be a successful niche market?


Well, it's a pretty small niche. So it's easy to target customers with ads that are only looking for that thing, rather than something nebulous like 'women's clothes' or 'home furniture'. For the most part, it's not a repeat business type of thing (though I do have some builders and distributors that have bought repeatedly). So in that respect, it's not hard to get to the first page of google with a bit of ad spend. $300/mo gets me lots of business, but $500 a month doesn't get that much more so I'm probably reaching all the clients I can. I only advertise in Canada, so I'm sure if I added USA to the mix, my ad spend could go higher. My products are cheaper than the competition (other dedicated web stores that sell only that product). But more expensive than getting something similar at Amazon. Mind you, Amazon doesn't sell the sizes I sell so that works out well. I'll be adding a couple new versions of the product soon, so we'll see if that leads to more sales from the same web visitors as perhaps they didn't find what they wanted earlier. My checkout conversion rate, abandoned cart conversion, all the metrics are really quite good and I think that speaks to the fact that it's hyperfocused on one product only.


----------



## Valueinvestor

^Thx, interested to hear an update for the summer when you get a chance


----------



## nobleea

Valueinvestor said:


> ^Thx, interested to hear an update for the summer when you get a chance


I usually update my numbers around the 10th of the month, so a couple weeks. Some changes for sure.


----------



## nobleea

*September 2020 Update*

Back to school, back to reality for a lot of things. Our oldest is now in Grade 1 and we opted for her to go back to proper school, rather than online learning or home schooling. The cleaning and sanitizing protocols are pretty stringent. They get used to it pretty darn fast. Our middle is going to preschool end of the month. We put our previous nanny on hold during the pandemic since we were both home, but she's started college now, so we found another one (a neighbour) which works out great.

My pandemic portfolio is still doing well. I selected sell prices I would be happy with when I bought in, and I've already been sold out of Ford, most of MGM, DIS, and a bit of VIAC. My only loser right now is Shell. CAE is not doing great, after a huge run up earlier. Tracking says the overall portfolio is up 41%.

Still employed. Our double furlough was extended until the end of Sept, which means I have a ridiculous amount of vacation days available. My feeling is they will extend at least single furlough (10%) if not double furlough (20%) until end of June next year. They haven't been matching RRSPs for some time and I think that will continue for some time. Since the last update, there's been a couple more layoffs in my group. Not sure if I'm going to make it to the end of the year. It doesn't cause me any stress and I certainly don't lose sleep over it.

We had a long holiday through BC in August. Shuswap area and Okanagan for almost 3 weeks. Edmonton is far more diligent with mask wearing and pandemic protocols than anything we saw in BC (locals and visitors alike). It was a bit of a shock. We camped, stayed with friends in a cabin, and rented a house. Pretty much decided that our semi-retirement plan will include lakefront on okanagan. The next few years, we'll take more trips out there to decide where on the lake we'll want to be. I suspect we'll be able to finagle something in combination with the in laws. I would think something like an older house on the lake that can be renovated a bit to make a good vrbo or airbnb property (ideally with the main house and a carriage house/garage suite) when neither of us are there. Lakefront homes go for 800-1000$ a night during the summer and have no trouble renting out completely. We'll see, lots of moving parts, and obviously this would be a big investment, probably 1.2-1.7M. We figure its a good retirement spot as we love the lake and skiing in the winter (lots of great hills within 2 hrs) plus the benefit of a vacation house for the summers (and winter ski trips). We'll be tied to Edmonton for the next 16-18 years due to kids schooling but that's lots of summers at the lake, and then a good 15 years after that we can enjoy it as empty nesters. I know in our late 70's we'd probably have to make another move to a town/city, but that is almost 35 years from now. The pandemic has shown that I can work remotely just fine. My wife doesn't work in the summer, and I can work remotely (from a lake), we could spend most summers there. That's the dream at least. A lot to work out and need to take a deep dive in to the numbers on the rental side.

My little web still does well and grow. Looking to exit the year with about 50-55K in revenues and 20-25K in net income. Last year was a third of that, maybe I can double again for next year? I bumped up the google ad spend recently and included the US and immediately noticed a bump in sales from the US. In bigger news, a couple friends/acquaintances and I started a company to make the disposable masks. Even now, it's total price gouging happening and we think a made in Canada/Alberta/Edmonton story will help keep a lot of business even after this all blows over. We can make masks within a penny of what they charge from China. Our manufacturing machine arrives this week and then raw material over the next few weeks. We have a shop leased, incorporated, insurance, banking, website, etc etc. We figure if we can charge 40-50% less than anyone else is charging right now, and be able to claim Made in Canada, we should be able to max out our production. I am assuming things will start cooling down by March. Having all the extra holiday/furlough time has been helpful and will continue to be helpful as we get this up and running. We only leased the shop for a year, so if it doesn't work out, or we just break even, then we'll just liquidate before the lease is up. I am ok loosing 30-40K on a bet like this, and the two other owners are both far wealthier than we are.

Wife is loving her new job at a local school. Was supposed to be a 0.5FTE, but they bumped it up to 0.7FTE.

*Assets:*

House - $1,080,000
Work DC Pension (mine) - $108,604
DB Pension (wife) - $291,500
RRSPs - $353,604
Non-Reg - $7,198
TFSA: $71,880
Corporate Account/Value/Inventory: $81,000
House Maintenance Account: $5,812
Cash - $5,482
Miscellaneous assets - $16,000

*Total Assets $1,913,476

Liabilities:*

Mortgage - $657,850
Credit cards - $23,774 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $8,020
HELOC - $75,751

*Total Liabilities $765,395

Net Worth: $1,148,081 (+$56K from last update)*


----------



## Valueinvestor

$23K on the credit card - that must be a lot of points 

What do you think will happen long term with your company? Furlough until June/21, then what? More furlough?


----------



## nobleea

Valueinvestor said:


> $23K on the credit card - that must be a lot of points
> 
> What do you think will happen long term with your company? Furlough until June/21, then what? More furlough?


Ha, yes, one CC is a PC Points card, so we use those right away, but the other is the Westjet RBC, so those are just going to pile up until sometime next year.
I still say there's a 50% or greater chance of getting me getting laid off in the next 6 months. Likely higher than that. Earlier this year, I was thinking it would be October, which starts this week, so we'll see.


----------



## nobleea

Well, as expected, my boss informed me that I wouldn't be employed after Oct 31. Its a bit of a win in that I was able to predict the month it would happen as far back as December. He just gave me the heads up that it would be happening. There's no numbers yet. Going off others who have been laid off this year, it will be somewhere between 140-200K with benefits until the end of the year I would guess. It will be a lump sum. I'm still unclear on the taxation. Some sites mention a flat 30% witholding tax and others mention taxed at full income, which would be at marginal rates.

My RRSP contribution limit will probably be around 120K and I think my wife will have around 20K, so we can shelter most of it from taxes and then withdraw as needed next year. I assume attribution rules would apply to the wife's spousal, but maybe that's not a bad thing since my income would be lower than hers when the withdrawal is made. Sucks wasting contribution room like that, but that's sort of what I though it might be helpful for.

As for work, I'm just going to put the layoff news out on Linkedin once it's done and see if anything happens. A long term colleague got laid off last month and she's already started a new job. I'm not opposed to working a salary job again, but at this time I'm not going to desperately hunt one down.


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## scorpion_ca

Sorry to hear that. It's a very bad week in terms of lay offs. Shell, BP, TC Energy and Disney have announced significant staff reductions until 2021. 

I think some of you are lucky to be part of the golden days of energy boom whereas we are at the last leg of this dying industry. Our small EPC firm may start to lay off staff in Jan, 2021. We have been working 4days/ per week.

Is it possible to negotiate with your employer to get some of the $$ in 2021?


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## milhouse

scorpion_ca said:


> Is it possible to negotiate with your employer to get some of the $$ in 2021?


+1. It doesn't hurt to ask even though the company likely wants the numbers in the books asap. Ideally, the ask would be for salary continuance into 2021. The missus says it might be more tolerable for the company if it's salary continuance without benefits as it's the benefits that are the pain in the rear. I had a former coworker that was able to pull that off because he had a great relationship with his manager and was about 6 months away from some target number like an unreduced pension or something.


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## Valueinvestor

Also sorry to hear that. You may want to seek advice on how best to utilize your payout. Nice thing is you have options - finding a comparable job, starting another small business, consultant or contractor gig, etc. The lump sum gives you breathing room, time and options


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## nobleea

milhouse said:


> Ideally, the ask would be for salary continuance into 2021. The missus says it might be more tolerable for the company if it's salary continuance without benefits as it's the benefits that are the pain in the rear.


I'll check. What happens if one gets another job during the salary continuance period? The one instance I recall of someone getting salary continuance, it was XX months or until he got another job. He did get another job, but didn't tell them about it so kept the full severance.


----------



## milhouse

nobleea said:


> I'll check. What happens if one gets another job during the salary continuance period? 7


Ooh, good question. I asked her that and she says it depends on the company. Her company just added that term in the exit agreement that depending on what kind of position they get, they may have to pay back a percentage of the remaining continuance. On the other hand, she said yes, if one doesn't tell their former employer they got a new job and doesn't blab about it on social media/linked in that it would be unlikely that the company would find out as they wouldn't likely assign someone to keep track of former employees. And it would likely be difficult to enforce because they'd likely have to take legal action to get the money back and it's likely too much effort and cost to do so. 
As with all info on the internet, your situation and employer may vary so please do your research.


----------



## Valueinvestor

You may also want to get a lawyer to review your severance.

How much lower (%) are the salaries for a comparable role in the new market?


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## nobleea

Well, I have some numbers now. To be honest, this company has never done me wrong. Raises always about what I was expecting, bonuses paid out in some years they probably shouldn't have. Severance package was more than expected. I was expecting somewhere between 140-200K and it looks like it'll be just over 210K once you add in furlough and vacation payouts. Lump sum, no options for continuance. Benefits until christmas as expected. The only part that is unfortunate is that I can only direct money in to my rrsp at sunlife. No options to direct any to self directed or spousal rrsp. I mean I can still do it, but the money gets taxed first, and then I'd get a refund in April. It works out to about 17months severance for 19 years of service, which I think is pretty competitive.

My salary was primarily related to my technical skills and knowledge, which are not transferable to any other industry. Generic skills such as management, client interaction, engineering development, business development, etc are transferable and would probably result in a 30% lower salary to begin with. There's really no rush, I think I could go all 2021 without touching any of the RRSP severance (over half of it). My wife is a bit more keen on me getting a new job ASAP so we can pocket all the severance but I'd rather find something well suited that I enjoy, and also there aren't exactly jobs floating around here.


