My 2021 Finance Summary
Hi readers, 2021 was a very eventful year for me. Going into 2021 I had no debt besides a mortgage. After starting to research trading and invest a lot in 2020, I continued the momentum and focused on wealth growth in 2021. Here are some of the highlights of my year.
Major Events of 2021:
In May I started Financially Free AF. It’s been a fun learning experience so far. First I learned how to build a website using Squarespace. Now I’m learning about affiliate marketing, advertising and search engine optimization (SEO).
In September I replaced my hot water heater. Fortunately it only cost me $650 because I had a friend to help install it. With professional installation it would have cost around $2000. Make sure to build mutually beneficial friendships.
In September I bought a new car. I paid a little more than I wanted to but the price of used cars is very high. I bought a 2017 Nissan Rogue because it’s dependable, has lots of space for activities and is relatively fuel efficient. See my article on buying a used car here.
In December I got engaged to the love of my life. Engagement rings aren’t cheap but I made sure to stay within budget and negotiate the price. We have no date planned for the wedding yet but I already started budgeting for it.
Over the entire year I made $1,640.75 in dividends and distributions. I’m very excited I made that much in one year and I will continue to reinvest my dividends and distributions as soon as I receive them.
In 2021 I made a whopping $15,817.32 tax free in my TFSA and RRSP accounts. That is well above the market expected average but I don’t expect to consistently have gains that high. Learn investing here.
With diligent investing and keeping extra spending to minimum, my Net Worth increased by 46% from the start of 2021. With a low Net Worth it’s easier to have large gains. My salary has not increased so this years Net Worth gains will be more dependent on budgeting and the stock market performance. Learn budgeting here.
I made $498.30 in credit card cash back. Learn about using credit cards to your advantage here.
Breakdown of Assets
Asset Details
When I first bought my car it was about 9% of my assets. After all my investments have been declining it my car changed 11%. Because my car, hot water heater and engagement ring were much more than I usually spend, I used up some of my emergency fund (that’s why it’s there). My plan is to:
Rebuild my emergency fund.
Max out my TFSA.
Max out my RRSP.
Invest using a non-registered trading account.
These are long term goals and unless there’s a drastic change, these won’t all happen in 2022. Interest rates are still very low so I currently have no plans to pay off my house early.
If you’re like me and concerned about how much the value of your portfolio has gone down in 2022 watch this video on economics by Ray Dalio. You’ll see it’s a perfectly natural part of the cycle.