Wednesday, August 13, 2008

Are You Supposed to Tip for Certain Wedding Services?

The future Mrs. Dreamer and I were talking last night about whether or not we are supposed to tip for certain wedding services we hired people to perform. She had read on some website that you are expected to tip the dj and hair and makeup people. I hadn't thought of this before but it makes sense that they would expect a tip. However, I don't believe they should.

For one reason, we have hired an individual person to be the dj at our upcoming wedding. The $700 or so price that we agreed upon will go directly to him, not some company he works for. Therefore I don't believe he should recieve an extra tip. Same goes for the hair and makeup person that future Mrs. Dreamer has hired. We are not paying a company who then sends out an employee. We are paying the person directly and they are keeping all the profit themselves.

What do you think? Am I missing something? Should we tip for certain wedding services? What services would require a tip? Any suggestions and thoughts are welcome!

I'm Back!

Ok, I've been gone awhile (read 4 months). The truth is I became a little uninterested for awhile in writing. I don't know why. But now, I am back. I am ready to go. I have lots of things floating around in my head I want to get out. So now I will try to update my blog more often and hopefully my faithful readers will forgive me for abandoning them and come back to join me once again on my progress towards wealth!

Wednesday, April 2, 2008

Goal Progress Bar Updates

After updating my net worth I went ahead and updated my progress bars on the left.

Earlier this month we paid off the remaining balance on my credit cards. We no longer are carrying a credit card balance from one month to the next. We are really excited about this because this was the debt earning us the highest interest.

For retirement we are only 18% of the way to our year end goal of $10k. After a quarter of the year has gone we are about 7% behind on this goal. Hopefully the market will turn and catch us back up in the next couple quarters. If not we will need to consider contributing to my IRA to reach this goal.

Our total debt has been reduced to just under $38k. This puts us 34% of the way to our year end goal of $30k in debt. We are well on schedule here. However this month we are taking on a mortgage. I will need to readjust this goal next month including the mortgage in our total debt calculation.

Total net worth has increased to $25,877. This puts us 66% of the way to our year end goal of $30k. When I made this goal I was not sure how much the wedding would cost us and hold us back. Now however, I am optimistic we will reach this goal within a few months and I may need to push for something higher. How much higher I have no idea.

March Net Worth Update

March was a good month for my fiance and I. We filed my fiances taxes and recieved about $1,000 refund already from her federal and states. This money was put directly into our wedding fund as we had planned along to save all tax refunds for the wedding.

Assets:
Cash was up this month because of the taxes mentioned above. We also did not have to make our payment on our wedding location this month because my fiances parents covered it. I'm hoping this will be the same case next month.

Retirement was up slightly but I feel like we contributed more then the increase shown. So this means our returns were down and ate up some of our contributions. Hopefully next month the market will turn in our favor.

Total assets increased by 3.87%

Debts:
Credit cards took a giant decrease this month. This is because we made the payment to pay off all my credit card debt. The amount we still have in credit cards is for daily expenses that we pay off in full each month. A balance will no longer be carried forward on the credit cards.

All the other debts were paid down with thier usual amounts.

Total debts decreased by -3.95%.

This gives us a total net worth increase of 17.96% or almost $4,000. We have crossed over $25k for our net worth!

Next month I am afraid we must have a drop. We will be closing on our house April 18th so will be paying out money in closing costs. We also might have to make a payment on our wedding location. We are also paying for a drain for our new house backyard where there is a problem with pooling water. This money will be put into escrow by the sellers so I am not sure when we will get the money to pay for this or if it will come out of our pockets at first. Hopefully we will still be able to break even or not go down too much!

Wednesday, March 26, 2008

Careers

Recently I have been thinking alot about my job and whether I am going to be stuck here in the same position forever. I haven't been in my current position for two long (a little over a year and half). However, I find myself worried that it's not giving me the kind of experience that will make me valuable for other positions either with this company or other companies. I work for a mutual fund company working on reporting for the funds. I basically work up all the financial statements, portfolios, annual and semi annual reports for a group of funds owned and managed by my company. I like my job. It's interesting.

However, currently there are only 4 staff working in my department. There are 3 managers. One of the staff has been here and in the same position for 8 years. I know she is very frustrated that she can't get a promotion to some sort of management level. I can picture myself in the same situation 6 years from now. Still working in the same department as a staff. That has me worried. I don't want to be CEO of a company. However I do want to be successful. I feel that moving up into middle management and taking on more responsibility is a sign of success. Higher pay also helps. My concern is that with the type of work I do, there is not alot of demand in my city. There are two big mutual fund companies that I know of where I live. Other companies accounting departments are looking for people with mutual fund accounting experience. Therefore I don't see how I could expect or hope to move up the career ladder either with my current company or a different company. I guess my main concern that I don't want to be stuck in a dead end job.

Today there was a job posting for a tax associate in my company. The position is a staff position working on the tax aspect of the mutual funds owned by my company. I'm considering it. The reasons I'm balking at applying for the position are that I'm not sure if it would get me anywhere. Would I be exchanging one dead end staff position for another? Or would this position offer the kind of experience valuable to other companies? Could this position possibly lead to a higher up position in the future? Another reason for balking is that I don't even know if I would like the position. I'm fairly happy doing what I currently do. What if I switched jobs and hated it? The job description doesn't give me a great idea of what they do. The responsibilities are listed but they don't give you a great idea if you haven't worked in that type of position before. I am going to mull this all over in my head today and tomorrow and see where I land. In life you must take chances. Time will tell if I make the right decision.

Warning to My Readers

I just wanted to send out a warning to anyone who reads this blog that I am not a financial advisor. I do not claim to be a professional when it comes to finances. This blog is not intended to be used as a guide to others and my advice is not for you to follow. If you do follow any advice given on this blog then you do so at your own risk.

This blog is merely about my own personal journey through the world of finance. It is about my quest to pay down debt, save for retirement, and any other financial aspects of my life. I don't claim to have all the answers. I don't claim that my way of doing this is the best way. It does seem to be working for me but may not work for everyone.

I just wanted to make sure I warned everyone because I recently received an anonymous comment stating that I was wrong in my financial advice. In my post on my review of how my 401k performed in 2007 I stated that I had earned 7% in 2007. I stated that I had only invested in my 401k for the last 3 months of the year and that if you annualized my returns I would have earned about 28%. However, a commenter decided to correct me and state that had I been invested the whole year I would have only had a return closer to 6-8%. I still believe that 7% over 3 months annualized comes out to 28%. However, to make this commenter happy I would like to state that if I had invested in the same 3 funds all year last year my return would have been just over 18%. Not the 28% annualized I stated. Also well better then the 6-8% the commentor stated. If the funds did as well all year as they did in the last three months then I would have had 28%.

Anyways, the point of this post is to take everything I say with a grain of salt. I don't want anyone thinking I am a financial advisor giving out advice. I am not. I don't know what investments are the best out there. I do know what is working for me and my fiance. If you want to follow us on our journey then keep reading. I appreciate my readers.

Taxes, Wedding Savings, House Appraisals and More

I haven't posted in awhile because thier hasn't really been alot going on recently. We filed my fiances taxes about a week and half ago. She will be getting refunds from federal and two states. She owes $8 to a third state which she worked in for probably 2 or 3 weeks total this past year. Anyways, we used turbotax and the federal was really easy. The state part was a bit confusing. It didn't help that we moved mid way through the year and crossed the state line. Hopefully we got it right. So she recieved her 2 state refunds via direct deposit last week and we moved that money into our wedding fund. So the wedding fund has increased a total of $750 this month with contributions! I think that's a pretty good month. When we get her federal it will also go to the wedding fund.

I got a call from the bank that is doing our mortgage this morning to let me know they got the appraisal done on the house. We are purchasing the house for 162k and they appraised it for 168k. So that sounds pretty good to me. I have heard that the bank appraisers usually go lower then what the house would be appraised for by someone you personally hired to do it. But for now we'll stick to this appraisal's value.

On the insurance front, we have decided to switch our insurances to Traveler's Insurance. After getting quotes from Nationwide, Allstate, Farmers, StateFarm, Shelter and Traveler's, Traveler's worked out to be slightly cheaper then the next closest and so we decided to go with them. We will be saving almost $600 a year in car insurance which will come close to covering the homeowners insurance. This is because we will get the discounts for having all our plans with the same company. Good news!

Tuesday, March 18, 2008

Fed Rate Cuts and Me

The Fed made an emergency rate cut over the weekend of .25 points and are expected to make another cut today possibly up to a full point. What does this mean for me? Well I found an article on yahoo that kind of helps explain what I can expect for these rate cuts.