----------



## milhouse

17 months is good; I'd be happy with it. The missus was saying the range for your tenure would likely be 1 year on the low side and 2 years on the generous side but it depends on a variety factors. The benefits to xmas is nice too. I think Shaw was giving out up to 24 month packages for their longer tenured staff when they were doing their purge a few years ago. 
I'd be interested to know if you are able to find ways to limit or shelter your package from taxes though because I may try to angle for one late next year.


----------



## nobleea

milhouse said:


> I'd be interested to know if you are able to find ways to limit or shelter your package from taxes though because I may try to angle for one late next year.


Obviously early the following year would be much better, taxes-wise if you can hold off til then.

If I list the 5-10 things that needed to happen in order to retire before 50, honestly getting laid off with a package like this was on that list as weird as it sounds. There will be a bump in the net worth tracking for November. It will be interesting to see what happens over the following 12 months, if we are able to keep that bump and grow, or whether it stagnates or even drops.
In the short term, not much happens. Will need to get a laptop and a printer as I won't have access to those anymore. Might get rid of one of our vehicles. They're both leases but looking at the current sale prices on the used market it looks like they have a few thousand$ value above the buyout amount. RESP contributions will continue but we'll defer our monthly contributions to our house maintenance account.


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## nobleea

*October 2020 Update*

Well, work is all wrapped up now. Got my last paycheque today which includes all severance and payouts. I moved 102K of the severance in to my RRSP (I had the room) and 20K in to a spousal RRSP (she has the room, and more). In January, I'll put another 20K or so in to RRSPs. In December sometime, the Sunlife RRSP balance will move over to my BMO self-directed account as there's no need to keep it with Sunlife. I am covered under my wife's benefits plan, which should be more than enough for us at least for the next couple of years. I've inquired about life insurance, but not sure if I need it now that I'm not covered anymore. We have 900K of coverage under a couple term life policies and that's probably enough.

Wife has temporarily moved up to a 1.0 FTE position at her school, which helps. I have estimated the CV of her pension - I will check it soon and update on the next round. I suspect it's a bit higher than posted due to interest rates.

The family RESP sits at 58K right now, we've been holding off on some contributions as one of the kids is maxed out for this year (for grants), so that will happen in January. If we can hit 80K in the next 16 months for a balance, I'm wondering if we need to continue contributing since our eldest (of 3) would still be over 10 years away from starting post secondary. The RESP balance is not included in the numbers below.

I'm comfortable with our finances until early 2023. EI can kick in after the severance period dries up. I am looking for jobs that would suit my experience and skills, but there's not a whole lot out there. I don't really expect to even get an interview until late spring. The biggest concern I have right now is our mortgage. Not the size or staying current, just that it is due for renewal in Sep 2021. Now, we can probably just take whatever the bank offers us when they send renewal papers assuming it's not far off what we currently pay (2.59). Obviously negotiating and/or going through a broker would require us to qualify again, which would be a challenge if I am not employed. We might be able to use TFSAs to buy the balance down, along with some other cash, and get the mortgage balance down enough that we qualify with just my wife's salary, our rental income, and other income.

I need to take a few months and just do nothing. I haven't watched a tv show/series in over a decade, lots of movies and books to catch up on. Would be nice to start some physical activity again, work on the house, play with the kids some more. It will be really interesting to see what happens to the Net Worth over the next year. My forecasts say it will continue to grow, even if I'm not employed.

*Assets:*

House - $1,080,000
Sunlife RRSP - $217,250
DB Pension (wife) - $294,500
RRSPs - $265,996
Non-Reg - $7,750
TFSA: $44,570
Corporate Account/Value/Inventory: $47,500
House Maintenance Account: $6,330
Cash - $46,697
Miscellaneous assets - $16,000

*Total Assets $2,020,593

Liabilities:*

Mortgage - $653,579
Credit cards - $5,415 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
HELOC - $50,245

*Total Liabilities $709,239

Net Worth: $1,317,354 (+$169K from last update)*


----------



## Valueinvestor

Sounds like you have a good plan going forward. You may want to set some cash aside in case you need to pay down the mortgage when it renews. My mortgage renewal offer came a few weeks back and it was stupidly high, 3%. Ive been told never take the first offer but still it was borderline insulting. Funny enough though the bank would only come down to 2.8% so I will have to go elsewhere through a broker


----------



## Valueinvestor

Forgot to ask. How is your web business doing?


----------



## nobleea

Valueinvestor said:


> Forgot to ask. How is your web business doing?


It's going well. I am guessing the 2020 sales will be around 50K. 2019 was 16K. I think 2021 would be over 75K. Dec-Feb are typically really slow months.
I am thinking of adding another webstore, this one focusing on a specific outdoor sporting activity. I could see it adding 30-45K of sales per year, also heavily focused on the April-Sep time period.


----------



## Spudd

When you say "a spousal RSP" do you actually mean that? If so, that's covered under your contribution room, not hers. You might have overcontributed?


----------



## nobleea

Spudd said:


> When you say "a spousal RSP" do you actually mean that? If so, that's covered under your contribution room, not hers. You might have overcontributed?


Wow, yes, you're right. What an oversight. I asked for it to be reversed (it was a bill payment, and that would be the first way to do it). If that doesn't work, then I'll fill out the forms.


----------



## nobleea

Some updates:
Work RRSP balance has disappeared from the Sunlife website, so it should be available to start investing in my brokerage account on Monday.
Checked the wife's CV on her pension and as expected, due to low interest rates, it's higher than I had listed. Just over 10% higher.
Looks like I'll be starting a new job in December. Significant paycut, but it just fell in my lap. I don't know how long term it is.

One thing I wonder: according to my ROE, my severance runs til say April 2022. If I get a new job now, and either quit or get laid off before April 2022, could I still go on EI after April 2022? For sure if I get laid off, but if I quit? Or does the new job erase all the severance from the last one and if I get laid off from the new job, even if prior to April 2022, EI is available?


----------



## Valueinvestor

How is the new job going?


----------



## nobleea

Valueinvestor said:


> How is the new job going?


Don't actually have a new job yet. Just asking a what if scenario.

It looks like I will have some work coming up for a few months, but it will be a contract through my corporation and I don't intend to withdraw any of it as income or dividends, so it shouldn't affect EI eligibility,


----------



## nobleea

*December 2020 Update*

One month in to no pay and I can't say we're hurting. In fact, everything is ticking along quite nicely. The large gain in net worth this month was a split between adjusting the CV/termination amount of my wife's pension (up due to lower interest rates), good market gains, and debt repayment.

It sounds like I have a contract position for a few months lined up. I will bill it through our corp and not take income from it. We don't need the money right now.

The most pressing concern at the moment is our mortgage which comes up for renewal in Sept. If I don't have a FT job by then, which I would put at 50/50, then we would have to qualify on my wife's income which is not going to be enough given the size of the mortgage. Options are to 1 - sell non reg and TFSAs, load up the HELOC to pay down the mortgage enough to qualify on her alone (along with rental income), 2 - take whatever crap rate the bank gives us in our renewal papers, 3 - get a cosigner for a short 1 or 2 year term (her parents wouldn't hesitate), 4 - sell and downsize to something we can afford with little to no mortgage. Option 3 would be the easiest and lowest cost. Option 2 is a fallback plan that we could do for 1 or 2 yr term.

We currently have 2 leased vehicles. The leases on both finish this year (June and Oct). We for sure only need one vehicle as I have no job and my wife walks to work. I'm not sure what we'll do - buy out one of them and return the other, or maybe return both and buy a used vehicle.

My little web business looks like it will exit the year with sales of 50K (previous year was 16K). I could see revenue of 70K next year which would amount to 28-30K net income. I had looked at adding a new product/website together, but the insurance costs were ridiculous (like 5K/yr) for a small business.

What's on the plan for the next year? Not sure. We might kick around the idea of doing a 1yr contract in Qatar, Dubai, MAcao, etc where my wife can teach. She's always wanted to try something like that and the kids are a good age to experience it. I have been doing a few what if calculations if we did downsize our house to something mortgage free...1 mil in investable assets is within reach, our RESP is close to big enough to just grow with no contributions, child benefit payments are pretty healthy, and with rental income and some small business income...well. Might be a bit premature to talk like that, but it's moving in to the realm of possibility.

*Assets:*

House - $1,080,000
DB Pension (wife) - $322,000
RRSPs - $479,408
Non-Reg - $9,300
TFSA: $46,665
Corporate Account/Value/Inventory: $68,000
House Maintenance Account: $6,490
Cash - $15,070
Miscellaneous assets - $16,000

*Total Assets $2,042,933

Liabilities:*

Mortgage - $651,413
Credit cards - $2,266 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
HELOC - $3,800

*Total Liabilities $657,479

Net Worth: $1,385,454 (+$68K from last update)*


----------



## Money172375

nobleea said:


> *December 2020 Update*
> 
> One month in to no pay and I can't say we're hurting. In fact, everything is ticking along quite nicely. The large gain in net worth this month was a split between adjusting the CV/termination amount of my wife's pension (up due to lower interest rates), good market gains, and debt repayment.
> 
> It sounds like I have a contract position for a few months lined up. I will bill it through our corp and not take income from it. We don't need the money right now.
> 
> The most pressing concern at the moment is our mortgage which comes up for renewal in Sept. If I don't have a FT job by then, which I would put at 50/50, then we would have to qualify on my wife's income which is not going to be enough given the size of the mortgage. Options are to 1 - sell non reg and TFSAs, load up the HELOC to pay down the mortgage enough to qualify on her alone (along with rental income), 2 - take whatever crap rate the bank gives us in our renewal papers, 3 - get a cosigner for a short 1 or 2 year term (her parents wouldn't hesitate), 4 - sell and downsize to something we can afford with little to no mortgage. Option 3 would be the easiest and lowest cost. Option 2 is a fallback plan that we could do for 1 or 2 yr term.
> 
> We currently have 2 leased vehicles. The leases on both finish this year (June and Oct). We for sure only need one vehicle as I have no job and my wife walks to work. I'm not sure what we'll do - buy out one of them and return the other, or maybe return both and buy a used vehicle.
> 
> My little web business looks like it will exit the year with sales of 50K (previous year was 16K). I could see revenue of 70K next year which would amount to 28-30K net income. I had looked at adding a new product/website together, but the insurance costs were ridiculous (like 5K/yr) for a small business.
> 
> What's on the plan for the next year? Not sure. We might kick around the idea of doing a 1yr contract in Qatar, Dubai, MAcao, etc where my wife can teach. She's always wanted to try something like that and the kids are a good age to experience it. I have been doing a few what if calculations if we did downsize our house to something mortgage free...1 mil in investable assets is within reach, our RESP is close to big enough to just grow with no contributions, child benefit payments are pretty healthy, and with rental income and some small business income...well. Might be a bit premature to talk like that, but it's moving in to the realm of possibility.
> 
> *Assets:*
> 
> House - $1,080,000
> DB Pension (wife) - $322,000
> RRSPs - $479,408
> Non-Reg - $9,300
> TFSA: $46,665
> Corporate Account/Value/Inventory: $68,000
> House Maintenance Account: $6,490
> Cash - $15,070
> Miscellaneous assets - $16,000
> 
> *Total Assets $2,042,933
> 
> Liabilities:*
> 
> Mortgage - $651,413
> Credit cards - $2,266 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
> PLOC - $0
> HELOC - $3,800
> 
> *Total Liabilities $657,479
> 
> Net Worth: $1,385,454 (+$68K from last update)*


You rarely need to re-qualify for your mortgage at time of renewal. In fact, in my 20+ years of banking, I never witnessed a renewal that wasn’t automatically offered.

were you planning on borrowing additional monies in Sept?


