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Archive for February, 2008

Networking & Market Timing

February 29th, 2008 at 10:24 pm

You know, things have been going good, but yesterday was hell.

The good side is, and I hesitate to say it, but this year feels rather CALM. (knock on wood???) 2007 will go down as the tax season from hell for sure. It seems like last year all my clients came in with deaths in the family, brain tumors, and other horrid/complex tax issues. It just never ended. We lost a manager so the workload was insane, and we just didn't have enough management to catch mistakes.

Likewise, I thought most of it had been cleared up but I Was very frustrated yesterday to catch my own mistake. Grrrrr. This is why I work for a firm; why I am not a fan of being out on my own. So a second set of eyes always looks at my work and catches my dumb mistakes before they go out the door. IT's very frustrating to me. Likewise, I am happy the pace is much slower this year. I am not rushing as much; which helps.

So anyway, crisis averted. Life goes on. But I have been a little preoccupied.

On the flip side, this year has been kind of boring and most of my tax returns are done. It isn't even March! Hey, I might have time to care for my Corporations. Those are really our bread and butter, and they really get the short end of the stick this time of year. I keep wondering if I am forgetting something. I think a bulk of my tax appointments ended up in February, and I think that is awesome. Since March/April is a very busy time with our Corps.

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This morning though I did reply in the forums about a question from someone who "had to" pay $130k to go to film school. He has to network after all. I started choking when I read it; particularly knowing a large pool of unworking film students with FANCY degrees. Hehe.

Anyway, I have heard it said many times you can't be an engineer without the fancy degree and the connections. I just roll my eyes. My dad is actually an engineer and he just has a bachelor's from state. It is from him I get most my attitude about money; I must admit. But who can argue with success?

Anyway, I know networking is a huge part of my dad's career. I couldn't tell you how many times he has been laid off. HE is usually hired on for a project and let go. That's the nature of the industry. Maybe he's worked for 30 companies and been laid off 30 times. I honestly would not be surprised. I don't know.

Likewise, with the networks he has made in the WORKING WORLD, I never have known him to be out of work for more than a week or 2. The only exception was back in 2005 I think - he hit 55 and had a hard time finding a job, for about a year. We attributed it to age. However, he thought his current job was in danger and took on a side job recently this year. Now he is working 2 jobs. Sometimes when it rains, it just pours. Now that he's almost 60.

From my experience, networking was really key to helping me land a good job right out of college. I was in the networking clubs and familiar with all the CPA firms in the area. However, I have to say, I don't talk to any of those people today. I run into them here and there; mostly at seminars. I know how to look them up. But my career network is far more solid with the people I have met at various jobs. Once you get to your first job, your college and your college experience suddenly doesn't matter so much. You get your foot in the door and you move on.

Likewise, my husband has a pretty large network of friends in the film industry. He didn't have to go to an expensive school to network with the people who went to the expensive schools. Wink

I just had to cringe when I Read that post though because most of my dh's friends in the film industry work minimum wage jobs. It might be a little different if we lived in LA or NY. But for the most part, seems to be a thankless/volatile career. I would put it akin to the music industry. My dh is lucky he has me, but I ain't shelling out six figures so he can hob nob with the best. LOL. He'll just have to meet them outside of college. His friends are pretty talented and are starting to land jobs. & I think that is awesome for dh. The friends he has will make or break his career. I agree. He just didn't have to meet them at school.

My point is, yes, networking is key. But no, it doesn't have to cost 6 figures to network with the right crowd.

I mean, if you believe that, be my guest. I rather keep that money in my pocket, personally.

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Anyway, that was my rant-y post of the day. Now for something more interesting.

I have totally noticed with a good 18 months of tracking my investments that the market seems to behave similarly on a monthly basis. For example, the market is ALWAYS up on the last day of the month. From what I Can tell anyway. It tells me that the last day of the month is probably a horrible time to invest. Of course that is probably a big chunk of why investments up on the last day of every month. BEcause everyone gets their paycheck and funds their 401ks??????

So I did a web search on best days of the month to invest. Just curious. For now I dollar cost average in on the 10th and the 20th. Not to be different. It's just I get paid on the 1st/16th and it gave me a decent grace period to get my paycheck to the bank. I don't have direct deposit and I don't always rush to the bank on payday. So I had been doing one deposit a month, on the 10th. This year I added another one on the 20th. Just sounded nice I guess. My account is usually pretty flush on the 16th, paycheck or not. So I gave myself less time on the second half of the month.