Many people think that as the Fed cuts rates, mortgage rates also go down. This is not the case. With the Fed rate cuts comes expected inflation. The mortgage rates won't go down because the investors who buy these mortgages are not likely to want to lock in a low rate with higher inflation expected down the road. And the investors are the ones who supply the money to be loaned out to those of us looking for a mortgage. Thus, I can't hope that this rate cut will help my fiance and I get a lower mortgage rate when we close on our house in April. Mortgage rates have been fluctuating around 6% since September 2007 when the Feds began cutting rates. I don't expect that to change much by the time we lock in our mortgage in a month.

People with credit card debt hope that a cut in the Fed funds rate will help drop thier interest rates on thier credit cards. Not the case. Even with a reduced rate from the Fed does not mean credit card companies have to pass that rate on to you. You need to call your credit card company and try to get a reduced rate. For me personally we have paid off all our credit card debt and this is not a concern.

The Fed rate cuts can hurt your savings. Many savings products rates are dropping at a very fast rate due to the rate cuts. An online savings account I opened about a year ago earning me 5% is now earning me slightly above 3% and probably going to fall lower if the rates get cut today. CD's at banks are following the same trend.

So does someone want to help me out? I don't see how the cut in the Fed Funds rate is going to benefit me personally. It will benefit the big banks who are having liquidity trouble and need to find ways to borrow money at a low rate, but I personally won't see the benefit. Am I wrong? Let me know what you think.

Savings Updates!

This past weekend I went ahead and transferred some money from checking into our wedding fund and our emergency fund. This month we were able to save $500 into our wedding fund. We were also able to save $800 towards our emergency fund. We decided to save more into our emergency fund because the money we need for closing costs for the house will come from this account. Once the end of the month hits I will know how much we were under budget. Currently it looks like we will be about $300 under budget which we will also put in our emergency fund at that point.

Also this weekend we completed filing my fiances taxes. Once all was said and done she will be getting refunds totaling just over $1,000. We will probably divide this money up between the wedding and emergency funds.

On my run yesterday I was doing some math in my head. I figured up that at our current savings rate we should be able to have about $11,000 in our wedding fund when it comes time to pay off everything we have yet to pay for such as catering and photography. Hopefully along with some help from my fiances parents this will be enough to cover everything and we won't have to dip into our emergency fund to pick up any slack. I also figured that if we save the rest of the year like we did this month that our emergency fund should be close to $25,000 by the end of the year. This is not including any money we can hope to get for our wedding which I'm sure some will go towards this goal. I also did not take into account the tax stimulus of $1,200 we should also be recieving in May. Thus, I was feeling pretty good on my run both physically and mentally. I feel like we are in a good position to end this year off in a good position with our wedding paid for in full and our emergency fund to the point we want it. That will put us in good position to work towards more exciting goals in 2009.

Monday, March 17, 2008

If You Were Debt Free!

Today I read a post over at Apples and Telephones that got me to thinking. The author is debt free and most of the personal finance books she has read focus on getting out of debt. She mentions Dave Ramsey who it seems focuses completely on getting out of debt. I feel this is because this is the biggest and most important step in his plan. Also, most of Ramsey's audience is probably in debt which is why they are looking for help. The author of Apples and Telephones states that she has no debts and therefore does not quite no what to do. She has no big goals to aim for such as becoming debt free.

For me, once my fiance and I are debt free we will have a plan. I've thought about this many times before. I am considering having all our debt besides the mortgage paid off as being debt free. I think once we are at this point we will be in a good position to save.

We currently save for retirement but once we have no debt we will be able to save a higher percentage of our salaries. I believe that it is very important to save as much as you can towards retirement close to 15% of your salary.

Once we are debt free except for the mortgage we will start paying off the mortgage at an accelerated rate. We don't want to carry a mortgage for 30 years. Hopefully if things go well we can get it paid off in 20 years or less.

We will have our emergency fund built up to 6 months of expenses and we will focus on keeping this at 6 months worth of expenses in a safe online savings account that hopefully earns us a higher rate of return then a regular account at a brick and mortar bank.

At this point we will save for things we want. We will have different accounts saving for new cars when the time comes to replace our current cars. We will save for vacations we want to go on. We will save for anything new we would like.

Last we will be saving into a couple of mutual funds through my company (a mutual fund company) for our futures. We will be saving to build wealth. For us the ultimate goal is building a large amount of wealth where we can feel comfortable financially. An amount of wealth where we will not be concerned with any emergencies that may arise. An amount of wealth where we can feel comfortable donating large amounts to charity. An amount of wealth where we can feel free to experience different things we would like to experience such as world travel.

I feel that once you have become debt free the journey has really just begun. At that time it is time to really save for your future. Enjoy the now but also save so you can really really enjoy the future!

Friday, March 14, 2008

Are you Scared of a Recession?

There has been a lot of talk lately about our economy slipping into a recession. From all the talk you might start to worry that we are heading for a repeat of the great depression. Lots of bleak terrible sounding data that can definately make you worry. So, are you scared of a recession?

I personally don't know what to make of all the talk. All I know is my fiance and I's personal situation and I can comment on what we are doing and why we aren't to worried about a recession.

My fiance and I both have fairly stable jobs. We don't feel disposable because we both hold jobs where they honestly need to hire more workers to get all the work done. Also, our work is required by the SEC. Thus, if we don't get our work done, the companies are going to be required to pay some hefty fees to the government. But you never know. We could be out of jobs tomorrow but we certainly hope not.

We have a nice emergency fund built up. It's not as high as we would like but well over 3 months worth of expenses. We will use some of that money to pay for our part of the closing costs for the purchase of our new home. But, we plan on putting some extra savings towards that account over the next couple months to boost it up.

Our retirement funds may not get a good return. However, we are both soo far away from retirement it's not even funny. We just started our careers and have at least 30 years before we could even think about early retirement. We have 40 years before a regular normal aged retirement. Therefore, we will keep funding our retirement at our current rates and hope for the best.

The only worry I have is with the purchase of our house. It's a big purchase. We did the math and have plenty of room in our budget for the monthly mortgage, insurance, and taxes. We also have plenty of room left over for savings. We just have to make sure we don't go crazy when we move in and buy a bunch of new furniture and items we feel we need while sacrificing savings. With our upcoming wedding, we will register for most of the stuff we feel we need. Hopefully we won't have to buy anything when we move in.

So what about you? Does all this talk about recession have you worried? What are you concerned about or why aren't you concerned? Is there anything you are doing to try to help yourself be in a better situation because you are scared of the recession? Or are you just continuing along with life with no fears?

Thursday, March 13, 2008

Shopping for Insurance

With the contract on the house and closing in mid april my fiance and I decided to do some shopping around for insurance. We want to get the house covered under a homeowner's policy and put both our cars on the same plan.

Today I submitted online requests to be contacted so that I can get quotes. I contacted 5 different companies and we will also get a quote from the current insurance company we use. We will compare the same coverages from the different companies and choose the one that will be cheapest for us.

I've heard back from 2 of the companies contacted and have given them some information. There was some information I did not have such as vin #'s on the vehicles and my fiances personal info. like drivers license number. I will get that information tonight from her so I am prepared tomorrow. We will try to get these quotes together this week and next and have a decision made by the end of the month. I believe by buying a homeowners policy with the same company we have auto through will get us a good discount on the auto insurance and hopefully our car insurance will be less then it currently is. Once I have all the quotes I'll do a post about which companies I contacted for quotes and the range of quotes we recieved.

Finally! An Agreement Reached!

We finally reached an agreement with the sellers of the house last night for good! After our inspection we realized there were some problems with the drainage in the backyard causing water to pool up on a side of the yard when it rains alot. In the midwest we get alot of water through the winter and spring so this was a concern of ours. We didn't want a pool of water in our backyard for half the year. We want to be able to play in our backyard with our dog. We don't want concerns that the pooling of water could cause foundation problems in the future. Thus, we were set on making sure this issue could be fixed and that the sellers were the ones to have to pay for the solution.

So, we recieved 4 estimates on what it would take to fix the problem. Most all of them were using a drainage system that would bring the water around the side of the house and out the front yard into the street. The estimates ranged from $1,650 to $6,665. The $1,650 came from someone the sellers wanted to get to do the work. We did not like this solution. We did not know if they were just friends that would do a quick fix so the seller could pay as little as possible. They weren't an actual company from what we could tell.

Thus, we decided to take the $1,650 that the sellers were willing to pay in an eschrow account. We will use our company which gave us a bid of $2,600 and a one year warranty that the solution would work. We will pay the difference ourselves.

So with that taken care of we have an agreement and a house will be ours in mid April! It is a scary ordeal. We will be a homeowner and all the costs that come along with home ownership will be our responsibility. The house is wonderful and I can't wait to get the keys and be able to move in! The next concern on our list is getting our current residence rented out so our landlord will release us from the lease. Hopefully we can get that taken care of within the next month!

Tuesday, March 11, 2008

All Major Bills Due Beginning of Month!

The other day I was going over our budget and our checking account and freaking out. My fiance and I try to keep a minimum of $1,000 in our checking account. That may be high but that's the level we both agreed we would feel comfortable with so that's where we try to keep it.

