Monthly Review - February 2004 ($139,905, +$3,653)

Contributed by mm | March 4, 2004 7:52 PM PST

SUMMARY

With a net worth increase of $3,653, February 2004 brought another month of solid progress toward my 2004 objectives. The 3.0% net worth growth is attributable almost equally to regular saving from job income and a new batch of vested stock options. The Month-To-Retirement reading is unchanged at May 2016.

MONTH-END BALANCE SHEET

(Since this month, I am including three months' balancesheet data for comparison purposes. This should offer more meaningful analysis of the progress.)

See definition of balance sheet line items here:

	Dec-03	Jan-04	Feb-04	Change	Change %
Cash & Equivalent	$ 918	$ 953	$ 1,193	$ 240	25.2%
Saving	$ 10,671	$ 15,298	$ 15,098	$ (200)	-1.3%
Brokerage	$ 21,329	$ 21,827	$ 22,358	$ 530	2.4%
Roth IRA	$ 7,604	$ 10,822	$ 10,941	$ 119	1.1%
401(k)	$ 11,308	$ 12,005	$ 12,811	$ 807	6.7%
Stock Option	$ 1,211	$ 2,268	$ 3,146	$ 878	38.7%
ESPP	$ 9,805	$ 1,291	$ 2,582	$ 1,291	100.0%
Home Equity	$ 66,392	$ 67,193	$ 67,995	$ 802	1.2%
Other Assets	$ 9,700	$ 9,550	$ 9,400	$ (150)	-1.6%
Payable (Receivable)	$ 3,491	$ 3,558	$ 3,699	$ 142	4.0%
Reserve Funds	$ (1,455)	$ (1,693)	$ (1,984)	$ (291)	17.2%
Loans	$ (4,979)	$ (2,959)	$ (3,147)	$ (188)	6.3%
Tax Liability	$ (3,411)	$ (3,860)	$ (4,187)	$ (327)	8.5%
Net Worth	$ 132,584	$ 136,252	$ 139,905	$ 3,653	2.7%
Liquidation Value	$ 106,875	$ 110,156	$ 113,455	$ 3,300	3.0%

INCOME STATEMENT

Total operating expenses for the month is $5,193, around $1,260 higher than last month's multi-month low. The variance is mostly due to prepaid expenses (airfare and hotel) for our family's vacation to Las Vegas in early March (we expect another $500 travel expenses to be recognized in the month of March for the same vacation).

With a new batch of stock option vested in February, my stock option account grows $800 albeit a slight drop in the company stock price. My other investments also raked in $646 in the month.

BALANCE SHEET

Balance-sheet wise, the month-to-month change is typical: regular savings from job income impact mostly the 401(k) and ESPP account except for January and July, when i regularly sell off my ESPP stocks. Other than that, home equity continues to grow steadily (and still, the market value of my house is well exceeding what I am recognizing in the book now based on recent sales).

INVESTMENTS

S&P 500 advanced another 1.2% to 1,145, marking a fifth month of consecutive gain. My portfolio performed pretty well, especially with a 17.2% climb in my option play in MSFT and comparatively solid performance of my new holding of TALK. (See more discussion of my actively managed portfolio in this post.)

My 401(k) involvement is still largely defensive, although with a portfolio value of more than $12,800, the account represents a sizeable portion of my liquid assets. I'm allocating around 65% in money market, 25% in international equity (NIIVX) and 10% in a blended fund (OAKBX). I am willing to miss some additional run of the crazy domestic equity market in order not to become prey of another major market downturn like that of 2000-2002.

IMPORTANT PERSONAL FINANCE ISSUES

- In late March I will sell my position in RJR (which I acquired on March 18, 2003). This is a profitable play, returning 91% so far and substantially exceeding my target now. I intend to liquidate it with long-term capital gain treatment.