Net worth update: January 2012

Approximate value of our house: $175,600* (down $7,700)
Roth IRA: $22,110 (up $1,183)
Simple IRA: $4,500 (up $402)
Savings (including emergency fund): $12,811 (up $5,924)
Total assets: $215,021

Liabilities:
Mortgage: $183,073 (up $101)

Total net worth: $31,948
Difference since last quarter: $-292
*Source: Zillow.com

Wow, so I do all that work to save money and my retirement accounts are slowly climbing higher without any additional investments, however my net worth still decreased due to the house losing $7,700 in value in just 3 months. Apparently we are not done with the housing crisis because values are still dropping at a faster rate than we can pay down the mortgage. It's sad our house has turned into such a money pit. Since my last net worth update, we paid 3 payments of about $1,100 for our mortgage and it lost $7,700 in value - so essentially we've sunk $11,000 into the house in 3 months - so that's like paying $3,666 per month to live in our house - or $122 a day - which is more money than I make in a day - before taxes. It's frustrating to do all the right things but barely keep our heads above water.

Even though I do have over $12,000 in savings, about $7,000 of that is allocated to replacing our windows and siding on our house (the rest is our emergency fund). I don't know how much we will increase the value of our home by making these improvements, but I'm guessing we'll probably only regain about half the value we put into it. So the house is even more of a money pit!

So why did our mortgage balance go up? We just signed papers to refinance our mortgage at 4.5% interest rate (down from 5.75%)! They "pay off" our old mortgage before starting the new one, so the pay off value was actually more than our principal balance. But on the plus side, I think (although I'm not 100% positive) we won't have a mortgage payment for February since this new mortgage is set to start on March 1. So although we took a couple steps backwards in getting the balance of the mortgage lower, we should save about $1,000 next month by not having a payment. At first I thought I'd just throw that extra money at the principal of this new mortgage to get the balance we owe closer to where it was before we refinanced, but then I remembered my current goal of saving $20K by September 1. Setting this extra money aside would help us reach that goal faster.