The problem is that all our major bills are due at the beginning of the month. So we get paid at the beginning of the month and our bills such as rent, credit card, 2 cars, and other smaller ones are due before we get our second paychecks. I realized this month that this brings our checking account balance down very low to a level we are definately not comfortable under $300. We will get paid again mid month and there will be a couple bills to be paid but a majority of those paychecks will go towards our different savings goals and we will end the month off with exactly $1,000 in our checking account.

Right now I am wondering if we shouldn't end the month off with closer to $1,500 in our checking account so that mid month we don't get below $500. Or does it really make a difference? We have plenty of money in our savings that we can transfer over if needed to pay a certain bill if we do get close to running out of money in our checking account. I feel as long as I keep good track of how low my checking account balance goes and make sure I don't overdraw on funds I should be alright. It is really only about one week out of the month where that balance is well below our $1,000 comfort level anyways.

I think we will continue to do what we currently do and if things get to tight we can transfer some of the money over from savings. I wish that our bills were more spread out. The current situation makes me sad at the beginning of the month but very happy towards the end. This is because I'm paying out a bunch of checks at the beginning and then only at the end do we get to see our savings going up.

Sunday, March 9, 2008

Run for the Money


I read a small article in the January 2004 issue of Runner's World titled "Run for the Money" the other day. The article was about a study from Ball State University where they studied 336 small business owners who either ran or lifted weights regularly to see if there was a correlation between exercise and business success.

The study found that running had a positive effect on sales volume, external goals such as wealth and family security, and internal goals such as recognition, challenge, accomplishment and independence. Weight training was positively linked to external and internal goals but not sales.

I'm not sure if this study necessarily shows that by running you become better and more successful in business. I think that runners are very goal oriented people and goal oriented people tend to be the most successful. Either way I think this is a positive article for exercise. I would recommend that everyone start exercising in some way. My chosen way is through running. A lot. I've been a runner since I was 12 years old and although I'm not sure I wouldn't be where I am today if I didn't run, I don't think it hurts. Not that I'm super successful but I feel I'm getting along pretty good for myself in my life.

Friday, March 7, 2008

Home Inspection

We had the inspection on the house we are considering buying on Tuesday and most everything turned up good. There was one problem with drainage in the backyard and what looked to be a little problem has turned into a very big problem. The inspector, who is a family friend, expressed to us his concern that the back yard had very poor drainage and water was and would continue to pool in the backyard making the back yard unusable and putting too much pressure on the foundation. He recommended calling a company that does drainage work to figure see if there was anything to be done to fix the problem.

So Wednesday the drainage company checked out the yard. I was not able to go because of work but the realtor went and she called and told us they thought it would be around $2,500 but were working up an estimate and would get that to her Friday. So today we got the estimate for a much larger number of $6,650.

For my fiance and I this is completely unacceptable. We are going to submit an offer for them to pay for this drainage system to be put in or we are going to drop the contract and move on to looking for a different house. Currently this is not our problem and if they are not willing to pay to have this fixed then we don't want to make it our problem. We have no pressure to move from our current location so we can keep looking and still be fine if we don't find a house for a few months. If we don't find a house in before June we will probably continue renting our current house.

This whole process has gotten frustrating. We are starting to feel like our realtor is just trying to get a sale and isn't looking for the best house for us. She makes little comments that I just don't feel comfortable with. I believe if things fall through with this house we will be looking for a different realtor as well. I'll keep you posted on what happens.

Wednesday, March 5, 2008

Paid Off Credit Card!


We did it! Yesterday afternoon I went online and paid the balance of my final credit card off. The balance was a little over $1,000. We used the proceeds that came from me selling my stock in an account that I basically am kidding myself with thinking I can make millions in. We also used some money that we had from going under budget last month! Thus, we are free from carrying a balance monthly on our credit cards.


Now we will only use my fiances credit card which we put groceries and gas only on and which we pay off in full each month.


So what to do with the money that was being budgeted towards paying down the credit card? Well, last month we budgeted $200 to be paid towards the balance of the card. In this months budget we have redirected that money to go towards saving for the wedding. With our wedding coming up in October we will need quite a bit of money to pay all the vendors the month or so before the wedding. After the wedding, the wedding savings will be redirected to emergency savings and paying down more debt (car loans).

Friday, February 29, 2008

Challenge for Myself in March

I have been reading some different blogs where the writers are challenging themselves not to eat out for lunch for a certain time period. Most of the bloggers are actually doing the same challenge. I decided that I needed to provide a challenge for myself that is similar in nature.

I have a lot of trouble spending practically all of my "fun" money every month on eating out. Whether it is lunch or any meal over the weekend, I have trouble getting myself to eat at home. I find myself wanting the convenience of getting a sandwhich somewhere like subway rather then fixing something at home. On the weekends I feel like it is something to do for entertainment instead of just eating something normal at home.

I have tried to cut back on my eating out before. This month I am going to challenge myself to not eat out the whole month if I am paying. I know I will have to eat out at least once when my group at work takes our monthly lunch together. Other then that I can push myself to make sure I save my money and don't eat out. I will be marking a calendar in my cubicle at work to make sure I keep track of my progress. I will mark the days I don't eat out with a green mark and the days I do with a red. I will try for all green.

At the end of the month I will reward myself depending on how I do. If I have any fun money leftover at the end of the month I will split this money in half. I will put half of the money into our emergency savings because I love seeing that fund go up. I will save the other half in a different account for something for myself. Something big that I want. I'm not sure what yet but possibly a Garmin Forerunner GPS watch which tells how many miles you've ran and what pace you are running. They are pretty expensive and I will have to be really disciplined if I want one. It will take a few months to reach that goal. But that can be a good reward if I can get myself to eat out less.

Updated Net Worth and Progress Bars

Well the end of February is upon us and that means it's time update our net worth and make sure we are still headed in the right direction.

This month our cash is up quite a bit. This is because we didn't pay anything on our wedding and I got my tax refund. I also sold some stock and have the money in cash which will be used probably next week to pay down my credit card. Our retirement went up quite a bit to put us over the $5,000 mark. Hopefully by the end of the year we can get that up above $10,000. With 10 months left that is about $500 a month so unless the market performs very poorly and loses what we are putting in, we should reach this goal.

On the debt side we paid monthly bills as normal. We have one credit card with a balance that we are working on paying down and hopefully next month that will be gone. The other credit card is paid off every month in the middle of the month. Therefore when I update the net worth we will always have a balance on there of monthly expenditures such as groceries, gas, and medical expenses which are the only things we use it for.

Overall our assets went up 5.79% or $3,362 and our liabilities went down 1.4% or $562. This combines for a net worth increase of $3,924 or 21.78% to put us almost up to 22k.

I updated the progress bars on the right. I think I did them right. The only area we aren't making good progress towards our goal is debt reduction. Everything else is going good. However, we are making good progress on getting rid of the credit card balance so this is a plus. Everything else is looking well on track to reach the goals I set out at the beginning of the year.

Bought A House! Almost.


Well last night the sellers of the house we put an offer in on countered our offer. It was a good counter and showed they were ready to sell. They came down off their offering price about a quarter of the way down to our offer price. They agreed to give us a home warrenty, a refridgerator, and pay most of our closing costs.


We went ahead and counter offered again to try to get the price down to half way between thier asking and our original offer. They accepted and we agreed on a contract. So if everything goes smoothly we will own this house in mid April!


Next on our list is getting house inspected probably next week. At that point we will either renegotiate or move on with the deal depending on what the inspection looks like. Hopefully nothing major will be wrong and we can move along to close the deal at closing.


So we are getting close to making our very first house purchase!

Thursday, February 28, 2008

Don't Just Wish, You Need Action to Reach Those Goals!

Today I read an article found on Yahoo! Finance titled "Wishing for Retirement? Replace Hope with Action!" This article is talking about actually putting a plan into action to reach your retirement goals. Many of us might want to retire. We might have a specific date we want to retire and we have a general idea of how much we need to have saved up to make this possible. However, we may just be throwing what seems like a reasonable amount of money into our retirement savings and "hoping" that this will be enough.

This article gives some good points. Make your dreams yours. This involves being able to picture your dreams. Know what you want. You are more likely to be motivated to sock away plenty of cash in savings if you know why you are doing it. If you just know you want to retire but you have no idea where or what you want to do then it's harder to stay motivated for that. If you know you want to retire at a certain age, buy a nice lake house, and spend your days fishing and cruising around the lake, then you have a pretty set dream and will be more motivated to make that happen.

Chart your goals. You need to know your ultimate goal or at least a very good idea of that goal. You need to figure out a plan of where you need to be at different points along your journey in order to reach the end goal. Make a plan and check your progress along the way. Make a visual chart and this can help motivate you on your long journey.

Find inspiration on a daily basis. For me I believe a chart will be quite a bit of inspiration. I may put up a chart in my office at work charting my progress in different goal areas. For example I want to cut down on eating out. I may chart every day I do not eat out a certain number of dollars for savings so I can see the impact it is having on my savings.