Anyway, if I read this article correctly, it says about the 27th/28th is the best day to invest.

Of course, it goes on to briefly explain a plan to buy and sell certain days of the month, which reduced volatility by 45% (? I think that is what it said - you can read for yourself). This was an elaborate market timing plan to keep your money in money markets most of the month and jump into an index before the end of the month for the run ups, then sell back to MM. Repeat, repeat, repeat.

Don't worry, I am not going to bother doing that. But I found the concept rather intriguing all the same.

Anyway, didn't see much else on the topic. Will have to research more. Maybe I should just put my money in my money market every month until the 27th/28th and then invest. An idea! But more practically, I may invest on the 27th instead of the 20th. Of course, I am not sure that feels very settling. I generally fund my investments from my interest-free checking. So it seems to me I just want to transfer when I get it. & I think in many regards that just makes the most sense.

http://www.kiplinger.com/columns/value/archive/2004/va0525.h...





Who needs cash...

February 28th, 2008 at 08:46 pm

I have mentioned many times before that we don't use cash for the most part.

Anyway, I roll my eyes at the idea that just because you have a credit card you spend more. Sure, may be true for many. But I find quite the opposite.

I earn 2%, on average, on every credit card purchase I make.

It is easy to track. When I spent more cash, I have to tell you I had NO IDEA where most of my money went. Now with the magic of online banking and Quicken I know where every penny goes. With pretty much no effort on my part. (That's the best part. I don't have to write anything down).

Likewise, we have a budget and we know how much we have to spend. Whether we use credit or cash, doesn't make a difference.

HOWEVER.

There is a BUT here.

I keep cash for my fast food/junk food purchases. My small luxury I guess. We don't have a lot of room for eating out, but I give myself a cash allowance of sorts.

I am just so used to guaging how much I have and how much I Can spend by the cash in my wallet.

Anyway, while we were sick dh ran to BK a few times for dinner/lunch. I saw all these BK charges on the card. I asked if he had paid through the drive thru. The thought had never occured to me, though I usually swipe the card when I go INSIDE a fast food place (generally only to let the kids play).

Anyway, so I tried it today. HAd leftovers all week and was in the mood for something greasy. Went to McDs and swiped the card.

Well, wasn't that easy?

It's just going to take a bit of mind shifting.

I think my best bet is to set up something in the budget. "Burn money" or something. Just limit it to the $20/month or so I usually pull out of the ATM. There's really not much need for cash any more. I could hardly think of anything else we need cash for. The occasional split lunch with friends or gambling money (poker/bunco). That's about it. Dh and I always carry an extra $20 in our wallet for this kind of stuff, or for emergencies.

I really enjoy handling cash less and less. Woohoo!

Plus, heck, I earned a dime of "interest" on my lunch. Big Grin

P.S. It's 70 degrees here and beautiful. Neener neener (LOL).

Hope the weather holds...

February 27th, 2008 at 03:46 pm

Well, I guess I don't have to work saturday, but I generally prefer to work saturday and take sunday off. Though I guess I could rearrange my schedule according to the weather. If I really wanted to.

But I luck out. Weather looks to be 70 degrees/clear this sunday.

I picked out an easy looking hike that isn't too far from hear, to try. There is also the nature center. I have only been once, but they have a lot of activities. The kids loved it. They have a few easy hikes around. I figured that one would be a good warm up for LM. See how he does. Before we go on a 2-hour hike (the other one).

Anyway, one reason we don't frequent the nature center is because it costs $5 to park. There is plenty that abounds around here for FREE. But it looks like it will be a good place for some nature hiking, and I could buy a membership in the $30 range. I think we'll just give it a try. I have never been on the hiking trails. But will probably end up getting a membership if it goes well.

We had also talked about going to Family Camp this summer, and decided against it. I was looking at the cost today. The nice thing is all the food and activities are provided. It really is a good deal, and great with small kids. I have never been, but I guess dh has been before. Many times when he was a kid.

Well, this is through our old city and I just figured out that they charge quite a premium for us not being residents any longer. What a bummer as it is really the best one around. It is right by Yosemite.

Anyway, so I was reconsidering. With LM only being 2 yet, it would have been $125/night (food and everything!). All we need to bring really is sleeping bags.

Our non-resident status puts us at $180/night. Frown

Sacramento has something similar. But it is NOT Yosemite!!!!