----------



## nobleea

Money172375 said:


> You rarely need to re-qualify for your mortgage at time of renewal. In fact, in my 20+ years of banking, I never witnessed a renewal that wasn’t automatically offered.
> 
> were you planning on borrowing additional monies in Sept?


Certainly don't need to requalify with our existing lender. But they're going to give us just the posted rate.
If we want the amazing 1.5% rates that are floating around, it would be with a new lender, and I assume they'd want all the background info. I've been told from broker friends that we would only have to qualify at the actual rate, not some much higher qualification rate that new buyers have to follow.


----------



## Money172375

It’s my experience that getting a good rate with your existing lender isn’t thst much different than shopping around. I routinely gave my best rate to retain the business. I would assume most banks have retention goals. iIRc, ours was 90 or 95%. 

I would find a published competitive rate and show it to your existing lender.


----------



## nobleea

*January 2021 Update*

Net worth keeps on humming along, all on the backs of market gains. I am now working a contract position until the end of March, though I can probably extend it several weeks after if I want to. It only pays 60% of what I was making before, but it's something to do, the weather's no fun and everything's locked down.

On our vehicles, we are probably going to buy out both of them in the spring/summer and then sell our SUV and keep the pickup truck. We've started planning for the summer. Sounds like a AB/BC road trip with stops in Jasper, Shuswaps, Tofino, Comox, and maybe Okanagan. Going to try and hit up Waterton NP and some of the more unique provincial parks within a days driving distance.

I took some HELOC money and put it in our TFSAs for more stock purchases. On the TSX, we hold AD, SPG, TECK.B, ATD.B, ENB, CGX, SU and in the US we hold MGM, VIAC, USB, INTC. After we passed 1M in net worth, which was barely 3 years ago, the next goal was to have 1M in investable assets. That looks to be happening some time this year, and we will likely pass 1.5M in net worth as well this year.

We have a family RESP with Questrade which has a current balance of $70K (for 3 kids, oldest is 6). At some point, we may no longer need to contribute to it.

*Assets:*

House - $1,080,000
DB Pension (wife) - $325,500
RRSPs - $520,526
Non-Reg - $10,150
TFSA: $95,933
Corporate Account/Value/Inventory: $60,000
House Maintenance Account: $6,600
Cash - $5,552
Miscellaneous assets - $16,000

*Total Assets $2,120,261

Liabilities:*

Mortgage - $649,289
Credit cards - $4,015 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
HELOC - $44,416

*Total Liabilities $697,720

Net Worth: $1,422,541 (+$37K from last update)*


----------



## scorpion_ca

What is in your RESP?


----------



## nobleea

scorpion_ca said:


> What is in your RESP?


21% VGRO
27% SPG.TO
18% AD.TO
7% SU.TO
4% SPG.WT.TO
23% Cash tied up in orders that haven't filled yet.
Apparently it's been at 24% CAGR since I started tracking it 2 yrs ago. That's counting the grant money as contributions.


----------



## scorpion_ca

I started to manage two RESP accounts for my nephews since last year. My plan is to buy only ETFs.

#1 started last year - Buying ZRE as REIT is lower lately. Will buy XEQT and TEC once the market is little bit lower. Let's see if we can reach $100K in 18 years. 

#2 started last year with $16K cash - Buying ZRE as REIT is lower lately. Will buy XEQT and TEC once the market is little bit lower. However, he will need the fund starting from 2024.


----------



## Walksing

Can you explain what is the point you do not need to contribute resp? How do you determine it? Thanks
“We have a family RESP with Questrade which has a current balance of $70K (for 3 kids, oldest is 6). At some point, we may no longer need to contribute to”


----------



## nobleea

Walksing said:


> Can you explain what is the point you do not need to contribute resp? How do you determine it? Thanks
> “We have a family RESP with Questrade which has a current balance of $70K (for 3 kids, oldest is 6). At some point, we may no longer need to contribute to”


I estimate we'll need somewhere between 200-250K in future dollars around 14-15 years from now to cover 4 yrs of university tuition for 3 kids. Now of course, one or more kids might not do a full 4 years, and one or more might do more than 4 years. And they might get scholarships or co-op terms. I've assumed that tuition inflates at almost double the CPI as that is likely to happen over the mid term.

Knowing our end point and how far away it is, it's just a math exercise to know when we can stop contributing based on certain estimated returns from here til then.

The kids' uncle gifts them money every christmas for their RESP and that will continue forever.
But if the RESP has a balance north of 100K and there is still at least 8 years until the oldest is university age, it seems overkill to keep on contributing even with the free grant. Since our oldest is 11.5yrs away from university age and the balance is already 71K and we're contributing 8K a year and returns are quite good at the moment, there's a very good chance we'll hit 90-100K in the next couple years. At which point we can save the 500-600$ per month we contribute.


----------



## Walksing

nobleea said:


> I estimate we'll need somewhere between 200-250K in future dollars around 14-15 years from now to cover 4 yrs of university tuition for 3 kids. Now of course, one or more kids might not do a full 4 years, and one or more might do more than 4 years. And they might get scholarships or co-op terms. I've assumed that tuition inflates at almost double the CPI as that is likely to happen over the mid term.
> 
> Knowing our end point and how far away it is, it's just a math exercise to know when we can stop contributing based on certain estimated returns from here til then.
> 
> The kids' uncle gifts them money every christmas for their RESP and that will continue forever.
> But if the RESP has a balance north of 100K and there is still at least 8 years until the oldest is university age, it seems overkill to keep on contributing even with the free grant. Since our oldest is 11.5yrs away from university age and the balance is already 71K and we're contributing 8K a year and returns are quite good at the moment, there's a very good chance we'll hit 90-100K in the next couple years. At which point we can save the 500-600$ per month we contribute.


----------



## Walksing

Thank you nobleea for the detailed explanation, we have two kids at the same age of yours, your resp plan is a great analog for ours

also, good for your kids who have a generous uncle!


----------



## nobleea

Decided to look at the XIRR on our RRSP and TFSA's since 1 April 2020. I knew it would be good, but didn't think it was this good. *97.3%* annualized return. I am guessing it will be higher than that once we hit 1 april 2021.


----------



## nobleea

nobleea said:


> We have a family RESP with Questrade which has a current balance of $70K (for 3 kids, oldest is 6). At some point, we may no longer need to contribute to it.


Barely 2 weeks later and the RESP is at 85K with no contributions or grants in the meantime. This market is crazy. At this rate, it'll cross 100K before the year is out.


----------



## Plugging Along

nobleea said:


> I estimate we'll need somewhere between 200-250K in future dollars around 14-15 years from now to cover 4 yrs of university tuition for 3 kids. Now of course, one or more kids might not do a full 4 years, and one or more might do more than 4 years. And they might get scholarships or co-op terms. I've assumed that tuition inflates at almost double the CPI as that is likely to happen over the mid term.
> 
> Knowing our end point and how far away it is, it's just a math exercise to know when we can stop contributing based on certain estimated returns from here til then.
> 
> The kids' uncle gifts them money every christmas for their RESP and that will continue forever.
> But if the RESP has a balance north of 100K and there is still at least 8 years until the oldest is university age, it seems overkill to keep on contributing even with the free grant. Since our oldest is 11.5yrs away from university age and the balance is already 71K and we're contributing 8K a year and returns are quite good at the moment, there's a very good chance we'll hit 90-100K in the next couple years. At which point we can save the 500-600$ per month we contribute.


I am curious why you would not want to continue to fund the RESP (assuming you have the funds) for the max amount with grant or even up to the $50k per child. Other than deploying your funds else where is there any down side?

We have two kids how are older 12 &15 so only 3 years away from needing the funds. their account is just around $200k for the both of them with only one more year of contribution for the youngest. would it mot make sense to try and out as much as you ca. For them that grows tax free, and is with drawn and Taxed at their income bracket? 

Is there any down side to having a large RESP?


----------



## nobleea

Plugging Along said:


> I am curious why you would not want to continue to fund the RESP (assuming you have the funds) for the max amount with grant or even up to the $50k per child. Other than deploying your funds else where is there any down side?


Of course, there is no downside (and some free money). However, our TFSA's are not fully funded. Our RRSPs are very close to it. If early retirement is in the cards, and I hope it is, then eliminating big monthly outflows is important. Funding an RESP for 3 would be close to $600/mo. If we have enough in the account to 'let it ride' for the next 10-12 years, why continue? I mean having a big RESP is nice, but retiring early is nicer. Obviously we have a big mortgage to take care of as well


----------



## Plugging Along

nobleea said:


> Of course, there is no downside (and some free money). However, our TFSA's are not fully funded. Our RRSPs are very close to it. If early retirement is in the cards, and I hope it is, then eliminating big monthly outflows is important. Funding an RESP for 3 would be close to $600/mo. If we have enough in the account to 'let it ride' for the next 10-12 years, why continue? I mean having a big RESP is nice, but retiring early is nicer. Obviously we have a big mortgage to take care of as well


That makes sense if your other accounts are not funded. I have heard of people saying that once the RESP hits a certain amount they are stopping. Money doesn t seem to be an issues, so I was just trying to figure out if there is downside to having a large RESP


----------



## nobleea

Money172375 said:


> It’s my experience that getting a good rate with your existing lender isn’t thst much different than shopping around. I routinely gave my best rate to retain the business. I would assume most banks have retention goals. iIRc, ours was 90 or 95%.
> 
> I would find a published competitive rate and show it to your existing lender.


