Tuesday, December 15, 2009

Update for December

Long time since I last Posted..Man how time flies. Networth is sitting at $264K. Considering the year we have had I really can't complain. This is a 70K increase from December 2008. I am very pleased that my cash accounts are now over $50K (sleeping well at night) and my 401K and 403B balances equal over $100K now. That's a nice milestone to achieve. My wife and I are still planning on building up our cash accounts for a potential move of paying down a bit of the mortgage, resetting our rate (we have a 5 year arm) and increasing our monthly cash flow. Our mortgage has a nice feature of not needing to refinance but with a $700 fee we can have our mortgage reset with a new payment and new rate.
We continue to wrestle with our wants and needs and have purchased a second flat screen TV and a new rug for our dining room. At least we got a good deal on it since we purchased it around the holidays. We are now anxious to purchase some new dining room furniture to increase our storage capacity and lesson the burden on the Kitchen cabinets. Of course furniture is hugely overpriced which makes the process ever so painful. We continue to use a very useful system for determining future big purchases. We have a piece of paper on the refrigerator and simply write items on the list and cross them off when we get them. This at least helps control the impulsive buys and allows for some level of planning.

Saturday, August 15, 2009

Update for August

Nice gain of $8,507 to get me to $225,955. It is nice to see the stock market bounce back a bit but the fast gain is a little concerning. As much as the market has come back I think it can give a false sense that things are better. The reality is that although some of the losses have been erased all of the profits from the last ten years are still lost.

For a comment on the local real estate market there are two homes for sale in my area. One is a forclosure..ugh..and in terrible condition. There have been a lot of people in and out of the house looking for a good deal but I'm guessing they are totally appalled by the house. I have not seen the inside but I can tell you that by looking through the fence in the backyard the home appears to be missing the AC unit. This speaks volumes for what the inside must look like. I think we need an investor or a young couple willing to fix it up. On a much more positive note there is another house on an opposite corner (an end unit) that was only on the market for 11 days before showing up as under contract. The pictures that I saw of this home were very good. The home is a good comp for me and shows me that people are still willing to pay for nice things. I will wait to see what the final closing price is. I'm feeling much better that the market in my area is already starting to recover. According to Zillow my house has increased by about $15k in the last 30 days. I am not a huge fan of Zillow but it is a good site to show trends.

Although I am happy with the gain this month I am a little frustrated over the lack of cash savings increase for the month. There was a decrease of cash by about $1,600 because of having to pay property taxes.

My wife and I continue to balance the "wants" and "needs" for our lives. We now have a list of items we want posted on the fridge. This is everything from a $300-$500 carpet for the dinning room, fix the flashing on two windows-$500, new TV for the living room-$900, dining room cabinetry-$unknown, and living trust $300-$1,000 , and a new mattress for our bedroom which is maybe a $1,500-$2,000 cost. We may pick off a few of the smaller items first. A lot of these items are hardly necessities but they are things we want.

Still plugging away with saving...wish it was going faster.

Debating and thinking about contributing to our 1 Roth IRA. I am still wanting my cash to grow by another $4k-$5K before I either start contributing to the Roth or start working on paying down my mortgage a bit. I still think it would be great to have a much reduced mortgage over the next 5-8 years. The increased cash flow by the refinancing would be really nice. Much to ponder.

Saturday, July 11, 2009

End of June update

Small gain of $3,471 which puts me up to $217,447. Still trying to recover from spending some money on my landscaping. We have also come into several minor expenses that seem to add up. We've both got new car seats for the baby which are of course mandatory expenses. For one of the car seats we used several really good coupons which saved us about $50.00. For the month of July we have paid our property taxes ($1,600) and also have a $300 medical bill which was a co-pay for a minor procedure for the baby. All is well with the baby but $300 is now on the credit card that will be paid off by the end of the month. I have tried to offset some of these costs by cashing in some of our credit card reward points. That added up to $500 which was very nice. My wife and I have also both pushed some money from our personal accounts into the joint account to help catch up. Our cash accounts are sitting at about $43K. A few more months of building up the cash accounts and I will begin looking at paying down some mortgage debt prior to a rate reset in 3 years.

All for now.