Whatever you do, it is good to have goals and a plan of action. Whether retirement, weight loss, a big project at work, or any other goal, it is good to know what your ideal end result will be and how you plan on getting there. Stay motivated and put a plan into action. The end result will be great!

Offered on a House

Well, last night my fiance and I decided to go ahead and put an offer in on the house that we hope to buy. We met over at our realtors office about 7 pm and after looking at the neighborhood comps and the sellers disclosure we went ahead and decided on an offer to send the sellers.

The house asking price is $164,900. We offered them $158,900 and asked for a majority of closing costs, the refridgerator and a home warrenty. I'm not sure how that offer compares. Whether we are asking too much or too little. It is an offer I feel good about putting in which gives us some room for negotiation to a point where we would be satisfied.

Next we will wait and see what they come back with. Hopefully they come back with a decent counter offer. My fear is they will not come back with anything and then we will have to move on to something else. I don't think I could work with someone that wouldn't budge a little on asking price if they are serious about selling thier house. We should find out sometime today whether they accept, reject, or counter our offer. I'm expecting a counter offer.

Wednesday, February 27, 2008

Looking into some Houses

My fiance and I have been on the look for a house to buy recently. We have been looking for most of the month of February. We've seen probably around 30 homes and have liked a grand total of 3. We are at the point where we are considering making an offer on one of them that we liked. One that we liked sold the next week after we saw it. The other one we thought we were going to put an offer on but then we saw this one and are certain it is the one for us. It is a little bigger with a finished basement for the same amount of money.

Here is what we are looking at. The asking price for the home is just under $165k. The home is in a suburb off of Kansas City on the Kansas side in Johnson County. The house has 3 bedrooms, 2 baths (one in the master bedroom), a nice kitchen, dining room, living room and a finished basement. I am so excited about the house. I think we are going to drive by it again tonight after work and then let our agent know we are wanting to put in an offer. After figuring up some numbers we have figured out that buying this house will cost us about $200 more then our current rent. This will make things tight for the next few months because we are still trying to save everything we can for the wedding and aren't willing to compromise that. After the wedding we will still be saving but it will losen up the strings a bit and life will get a little more comfortable. Thus, things will be a little tight for about 3 or 4 months.

Anyways, I've been so busy lately with work, wedding planning, and house shopping that I haven't gotten to post so I figured I better put out a new post to let everyone know what's been going on.

Sunday, February 24, 2008

The Ultimate Savings Goal (for me)!

This morning I worked on an excel spreadsheet that I have used to determine how much I ultimately want to save up to be able to sustain my current life. I figured in savings in my 401k and a taxable account. I did not take into consideration taxes.

On my spreadsheet I took my current salary and increased it by an annual raise of 4%. Since I've been there my raises have been higher but I like to be conservative in my estimates. So, if I get no higher of a raise then 4% and no promotions to higher pay grades then I will be making approximately 182k by retirement age of 65. Honestly I'd like to retire sooner but that's going to depend on how well I progress towards my savings goals.

Next I figured out how much I feel I need after retirement to sustain the same standard of living. I decided that in retirement, I would need about 80% of my current income. This is probably a little more then I will need because hopefully I will not have a house payment at that time. To come up with 80% I just figured that if I am saving roughly 20% of my salary during my working years I won't be saving while I'm retired. Thus I figured I need 20% less. This is again pretty conservative I feel. I took the 80% of current salary I figured I would need and adjusted it with a 4% level of inflation out until I am age 95. I figured if I live that long then I'm doing good and honestly I hope I don't live that long. If I pass in my 80's I will be happy.

So next I took my retirement savings. I took what I currently have and what I will be saving into retirement each year from my salary and adjusted it for a return of 8%. Hopefully I can get more of a return but I like to be conservative. I grew this account up to retirement age(65).

I also have a taxable savings account where I took current savings and grew it by about the amount it currently grows and adjusted it for a gain of 6.5%. I will have most of this money in mutual funds so I expect it to earn me a high return. I did this through retirement age as well.

Once I hit retirement age, I took the amount I figured I would need to live off of and divided it by two. I took half of that from the retirement account and half from the taxable savings. I switched the return on those accounts to 5% because they will now be invested in a mix of bonds and stocks. I continued to decrease these accounts by taking out what I would need to live. Once taxable savings was down to 100k I took only from retirement savings. I decreased these accounts until the age of 90 and if I live to 91 with this plan I will be completely out of money.

Anyways, these are all really really rough estimates. In the long run I could need more I could need less. I may live off of half my current salary when I retire. I didn't take into account a pension I plan on receiving from work. I didn't take into account the fact that my highest expense should be gone by retirement which is mortgage or rent. But I said I wanted to live without worry. I wanted to be able to be at financial peace with myself. Therefore, I took the numbers I came up with that I would need at retirement to come up with my goal number. At retirement I figured I would need roughly about 3.5 million. Therefore, my goal savings number is going to be 4 million by retirement. With that number as my target, I will work out a plan to achieve that goal.

By the way, I said I am not worried about being incredibly wealthy and to me 4 million sounds incredibly wealthy. However, once you take into account inflation and the fact that I plan on living off of this savings with no other income for 25 years, this is not a lot of money. Today it is. In 2050 it will not be. Four million is my ultimate goal and next I will work on plans to reach that goal through mini goals.

Saturday, February 23, 2008

What is Financial Peace for Me?

Earlier in the week I wrote an article about how I wanted to develop a plan towards reaching financial peace and prosperity. I want to formulate a number and mini goals to help myself keep on track towards the ultimate goal.

However, before I can do that I feel like I need to define what financial peace is exactly for me. Financial peace can be different for every single person. One person may be happy just having enough money to get by with every day living with no luxuries, no vacations, no entertainment. Others may want to be able to take the occasional vacation or the occasional dinner out but are not concerned with being very wealthy. And yet there are others who may want to accumulate as much as they can until they are millionaires when they feel they can do what they want.

I would like to define what I believe would be financial peace for myself. Just after college I took a job as a financial planner. They promised the potential for a very high salary and I was all game. I wanted to be rich. That is all I knew and that is all that mattered to me was I wanted to say I made over 100k this year and have x amount in the bank with a big house to come home to. However, once I got into that job I quickly found out that it was definitely not for me. I was working every day from 8 in the morning until 9 in the evening. I was working half a day on Saturdays. What good would it do me to have all this money if I never had any time to enjoy it? I quit after a couple months and searched for something with less hours. Therefore I know I would much rather have time to spend with those I love and earn a little less instead of working all the time and earning a lot.

So for me, financial peace will involve being able to live comfortably while spending most of my time with those I love.

What is comfortably? Comfortably for me involves being able to afford to pay our bills each month without worry. Also being able to go to eat occasionally on the weekends. Also being able to take a vacation or two every year. Being comfortable would mean I'm not worried about the budget when I go looking for a gift for my loved ones. I would have a house that I love and am happy with and can afford to pay for. I probably wouldn't be living excessive. I wouldn't be traveling every month of the year to far off places. I wouldn't have to have all of the latest electronic gadgets, although an occasional one would be nice. I don't need a maid or a live in home nanny. I just want to live comfortable. I want to be able to pay for the necessities, a few luxuries, and have some left over to save because I love to save.

Later I will write a couple more posts about how much money I will need to live "comfortably." I will figure out how much I need in savings to support the lifestyle that I want. Ultimately I will not be forced to work to live how I want to live. I will write a post about where I want to end up and another one about how I want to get there. Stay tuned for more.

Friday, February 22, 2008

Paying for a Wedding

I had a discussion today over lunch with a coworker about me and my fiances wedding planning and how it is going. I make it no secret that my fiance and I are saving for our wedding and paying for most of it ourselves. I found it interesting how my coworker thinks it is so ridiculous that we have to pay for our own wedding. She thinks it is the brides parents responsibility to pay for the whole thing. This confuses me considering she has told us before that her father is unable to work for some reason and does not have much money. Her mother passed away a few years about. She still expects her father to pay for her wedding and from how she talks, it is going to be an expensive wedding whenever the day comes.

What do you think? Obviously everyone has a different situation but do you feel it the responsibility of the brides parents to pay for the wedding? My fiance and I don't. We know the financial situation of her parents and would feel really bad if they were paying for it. They are helping out by paying for a few things. All in all I think we will end up splitting the costs about even once the whole thing is done and over. My fiance and I are financially responsible and we have been saving for our wedding since the day we got engaged. We have our own joint account that we automatically deposit money into every month. As we need the money we have been able to pay from the money we've saved in this account. I don't have a problem with it and neither does my fiance. However, for some reason others find it necessary to tell us how they won't have to pay for thier weddings because thier parents will. In some cases I think they are right. In others like with my coworker I think she is in for a rude awakening. I don't think she realizes how expensive weddings can get and I doubt her father will be able to pay for it all. In most cases, I just think to myself that it is a good thing your parents are going to pay for it because there is no way you are financially responsible enough to do it yourself without putting yourself in massive debt. However, I just keep my mouth shut and smile and nod.