I think we can get around this for the most part. We need to plan a big trip with the family. If grandma signs up and pays, I assume she will get the san jose rate. We'll have to see. Of course in that case she would just pay for us anyway.

I think since LM is free though, it might be worth a try this year on our own. It's still a good deal. It will cost in the $600 range for 3 nights. Just that and the gas to get there, really.

I am considering it because we have a free room for our LA trip (wasn't expecting it). & with this whole economic stimulus rebate thing. I am thinking I want to go to Yosemite!!!! I think it would be good to gauge how the kids do though. & heck, take advantage of having a 2-year-old (free). Cost will be more like $210/night once he turns 3.

Anyway, the nice thing is registration opens up in May. Gives us some time. I guess the other thing is planning around my vacation. I have an unused 7 days or so I did not know what I was going to do with. So I don't know if I want to tie it up with another trip. We'll see... I had wanted to just cut back my working hours in the summer. Decisions, decisions.

Oh anyway, I was going to go to the gym last night (it has been weeks, since I first got sick) and dh talked me out of it. Weather was really nice so kids and I went for a walk. I think that was a good start. Though I will probably hit the gym tonight. Just the treadmill; going to take it SLOW. I have lost so much weight but it's not good weight loss. Losing a lot of muscle tone from being sick. Blech.

Likewise, I know hitting the gym will help me fend off future germs. This thing was just so nasty; knocked me off my feet for so long. So it is nice to be building up strength again.



Spring is in the Air...

February 26th, 2008 at 05:33 pm

The weather has been gorgeous and the trees are starting to bloom.

Big Grin

Makes me VERY happy. Did I mention I Was so over winter???

I can't believe Easter is in 4 weeks!!! It's always a fun family event. We don't host but it is in OUR city which makes it nice. & I have 2 new baby nieces to enjoy this year.

Dh spent a lot of money this week. He has been a bit depressed. I think I see a pattern. Depressed = spending. Just more crap for the kids. Like the NEED more crap. Ugh, I have to update my list big time.

I had an epithany when it comes to our medical insurance situation. I had totally forgotten that our deductible was $1500 per person. So even if we do get an insane/over blown bill, it will be $1500 max. It's $1500 per person, but $3k for the family. Which is much more reasonable. I had just forgotten about that part. As long as we have a boring week, I'll have a good $1k for the medical bill by march. Going to try to deposit an extra $250 since February is a short month. Our expenses have been low this month. We'll see. No medical bill yet. Buys me time.

Well, my first balance transfer is due back next month. It's due in April, so I am paying it back in March with the March payment. It's the shortest one. IT was 9 months. So at about $50/month interest, we will have earned $400. That was EASY money. This one was in dh's name. We'll pay it back and just have him close the card.

IT leaves 2 outstanding in my name. One I just started and will replace dh's money in our 5.7% CD. Big Grin

I have a few thousand due back in June/July. It's with WAMU though and they send me my FICO score every month. As long as I get my FICO for "free," I am going to keep the card open. But the other one is due come December and I will close it when I am done.

HAving a good score, we always close old cards. I Don't care how old they are or how big the limits. IT has never made a noticeable difference to our scores. I mean it may have dropped from 800 to 780 or something, when I did close my oldest card because they started charging an annual fee. I think we'll survive. IF nothing else I don't like having old cards opened, rife for theft. Or unnoticed fees. Likewise, since they are old cards I Don't use or pay attention too, I am likely to not notice if there was some weird activity or fees, etc. That makes me nervous. I have always just closed all my cards, but kept open one extra one for backup.

Likewise, though it was easy money, I think we'll take a break from the balance transfer game. IT was very helpful to our emergency fund and all that. But it was a lot of juggling with the 3 cards, and I think it will be nice to give our credit scores a break for a while. Well, dh's score will get a break. My 0% is still good for another year. We'll see how I feel in a year I guess. I admit it was easy money and it will be tempting to keep playing the game...





Got out of the house!!!!

February 25th, 2008 at 02:59 am

Isn't winter OVER yet??????? Oh, soon enough...

It didn't help that nice weather taunted us the whole time we were sick. So I looked extra forward to getting out this weekend. Instead, we got big STORMS.

Of course, to be fair, it looks to be 70 most of next week. Big Grin How nice! We'll see how next weekend is...