I talked to our existing lender about an early renewal, what the rates would be like. She asked if I was still employed at XYZ, I couldn't plead the fifth so said no and she said it doesn't matter. They offered fixed rates as low as 1.59% which is good enough for me and quite competitive with what's available locally. It's 1% lower than our current rate. Signing 6mo before the original term is up means our last mortgage was a 4.5yr term at 2.59, rather than the 5yrs it was supposed to be as the new rate kicks in 6mo early. No penalty. Our only decision is what kind of prepayment terms we want (10/10 or 20/20), 4 or 5yr term (4yr is cheaper), and what kind of ammortization we want (anywhere from 15-20yrs). My guess would be 4yr, 20/20 and 18 or 19 years to save a bit every month of our current payment but also drop the ammortization by a year or so.


----------



## nobleea

*February 2021 Update*

Net worth keeps on humming along, all on the backs of market gains. I am now working a contract position until the end of March. I've indicated to them, and they've been receptive to me doing a gradual exit, rather than abrupt. So in a few weeks I'll drop down to 3 days a week, then 1, then just on an as needed basis. They're pretty disorganized, so I'm sure that work will be there part time for quite some time. I also got a call from an ex colleague wondering if I was interested in contract engineering work, around 30-60hrs a month. For those kind of hours, and a rate in the 150-200/hr range, I'm sure I could handle it and that would honestly be all we need for income going forward. I do check the job postings every week, but there is nothing that I find interesting or really suits my skill set and experience.

On our vehicles, we will be buying out both vehicles and keeping the truck. It's just too convenient to get rid of. Will probably pay for it with TFSA money.

If we include the wife's pension value, which I have been for tracking, we passed the 1M mark for investable assets, as well as the 1.5M NW mark. Next goal would be 2M NW and 1M in RRSP and TFSA's alone.

We have a family RESP with Questrade which has a current balance of $81K (for 3 kids, oldest is 6). We contribute pretty close to the max every year.

I opened a HELOC last March to take advantage of the drop in equities. I also moved over as much as I could from my work RRSP in April, and then had access to all the rest of my work RRSP and severance amount when I got laid off in November. Combine that with the runup in equities and we have done quite well. I calculate our XIRR since start of April to be just over 115%. One of the TFSA accounts was pushing 170% XIRR. We are up 100K on just one company alone.

I have been trying to get some more entertainment in my life. Sounds weird but I'm actually trying to be more sedentary. I haven't watched many movies and no tv series in probably over a decade. I'm all caught up on Mandalorian and starting the Jack Ryan series, plus about a dozen movies. There's some books I need to get started. Once I finish off this contract work, I'll be looking to get in to a fitness routine as well.

*Assets:*

House - $1,080,000
DB Pension (wife) - $335,000
RRSPs - $588,810
Non-Reg - $9,200
TFSA: $112,674
Corporate Account/Value/Inventory: $59,000
House Maintenance Account: $6,730
Cash - $4,792
Miscellaneous assets - $16,000

*Total Assets $2,212,206

Liabilities:*

Mortgage - $647,164
Credit cards - $4,600 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
HELOC - $47,658

*Total Liabilities $699,422

Net Worth: $1,512,784 (+$90K from last update)*


----------



## scorpion_ca

nobleea said:


> We are up 100K on just one company alone.


Is it Tesla?


----------



## nobleea

scorpion_ca said:


> Is it Tesla?


No, it's a small company called Spark Power (SPG.TO). Own their common stock and a lot of warrants (SPG.WT) as well. But honestly, there's a ton of companies that have doubled, tripled in the last year. And not small or tech companies. Disney, Ford, MGM, VIAC, Magna, Boeing, Canadian Tire, etc etc.


----------



## nobleea

*March 2021 Update*

Small change in NW this month due to drops on a couple stocks, but we still eked (eeked?) out a gain. I did not check the wife's DB pension CV value this month. Will check it next month to see if the rising bond rates have decreased the CV amount. That would could be a decent hit to the NW as well if that drops.

We renewed our mortgage this month. It was the easiest thing ever. Stayed with our current bank, as we wouldn't qualify elsewhere with me having no income. No haggling and they still offered 1.59% right off the bat, which is pretty competitive. We were at 2.59%, so that's a savings. Did not change the amortization, still at 20 years.

Started doing the taxes in earnest. For a couple reasons, we are going to have a big tax bill this year (~16K). First, before COVID, we were thinking that my wife would be working full time and we'd have a nanny full time. So we got them to take less tax off during the year to compensate for that. However, due to covid and me losing a job, we did not end up having a nanny for most of the year which means she owes a fair amount. And then my severance they only took off 30% withholding, which was not enough as I would have been in the highest tax bracket even with stuffing 100K in an RRSP. This might force us on to an installment plan with taxes, as I've had to be on that before due to large taxes due in certain years. Hopefully not.

I have been trying to get some more entertainment in my life. Sounds weird but I'm actually trying to be more sedentary. I haven't watched many movies and no tv series in probably over a decade. Been continuing on this and its been working out well. Finished the Jack Ryan series and now almost finished The Expanse (which I love). Next up is Firefly (now on Disney+) and then Man in the High Castle. Once I finish off this contract work (early April), I'll be looking to get in to a fitness routine as well. Weather's been warming up quite a bit here, by the end of March nighttime temps will be consistently above 0 which means the veggie garden can get started with a little help.

*Assets:*

House - $1,080,000
DB Pension (wife) - $342,000
RRSPs - $593,992
Non-Reg - $11,000
TFSA: $100,431
Corporate Account/Value/Inventory: $68,500
House Maintenance Account: $6,900
Cash - $1,043
Miscellaneous assets - $16,000

*Total Assets $2,219,866

Liabilities:*

Mortgage - $645,110
Credit cards - $3,751 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
HELOC - $48,808

*Total Liabilities $697,669

Net Worth: $1,522,197 (+$9K from last update)*


----------



## nobleea

*April 2021 Update*

Another small increase in the NW this month. Haven't been getting a lift from the market, so it's been pretty flat as might be expected. Definitely a note of concern is the flat NW growth and the small increase in debt.

We have a large income tax bill this year due to severance and less tax taken off for my wife with expected childcare credits (that didn't happen due to Covid). It'll be 17.5K. I sold some items in my TFSA to cover it. First mortgage payment at the renewed rate started in April. Nice to save a few hundred a month. I have to call the internet company to threaten to leave and get a discount, should be able to save 30-50$/mo there. We have about 4K in house expenses this summer with some cracked window replacements and a new parking pad for our tenant.
May-Sept is the best months for my web business, so I expect the NW will start to rise in earnest over the summer. I did apply for EI last week. I don't think they'll pay anything until my severance is assumed to have run out (which would be in 12 months), but important to get the name in the system I understand as there is a time limit? I have applied to the odd job here and there that look interesting and I would be suited for, but there isn't much. No interviews and I'm not expecting anything until the fall. They'd all be drops in income from what I was making before, but that doesn't bother me. Wife is working 1.0FT right now and is not loving it, so she will probably drop down to a 0.75FT for Sept.

As far as entertainment goes, I've finished The Expanse series (epic good), and have started Firefly (not sure what the hype is about). We went to Calgary for a trip over the spring break, stayed in a hotel with pool/slide that you could book. It was a nice break. Been hanging out with our two youngest during the day, baking, cleaning, laundry, yard work. I'm enjoying the routine (for now). Thinking of a little hobby project for the spring to keep the mind sharp. A 1 or 2 axis solar tracker panel setup to run our extensive landscape lighting off of.

Started taking the kids to the park during the day while I do a workout around the park. Weather's nice enough for it now. Will break the road bike out this weekend too.

*Assets:*

House - $1,080,000
DB Pension (wife) - $346,500
RRSPs - $568,239
Non-Reg - $9,500
TFSA: $99,151
Corporate Account/Value/Inventory: $101,776
House Maintenance Account: $7,600
Cash - $1,714
Miscellaneous assets - $16,000

*Total Assets $2,230,480

Liabilities:*

Mortgage - $642,645
Credit cards - $3,220 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
HELOC - $54,680

*Total Liabilities $700,545

Net Worth: $1,529,935 (+$8K from last update)*


----------



## nobleea

*May 2021 Update*

Finally a drop in the NW. Had nothing to do with the markets and everything to do with the large income tax bill we had end of April. We knew how much and when it was going to be, but did not allocate for it in the net worth, so it shows up as a hit to the net worth. I should have put it down as a liability as soon as I received the severance as that's what it's from.

We decided to go down to one vehicle, so we got rid of our SUV having only a truck now. Both our vehicles were leased. With the crazy used car market, we were able to get out of our lease on the SUV 5 months early and the dealership gave us a cheque for $3500. Even with the truck being leased, the crazy market for used trucks means we have about 10K equity in it right now. It is almost worth what we paid for it 3 years ago. I haven't put that down in the net worth. We'll buy out the lease next month and it will show up as a vehicle asset with a market value. As we did before, I will depreciate the value every month to reflect the depreciating asset nature.

My wife's school board has to cut some budgets. She's currently working a 1.0FTE but her position is formally only a 0.5FTE. So there's a risk that she gets knocked down to 0.5FTE in September. I think it will be more like 0.7 or 0.8FTE, and that's what we've planned for in the cash flow.

Even though EI has my record of employment and severance details, they started paying me EI. I have an interview next week for a job. It's entry level job with the provincial govt. Might be a foot in the door to bigger things, but still not sure if I really want to do much work this year. It would pay about half of what I used to get paid so it has to be damn interesting.

Web business is going well. Just stocked up my inventory for the busy summer/fall season. I imported a few watersports items, which are popular right now, and have a second order arriving in a couple weeks. I am tossing around the idea of making that a full business for next year. That would require bringing in a full container's worth of product and renting a storage space. I am helping out one of my entrepreneur friends on an app he is working on. He is brilliant and very good at business. We've worked together before on an infill project. I am probably going to get paid in equity in the company, which is alright by me.

The city now allows two secondary suites per property. We have one above our detached garage. I am going to look if it would be possible to add a second one on the main floor of the garage with a small addition. With all the services and structure already there, it would not be an expensive investment (50-80K) and would probably rent for $1000/mo.

Kids' RESP sits at 66K right now, not included in the NW. Our oldest is 7 and we have 3 kids.

Wife and I got our first vaccine shot about a month ago.