What are your thoughts? Who's responsibility should it be to pay for a wedding? What about your own situations? How was your wedding paid for or how do you think it will be paid for?

Thursday, February 21, 2008

Easy Home Renovations

My fiance and I are looking into buying our first house together very soon. There are a lot of different options available for us out on the housing market. You can find a house that is completely updated and everything is new inside and needs no work. You can also find a house for quite a bit of a discount that needs work to be acceptable for your living standards. We have seen quite a few homes that just need some minor work inside such has removal of wall paper and painting or new counter tops and flooring in the kitchens.

We personally are looking for something that is mostly done and ready to move into. However, we are considering the houses that we feel need minor work. Especially if those houses can be bought for a nice discount to what a completely nice finished updated house is selling.

I am not a professional construction worker or someone who is great at decorating and remodeling. However, I found a neat site that could help me change all of that. Easy Home Renovations is a website that has many different articles to help you find the information you need to improve your home. You can find everything you need to know from updating your bathroom to creating your own garden, from new flooring to new cabinets or from carpeting to windows. There are many different topics you can read about on this site. If you are thinking about doing a little work to your house, I would recommend checking out this site. I know when my fiance and I finally find our house, we will be looking into this site for different articles before deciding whether to do some work on the house.

Adjusted Net Worth due to Mistake on Car Loan

Today I adjusted my net worth on NetWorthIQ because of an error on my fiances car loan. We found out last night that she has a balloon payment due at the end of her loan which she did not know about. I thought something seemed wierd with her loan but since it was something she acquired a couple years before meeting me I did not pay too much attention and look into it. However, her credit report showed a balance of about 5k more then we thought it should be. So after looking into it I found out she took out a balloon loan which would require a balloon payment at the end of 4 years of about 5k. This really sucks. I had thought her car would be completely paid off about a year and two months from now with just the monthly payments. Instead we have to fork over another 5k at that time. This loan seems like a big waste of money. I am not sure why her father funded the car this way instead of just a typical 4 or 5 year loan.

Anyways, I went in and adjusted the car loan for the two months our finances have been joined by 5k. So now our networth is 5k lower then we originally thought. This puts us just over 18k net worth. Hopefully we can cross the 20k mark either this month or next with our savings and debt repayment.

A lesson is to be learned here. When financing a loan for anything, make sure you understand the terms if you are going to put your signature on the contract. My fiance had no idea about this balloon payment which really frustrates me. She is frustrated as well because she has become a lot more financially aware since we started dating and became engaged. She is mad that she now has to shell out 5k at the end of her loan after she's been paying on it for 4 years already. I agree and I know this frustrates her because she is actually more of a money saver them me and really will not like seeing our savings go down by that much.

You'll Give Me How Much for a Mortgage!

Last night the fiance and I had a meeting to get pre approved for a mortgage. We are starting to look at houses and have decided we can afford something under 160k. In our area this should buy us a 3 bed, 1 and half bath, 1 car garage and a basement that is hopefully finished or easily finishable. That is what we are looking for and we have found quite a few that would work but just not the perfect one for us yet.

We knew getting approved for this much for a mortgage would not be a problem. However, the amount they approved us for is ridiculous. The mortgage company told us we could be approved for 350k. That would buy us a mansion in our area. Well, maybe not a mansion but a really really nice house. Anyways, we know we can't afford that with our current situation. Maybe if we didn't want to save for retirement or anything else and if we never wanted to spend money for entertainment, vacation, clothes or anything. Don't worry, we are keeping a level head about ourselves. Just because they say they will loan us 350k doesn't mean we are going to start looking at 350k houses. We are still sticking to our original price range under 160k.

Another interesting thing we got to see last night while meeting with the lender was our credit scores and reports. It was interesting to see that I have a credit score around 720 and my fiances was in the 760's. So she has better credit then me. Yes I'm jealous. But I can live with it. So we currently have good credit. Now we just need to continue paying everything on time and not mess it up.

The funny thing was after the meeting my fiance was asking me how she can increase her credit score. Apparently it wasn't good enough for her. Gotta love her!

Wednesday, February 20, 2008

Do You Have Goals for Your Blog?

Do you have goals for your blog? I'm not talking about the financial goals that I'm sure every single PF blogger has. I'm talking about personal goals for your blog writing and readership.

There can be many different types of goals you set out for yourself and your blog. Some bloggers might want thier blog to help earn them some income. Some bloggers might want to gain a growing number of readers striving to reach a certain amount of visitors in a given month. Some bloggers may strive to post more often or better quality posts.

When I started my blog I was not really concerned with any of these things. I didn't care if I had any readers and never expected to be able to make some money from blogging. I do try to make quality posts more for myself then for anyone else. The posts I make are more for my own interests and if others enjoy them then that is all the better.

Recently, I have become more and more into checking out daily how many readers I had for the day and for the month. I am finding myself striving to grow both numbers and find myself obsessed with checking the results. My numbers of visits has been growing since I started this blog back in August but the numbers are still pretty low. So far my highest number of visits in one day has been 30 and my highest in one month has been 203. This month I have broken the 203 number already with a week and a half still to go in the month. How high can I go this month? Will I reach 250? 300? I've decided I want to set goals for myself in growing this blog.

I'm not concerned with making an income from this blog. My main goal is growing the number of visitors. I think my next big goals are going to be 50 visits in one day and 400 visitors in a single month. Can I achieve this? I think so and here is how I hope to do it. I hope to write more posts and more quality posts in the upcoming months. I find the more posts I write the more visitors I have to my page. I plan on reading more of other peoples blogs and commenting on thier posts. If I become a frequent commenter, people may click and check to read my own blog. I also typically like to voice my own opinion on others blogs.

Are there any other ways to grow your readership? What do you do to try to attract more readers to your blog? I know there are some people out there who have hundreds of visitors a day. How do they bring in that traffic? Let me hear your thoughts!

Sold Stock to Pay Down Debt

I just sold off my stock in order to use the money to pay down my credit card. Once the funds settle I will be able to request a check for about $600 and will use that money to pay down my credit card which will leave me with a balance of about $600 left to pay. I have decided this is the right decision because I have done nothing but play with the money in my stock account since opening it. I need to take some responsibility and use that money for a use that would be best. I believe I will reap more benefits by paying down the credit card debt over the next few months then I would by keeping this money in my stock account and "playing" with it.

This still leaves me with one more stock holding. I have a few hundred dollars still in Bank of America. The stock is depressed slightly from when I bought it so I did not want to sell it because I still believe this to be a strong company that will rebound in a year or two. In the meantime this stock pays me a dividend yeild of near 5%. I plan on holding this stock until a more opportune time to sell and hopefully this one stock holding will satisfy my stock urge for the time being.

Work and Politics

Do you talk about politics at work? With the primaries waging on as the Democrats and Republicans choose who thier final candidates for President will be, politics seems to be a hot topic. But is it ok to talk about politics at work?

Recently, my office department went out to our monthly lunch together. This is a small department consisting of 4 staff, 2 managers, and 1 director. With everyone in attendance the topic of politics came up. I avoided the conversation because I don't want beliefs or ideas to influence how any of my coworkers see me or especially one of my many bosses. I noticed the managers and director did not seem to partake in this conversation either. I just don't want my views to influence how they feel about me. People have very strong opinions on politics and if their opinions differ from mine, I don't want that to get in the way of any future promotions or raises. Thus, this conversation seemed to mostly take place between the other 3 staff workers. And even though thier opinions seem to closely mirror my own, I felt it necessary to keep my mouth shut. I have very strong political views and I will gladly talk to my coworkers about them without the presence of those in control of my future career.

What do you think? Do you talk about politics at work?

Tuesday, February 19, 2008

PayPerPost to Help Pay My Debts!

Recently I stumbled upon a blog marketing site called PayPerPost(www.payperpost.com). This is a site that pays people to write sponsored blog ads about different products and services. It seems to me like it would be a good way to make some extra money. Earlier I wrote about another company that is virtually the same thing and I had a comment of someone saying they use PayPerPost. The thing they like about PayPerPost is that they pay your money out only 30 days after the post. Another positive is that you don't have to have a certain amount of money earned to receive payment. Both of these are big positives for me. I have decided that every once in awhile I can write a sponsored post and possibly earn a small amount of income that can help speed up my credit card debt repayment. I have a goal of wiping out my credit card debt by the end of August but with the help of PayPerPost, I hope to be able to accomplish this goal one or two months early.

Not only does PayPerPost seem to be a good way to earn some extra income by writing sponsored posts, but they have a community of bloggers that seem fun and interesting. There are many featured blogs of those using PayPerPost that you can search through and find some new reading material! I enjoy reading interesting blogs and there are quite a few PayPerPost user blogs to check out. The community could be an interesting place for me to find new personal finance blogs or blogs about other interests I have such as running or baseball.