Anyway, I had told the kids we would go out this weekend. so with the weather, we went to McDs instead. We drove a good 20 miles to the one I knew LM would enjoy. He's a little on the young side. But there is one over by the preschool that I take BM to, to meet up with his friend monthly. The play structure is a lot bigger and is mostly stairs, instead of those stupid tubes. Easier for LM and easier for us adults if he needed help (which he didn't, phew). So the kids had fun. I expected it to be PACKED. But it wasn't too bad and not a lot of big kids. So LM definitely enjoyed. Of course BM enjoyed.

Anyway, so feeling VERY antsy, I wrote down a list of all the activities I wanted to do this year.

*sigh* The list is huge. Some festivals, a trip to San Francisco and Monterey, the SF zoo, another small amusement park, Disneyland (which we have all booked) as well as quite a few hikes. Hikes - Bay Area, the coast, Tahoe, local... Really, just too many options!

Of course, I am a get up and go person. I always have a list a million miles long of things I Want to do. Dh is happy to stay home and watch TV. Just the way he is. So I think he is very scared. LOL. It has been easier to stay home and watch TV with babies and wee ones and all that. But one main thing I have been wanting to do more of is some serious hiking. & BM LOVES it. (Dh enjoys hiking as well. He must admit). But anyway, we did a couple of small hikes last year with LM; he just was not quit ready. I am hoping this year will be better. Plus he is moving past diapers too (extra plus). So it's not only this winter I guess. Just the last 5 years or so stuck with small babies and toddlers. I am so excited to get PAST that and get back to some of our old habits.

Anyway, on my list were quite a few things I Want dh to do with us. So I think he is scared. But it will be good for him to get out more too. Big Grin

On the flip side, I feel a little overwhelmed. There are only so many hours in the day; week; month. It's just not ALL going to happen.

But I Am looking forward to a FUN year.

There are a few expensive/pricey things on my list. But most of it will cost little more than the gas to get there. So that I can really appreciate.

I think having such small kids, too much of our own lives have been on hold. So I am a little giddy that they can start doing more things that we want to do with us. & it's just fun to show them the world.

But I totally get this form my dad. I just want to do EVERYTHING. & the list is getting a little too long...

So yes, winter is making me antsy. But so is the last FIVE years of caring for babies. I just want to get OUT there again. WITH the kids. BEcause I Wasn't going to go hiking every weekend without them, when they were too little. (I have big babies - there was no carrying them around on hikes. No way!!!!! LOL).

Beyond all that, I bought a project to work on. Isn't it cute?



It's a latch hook. It is a small one. I am making it for BM. He wants to hang it on his wall. Then I'll go from there. I figure if I could finish a small one; maybe I would tackle something bigger.

I tore the house apart looking for my half finished giant latch hook project and I could NOT find it. Dh offered to run to Michael's to pick up a new hook for me. He saw the model airplanes and all sorts of stuff and ended up spending $15. (I wondered what was taking him so long!!). OF course, not bad for all he made off with.

I'll have to post a picture of my "kool kat" when it is done. I am not much one for pastels, but I kind of liked it. Big Grin

I think I like cats more than monkeys, truth be told. So had to get the cat. But, yeah, it amazed me all the selection out there in internet-land. How fun!!!! How things have changed. I have no idea what I would pick next. Decisions, decisions. Well I'll start and see if I can finish this one, this century!





Credit Card Usage 2007

February 24th, 2008 at 02:06 am



Well, I got an e-mail a long time ago my annual summary was ready, but I hadn't looked at it.

Here it is in all its glory.

we try to budget around $1200-$1300/month for regular purchases. But we put so much other stuff on the cards. (Whatever we can anyway). So it really skews the balances. All in all, I think we spent less than the prior year. I can already tell 2008 started out much less spendy.

Misc. - was primarily medical/dental bills

Services - mostly diaper service and utility bills

Merchandise - mostly groceries & all our other purchases

Auto - repairs and Fuel

April - dh spent $2k on video stuff (TV & PSP)

May - We had a $1k car repair

June - we used a new credit card to get some rewards (so spent less than usual on this particular card).

August - I put a good $3000 on my card for our Japan flights. My parents reimbursed me since they paid. But I am the travel agent of the family. Big Grin

So, the total for the year was $26,000.

Really $23,000 when you take out the flights. Probably a good $1k charged to other cards, so comes out to a pretty even $2k/month.