*Assets:*

House - $1,080,000
DB Pension (wife) - $351,000
RRSPs - $571,149
Non-Reg - $10,200
TFSA: $85,764
Corporate Account/Value/Inventory: $65,000
House Maintenance Account: $6,700
Cash - $1,799
Miscellaneous assets - $16,000

*Total Assets $2,187,612

Liabilities:*

Mortgage - $640,345
Credit cards - $3,180 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
HELOC - $27,681

*Total Liabilities $671,206

Net Worth: $1,516,406 (-$13K from last update)*


----------



## nobleea

*June 2021 Update*

Another drop in the NW this month. This one was due to an update to the commuted value of my wife's pension. I guess rates have gone up a bit, which drives the CV down. It went down by $75K, but the NW only went down by 29K, so that's still a win.

I just picked up the bank draft today to buy out our leased truck. Our only vehicle. The buyout is just under $28K and the market value today is $35-38K. Car insurance obviously going down with only one but also since we use it only for pleasure as I don't work and my wife walks to work.

I've had 2 interviews in the last month. Both jobs I would be qualified or overqualified for and would come with steep income drops. Probably an income of 85K for one and 100K for the other. I think they both have 2nd, 3rd interviews before they make a decision but I would probably pass at the moment. The PT consulting job I mentioned looks to be going ahead as they sent me a contract and told me to just put an hourly rate down. I have no idea what to put down. I think $135/hr would be equivalent to the FT job I had previously. But I'm pretty sure it would be higher than that as a consultant. $200?, $240/hr? I can pretty much tell them when and for how long I want to work as it's open ended. I think 20-60hrs/month would be nice. At the moment, I think I might be done working the FT salaried 8-5 job forever. My webstore and ventures look to bring in about 55K in income and then another 60K in income in consulting/contracting for 2021 and that's not working at all for at least 4 months.

I've been thinking about retirement and the consensus that the mortgage needs to be paid off. As we have a garage suite which nets $1200/month would it not work to have a mortgage payment the same as that and call it good? That would mean a mortgage of $250K ish would be a target for retirement. Or if we really wanted to push it, we could convert the mortgage to a HELOC and pay interest only. That would be a debt of 350K ish then. Of course the balance would never be paid off, but maybe that's not necessary if you're living there for free. Let inflation kill the impact.

The city now allows two secondary suites per property. I am going to look if it would be possible to add a second one on the main floor of the garage with a small addition. With all the services and structure already there, it would not be an expensive investment (50-80K) and would probably rent for $900/mo.

Kids' RESP sits at 74K right now, not included in the NW. Our oldest is 7 and we have 3 kids.

We're getting our second vaccine shots this week.

The weather has been great the past month. Spray parks are open, I've been out on the river a few times. Bike rides with my boys to pick up donuts or check out new parks. Honestly no stress at all and living our best life.

We've been tossing around the idea of an all inclusive in mexico for a week in December. Prices are definitely higher than they were pre-covid but not crazy so if you avoid some of the school breaks.

*Assets:*

House - $1,090,000
DB Pension (wife) - $278,158
RRSPs - $580,632
Non-Reg - $11,000
TFSA: $89,990
Corporate Account/Value/Inventory: $80,000
House Maintenance Account: $7,500
Cash - $5,113
Miscellaneous assets - $16,000

*Total Assets $2,158,393

Liabilities:*

Mortgage - $638,069
Credit cards - $5,000 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
HELOC - $27,619

*Total Liabilities $670,688

Net Worth: $1,487,705 (-$29K from last update)*


----------



## nobleea

Just ran the XIRR numbers again on our 'pandemic portfolio'. 75% annualized return since 1 Apr 2020.


----------



## Forebiz

nobleea said:


> I think $135/hr would be equivalent to the FT job I had previously. But I'm pretty sure it would be higher than that as a consultant. $200?, $240/hr?


I've found over the last 10 years that rates have stayed the same and even dropped in a lot of cases in the engineering field. Perhaps they are going back up over the last few months with more demand in the O&G sector? I'm interested in your next update on this.


----------



## peterk

Forebiz said:


> I've found over the last 10 years that rates have stayed the same and even dropped in a lot of cases in the engineering field. Perhaps they are going back up over the last few months with more demand in the O&G sector? I'm interested in your next update on this.


Well I have no idea about your field Nobleea - but in my engineering field in oilsands the only ones who can charge out more than >$200/hr are the "Principal Engineer" / Sr. Reviewer/Advisor, and that is only for like 10-20hrs on a 200hr project.

Even Senior Associate engineers in their 50s who are not the final Principle level advisors are only billing out $180/hr I think. Regular working engineers like $140/hr.

Agreed with Forebiz that rates have not gone up or gone down in the past decade. Consulting engineering companies have been getting squeezed hard on cost/billings, and been subject to many and frequent mergers/consolidations over the last 2 decades.


----------



## nobleea

I threw out $220/hr to them and the main contact said that was within the range, but after internal discussions, they said $180 is more in line with what their other consultants are making, so that's what's in the contract. We'll see how the first 6 months go, it seemed like there was room to push that up a bit (though probably not over 200/hr). This is a firm that is niche, but well known throughout the world. They focus on research and support for production, rather than construction, so it's a little less feast/famine. Vast majority of their customers are outside N.America.


----------



## nobleea

*July 2021 Update*

Nice gain in the NW this month, mostly from market gains and the pension CV going up a bit.

We bought out the lease on our truck, so now it'll show up in the asset column. I depreciate it every month at $350/month and will do a major adjustment of the value once a year as necessary.

I signed a consulting contract with a local outfit at $180/hr. They're expecting to need me 1 day a week on average, but it's likely to be closer to 2/2.5 days a week at least starting in fall. Simplest is sole proprietorship, I have to get a GST number, but other than that it's pretty simple. If I ran through our corp, I would have to get a proper permit to practice with the provincial engineering authority and a bunch of paperwork that I'd rather not do. Had a call about another job that I'd be easily qualified for. I'm pretty sure I'll be getting an offer or two in the next month. They are FT positions which I'm not sure is something we want or need at the moment. Maybe I can convince the govt job to spring for a 0.8FTE position?

I talked to the city about adding a second garage suite. While they do allow 2 secondary suites per property now, apparently only one can be a garage suite (with the other being a basement suite). I think that's stupid semantics. If I applied for one, I would get rejected, but I'm reasonably confident I could win an appeal at their appeal board. The first step would be to get a design drawn up properly and get pricing from builders. I still think it would be under 60K to get done which is still a darn good investment for $800/month net income. Even a cost of 80K would be a good investment. Will cost about 1200$ to get drawings made and sent off, so we have to decide if we're willing to make the gamble that we can get approved on appeal.

I did a trial run of a new product to import and sell and it went really well. I made about 45% margins for a net profit of about 25K. This was just selling from my garage and listing them on Facebook marketplace. I will probably go full bore next year and bring in a couple sea cans worth of product, proper branding, website, and advertising. I could see income of 80-180K/yr with a single employee doing most of the work. It's a very seasonal product with probably 90% of sales in the April-Sept period.

Kids' RESP sits at 79K right now, not included in the NW. Our oldest is 7 and we have 3 kids.
Our 'investable assets' has surpassed 1Mil now. This is RRSP, RESP, TFSA, cash, and CV of pension. It has been over 1M for all of 2021. That and a 1.5M net worth was the next goal after passing 1M net worth. So the next target would be 2M net worth. Outside chance that happens in 2022.

Off to Jasper and Shuswap areas for 3 weeks in Aug. Then camping throughout AB the rest of Aug.

Our retirement goal is looking like a lakefront property on the Okanagan. An acreage likely. The plan would be to buy a larger property with a friend, subdivide and each take a lot. Our near to mid term plan would be to have it as a vacation property and airbnb/vrbo when we're not there, and then once the kids are out of high school in 15-16yrs, move there full time. We know this will be an expensive property, probably 1.3-1.8M just for the lot. That means we'll have to come up with 450-600K cash in the next 3-5 years to make the purchase for our portion of the downpayment.

*Assets:*

House - $1,100,000
DB Pension (wife) - $293,133
RRSPs - $605,329
Non-Reg - $10,240
TFSA: $97,301
Corporate Account/Value/Inventory: $73,730
House Maintenance Account: $7,650
Truck - $34,500
Cash - $1,310
Miscellaneous assets - $16,000

*Total Assets $2,241,193

Liabilities:*

Mortgage - $635,763
Credit cards - $4,308 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
HELOC - $44,306

*Total Liabilities $684,377

Net Worth: $1,556,816 (+$69K from last month)*


----------



## scorpion_ca

nobleea said:


> I did a trial run of a new product to import and sell and it went really well. I made about 45% margins for a net profit of about 25K. This was just selling from my garage and listing them on Facebook marketplace. I will probably go full bore next year and bring in a couple sea cans worth of product, proper branding, website, and advertising. I could see income of 80-180K/yr with a single employee doing most of the work. It's a very seasonal product with probably 90% of sales in the April-Sept period.


Would you mind to share the name of your products? Don't worry, I don't live in your city and won't take your market share. Perhaps you could import the products and ship some of it to me in Calgary. I can sell it in Calgary and surrounding areas and you can give me commissions per sale...

What is the average price per item? Do you take cash or e-transfer? How do you ensure that you are not getting duped while selling online?


----------



## nobleea

The products I've imported for a few years now are house decor/finish items. They are custom made for me. Average landed cost is probably $12-16CAD and list price on my website is $26-35CAD. I've probably sold 4000 units of those since I started. I sell these through a shopify store across Canada.
The new product I imported this year is a watersports item. The ones I brought it are stock by the manufacturer, so their branding. I will change to my designs and branding next year. Average landed cost is about $205CAD and I sold them for ~$420. I sold these locally this year, but will sell locally and through a shopify store across Canada next year. Local sales are cash or etransfer.
Website sales are obviously all credit card. Never had a fraudulent charge. Couple chargebacks, but I was in the right on both of them.

The challenge is knowing how much and what styles to bring in, as there is a significant time lag between ordering and delivery. About 2-3 months. Never had an issue buying things from the manufacturer in China, and I've dealt with over a dozen different manufacturers. They all have to be fully paid before shipping.


----------



## nobleea

*September 2021 Update*

Well, I guess that's it for summer. School is back in full swing, for now (who knows what COVID will bring). I think we have a good summer. We got smoked out of BC (literally). Had to cut out road trip short by a week due to the wildfires. Spent a few more days in Jasper instead. A few camping trips around the province in Aug and Sep and that's probably it for the time being.

Work wise, wife is working full time at school. I did a bit of consulting work over the summer and expect that to pick up a bit in the fall to around a day a week. Didn't get offered any of the jobs I interviewed for which is good because deep down I don't think I want to work full time yet (or again?).