So bear with me while I try out PayPerPost. Hopefully this will be a way for me to earn some extra income. If you are interested in trying PayPerPost then I recommend clicking on the above link and checking it out! What can it hurt?



A Long Road to Financial Prosperity

The journey to financial prosperity and peace is long and sometimes seems to be an impossible task for me. I started my personal finance journey back in August when my eyes were opened up to the vast world of PF blogs and books available. I became consumed with reading everything I could about personal finance. I quickly turned to my own financial situation with a critical eye. Deciding I needed to make some changes, get out of debt, and start saving for the future, I set out on a mission. This journey is long. There are many turns and bumps on this road. Since becoming interested in personal finance and my own finances, I have had a few life changes. One is that I became engaged and now my fiance and I's finances are one. Another change which is coming up is the future purchase of our first home. This is something we are considering this sometime between now and the middle of summer. These changes throw forks in the road and a plan that was once set has to change.

However, I never really had a set plan. I never really had an exact idea of where I needed to go. I know where I have started but how will I know when I've reached the ultimate dream of having financial peace?

This week, I would like to set out to answer these questions. I want to come up with a goal number that will be my ultimate financial peace. The number where I no longer need to worry (as much) about money and work. The number where I have saved and invested enough to live off of the earnings and my work salary is no longer important. For most, this is the goal number to reach by retirement. This week I would like to try to find this number. I would like to develop a plan complete with short, medium and long term goals to achieve my ultimate goal of reaching this number and being at peace with my finances. After all, how can I ever achieve financial peace if I don't know what that is? I wouldn't start out on a road trip across the country without a map. And I shouldn't start out on my financial journey without some idea of where I ultimately want to end up.

Keep posted for some more posts about where I ultimately hope to end this journey and how I hope to get there.

Monday, February 18, 2008

New Way to Make Money from Blog

I didn't start this blog with the idea that I could make money off of it. I started blogging to help myself keep track of my personal finance progress towards my goals. I wanted this blog to help me be accountable for my actions. However, I have read many different blog posts by other bloggers who are making money from their own blogs and who seem to be doing pretty well. I have always wondered how they were able to do this.

Personally, I have tried to use Google Adsense to generate some income from the blog but have yet to have one single reader click on the ads seen to the right. I don't think I can hope to make any extra income from adsense.

I was looking for something different. Recently, I ran across the website called Snapbomb (www.snapbomb.com) and decided this sounded like an interesting way to generate some cashflow from my blog. The idea behind Snapbomb is that you write blog posts about certain products or company services. Based on your post, you are paid a certain amount. This is a way for companies to advertise. Blogs can be read by hundreds or thousands of people a day. This blog currently is only read by a few people a day but is on it's way to becoming more popular. Companies will pay you a certain amount based on how many visitors you have to your blog to write a review which is an advertisement for the company. This blog marketing is a way for companies to get some cheap advertisement and reviews from trusted bloggers.

Will this idea for making some side money work for me? I don't know. I'm not sure how many opportunities will be relevant to this blog to write about. However, it is worth a shot if I can generate a little bit more income to help pay down my debts! Has anyone else tried using Snapbomb or a service like it? If so how has it worked out for you? Would you recommend this kind of service or is it a waste of time? I guess I will soon find out.

Book Review: A Million Bucks by 30

I recently finished reading the book titled "A Million Bucks by 30" written by Alan Corey. I first off want to say that I liked this book. I liked it a lot and would definitely recommend it to anyone for a good read. It's not a definite plan for getting out of debt and becoming a millionaire. However, it is very funny and interesting to see how this particular individual went about becoming a millionaire.

Alan Corey made it a goal at the age of 23 to become a millionaire by the time he turned 30. He accomplished this goal by his 29th birthday. Alan Corey grew up in Atlanta. He decided after college he wanted a change and found a job in New York City making 40k a year. He worked this job up until he became a millionaire. He was very frugal and came up with clever ways to save money all the time. He was a cheapskate.

I find it interesting to hear the different ways he saved money. He maxed out his 401k at work and lived off of very little of his income. He stashed a large percentage of his money into a savings account that he did not have easy access to before he even saw the money. Through direct deposit he was able to amass a small fortune in this one savings account alone without keeping track of the balance daily, monthly, or even yearly for fear of temptation to spend it.

The way Corey became a millionaire was more through his real estate ventures. He bought his first apartment in an up and coming neighborhood. He rented out the living room to a friend to decrease his costs and he stayed in the one bedroom. Corey made it a goal to buy one real estate property every year. His next property was a multi family unit that he made into one unit where he could rent out each room. This arrangement was more like a dorm then city living but he found willing renters and was able to create a positive cash flow from his two properties after paying mortgage, taxes and insurance. He kept his eyes open and found good properties to get involved with. He found business partners and made things work.

I like this book because it gives me encouragement that I too can become wealthy. This book motivates me to be frugal and keep an eye out for opportunities that come up. I believe Corey got into the real estate market of New York at the perfect time and even he admits a little luck played a big part in achieving his goal. I would like to get involved in real estate some time. Now is not the time because I have many other goals but in the future I will keep my eyes open for opportunities. This book is a very motivating and interesting read.

Should I Sell Stock to Pay Down Credit Card?

Today I made my monthly payment on my credit card towards paying down and eventually paying off the balance. Right now I am able to throw around $200 a month at the balance so that this month it went down from $1,400 to $1,200.

I want this debt gone. It is credit card debt and I have grown a terrible hatred for credit card debt. I have always believed carrying a balance on credit cards is a bad thing to do. Due to some irresponsible moves the past couple years I built up a large balance and have been working since September at paying it all off.

Today I found myself contemplating whether I should sell some stock I own and use that money to pay down some of the debt. I have a small online stock brokerage account which only has about 800 dollars worth of stock in it. I am contemplating selling one of the holdings which would give me a little over $500 to put towards the credit card. This would help me pay off the credit card a couple months earlier then the current plan of paying down $200 a month.

Once I have that credit card paid off I will be able to save an extra $200 a month. This would help boost my savings quite a bit. My stock account is for fun. I like speculating in the market. However, I don't see myself getting rich off of this. Especially with such little capital and considering I've lost money on most of my trades except a couple. I don't see myself growing the capital I can trade anytime soon either. My fiance and I have specific goals and none of them include building up my stock account. We are saving for our wedding. We are buying a house. We are paying off our debt. After all of this we want to build our emergency fund up about $6,000 more. And after all of this we would like to start saving into a couple mutual funds. I don't see myself contributing to my online stock brokerage account any time soon. Even after our wedding and after our debts are paid off, I doubt my fiance is going to want to put our savings into my stock picking ideas. She would rather put our savings into mutual funds with a history of good performance. And since I work for a mutual fund company, we can do this at NAV with no commissions or sales charges.

It may pain me to liquidate my stock account and use the money to pay down the credit card. However, I believe it is time to face the facts and go after my first goal. Being debt free. Getting rid of this credit card debt will free up a couple hundred dollars a month and that is what I need to do.

Friday, February 15, 2008

Federal Tax Refund Recieved Today!

Well to my surprise I looked into my checking account this afternoon and had a deposit of my federal tax refund! I was expecting to get the refund next week so am happy to get it a couple days early. I already transferred the money over to my fiance and I's wedding fund. This puts our wedding fund in pretty good shape. My fiance hasn't filed her taxes yet. I think we will do that this weekend so we can know how much more we can expect the wedding fund to go up due to taxes. Other then our tax refunds, there aren't going to be any more big jumps in our wedding fund. We expect to save about another $2k between now and the wedding in the fund in our normal monthly contributions.

On another note, we got preapproved for a mortgage today by another mortgage company. This makes two different companies that have preapproved us. We are going to meet with this second company next week. Our goal is obviously to find the cheapest mortgage we can get with the lowest interest rate offered to us. Thus we are shopping around and will probably look into one or two other lenders as well.

Thursday, February 14, 2008

Let the Home Search Begin!


Well it's official! My fiance and I went out to some open houses last Sunday and decided that we were ready to begin looking for our future home to purchase. We decided on a realtor we like and got pre approved for a mortgage. Now all we have to do is find that perfect house!


We are in a lease at our current house until the end of July. Therefore, we are hoping to find a house that we can close on sometime in June or July. We decided that we wanted to buy a house now because we are tired of paying so much for rent. For what we currently pay in rent, we can buy a house about the same size. For a couple hundred dollars more a month we can get a bigger nicer house then where we currently live.


We aren't out looking for a mansion. We've decided on the things important to us. We are looking for a 2 or 3 bedroom house. We would like a basement that is finished. A deck or patio area in the backyard and we will be set! Our next plan is to search through some homes on our realtor website and then go check them out with her. Hopefully we'll find something we like in a price range we can afford!