Some things we spent in 2007:

Travel & Entertainment:
Museums, Aquariums, Amusement Parks
Expenses for Cruise, Japan, Vegas, Florida (mostly dining since most of the rest of these trips were free).

So all that was only $1200.

Dining Out - $1300 Not a ton; mostly take out/fast food

Auto - about $3k gas; $1300 repairs/maint.

Merchandise - was $10k.

I'd peg $6k groceries/household. $2k dh's purchases. & another $2k on other merchandise.

Services - $3400 - gym, utilities, diaper service, ID theft monitoring, blockbuster online, etc.

Misc. - $1600 - was medical/dental, charity. Also DMV renewals and payments to city for programs/classes.

& that sums up 2007!

I always find it interesting to see it all laid out like that.









Paid Auto Registration

February 23rd, 2008 at 05:19 pm

Which reminds me, I answered on the forums that the most debt we ever had was $6k. (Outside mortgage). I actually borrowed money for 3 of my cars.

Anyway, it just occurred to me that I am the debt one in the family. Which is funny because I am pretty anti-debt. Dh has never had any sort of car loan. $0. I was thinking - hell - he paid cash for all his cars.

To be fair, his first car was GIVEN to him. I borrowed a good $1000 to pay for mine. (Worked an entire summer to pay for it. But bought it before I had the cash because I needed to drive to work).

So on that count I will consider him spoiled.

Likewise, he paid cash for his second car in college because he was living at home and had his college paid for. I can chalk that one up to spoiling too.

Likewise, I wasn't SAVING money in college. I was just trying to survive and get through. My car conveniently died about a month after I graduated. Actually, it really was good timing. I had just tripled my wage. But a few more months would have been nice. (I drove that car a good 7 years - certainly a good deal). So I borrowed around $6k to buy my second car. I paid it off within a few months though. It didn't take long to pay off $6k, with my new paycheck.

We replaced dh's crappy car after we moved here and had like a years' salary in the bank. So that was easy peasy. Paid cash.

When I had BM, I sold my convertible for $3k and bought an interim car for $1k cash. So that is the only car I have ever personally paid cash for. I was in STRONG denial. To be fair, we did not originally plan to have kids so soon. But I was determined to keep my convertible and didn't sell it until BM was 3 months old. I finally gave in that babies and tiny convertibles do not mix!!! But it took me a while. Likewise, if I had known at 22 that I Was going to have kids at 25... The thought hadn't crossed my mind. LOL. Likewise, my denial didn't put a better car in the financial plan. But it worked out.

Then we upgraded the interim car to a minivan 3 years later. We had the cash, but it would have drained most of our cash. So we borrowed $5k for about a year. To keep a nice $5k emergency fund.

So, looking back, I have borrowed on most my cars. Dh has borrowed on none. Just the way it worked out.

You could call him pretty darn spoiled too. Big Grin I can't imagine I would have ever borrowed money for a car either, if I was GIVEN my first one, and I didn't have to pay for college and living expenses myself. So I guess that is how it goes.

Likewise, I don't mind these debts at all. They were small, manageable and no/low-interest. We always bought very modest cars, so it's not like we were borrowing beyond our means. I seriously expect both these cars to last a good 10 years longer. Plenty of time to save up a wad of cash to pay cash for some nice cars for a change. Plus cars are just getting so much cheaper. Dh would be thrilled with a brand new subcompact Toyota in the $12k range. Probably what our next move will be. If he can bring in some money we'll pay cash for a hybrid. Depends how long his car lasts too. If it lasts another 10 years, we can certainly swing a hybrid. 5 years? Then he'll get another subcompact. HE loves tiny cars and that's good for the pocketbook. We paid $8k for his little used Ford and these days you can get a new Toyota for $12k. That just boggles my mind. So I guess with age we have more means AND cars seem to be getting cheaper. win-win.

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Well, back to the topic at hand. I paid dh's auto registration renewal.

The California DMV is the only government agency I am aware of that takes credit card payment with No FEE or SERVICE CHARGE. The county and the IRS will definitely charge you for putting things on a credit card. Which is a bummer because I love to pile as much as I can on the card.

I don't know why I checked the DMV last year, but I Saw no fee!!! I think it mentioned on the bill. Sounded too good to be true.

Anyway, it was due in March, but I was just looking at the Feb. budget and we are WAY under. Mostly from being so sick.

So I popped it on the card for this month. Will be able to just pay it out of the budget instead of the escrow account.