I am still going back and forth with the city about a second garage suite. I just need confirmation that I could appeal their decision at an appeal board and I'll give it a shot. There are lots of garage suites going up in the neighbourhood. We did spend about 5K on a parking pad/driveway extension which will be for our current tenant. They've been parking on gravel/mud up til now. Our current tenant's lease is up end of this month and she wants to renew for another year. I will try and raise the rent a bit.

Big news is we bought a motorhome. My wife grew up with one and has been incessant about getting one since we met. I've managed to hold it off until now, but after camping with young kids in 5C weather a few nights, it became obvious this was not a battle I was going to win. Happy wife, happy life. My only stipulation was that it had to be a model that we could rent out easily when not using it. So we bought a pretty big, new-ish Class C. I think we got a pretty good deal on it since it was end of season and it was a private sale almost 3hrs away from here in the middle of nowhere. We plan on putting it on RVEzy next spring. Rigs of this size and age net about $200/night, so I'm confident we can cover all our fixed costs and maintenance, depreciation, and even have a few grand profit left over every year. While still being able to use it ourselves when we want. We bought it with our HELOC and then I've been selling some TFSA stuff to pay that down. A bit more to go yet.

Other big news is we are going to proceed with solar PV installation. The city of Edmonton and the Feds have pretty good rebates at the moment which can bring the installed cost to around $1/watt. There are generous surplus generation rates as well which result in investment payouts of about 7-8 years. We haven't decided on a size, the options we are looking at are 5.2kW on the low end and 12.6kW on the high end. Definitely a popular option right now as most companies are booking installs into January already. If we ever get a second vehicle again, it will more than likely be an EV.

Started ordering product for next spring for a new website. I believe I have to have it in stock. I've committed to $35K worth already and probably will do another $25K before the end of the year. I may need to provide my corp with a shareholder loan to buy it all. If initial sales go well, I may do another $35-50K worth in March.

*Assets:*

House - $1,120,000
DB Pension (wife) - $309,000
RRSPs - $586,871
Non-Reg - $8,479
TFSA: $61,461
Corporate Account/Value/Inventory: $68,000
House Maintenance Account: $8,000
Truck - $33,800
Motorhome - $37,500
Cash - $8,072
Miscellaneous assets - $16,000

*Total Assets $2,257,183

Liabilities:*

Mortgage - $631,197
Credit cards - $2,531 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
HELOC - $57,893

*Total Liabilities $684,377

Net Worth: $1,565,562 (+$9K from last update)*


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## scorpion_ca

Would you mind to post a picture of your motorhome? I would like to buy a RV one day but don't have much idea about it. What did you look for when buying your RV?


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## nobleea

scorpion_ca said:


> Would you mind to post a picture of your motorhome? I would like to buy a RV one day but don't have much idea about it. What did you look for when buying your RV?


 This isn't the exact one, but it's the same model and year.








2008 Winnebago Access 31J






cneerrv.com





We wanted one that had separate single bunks for the kids as we thought the bed above the truck cab would lead to fights and it's inconvenient to convert the couch and table to beds and back again. The slides are helpful in making the space seem bigger. Had to have good AC, larger fridge, and the ability to tow up to 5000lbs. Its definitely on the long side, which makes it hard to maneuver around towns.


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## Walksing

Nobleea, really interested in your solar PV installation and future EV purchase, looking forward to learning more about your progress!!


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## nobleea

No formal update this month, just some comments:

Work: My old boss asked if I'd be interested in coming back for a role starting in January. I said I'd consider it but I wasnt really keen anymore on working full time, he mentioned that a 3 or 4 days a week might work. I would tend to think that the workload wouldn't be reduced, but who knows. It would require getting childcare/nanny for at least 3 days a week. Accounting for vacation, holidays, taxes, deductions, I think this role would bring us around $55-60/hr net.
Meanwhile, this consulting gig I have bring us about $125/hr net, however the hours are about 1/3 of what the position above would be. But no childcare and way more flexible, less stress.
I probably can't do both as that would be a conflict of interest as they are in the same field of work. I have to let my old boss know this week. No right answer, but part of me feels there could be regret that I had a chance to stay home with my kids for their pre-school years and I went back to work. On the other hand, the stability of a job plus no large gaps in employment history is attractive. And even if it is more hours of work, the net financial gain to our family would be greater by taking the job. Any thoughts to chew on?

Motorhome: we took it out a couple times. Someone stole the catalytic converter while parked on the storage lot. Total piss off. Will put it up on RVEzy this month for rentals starting in mid-April I think.

Solar: We signed a contract and paid 50% deposit for a 6.15kW system for our garage. They guarantee the solar production and will pay us the difference if we don't hit a certain amount. After rebates, I think it'll be around $7500. Should cover about 70% of our annual production, and closer to 100% of our electrical bill (due to higher rate as a producer feeding the grid during spring/summer months).

EDIT: Stocks: We've been a net seller the past couple months and have about 120K in cash available to deploy.


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## milhouse

nobleea said:


> Motorhome: we took it out a couple times. Someone stole the catalytic converter while parked on the storage lot. Total piss off.


Oh man that sucks. My coworker had hers stolen off her car a few months back. I'm just happy we can park our car in the garage. Any plans on how to protect it from being stolen again? I'm guessing if they found it easy to do the first time (easier access/more clearance?) they'll likely do it again. And I'm guessing if it gets stolen while the motorhome is rented out, the renters/their insurance are on the hook?


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## nobleea

milhouse said:


> Oh man that sucks. My coworker had hers stolen off her car a few months back. I'm just happy we can park our car in the garage. Any plans on how to protect it from being stolen again? I'm guessing if they found it easy to do the first time (easier access/more clearance?) they'll likely do it again. And I'm guessing if it gets stolen while the motorhome is rented out, the renters/their insurance are on the hook?


It would never get stolen while someone is using it or at a campground. Just in long term storage or parked in an alley. I know it will happen again, so we had a resonator installed instead of a catalytic converter. Looks different and doesn't have the precious metals in it, so it won't get cut out. There are kits you can buy to cover/lock up the cat, but they are expensive and don't really guarantee anything. I had plans of spray painting it yellow and stencilling 'STOLEN' on it before we put it in storage but never got around to it. The resonator doesn't do the same thing as a cat, but I'm not reinstalling a catalytic converter until the province cracks down on the metal recyclers. I understand BC did and it had a huge impact.


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## nobleea

*November 2021 Update*

A couple months since the last update and no real change in the net worth numbers. It has also been over a year since I was laid off, so a good checkpoint to see how we're doing on one formal salary. Overall, debt went down by only 20K, but assets went up by 230K in the last 12 months. We're definitely in a better position than we were, but I'm curious if we'd be as comfortable as we are now if we hadn't seen the great run up in stock prices in the last year.

We have more or less decided that I will stay at home for the foreseeable future, not looking for a FT job. My old boss had some discussions about me coming back and I indicated I'd be willing to work 25-30hrs a week. They said that might work as a consultant position, but I don't expect that's going to work out and I'm not losing sleep on it. The consulting gig I have already is continuing and I just signed a contract extension for another 6 months. It is looking like it will average around 4K/mo in income, but this only requires about 60-90 mins of work a day leaving me lots of time to parent and do other things.

I tried to raise rent on our garage suite tenant when her lease was up. She was ok with it, but then said she'd get her own internet (it was previously an add-on) which ended up being a net 0 increase in rent. She signed for another year. Our motorhome is now up on RVezy for rent starting in late Apr, 2022. I don't expect we'll see any reservations show up until Feb or March. If we can net $8-10K in rental income per year with it, that's a solid win in my books.

Our solar PV work is in permitting at the moment. Our pre-energy audit was completed and came back as being a very energy efficient house already. Better than 99% of new homes built today. But it approved the PV addition for a 5K rebate. We will have to do a post-energy audit once it's all done. I expect we're looking at Jan or feb for the panel install.

Did a roadtrip to Calgary to visit friends, zoo, and some other fun things. Booked a ski trip to Golden/Kicking Horse before xmas - they have free season's pass for kids in Grade 2 (and Grades 4/5) so we'll take advantage of that. I'm going to try and do several ski day trips to the mountains with friends (not Golden, that's too far) and maybe another ski weekend or two with the family. Nothing else planned for vacations aside from a trip to Vegas for me, likely in March.

On the web business side, our second little venture is live though I do not expect any sales until March or April. I'll post the website and FB page in a bit and y'all can take a look and provide feedback.

*Assets:*

House - $1,130,000
DB Pension (wife) - $296,504
RRSPs - $572,585
Non-Reg - $0
TFSA: $23,325
Corporate Account/Value/Inventory: $124,500
House Maintenance Account: $8,967
Truck - $33,100
Motorhome - $37,150
Cash - $2,405
Miscellaneous assets - $16,000

*Total Assets $2,253,271

Liabilities:*

Mortgage - $6326,618
Credit cards - $4,175 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
HELOC - $58,465

*Total Liabilities $684,377

Net Worth: $1,564,013 (-$1K from last update)*


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## nobleea

So here are the websites:

This one I have been doing for over 3 years now. Sells house number/addresses, flooring vent covers. Peak sales for this are generally April/May and Aug-Oct.

www.mdrn.house

This is the new one. I have been selling these for a couple years now, but informally. I need more product images and videos still, but A) I won't have a lot of the product until January and B) I'd have to fly somewhere warm to get it done (which I likely will). I bought a drone to do some of this work too. Peak sales for this are April-August and then practically nothing outside of that.

www.padlboards.com

PADL Boards FB

Both sell only to Canadian addresses for a variety of reasons. Please have a look and let me know if you have any suggestions. If you have time to 'like' the FB page as well, that is helpful.


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## nobleea

*December 2021 Update*

Another month in the books, and our investments have taken a sizeable hit. Our networth is down 46K, but our investments are down more than that, so that is still a somewhat positive month over the things we have direct, immediate control over. I lose no sleep whatsoever about market fluctuations. We have about 120K in cash available for further drops in the various investment accounts.

As I mentioned, I am going to be staying at home primarily to look after the kids (7, 5, 3). My old employer did not get back to me with an offer or further discussions after I told them I'd only work part time. I was looking back at Page 1 of this diary and I said our family income was about $240K. I think we'll be somewhere between $250K-300K in 2022 and that's with me working only part time. I also saw this comment from 2014:


nobleea said:


> I believe both our jobs are secure enough to not worry about a large cash savings. My wife is an award winning teacher. There'd have to be a >20% cut in staff across the Board before she was in jeopardy. My position is secure. I am close to being an international subject matter expert on the product. The product is a 2billion/yr niche of which my company has over 50% of the market. It's one of the crown jewels of the company. Even if the worst happened, a lay off would come with a healthy severance package and my skill set would be sought after.