Wednesday, February 13, 2008

People WILL Spend thier Stimulus Checks

Congress passed a bill and the president signed it so that this spring, possibly as eary as May, taxpayers will recieve a rebate check ranging from $300-$1200. The government is hoping that these checks will be spent and help boost business and stimulate the economy.

I have read many articles stating polls where people plan on saving thier rebates. One poll suggested that only 15% of people would spend thier rebates while the rest would either save or pay down some bills.

Personally, I believe most people will rush right out and waste thier rebates. Money will be spent! By the end of the year most people will have either new big ticket items such as tv's, or will not know where the money went. Thier savings account balances will not be any higher then they currently are. I am a strong believer in saving and investing. However, I feel most people just don't save. People may have good intentions to save but over the course of the year thier wants will pull that money right out of thier pockets.

With that said, will we be saving our rebate checks? Nope! We are saving up to pay for our October wedding in cash and this money will sure help us do that. Our rebates will be spent on something like catering or photography. We also have plans to buy a house. With the purchase of a house comes a down payment and closing costs. Our rebates will be spent! And I have a feeling so will most of the rest of America! There is a reason Americans are in massive credit card debt! They will continue to spend!

Tuesday, February 12, 2008

Blew Threw my Monthly Entertainment Budget in Half the Month!


Ok, so today I went out and bought a couple items for my fiance for Valentines Day and got myself some lunch at Taco Bell. My fiance and I give ourselves an allowance of $100 a month to spend on whatever we want. Mine usually goes to eating out because I can't control myself. I like to eat out and eat out often. Last month I did a good job. This month however, my fun money is gone. I spent about $30 on my fiance for a couple items for V Day even though we decided because of our budget not to buy each other anything. But I had to get a card and some chocolates for her. And then I got a romantic movie. I feel it is our first V Day together since being engaged and I don't just want to not do anything. So it came out of my fun money. I'm ok with that.


Now I have to figure out a way to make it through the last 17 days of this month without spending any more money. I guess this will force me to not eat out. On another note, somehow my fiance is an amazing saver and has all her money for this month plus $40 left over from last month. I need to learn from her! Next month I will try to have some left over money!

Saturday, February 9, 2008

Will My Online Side Business Work?

Ok, so as I posted a couple days ago, Microsoft Office Live is offering free websites and webpage hosting. I took them up on their offer and designed my own webpage for a side business idea I came up with a couple months ago but failed to implement. The past couple days I have been working on the content of the webpage and getting it all set up and ready to go.

The idea is an online running coach. I have been running for the past 15 years. I have trained under two coaches and read many books. Currently I write out my own running programs for myself to follow. I had this idea to be able to write out individualized programs for other people. I set up the site so that people can choose different program options such as one month programs or marathon training programs. This is all new to me so I don't know the demand for this. There are other websites like this one and after comparing I feel my pricing is reasonable. I figure if I can just get about 20 athletes then I will be good. That is about all the time I have available anyways.

So hopefully I can experiment and direct a few people to my site that will be interested in what I have to offer. If not, then I tried and it cost me nothing. I have implemented some ads to be run on ask.com and msn search. That is where I am counting on my traffic to come from.

Will this idea take off? I don't know but it's worth a shot if it means generating just a little bit of side income. If you are interested in checking it out then go to the website at www.foundationrunning.com. If you have any suggestions then feel free to post on here or contact me through the webpage. Thanks!

Friday, February 8, 2008

Do I have the Ten Traits that Make You Filthy Rich?


Today on yahoo personal finance I read an article entiled "Ten Traits that Make You Filthy Rich." You can access that article here. After reading through the article I thought it was something worthy of sharing on my blog and I'd like to comment on whether or not I feel I have some or all of these traits. I'm not necesarily convinced that having these traits will make you rich, but I think they would help you on your journy.


The first trait is PATIENCE. Patience is waiting for the right time and opportunity. It is waiting for the sale special deal to save some money. It is putting off a new car purchase a couple extra years so you can save the money. Having patience can mean the difference between buying things with cash and buying things on credit. Another part of patience is with investments. This year the market has seemed to go nowhere but down. Have patience with your retirement investments. For me, with retirement being 40 years away, it would be unwise to react to the down markets moving all of my retirement money into bonds or cash. I will be patient and reap the rewards with the market turns itself around eats up the current losses and gives me even more gains. I'm not sure that I have always held this trait but as I become more and more aware of my personal finances, I am becoming more and more patient with both investments and purchases.


The second trait is SATISFACTION. This involves being satisfied or happy with what you have. For example, I am satisfied with my current tv. It's not a large flat screen but it is big enough and works well for me at this point in my life. Will I never get that new tv? I will, just not right now. I am satisfied with my current car. It's not the Mercedes I would like to have but it does it's job. It's a nice car and I will keep it for a very long time. If you are not satisfied with what you have then you will always be spending money trying to find that satisfaction. It may give you joy buying that new product, however, it will be a joy that is short lived. Once that joy runs out you will be looking for something else to satisfy you. Be satisfied with what you have. This is a trait that I feel I have. There are things I want but I realize I would be no better off then I am now by getting those things.


The third trait is ORGANIZATION. I admit I could use a little help with this trait. I know where my stuff is but I sometimes lose things. I am working on this skill of organization. I have bought a filing cabinent and try to keep my financial records organized. Being organized helps you from losing things and paying late fees. I try to stay as organized as possible with my finances especially so I don't pay the unnecessary late fees. Organization can help you be more productive by being decluttered. Stay organized.


The fourth trait is DISCIPLINE. It is discipline that helps you stay on the road to your goals. You will not become a millionaire over night. Save for your goals. Stay on track paying off debts. Work hard and you will achieve. I am trying to be as disciplined as possible but sometimes I falter. I try to stick to a budget, save what was planned, pay off debt that was planned, and do everything I can to achieve my goals. It will not help me to make a purchase that is not in the budget. This will only force me to save less or pay off less debt that month. Stay disciplined.


The fifth trait is REFLECTIVENESS. Look at your financial decisions and reflect on thier results. I do this every month by looking at our net worth progress. So far my decisions have paid off and my fiance and I are increasing our net worth every month since keeping track. Another area for me to reflect is my stock brokerage account. Currently it is a small percentage of my capital I use to speculate in stocks. I often reflect on purchases and sales and what went right and wrong. I want to improve on each stock transaction I make.


The sixth trait is CREATIVITY. There are many aspects to creativity. For me, creativity is finding things to entertain my fiance and I without spending as much money. This includes walks in the park, picnics, nights staying in to watch a movie, and game nights with our friends. We try not to go out and blow too much of our hard earned cash on drinks and food or other more expensive forms of entertainment. Another way creativity comes into play is our budget. We must be flexible and creative with our budget to make it work each month so that we may accomplish our goals.


The seventh trait is CURIOSITY. Being curious helps you learn and improve. I am constantly reading personal finance books and investing books because I am searching for new and better ways to reach my goals. I read personal finance blogs every day looking for new ideas. If you are curious about something you will learn more about it.


The eighth trait is RISK TAKING. You must be willing to take risk. If you don't take risk then all your money is sitting in a savings account earning you very little interest. To make the kind of money you need to be filthy rich, you must take risks in investing and business. If you always do the safest thing then you will be paid to do the safest thing. The stock market may be risky with it's up and down volatility. However, that is a risk I am willing to take if I have a chance at earning over 10% return on my savings. This does not mean be stupid. I don't have all my assets in the stock market. You must diversify and have an emergency fund in a liquid savings account. I have mine in an online money market account. But by taking thought out calculated risk, you give yourself a better chance for becoming wealthy in the future.


The ninth trait is GOAL ORIENTED. Goals are like road maps. If you don't know where you want to go then how are you going to get there. I know I want to be independently wealthy. I want to be comfortable with money so I don't have as many worries in life. I have set goals towards reaching this goal. I have goals of paying off debt and saving certain amounts. With these goals in mind, I have put together a plan to reach them. I have a plan to pay off a certain amount of debt this year, save a certain amount this year, and reach a certain net worth this year. These goals keep me focused, disciplined, and knowing where I am and need to be.


The last trait is HARD AND SMART WORKING. Your chances of becoming wealthy by winning the lottery are slim. You must work hard and smart. Be as efficient as possible. Do your best at everything you do and your hard work will pay off. It is the people who put in the time who are rewarded. If you have a business, and you don't work hard to make your business successful, then chances are it won't be. People like hard workers. Hard work pays off.


I feel like I possess quite a few of these traits. I am concious of the ones I don't and can make an effort to do what it takes to develop them. What do you think? Which of these traits are most important and do you have what it takes to become filthy rich?

Thursday, February 7, 2008

Starting My Own Online Side Business

Recently I came across a blog post that said that Microsoft Office Live was giving small businesses free website domains and hosting. I looked into it and sure enough it looks like you can register for a domain name and set up a pretty basic website for free. This is a great opportunity for anyone who has thought about starting their own business on the side. An online business can be just the part time project needed to test out your business idea without having to quit your day job.