We also had a $75 charge for a doctor visit. It "should" come out of our deductible fund. But we have the cash this month for that as well. So I think I will not take it out of the deductible fund. It will end up going to retirement or savings then. An extra $75.

We still have another $80 for a date night too.

I think our auto gas bill will be $100 this month. Being home sicked helped that much. But we have been doing so much DRIVING these past few months. We have been averaging more like $300/month on gas. So that really created a lot of wiggle room in the budget this month.

Yay for February!!!

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ETA: I wish I had my camera with me. The sky was just BEAUTIFUL this morning. Apparently a lot of snow was dumped in the Sierras. They were a brilliant white this morning, from the sun, and the sky above was cloudy and pink and blue. I was driving in at 10am and looked a little sun-setty, though it is clearly not sunrise or sunset at 10am!!! So I really wish I had my camera. I couldn't even find a good picture of the view online, just to give an idea. Bummer.

Gorgeous.

It's the calm before the storm. We are s'posed to have another brutal wind storm this weekend. It had been so nice while we were sick, I had looked forward to going outdoors. But I am guessing we will stay indoors all weekend. Not a weekend to leave the house. IT seems to me these storms are worse than usual. Not the norm...

Anyway, we were going to go to the snow last weekend, but were all too ill. Maybe we can make it up when the storms settle, in another weekend or 2.

Something Else to Purge

February 22nd, 2008 at 03:45 pm

Man, this week has really sucked. Blech. I guess yesterday in particular. Just a bad day. & still sick of being sick. LM is doing a little better, but still quite grumpy. He worries me a bit.

I hope one of these days we all feel well again. I don't feel so confident that will be the case. Just hard to see the light at the end of the tunnel.

I also talked about taking BM out this weekend. (We just need out of the house!!!) But all I see is rain rain rain. Blech! It was nice and sunny while we were sick. Of course!

BM and dh seem to be doing well enough. I think I am getting there. Trying to take it easy this week.

Anyway, we will have something else for the purge pile. LM, in his grumpy mood, has refused to use his booster seat at the dinner table.

So dh took it away.

We should probably wash it down. I think it is something we will just donate. I can't see getting more than $5 for it. Likewise, I can't see it is worth the effort of selling it... Though I will peek and see what they are going for.

I still have to sell his crib bedding though. So hopefully we will rid the house of these things by the end of the month. I expect to get some cash for the crib bedding/room decor. Big Grin

We also trashed the changing pad last weekend. We bought a changing pad for his dresser (didn't see the point of a changing table). Likewise, with baby #2 we rarely used the changing pad either. Anyway, so we took it apart and trashed it this weekend.

Of course all this reminds me LM's room needs some work. Dh said he would paint it but I don't exactly see him taking the reins. The bottom 1/2 of the wall is brown and there is a ripped up wall border around the middle of the room. I am tempted to tear it down, but the 1/2 brown wall isn't exactly pleasant to look at!! So I will have to get on dh's case. I think that is a good project he can work on while the kids are at school! Poor LM in the meantime. Well, he is the one who ripped the wall border in places so his room looks like crap. Maybe I shouldn't feel too sorry for him. It would still be pretty cute otherwise.

Challenge $$$

February 21st, 2008 at 03:47 pm

2008 $20 challenge:

$ 50.00 - 1/10

$ 100.00 - February Contributions

------------------
$ 150.00 - Balance 2/20
------------------

**All retirement monies to challenge for 2008**

With my raise I am now adding $100/month to retirement. This will be bumped up to $300/month come summer.

$50 to T Rowe Target Retirement Fund
$50 to Vanguard total Stock Index

Retirement has always been an after thought as we were much more focused on other things (getting into a house, being there for our kids, etc.). So, it may be a small start, but it's a start. Trying the "automatic" and "pay yourself first" thing.

Didn't take Rocket Science to see that one coming...

February 21st, 2008 at 03:13 pm

I saw a house for sale and looked it up to see if it was foreclosure. (Our neighborhood).

Anyway, I immediately noticed a particular house on the same street had foreclosed. It caught my eye because it was one we were competing with when we tried to sell in 2006.

