Thursday, March 22, 2007

Contributions of Investment Returns and Savings

Following up from trainee investor's question on my previous post I made a jpeg of the Excel Chart that I maintain on the relative contributions of savings and investment returns to my net worth growth. Yoyo is patiently waiting for her next class on measuring investment performance :) Clearly, most of the current growth is coming from investment earnings, while in 2005 most growth came from savings. Back in January 2003 my accumulated investment earnings were negative to the tune of -$23,944. Now we are at a positive $173,768. So I have gained almost $198k. In the same period I've saved $142k. So there you have it. By the way the investment returns are primarily pre-tax (the exception is my Australian Superannuation Fund where the 15% tax on earnings is deducted at source). By the way any tax payments would be recorded as negative saving. But so far I have only had tax refunds as my withholding from salary has been sufficient to cover everything.

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