I was pretty accurate on all those statements. I should have made a comment about winning the LottoMax instead...

Our motorhome is now up on RVezy for rent starting in late Apr, 2022. I didn't expect to see any reservations show up until Feb or March, however, we just received a confirmed reservation of $4K for June/July (3 weeks). I think 10K or more in rental income is doable per year, which would actually be a fantastic investment since our cost base is under 40K AND we get to use it for personal use.

Our solar PV work is in permitting at the moment. We've been told installation is scheduled for late January.

Skiing-wise, there is some fantastic early season snow in the mountains. Did a day trip to Banff Sunshine already, and we'll be doing Kicking Horse for a few days skiing next week. My goal is 10 ski days this season which would be the most I've ever done since having kids.

*Assets:*

House - $1,130,000
DB Pension (wife) - $309,166
RRSPs - $527,128
Non-Reg - $0
TFSA: $20,445
Corporate Account/Value/Inventory: $120.000
House Maintenance Account: $8,463
Truck - $32,750
Motorhome - $36,975
Cash - $1,268
Miscellaneous assets - $16,000

*Total Assets $2,204,195

Liabilities:*

Mortgage - $624,269
Credit cards - $6,184 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
HELOC - $55,675

*Total Liabilities $686,128

Net Worth: $1,518,067 (-$46K from last update)*


----------



## nobleea

*March 2022 Update*

Been a while since I've updated this. Not a huge change, though the books may show some. My wife's DB termination benefit has dropped by over 40K due to rising interest rates. Can't do anything about it and that's the methodology I am using, so take the good with the bad.

Have a few stocks that are not doing so hot right now. If they were up to my ACB, the numbers would be about $75K higher. The HELOC balance is getting pretty high, but that is exclusively a shareholder loan to the company to buy inventory for this year. I expect it will be all paid off by July and then the company shouldn't need anymore loans.

Our motorhome, which I consider to be something of an investment we are also able to use ourselves, has about $9K in rental income booked so far for the season. I think it will be closer to $12K by the time it's all said and done. We have 40 nights booked off for our own use, which is about all we need. Also hoping to keep the mileage to less than 20-25K per year.

They started on our solar PV installation in January and then the weather got cold, icy, snowy, icy, windy, etc. They will be finishing it all off next week, just in time for our super long, super sunny days. Hoping we can build up enough credit to carry us all the way to Feb 2023.

Wife got Covid a month or so ago. She was functional but exhausted. No one else got it in our house and all the kids were not fully vaccinated at the time. We locked her in the basement.

My web stores are doing well. The existing one has sales peaks in May and Sept/Oct. The new one, I expect to have peaks in April-June and then almost nothing the rest of the year. I am going to try exhibiting at a tradeshow. Curious as to whether it's effective or not and whether the sales will make up for the expense. Its March 19/20 in Calgary. *If anyone in Calgary wants free tickets to the show, send me a note (Outdoor Adventure Show Mar 19/20).*

We are planning on going to Fernie for skiing in a couple weeks. They got 11" of snow yesterday, hopefully it doesn't melt by then. Will also get another day trip to the mountains in early April. I did a weekend in LA a while back to photo and video product for my webstore. Return flights were only $134, so it was hard to say no.

Just filed my income taxes, about $7K refund for me due to almost no income last year but a requirement to make instalment payments based on the previous year. Wife has to pay about $1K but haven't filed that one yet. Consulting is going well, I work about 6hrs a week, which is all I really want. They did offer me a full time job doing something similar but I told them I'm going to stick with P/T work for the next few years.

Kids' RESP is not included in our Net worth. Current balance is $81.5K.

*Assets:*

House - $1,130,000
DB Pension (wife) - $266,415
RRSPs - $536,790
Non-Reg - $0
TFSA: $15,686
Corporate Account/Value/Inventory: $166,000
House Maintenance Account: $7,509
Truck - $31,700
Motorhome - $36,450
Cash - $638
Miscellaneous assets - $16,000

*Total Assets $2,207,188

Liabilities:*

Mortgage - $617,288
Credit cards - $5,800 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
HELOC - $98,614

*Total Liabilities $721,702

Net Worth: $1,485,486 (-$33K from last update)*


----------



## nobleea

*May 2022 Update*

Birthday update. Another complete year around the sun and up the year counter to 44 now. Covid visited our house again with me and our youngest getting taken out for a couple days. I did get one final day of skiing in at Sunshine which made it 8 on the year - my goal was 10 so not too far off.

On our house, we finished up and activated our solar PV system. It's been running for a month now. Production is about 750kwh for the last month, which would be around or just over our actual consumption for that month. I expect we would we be net zero for the months of Apr-Sep. I want to run for a full year to see if there are any months where we do export more than we use as we can switch power providers and get paid 28c/kwh for excess generation. But we'd also get charged that rate for consumption, so it only makes sense in months where we're sure to consume less than we produce. It's a small array, 6.1kW. Most we could fit on the garage roof, which is the best location and angle for solar. Father in law lent us his fancy radon detector. I wasn't expecting much since it's a tight, new build house, but our numbers were 2-3 times the recommended limit (450-500 vs limit of 200 in Canada), consistently. So we booked a radon mitigation installation at a cost of $2500. Essentially just pulls a vacuum under your basement slab and exhausts it outside. Once it was turned on, radon numbers dropped down to ~20. Mortgage keeps on chugging away - I feel like a genius doing an early renewal last Feb at 1.59 fixed for 5 years.

Motorhome - continue to get bookings for it, up to 55 nights booked as rentals. Just took it out of storage from the winter and no surprises. I am going to stick with 12K in rental income per year after booking fees.

Pension - wife's pension continues to drop in termination benefit as rates go up. So that's another hit to the NW. Flip side is that purchasing years of service from maternity leaves is getting cheaper now, so something we might consider as we have 2 years available to purchase.

Investments have not done well as of late. Mainly due to one of my bigger holdings doing poorly. I feel like we're possibly heading in to rough waters here and see stocks dropping in general some more. I started moving to cash a couple months ago and am now about 50% cash. I have 300K in cash across the accounts available and may just wait to see what happens in the fall. I got out similarly in Feb 2020 when most indices broke thru their 200DMA.

Overall, I'd say things have gotten in to a bit of a mess with personal loans to my businesses, house repairs, etc. and will be focusing the rest of this year on getting everything straightened out and back to normal.

RESP is now at 68K though it was as high as 85K within a few weeks ago. Not included in the NW.

*Assets:*

House - $1,140,000
DB Pension (wife) - $241,320
RRSPs - $491,299
Non-Reg - $0
TFSA: $12,625
Corporate Account/Value/Inventory: $110,000
House Maintenance Account: $6,323
Truck - $31,000
Motorhome - $36,100
Cash - $3,702
Miscellaneous assets - $16,000

*Total Assets $2,088,369

Liabilities:*

Mortgage - $612,645
Credit cards - $4,050 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $12,941
HELOC - $76,100

*Total Liabilities $705,736

Net Worth: $1,382,633 (-$103K from last update)*


----------



## scorpion_ca

nobleea said:


> Investments have not done well as of late. Mainly due to one of my bigger holdings doing poorly.


Just wondering what is your biggest holdings other than your house?


----------



## nobleea

scorpion_ca said:


> Just wondering what is your biggest holdings other than your house?


Stocks in RRSP. The ones that are down the most in dollar amount (if not %) are PARA and SPG.TO


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## edip

You overestimate your networth in my opinion.. First, RRSP is 20-35% less as you need to pay taxes...Maybe even more depending when you take the money out.. Same with the DB pension. House, you don't consider the cost of selling it. On top of that, until you sell it you don't know the real value..... Also truck, motorhome and what miscellaneous assets are your estimations.. most of the time the real value is way less....

"You are richer than you think" doesn't work in reality... Think about 2 theoretical situations... Individual A has $1M in checking account or TFSA and individual B has $1M in RRSP... What is the networth of each individual?


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## nobleea

Overestimate? Maybe a little bit, but as long as its measured consistently on the way, the growth and change is what matters, not the absolute value. When we get closer to retirement, then the actual amount matters.

Anyone who loses 20-35% to taxes on their RRSP is massively incompetent. I think my average tax rate during earning years was around 24%, so I fail to see how our retirement tax rate would be worse. I suspect most average tax rates on RRSP withdrawals is 15% or under. If she plans on going to retirement, the value of the DB pension is a useless number since we'd be getting the income instead.
The truck and motorhome are conservative estimates. They're both worth about 10K more each and that is an easy estimation. The house value includes selling fees. Based on comparables in the surrounding neighbourhoods, selling right now would be in the 1.3-1.5M range, but that is sure to drop if interest rates continue to rocket.


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## milhouse

edip said:


> You overestimate your networth in my opinion.





nobleea said:


> but as long as its measured consistently on the way, the growth and change is what matters, not the absolute value. When we get closer to retirement, then the actual amount matters.


I've seen the question about whether you should use after tax figures to calculate net worth pop up here and there. 
IMO, it really depends on what one's goal is in terms of tracking net worth. I think for most, it's to check to see that one is progressing in the right direction and at what speed. And as mentioned, to compare apples to apples of one's net worth snapshots, the variables should stay consistent. One can try to calculate taxes along the way but theres so much potential variability around how tax rules may evolve and apply to one's retirement income strategy.

Closer to retirement, for me, it's also been less about absolute value but after tax cashflow and correspondingly, then figuring out how to minimize taxes.


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## Gator13

If it was me, I would drop the following lines:

House Maintenance Account: $6,323
Truck - $31,000
Motorhome - $36,100
Miscellaneous assets - $16,000 
Credit cards - $4,050

I would also track two separate net worth totals. One that includes your house & mortgage and another that doesn't. I also calculate my net worth using pre-tax totals.

I am in the same situation as millhouse: *"Closer to retirement, for me, it's also been less about absolute value but after tax cashflow and correspondingly, then figuring out how to minimize taxes."*


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## kcowan

With RRSPs and a DB pension, my average tax rate since retiring in 2002 has been consistently 13%.

I agree that it is better to have an optimistic plan than no plan. Pre-retirement, I had three plans: pessimistic and average. The optimistic plan was the most accurate, mainly due to the markets. But the three plans allowed us to properly allow for the impacts of major items.


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## scorpion_ca

Any update?


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## nobleea

Coming this week. Summer has been busy.


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## latebuyer

Just kudos for doing your diary so long. I hope its been helpful.