Saturday, May 30, 2009

Update for End of May

Since my last post things seem to be leveling off a bit. Large increase since my last post but since the end of April there has been a 5% increase up to $213,976. According to my spreadsheet I am still roughly $44K behind where I should be if I was averaging an 8% annual return and contributing $3K a month. The increase is nice even with some recent expenditures which include about $6K for some much needed landscaping work. We completely renovated the front of our home which in my opinion was well worth the price. The front was roughly half of the total cost. The rest of the money went towards tree removal, deck removal, new sod, and new flower beds. All of this work has gotten me motivated to tend to the yard and I am enjoying it a lot.
We are still plugging away at trying to save and are both somewhat relieved that now that some of the landscaping is done our major home improvement project are out of the way for some time. I believe our plan now is to bring the cash accounts back to $45-$50K. They are down to $42K now and then we will start putting more money towards retirement and or paying down the mortgage.

Saturday, February 28, 2009

End of February Update

It’s official, the sky is falling and I think it hit the back of my head on the way down. We have moved way past the 8000 mark on the Dow and are fast approaching Dow 6000. I will admit that I pay way too much attention to the news and have almost become frozen into inaction. Well not completely.

I recently read an article about a few people that had seen the troubled markets brewing back in 2007/2008 and are now trying to figure out when to reenter the market. I have to admit that I was jealous of those people who sold at the top and are now trying to time the bottom. Now I’m thinking about putting a note under my pillow that says sell everything when the Dow Jones get’s back to 13000? Will that be in 2011 or 2020…tough to say at this point. The financial down turn is very disappointing to say the least. I am working towards a goal of a net worth of $1,000,000 by the time I’m 40 and It seems like a big deal to lose several years worth of gains along the way. I turned 32 in the month of February and was reminded that I only have 8 more years. Part of me also knows and thinks that as I buy shares at 1997 prices in 2009 I stand a chance of drastically increasing my net worth if the Dow Jones does get back to 13,000 within the next 5 years. Jim Cramer keeps saying 4.5 years.

Net worth update: $193,407.57, Which is a loss of $866.47

Recent moves include upping my 401K to 14%. With my company match of 6.5% this puts me close to $20,000 for the year. I have also changed where my future contributions will go into.

PIMCO PIMCO Total Return Instl Fund 40.00%
Fidelity Contra Fund 35.00%
Principal Global Investors MidCap Blend Separate Account15.00%
Principal Global Investors International Growth Separate Account 10.00%

I know it seems a little conservative by putting 40% into a PIMPCO bond fund but I feel like this is balancing the risk of 5% out of the 6.5% match from my company being in the form of company stock. Having said that, my company stock is only down about 13% for the year.

Other financial moves if you want to call it that is the purchase of a new car. My car was dying and needed about $4,500 worth of maintenance. I elected to purchase a used car, 2008 with 13K miles on it. I put $6,000 down and now have a payment of $218 a month for the next four years ($9,000 loan). This purchase won’t be reflected on this month’s balance sheet but next months. The reason for this is that I put the down payment on a credit card that does not need to get paid off until next month.

I must admit that this purchase has made me question my thoughts on counting personal property as part of my net worth. At a maximum I was thinking of giving myself a partial credit for personal property only up to the point of offsetting the loss of cash from my savings account. This to me seems to fall in the category of “funny accounting” but seems like the car and all our property is worth something. However, I really don’t want to play the game of how much is my car worth versus how much I owe on the loan. I am leaning towards not putting my car debt on my balance sheet and only reflecting it in terms of cash flow loss. This is totally cheating in some respects. However, my wife’s car is nearly paid for with only a few car payments left and I will not include the value of her car on our balance sheet. We also have furniture, TVs, and a painting worth thousands of dollars not included on our balance sheet. The painting is worth maybe $2-3K alone. I think this all get’s back to how I want to count personal property as part of my net worth. The bottom line is that I don’t think it fair to deduct $15,000 from my net worth just because I purchased a vehicle. I don’t think it tells the entire story of what is going on. At the same time I don’t want to play the game of “how much is my car worth” either. The car has a blue book value of 18K and I owe 9K on it.

I will continue to ponder my accounting over the next few weeks and months ahead.

Saturday, January 31, 2009

Net worth update for Feb 2009

Just tallied up the net worth for the end of January. This is getting old. With the stock market declining 10% for the month I was not expecting any gain. Net worth is down to $194,274. That's a loss of $1,900 for the month...ahhh really a loss of much more if you include the $2K I put in. It was not a good saving month because of the excessive credit card bill. Mainly from the purchase of the new refrigerator. Next month I will start putting extra money into my cash account until I decide what to do with it.