Personally, I am extremely excited about this opportunity. I came up with an idea a couple months ago for a business I wanted to try out online. I'm not sure of the demand and was afraid to take the chance of paying for a website and hosting if I would not get any customers. Since I was/am on a mission to pay off all debts and save for an upcoming wedding, I decided it was not the best time to take on this business adventure idea of mine. This seems to be the perfect opportunity for me. I can set up my website and pay a little bit for advertising and test out the waters. If it works then I will make a little income on the side each month to help pay down those debts faster. If it doesn't work then all I am out is a little time.

I went ahead and registered for a domain name and played around on their design page for a short while to try to get a feel of what I could do. I don't know exactly when I'll get the complete business plan hashed out and the website completely designed and ready to go. Work is pretty busy this month. That is usually where I do a lot of my brainstorming and come up with the good ideas. At night I am tired and don't like to do too much thinking so I tend to relax more. Therefor, I may not get the site completely designed and ready to go until next month. I'll work on it a bit here and there and hopefully have it up quickly but I am in no rush.

For me it would be great if my idea takes off and I am able to make a couple hundred dollars a month from this online business. I'm not looking to hit a home run and quit my day job. I like my day job. I just want to earn some extra income in a side business. This extra income could help me get out of debt faster and save more. Another pro about my idea is it is something I will enjoy spending my time on. If I am making money from doing something I already love to do, then I will call that a victory!

For now, I will work slowly on forming my business plan and designing the website. Once I get everything finished I will post more on my business idea and where you can go to check it out! Wish me luck!

Stacking Pennies added to Blogroll

I just updated my blogroll on the left with a new blog that I've been reading for about two months now. The blog is titled "Stacking Pennies" and is about a female twenty something who has just recently moved to California for a new job. I enjoy following her blog because we are about the same age and seem to have alot of same goals and interests. You can click on the link in the blogroll to the left to go check her site out.

I need to update the blogroll with blogs that I have been reading lately. I set that up when I first started my blog and have been neglecting to update it as the blogs I frequent change. I have started frequently visiting more and more personal finance blogs and will add them in the near future. If you would like me to check out your blog and possibly add you to my blogroll then feel free to drop me a comment. Of course I would appreciate you do the same thing for me.

Be Careful with Your Free Credit Report!

About a month ago I went to freecreditreport.com and took a look at my credit report from Experian. I also had the opportunity to look at my credit score for free. The catch was that I would be signed up for CIC Triple Advantage program. The first month would be free and then it would be $14.95 each month after until you cancel. This sounded ok to me as I planned on canceling right away and not using the service.

Well, I looked through my free credit report and got my free credit score and thought nothing of it. I never received an email about the Triple Advantage program and when I went a week later to try to sign in on the Experian site, it showed that I had no account. I took this to mean I was not signed up for the program and I also didn't know who to contact to make sure to cancel it.

Fast forward to today. I took a look at my Capital One credit card and found a balance. This is the card I paid off last month so I looked to see what it was. It was a charge for CIC Triple Advantage. Now I have been charged for something that I really don't know what it is. There was a phone number listed on my credit card statement for this charge so I will be calling tonight after work to cancel the program.

However, I am worried. While looking into this on the internet, I came across a number of sites with complaints about this program. People going to look at their "free" credit reports and being signed up for this program. I am worried because while reading through these complaints, it seems that people are having trouble getting the company to actually cancel thier accounts. You can read the complaints here on the site Complaints Board.

I just wanted to make sure my credit report was free from error. Because my fiance and I are thinking of buying a house in the near future I thought I would check out my credit score. Apparently nothing is really for free.

Does anyone else check thier credit scores and reports? How do you go about getting this information and do you pay for it? Anyone else have troubles with this CIC Triple Advantage program? Let me hear your comments and suggestions!

Wednesday, February 6, 2008

Filed 2007 Federal Taxes

Last night I went ahead and filed my taxes for 2007. I used H&R Block's free TaxCut software online to e-file so I can get my refund back as quick as possible. The software was pretty easy and free. To file for state costs $30 each state. I moved to a different state so must file in 2 states. I didn't know when I agreed to do them both on the TaxCut site that you can only efile for one state. Therefore I paid $30 bucks for Missouri and am going to mail in the return. I'm a little mad about that one. I could have just done Missouri by hand had I known. I did file my Kansas return electronically though.

For my federal return, I am expecting a refund of just over $500. I am expecting a refund from KS of $18 and I owe nothing to MO. I chose the option to have the refunds electronically deposited into my checking account. I am curious to see how quickly the money will be sent to me.

Recently I increased my with holdings from 2 to 3. I am debating whether to decrease it back down to 2 or not. In 2007, I had contributions to an IRA and was able to deduct this amount from my taxable income. In 2008 I will have no contributions to the IRA so I will not have this deduction. Also for 2007 I was able to deduct some short term capital losses. Hopefully, 2008 will fair better for me and I will be reporting gains instead of losses so I won't have this deduction. Both of these issues have me concerned that my taxable income will be higher in 2008 and I should pay more along the way. I don't want to pay taxes at the end of the year but I don't want a huge refund either.

For 2008, I will be getting married. This is a more favorable filing status and will help my taxes. We also plan on buying a house and will be able to deduct the mortgage interest. Therefore, I think I will leave my with holdings as they are for a few months before switching them back to 2. I can certainly use the extra money in the present to help pay off my debt quicker and save for our upcoming wedding.

Thursday, January 31, 2008

2008 Goal Progress Bar Updates

I updated my 2008 goal progress bars to the right this morning to reflect our end of January numbers.

This month we paid off alot of the credit card debt. The goal is to reduce my credit card debt to zero. This goal does not include B's credit card because it is paid off in full every month. By using my emergency money and some money from B's checking, we were able to wipe out half of the credit card debt this month. We are well on our way to accomplishing this goal in 2008. One credit card is gone. Our next mini goal is to get the other card balance below $1,000.

Retirement was not so good this month. Our accounts rose a total of only $95 which doesn't put us very far towards our goal of $10k. Hopefully next month will be better because we still have 98% to go towards our goal this year.

Paying down our total debt was a decent month. We got 29% closer to our goal of being under 30k by the end of 2008. Hopefully we keep this up and go below our goal!

Total net worth did not have a good month. While our debts decreased quite a bit, so did our cash. What we saved in retirement did not show in the small increase in those accounts. What we paid out for our wedding location won't help us for the next 4 months. While we paid down alot of the credit card debt, it was at the expense of some of our savings so the cash number went down.

Overall, I am pleased with the debt reduction this month. Hopefully next month will be a better month for retirement and overall net worth!

January Net Worth Update!


This is my second net worth update where my fiance and I are combined so I can make some comparisons from last month. Overall our net worth increased just $192 or 0.84% to just over $23,000.


Our assets overall went down $1,852 or -3.09%. Cash went down $2,136 because we used my emergency fund to pay down credit cards. We also made a payment on our wedding hall and used some extra money in B's checking account to put towards the credit cards. Stocks went up $189 due to me owning Countrywide when they were announced to be bought out by Bank of America. I quickly sold to take a nice profit percentage wise. Retirement only went up $95. We probably contributed over $300 to retirement accounts so this number is no good.


On the debt side, we paid off $2,044 or 5.51%. Alot of this is from the cash taken from my emergency fund and B's checking to pay down the credit card. One card is completely paid off and we will now be working on the last. Other debts decreased with their normal payments.


Overall I'm happy to see our net worth increase. I know these next 4 months are going to be difficult to increase because of paying off our wedding. Hopefully the stock market turns around and helps our retirement accounts out so we can balance our savings with our outflows.

Thursday, January 24, 2008

Tax Rebates from Stimulus Package in June

Looks like the President and Congress have agreed on a stimulus package aimed at helping the economy get through this current crisis and sub prime housing mess. An article is linked here. It appears they have decided to give tax rebate checks to be sent out in June in the amount of $600 for singles making less then $75k a year and $1,200 to married couples making less then $150k a year. If you have children you will get an extra $300 per child. There is also a partial rebate for individuals making up to $87k per year and couples making up to $174k per year.

The article states that Democrats pushing for more food stamps and unemployment payments gave up this idea when Bush agreed to include workers who don't make enough money to pay taxes in the plan. I'm not sure why Bush would not want to give rebates to those who don't pay taxes since they will be the ones needing it the most and in my opinion most likely to spend the money which is the goal of the package.

Overall I am pleased to be receiving a rebate which will greatly help out my fiance and I for our wedding. I am not sure if this package will accomplish what it is set up to accomplish but I do know it will help us out.

I am unclear on how this money will be disbursed. I don't know if we will need to claim it and get it back with our regular tax refund or if it will be sent out as a separate check. The article states that rebates will be sent out in June so I'm assuming a separate payment.