• Zach

Net Worth Update: August 5, 2020 - Uncertainly Positive


when I dip, you dip, we dip

This feels awkward to write. The world is in such a weird place right now. People are suffering, dying, jobless. Hell, I'M in an awkward place right now as well. I'm in Dubai, my job is in China, I'm waking up at 3:30 AM to work remotely. I have no idea how long this will last.


But I am so lucky. I'm not sick. My family hasn't been struck by this weird disease (although I do know several people who have had it and fortunately they're all ok). I have a job, a good one, and they aren't cutting my pay, and allowing me to work remotely until I can get in the country. I am so fortunate.


And financially, I've never been better. Literally. After last quarter's drop, my net worth has surged by nearly $30,000 in one quarter. I'm well past $200,000 for the first time in my life. It officially took me from January 23, 2018 until June 8, 2020 to go from $100,000 to $200,000, a period of roughly 17.5 months, after taking me 34 years to get to $100,000.


So, how did I blow past this major milestone? Savings, a "bonus", and the stock market, but let's look at savings first. In May, June, and July I saved nearly $11,000. At some point I should be getting a refund on the cruise I paid for that didn't happen in July, so that number doesn't really reflect that. Also, I finished my contract here in Dubai and got my "retirement" indemnity which added a decent chunk of change as well, over $7,000. The rest was gains in the stock market, which has continued weirdly surging ever since March.


Which I don't get, and it makes me nervous. America's economy is just getting the crap kicked out of it, along with the economies of many places around the world. And as many people smarter than myself say, don't invest in what you don't understand. So that's why I've made a change to my investing portfolio.


In which I move a bunch of money to Money Markets


So, I went and changed my investing portfolio. During a time of duress. It was an emotional decision. Which, if you know anything about good investing based on the modern portfolio theory, you DON'T DO. Like, any of that. You STAY. THE. COURSE. It's advice I've personally given many times. And I just couldn't do it. I'm weak. I'm scared. I don't want to see my hard saved money flushed down the toilet.


That led me to move about 1/5 of my portfolio out of stocks and bonds and into a Money Market (or a similar product), which is meant to provide low returns but high stability. The one I chose was iShares Short Treasury Bond (SHV). But I probably could have done nearly as well in a decent savings account. Honestly, my investment allocation was stressing me out, and with the global pandemic and not being able to get to my next job banging my brain on a nearly constant beat, I needed less risk.


Now I have a huge war chest of cash in savings accounts, enough easily for 2 years of living in Dubai without income, plus a bunch of money in this stable fund. I'm sleeping better at night and not freaking out about it as much. There are plenty of other things to freak out about.


And it's not like it has to stay this way. If things stabilize, I'll dollar cost average back into the markets and my previous asset allocations. But not right now. I just can't handle it. I really like knowing I could ride out a couple years of not working and still have money working for me. If I could get to a low cost of living country, I could not work for nearly a decade on just my cash reserves. This may seem like overkill to a lot of people. Hell, I know it's not the right thing to do, from a mathematical standpoint. But I'm not an equation. My amygdala doesn't reason well. Sh*t is crazy right now, and I need things to be a little less crazy.


So, what can we learn from all this?


  1. The principles of saving and investing work. The principles of Financial Independence and Modern Portfolio Theory has more than doubled my net worth in less than a year and a half.

  2. Even knowing this, uncertainty and fear can take you off the track of what has worked for you.

  3. Do what makes you sleep better at night, cortisol is a hell of a drug and will kill you, so try to minimize it.

  4. You can change it up later, as long as you don't do anything really stupid. I didn't invest it all into the airlines or something. I still think the market will fall again, and I'd like to have a bunch of money sitting around to invest then, this recovery doesn't feel real.


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Disclaimer: The views expressed is provided as a general source of information only and should not be considered to be personal investment advice or solicitation to buy or sell securities. Investors considering any investment should consult with their investment advisor to ensure that it is suitable for the investor’s circumstances and risk tolerance before making any investment decisions. The information contained in this blog was obtained from sources believe to be reliable, however, we cannot represent that it is accurate or complete.

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Currently in Dubai, UAE