| Real Life Strategies for Building Wealth

restructuring net worth

“You are doing what? The world economy just became so much more volatile and you are selling your apartment.”

My friend’s face was a picture. We were spending a perfect summer afternoon in Sofia, drinking chilled white wine and catching up when I mentioned that my main mission in Sofia is to arrange the sale of the apartment.

My friend was right about the new infusion of volatility in the world economy. She was also right that in a world where money has left the economy, putting it in ‘brick and mortar’ – or gold, for that matter – makes sense.

We decided to go against the grain and implement our programme for restructuring net worth.

You know that I’m a firm believer in tracking my net worth. This is not enough to make your money work for you; for that you have to know the structure and the ways for restructuring net worth.

This is what the structure of our net worth was like in summer 2013:

  • About half of our net wealth was in non-income generating property (houses, apartments and land) and possessions.
  • Another 45% of our wealth was in pension funds.
  • We had very few investments.
  • We had low level of liquidity (not much cash available for opportunities).

Over the last three years, I’ve embarked on a restructuring net worth mission. This unfolded in three major ways:

  • Dealing with the non-income generating properties; and
  • Increasing and diversifying our investments; and
  • Building capital available for investments.

To this effect I’ve:

  • Sold an inherited property;
  • Sold the land in Bulgaria;
  • Invested in internet businesses;
  • Invested in stocks and shares ISA;
  • Built a stocks and shares self-managed portfolio;
  • Invested in a local business;
  • Bought 50% share of a car testing and repair garage;
  • Built a substantial cash (capital) for investing.

One ‘stone in my shoe’ – or to put it differently, a stumbling block to my restructuring net worth mission – was our apartment in Sofia.

We bought it in 1997 for approximately £20,000.

My niece lived there while studying at university.

My sister lived there when she moved to live in Sofia.

We used it as a base to see family.

For me, this apartment was the tangible connection with the country where I was born and grew up.

Still, for the last three years it has been a bother. My family don’t need it any longer. I tried to rent it out and this is hard from the other side of the continent: it was rented for eight months out thirty six.

All I’ve done is pay its bills.

So, you see, it was time to go.

The sale in under way – this what I was sorting out over the ten days I spent in Sofia. Last Wednesday, John and I left our apartment in Sofia for the last time.

Am I sad?

You bet! With this sale, the last link to my birthplace has been severed.

I’m I sorry?

Not at all.

You see in times of uncertainty one can either sit and do nothing or continue on the course that has been charted.

In a time of volatility one should find ways to profit from it; and keeping cash in ‘brick and mortar’ is probably not the way to do it.

So, the apartment is being sold. We’ll get approximately £70,000 for it which is not a shabby return in anybody’s book.

I’d appreciate your advice on something.

All this money is in a euro account in a bank in Bulgaria. Do you think we should move it to the UK (and change it to GBP) and when?