We have over 400k in debt and I love it

At the start of 2012 our net worth was $246,756.54. Woman-with-money1

I talked about it in this post here “Our Networth Increased by 125k in one year”

From 2011 to 2012 we gained over 100% in net worth gains or 125k!!!

I was really happy and tried to figure out how we could outdo our 2012 start.

Well in 2013 our net worth is now….

Before we get to what we are actually worth, let’s break everything down…

What are our assets?

For the first time readers, I will define each critical term. So, what is an asset you ask? Good question Jane (Your name will be Jane for this exercise).

An asset is:

Property owned by a person or company, regarded as having value and available to meet debts, commitments, or legacies.

Our assets are:

  • Cash which equals to $53,152.62
  • Investments (Stocks/Bonds) which equal $164,727.22
  • Other Assets (Cars) which equal $31,000.00
  • Real Estate which equals to $646,000.00

Total Assets: $ 894,879.84 

As you can see, a majority of our net worth comes from our real estate adventures. That’s the power of 1 primary residence, purchased at a significant discount and 3 kick ass rental properties.

What are our liabilities?

What is a liability you ask? Good question Jane!

A liability is:

Legal debts or obligations that arise during the course of business operations. Liabilities are settled over time through the transfer of economic benefits including money, goods or services. Also know as… shit you have to pay for…

Our liabilities are:

  • Credit Cards which equal $7,189.69 (We pay this is full every month, 0 interest)
  • Loans which equal $115,313.36
  • Mortgages which equal  $353,882.95

Total Liabilities: $ 476,386.00

What is our net worth?

What is net worth you ask? Good question Jane!

Net worth is:

In business, net worth (sometimes called net liabilities) is the total assets minus total outside liabilities of an individual.

So, all we have to do now is some simple math. We will simply take Total Assets and subtract Total Liabilities to achieve net worth.

Total Assets – Total Liabilities = Net Worth


$ 894,879.84 – $ 476,386.00 = $ 418,493.84

That means our net worth has increased by over $171,737.30 in one year. That crushes our $125k gain from 2011-2012.

What could you have done better?

A review of our monthly expenses uncovered a few things that we could have done to improve our net worth.

We spent $15,600.00 on food/house items

We spent about $5,000 on going out/having fun (not including vacations)

We spent spent $12,000 in personal spending money (our allowance for personal fun)

We spent $30,000+ in real estate repairs / covering 3 vacant properties (This sucked!!!)

We spent over $5000 on holidays/Bdays

We spent $2400 on our dog

We spent $15,000 on home renovations

As you can see we definitely have room for improvement, but the good thing about this, even with all those expenses above, we still live on less than 50% of our net income.

Moral of the story?

It doesn’t matter how much debt you have, it doesn’t matter how much income you bring in, net worth is the measuring stick of financial success. I know a lot of people bringing in 200k per year and nothing to show for it. I also know tons of people with 0 debt and little to no net worth. Focus on the big picture.

Oh… and if you live on 50% of your net income, your wallet can take a big beating before you need to worry 🙂

Before you go.. I would love to work with you 1 on 1. Click the picture below to get started on building wealth



  • Impressive gains without living on dog food, dude. I think that’s the moral here. You give yourself a healthy allowance and still are able to attack the bottom line by paying attention to the assets that’ll increase your net worth.

  • […] From Dominique Brown’s Blog: We Have Over $400k In Debt and I Love It […]

  • Joe,

    I like to tell people that I am far from frugal. My method is simple.. Focus on things that bring in money. If you’re going to buy something that isn’t bringin in money.. no loans (cash only). It has been working pretty well so far.

  • Sam /

    Big bucks dude!

    What did you attribute your $170k net worth increase to as that is huge! Need to make about $300,000 gross income to save that much after taxes.


  • Sam a few things really..

    Real Estate appreciation on the primary residence
    Stock Market Gains
    Saved a lot of money
    Brought in a lot of money from the rental properties

    So all though it does seem like a lot left us.. we brought in way more that left us in 2012 🙂

  • Well done man! I’m just trying to grow my overall net worth by 10% a year and here you are doubling it for two years in a row! Definitely inspires me to try and work harder on my finances.

  • Sam.. it’s easy to double your networth when you start with a lower number. I’m sure you have a few million in the bank, so 10% is still no small potatoes 🙂

  • Sandy /

    What I want to know is how I can get in on this fun allowance money you guys have. I don’t need much. $3K should do.

  • I was wondering when someone was going to jump on the 6k spending money we each get per year lol. Hey it keeps us sane. It’s the only money that we both don’t scrutinize.. She buys what she wants and I buy what I want.. Gotta have some fun right 🙂

  • Great job in keeping track of your spending. I agree that net worth is the best way to determine where you’re at financially. It looks like things are going well for you. Congrats!

  • Thanks Pam! Yes.. I think a person needs to take a few steps back and look at the entire financial picture (networth) when seeing how they are progressing towards their goals. A lot of people only focus on debt.

  • Jon A /

    Hey good job, not many people like to take risks like you but it seems like you know what you are doing! Glas to see your strategy is working out for you 🙂

  • Thanks Jon! You’re right a lot of people aren’t willing to take risks with their capital. I’m doing everything I can with mine. However, we did decide that we aren’t taking any more equity loans to fund the real estate process, just all cash from now on.

  • […] the last net worth update. Well if you don’t remember you can read it here. I wrote about how we are 400k in debt and love it. Clearly this was an attention grabbing title. I […]

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Teach me how to improve my finances, 

so that I can buy a home

and stop wasting my money on rent