Real estate continues to soften in Canada but is picking up steam in the US. Stocks were relatively flat but overall nudged up slightly. I’ve decided to finally add my US trading account to my net worth. There’s not much in there. It’s only worth maybe $30K, made up of different US companies like Starbucks, Caterpillar, and other stocks I’ve blogged about buying in the past, but it is practically all leveraged. For every dollar worth of stock I have in there I’ve pretty much taken on the same amount of debt lol. I used my CIBC line of credit for the initial funding of $10K last year and then borrowed the remaining $20K on margin. So it’s basically a completely leveraged portfolio of US stocks :0) I have to pay about 3.5% a year after tax from my own pocket to maintain this portfolio at the moment. But I think there’s a pretty good chance I’ll get a 3.5% after tax return or higher on my stocks this year, so that’s why I’m doing it! Yay for low interest rates.
I’ve never added this US account to my net worth before because I thought my RRSP contribution room would be plenty to house all the US stocks I would ever want to buy. And it probably still is. But one thing I can’t do in an RRSP (401K equivalent) is use margin :D, and the reason my Canadian stocks are worth over $70,000 today is not because the TSX has done so well, but because I used lots of leverage. But the biggest reason I didn’t want to include it in my net worth is because I’m not sure how to consolidate 2 different currencies. The banks have done a great job of splitting my net worth so I have a balance for all my Canadian accounts, and then a separate balance for just my US accounts.
However I don’t want to have 2 separate net worths. Do I convert all USD to CAD when listing my assets and liabilities, or should I do the conversion at the very end when I calculate the final net worth? It’s not a huge issue right now because the Canadian loonie is worth almost the same as the US dollar. But in the future when the gap widens it could make for some very inaccurate calculations 🙁 Nevertheless this USD account is becoming too large to simply ignore anymore, so starting from this fiscal update and onwards I will include it’s balance and the debt that goes along with it. Of course since it’s all leveraged, it doesn’t really affect my net worth 😀
- Part-Time Work = $1200
- Dividends = $300
- Eating Out = $100
- Others = $100 (renewed Costco membership)
*Net Worth: (MoM)
- Assets: = $538,000 total
- Cash = $1,700 (-$100)
- Stocks CDN = $72,400 (+$300)
- Stocks US = $30,500 (new)
- RRSP = $31,400 (+$600)
- Home = $252,000 (Same)
- Farm = $150,000 (Same)
- Liabilities: = $382,400 total
- Mortgage = $203,800 (-$400)
- Farm Loan = $111,400 (-$300)
- Margin Loan CDN = $18,800 (–$100)
- Margin Loan US = $18,500 (new)
- Line of Credit = $19,900 (+$500)
- Line of Credit CIBC = $10,000 (new)
*Total Net Worth = $155,600 (+2.0%)
About $3K gain from last month, which is about the same as February of last year. My side hustle and dividend income pretty much covered half of that total increase. So lucky I have 2 jobs in this economy (~_~) I calculated the net worth this time by simply adding up all the numbers both USD and CAD so the result is a mix of two currencies lol. I need to find a better solution going forward though. I wonder how other people calculate their wealth if they have financial assets in different countries.