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## nobleea

*September 2022 Update*

We had a pretty busy summer. Thankfully, we managed to avoid wildfire smoke for almost all of it, except a couple days end of August. We had 10 days in Ottawa, then 3 weeks in BC (Shuswap and Okanagan). Banff and a few other camp weekends as well. All 3 kids are now in some form of school - 1 full day, 1 half day kindergarten, and 1 half day 3 days a week playschool (Jr Kindergarten for you easterners). We have a trip to LA for a concert coming up in October that we're looking forward to. Tossed around the idea of a Mexico trip in November for the fall school break, but I'm not sure that's going to happen. Quite expensive and stuck to the pacific side to avoid hurricane season (not a knock on the pacific side of course).

Our solar PV system has done well this summer. We averaged just over 800kWh generation each month from April onwards and that is more than our consumption, so we had credits on our bills for the electricity portion those months. Will be interesting to see if that can continue for October. Our tenant in our garage suite has agreed to another 1yr lease - we increased the rent by $30/mo and agreed that we would get something for cooling in the summer as it does get quite hot. I am hoping to get a mini split installed as it wouldn't need a large unit. Hopefully under 2K. If that's not possible, then I'll buy a portable unit and store it when it's not needed.

Motorhome - We had 8 bookings for the motorhome with an average length of 5 or 6 days each. Total revenue after booking fees was $8,225. Bit lower than expected as we had a couple cancellations due to the price of gas earlier in the summer. We also took it out ourselves for 35 nights. Just a couple oil changes. Will need an alignment and a new tire, but nothing significant this year. Probably 15,000kms put on it this year. We will probably list it on Outdoorsy in addition to RVEzy (where it currently is listed).

We have certainly taken some paper hits in the investments and the wife's DB pension value. Down about 200K overall from a year ago. But on the bright side, our debt number is close to a 7yr low.

For my work, I am averaging about 6hr/week for contracting work. I am going to try to increase that this year. The hours are available, I just need to be more organized and set time aside to work. Fall is the busy photography season, and I have lots of sessions booked. Web businesses are doing ok. I probably have more inventory than needed for one of them and it'll probably take 2 yrs to sell rather than the 1 I had planned on. We've agreed as a family that I will likely stay at home taking care of the kids until the youngest is in Grade 1, which would be 3 yrs from now. If something crazy comes up, maybe we'll reconsider, but I'm not sure I can ever be a FT wage slave again.

*Assets:*

House - $1,140,000
DB Pension (wife) - $208,493
RRSPs - $458,895
Non-Reg - $0
TFSA: $10,879
Corporate Account/Value/Inventory: $105,500
House Maintenance Account: $6,634
Truck - $29,600
Motorhome - $35,400
Cash - $1,176
Miscellaneous assets - $16,000

*Total Assets $2,013,577

Liabilities:*

Mortgage - $603,349
Credit cards - $6,069 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
HELOC - $69,915

*Total Liabilities $679,333

Net Worth: $1,334,244 (-$48K from last update)*


----------



## nobleea

*December 2022 Update*

Not a whole lot to update since the last time. We flew down to LA for a concert, which was a fantastic getaway. Haven't been out skiing yet aside from the local 'hills' but it has been really cold in Dec. Have trips planned in Jan to banff and jasper, and lake louise in Feb. We looked at going somewhere warm for after Christmas or the spring school break, but the prices are ridiculous, so that just won't happen. Prices 70-100% what we would have paid before Covid. Oh and someone slid in to our parked truck on some ice and caused 3K in damage. They at least stopped and shared details, but bit of a annoyance. Dealing with insurance has been interesting.

We are looking for a teacher exchange with someone in Australia in the next 3 years. Would be a good experience for everyone I think.

Motorhome - I did list it on Outdoorsy as well in the fall, but they gave me a lot of grief for some reason and wouldn't cover it under their insurance. After some back and forth they finally relented. But RVEzy is where all the bookings seem to come from.

Nov 30 was the last day our solar PV system generated any power, at least according to the app. We exported a whopping 2kWh over the last 30 days. But that's to be expected. Late march is when it picks up again.

Again more hits to asset column from the markets and interest rates. But our debt level is the lowest its been in 7 years. We have about $265K in cash in our investment accounts, which is just over 50%. Will gradually start to ease back in in Q1.

Still averaging about 6hr/week for consulting, brings in about $45K/yr. Income from photography this year was $5K. Our garage suite rental and motorhome rental bring in about 22K. And I'm still able to take care of our kids throughout the day without needing childcare. Still qualify for a lot of the child benefit, which amount to another $8k/yr.

I did get a little bored in December, so I dug out my list of ideas and signed up for some free courses with the local business/technology incubator. Focuses on ideation, problem generation, customer discovery, pretotyping, etc etc. I found them interesting. They have several more courses (free) that follow up on each other to get your idea to the launch/revenue stage. Probably won't do anything with it, but I hate the idea of living with regrets 20 yrs from now of what could have been.

*Assets:*

House - $1,140,000
DB Pension (wife) - $193,760
RRSPs - $422,990
Non-Reg - $0
TFSA: $8,198
Corporate Account/Value/Inventory: $127,500
House Maintenance Account: $7,058
Truck - $28,550
Motorhome - $34,875
Cash - $8,355
Miscellaneous assets - $16,000

*Total Assets $1,987,286

Liabilities:*

Mortgage - $596,312
Credit cards - $6,579 (this is not a balance, but the amount due. We pay off every month, but a true snapshot must include this)
PLOC - $0
HELOC - $66,018

*Total Liabilities $668,909

Net Worth: $1,318,377 (-$16K from last update)*


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## peterk

What's your total family spending been for the year, if you keep tabs on that?

Mine's up substantially to $110k in 2022, from $92k in 2021... Yikes


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## scorpion_ca

$200k down in 2022. Is this the first year where the NW is down significantly?


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## nobleea

scorpion_ca said:


> $200k down in 2022. Is this the first year where the NW is down significantly?


Yes, this is the first year where NW is down at all, much less significantly. But there was a year were NW was up 400K+. So it balances out.


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## nobleea

peterk said:


> What's your total family spending been for the year, if you keep tabs on that?
> 
> Mine's up substantially to $110k in 2022, from $92k in 2021... Yikes


I don't keep tabs on it. I assume you include all spending, including mortgage? What about RESP, RRSP, TFSA contributions? Paycheque deductions?


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## scorpion_ca

nobleea said:


> I don't keep tabs on it. I assume you include all spending, including mortgage? What about RESP, RRSP, TFSA contributions? Paycheque deductions?


RESP, RRSP, TFSA contributions are savings and I don't include it as expenses.

Paycheque deductions - I cannot control it. So, don't count it as expenses either.


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## londoncalling

@nobleea Congrats on your progress since 2013.

I noticed that you have indicated a decrease each quarter this year the wife's DB plan. I believe the reason is because of the move from full time employment. I have always had trouble determining the NW value of DB plans and in my research have not been able to find consistency in how this is calculated. Obviously the most accurate number would be the commuted value but that is typically not available unless you have a break in service and need to determine whether to lock in or commute your pension. As I have two DB plans that I am not contributing to and my wife has an active DB plan I am very curious. As a result I have shifted to a cashflow in retirement metric as the monthly payout is quickly pulled from the statement and updated annually. 

Would you be able to expand on how you calculate the value of the DB plan?


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## peterk

nobleea said:


> I don't keep tabs on it. I assume you include all spending, including mortgage? What about RESP, RRSP, TFSA contributions? Paycheque deductions?


Yes all "spending" including mortgage and property taxes (though I suppose property taxes could be debatable) - but not any payroll taxes or pensions contributions - and not any savings account contributions, those are savings.

I feel like my $110k spending is "high" - but I really don't think I could cut things by any more than 10-15k or so without hardship to the family.


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## peterk

londoncalling said:


> @nobleea Congrats on your progress since 2013.
> 
> I noticed that you have indicated a decrease each quarter this year the wife's DB plan. I believe the reason is because of the move from full time employment. I have always had trouble determining the NW value of DB plans and in my research have not been able to find consistency in how this is calculated. Obviously the most accurate number would be the commuted value but that is typically not available unless you have a break in service and need to determine whether to lock in or commute your pension. As I have two DB plans that I am not contributing to and my wife has an active DB plan I am very curious. As a result I have shifted to a cashflow in retirement metric as the monthly payout is quickly pulled from the statement and updated annually.
> 
> Would you be able to expand on how you calculate the value of the DB plan?


I suspect, as mine does anyways, that there is a DB calculator tool available that spits out your monthly retirement benefit, as well as a calculated CV, based on prevailing interest rates. My company has this service provided to us somehow. You can model any retirement date you choose, as well as a number of other factors related to your employment, to estimate your pension benefits.

The CVs have been dropping steadily for the past while due to the interest rate hikes dominating the calculation, despite increasing duration of service and salary, which should raise the CV.


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## nobleea

peterk said:


> Yes all "spending" including mortgage and property taxes (though I suppose property taxes could be debatable) - but not any payroll taxes or pensions contributions - and not any savings account contributions, those are savings.
> 
> I feel like my $110k spending is "high" - but I really don't think I could cut things by any more than 10-15k or so without hardship to the family.


If I include all those things, then I would estimate our annual expenses to be in the 110-120K range. About 50K of it can be associated with our house, which is probably larger than average. We could downsize, but we would probably miss out on our garage suite rental, which is 15K per year.


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## nobleea

londoncalling said:


> @nobleea Congrats on your progress since 2013.
> 
> I noticed that you have indicated a decrease each quarter this year the wife's DB plan. I believe the reason is because of the move from full time employment. I have always had trouble determining the NW value of DB plans and in my research have not been able to find consistency in how this is calculated. Obviously the most accurate number would be the commuted value but that is typically not available unless you have a break in service and need to determine whether to lock in or commute your pension. As I have two DB plans that I am not contributing to and my wife has an active DB plan I am very curious. As a result I have shifted to a cashflow in retirement metric as the monthly payout is quickly pulled from the statement and updated annually.
> 
> Would you be able to expand on how you calculate the value of the DB plan?


Thanks.

Calculating the CV is very easy. I log in to her pension portal, click on termination benefit, it calculates it and spits out a number, which varies almost week to week. Below is the print out they provide for today. The cash portion would be taxed, but she has enough RRSP room to cover it.
Commuted Value - $193,760.30
Payment - Transfer to LIRA $186,705.90
Payment - Cash Only *$7,054.40


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## londoncalling

Thanks @peterk and @nobleea for the feedback. Unfortunately, the administrator's do not provide that option for my wife and I on our plans. It is something that would be nice to have but not required as we do not plan to commute the value. Perhaps they are worried that knowing that number would result in more people taking the CV.


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