Also, I started my taxes. I finally got all the forms and have done an initial upload of information into H&R Block. I have made the mistake of accidentally falling into the 28% tax bracket. Ugh...Turns out I will only get about $200 back on my Federal and maybe $1,200 back from my state. So much for the small windfall I was expecting. I believe that this occurred because my wife was not contributing to her 403b while she was on maternity leave. Also, she was getting paid by an insurance company (who covered her benefits while on maternity leave) who may not have been deducting all of the taxes they should have. This didn't impact the tax bracket rate we fell into but impacted the size of our refund. I have taken some quick action to ensure I will remain in the 25% tax bracket next year. I raised my 401K deduction from 8% to 14%. This is a big jump but I think I can do it. My first check with the new 14% deduction will occur in a few weeks. My only frustration with doing this is it limits the amount of money I will have access to in the short term for home improvements and building up my brokerage account/cash acccount. Having said that, putting more money into your retirement account is hardly a bad mistake to make. This bump will put us up to over $20K of contributions for the year into our 401K/B accounts. Not including the matches that we get at 6.5% and 9% each. I also plan on putting more money into one Roth IRA for us. All in all this is a lot of money going into retirment accounts for us.

Don't expect any reall good news in the next few months. I expect the Dow Jones to go up and down from 8000 to 8800 for the next 6 months. ugh.

Saturday, January 17, 2009


It's been a while since I've posted so here is a quick update. We had an end of the year problem with bad luck. Our refrigerator went out on us, our computer got a virus and my car's transmission started to do weird things. It really began to feel like the world was working against us. We have seemed to come through the rough patch and are about to start a more steady state of affairs. At least so I hope. The fridge had to be replaced ASAP. I went out and got a mini fridge from Walmart for temporary supply and then later got a loaner from my boss. What a nice boss. I then later returned the Walmart fridge getting back my $89.00. We have since replaced the broken fridge with a new one from Lowes. Pretty standard side by side stainless steel (more grey than stainless) with water in the door. We did not previously have this feature and we are loving it. Nice to throw that Britta away also. The entire Fridge ordeal cost me about $1100. I have my $89.00 rebate in the mail for the "free" delivery from Lowes. I hate rebates by the way.
My computer virus was fixed by myself. I did some research and discovered the name of the virus that was on my computer. I did this by doing a google search for the constant advertisements that were popping up on my computer when I had a web browser open. I then did a search under the virus name which lead me to a website called, "bleepingcomputer.com" I posted my issue and a few days later I had a tech person respond with what to do. After several posts back and forth my computer was fixed. Most of what they had me do was download executable files and run scans of my computer. It took about a week but my computer is now fixed and all for free.
My car is a different matter. My transmission is making rough transitions between 1st and 2nd gear and I am almost ready to throw in the towel. I don't plan on replacing the transmission but will bite the bullet and get a used "new" car. I'm looking at Toyotas.
Net Worth Update- Last month was a small gain of about $3K. Nothing to get excited about because I am not sure this trend will continue. However, it is nice not to take another $10K hit. I am still below the $200K mark and standing at $193K. Very disappointing.
A few recent financial moves my wife and I have taken were to up her 403B from 5% to 12%. She also gets a 9% match bringing her to a total of 21% of her pay being put into retirement. I have left mine at 8% for now and will begin transferring money over to our ING savings account next month. My baseline of saving outside retirement accounts is at $1,600 a month. I think I can do more. I also changed my W4 tax form from zero to One. This didn't make a huge difference but will let me bring home roughly $800 more dollars a year.
We are excited to do our taxes this year. Maybe by next week I will have my W2 forms which might complete all of the tax forms required to begin the process. This should be a nice cash inflow for us. Most of it will go to savings although we may splurge on a new table for our dining room with some of the money.
Savings estimate for 2009.
At our current rate we will collectively put in $27K into our 401K/403b accounts. At $1600 a month we will be putting an additional $19,200 into taxable accounts. That is a total of just over $46K in annual savings. Not too shabby. I think I can put more money into savings on occasion. It is the unexpected expenditures that are tough to plan for. Some upcoming expenses that could mess things up are: new car and landscaping project this spring. Let's hope nothing else brakes on me in the next couple of months.