The story is as the market was dropping we were looking to make a rather lateral move. Take advantage of dropping prices. We carefully crafted an asking price around $500k. Anyway, these 2 houses were asking $600k and the realtors were quite nasty to us. Like WE were bringing down the neighborhood. We were just in reality. Anyway, we only listed a couple of weeks while we had a contingent offer on another home. When they found another buyer we took our home off the market. We found a couple of other nice homes for great deals, but dh and I could not agree on most of them. One of them would not take a contingent offer. So we quickly gave up. We might try again on the down side, but I think we have since decided we don't need to put more money into real estate right now. Though there were other reasons for our move. Likewise, we don't want to move once the kids start school and we are pleased with their school options right now. So, I don't think we'll be moving for the next 20 years. Not in the plans anyway.

Anyway, that's the long and short of it. There were 2 homes asking $600k and their realtors were really obnoxious to us. Well, they eventually sold for $600k!!!!!!!!!!!!!!!!! Could blow me over with a feather. I assumed the buyers were idiots. WAY overpaid. I mean I have no idea where the realtors found these people to way overpay. It just makes no sense. (Makes less sense why these home would have appraised for that much. Just way overvalued).

& so this is what the buyers are left with:

Sale History
11/09/2007: $436,455 (foreclosure)
08/15/2006: $600,000
12/24/2002: $308,500

Sale History
11/09/2007: $414,000 (foreclosure)
10/11/2006: $600,000
07/22/2005: $589,500
07/09/2002: $312,500

Extra weird that they both foreclosed the same day???

Maybe we were the idiots. Maybe we should have found some sucker to pay $600k for our house. Yeesh! We'd have a bigger house and a lower mortgage. Wink

So anyway, the biggest foreclosure activity around here are people who didn't do any research when they were buying a house. I would label them as suckers. Indeed. But a lot of people had to conspire against them. The realtors. The appraisers. The mortgage brokers, etc. They were all against them. That much is obvious. I could tell you there is no reason those 2 houses should have appraised anywhere near that price. So it seems rather shady. This was well after the downward slide had begun.

The whole thing was always just weird to me, and now I see how it ended up. No surprise there...

Debit Cards & Medical Bills

February 19th, 2008 at 09:45 pm

I was having a discussion with my spouse the other day, about why debit cards are so inferior. We don't use them, and apparently he didn't know why not.

So I Was telling him some of the horror stories I had heard about drained bank accounts and little protection from the banks.

(Oh yes, I think the convo came up when I mentioned the foreign arm of a bank that was dropping "deadbeat" credit card users who paid in full every month. Dh said, "who cares, we can switch to debit if they start doing that in the U.S." Which put us off on a debit card tangent).

But of course then dh looked at me and said, "well if you hate debit cards so much, why do you have one?"

We have one for the ATM.

Now ask me how often we go to the ATM. We've always had it "just in case." How often do we ever use it? Since we don't really deal in cash? NEVER!

So, I had never really thought much about it. But he had a point. I did use it much when our bank was far away. But for the last year or 2 we have been banking at a branch down the street. Since I don't have direct deposit, I have found it convenient to just ask for cash when I make deposits. & even then is rare!

So yeah, I think we can live without our debit card. I think I am going to cut them up. Not sure why I didn't think about it sooner. If I have one ripe in my wallet for stealing, well, I am not exactly protected, am I?

------------------------------

In other news, LM went to the doc today. He has just been REALLY out of sorts though he seems fine overall. Anyway, they said it was just the flu. Yikes! That is one GRUMPY little boy. HE hasn't had a fever in a while either. But guess he still isn't feeling well. I understand. I am back at work and my symptoms are mostly gone. But I certainly do not feel 100%. I feel like I could go home and nap the day away. Tired. Icky... I guess LM is much the same.

Anyway, the visit was only $75. Not bad, not bad. Our copay before was $50.

We insure pretty much for catastrophe. & we pay a pretty penny for that. But I always assumed that these services would cost way more. For example, our emergency co-pay was $500 last year. I found a list of procedures and costs (under the deductible plan) and it says emergency physician is only $100. So our emergency bill may only be $100? Holy cow! & I was so resistant to switch to the HDHP for so long. (The reason we switched for '08 is it lowered our out-of-pocket by a good solid $5k. I Worried it was a little too good to be true, but instead I am really pleased now. I Can handle $75 doctor visits and $100 emergency room visits).

I don't see anything about ambulances. So we'll see when we get that big bad bill. But I am starting to not really sweat our medical bills. Hmmm, you mean we might get to keep a chunk of our deductible after all? Maybe!!!! Any given year we pay for doctor visits and minor surgeries. Our bill for BM will hinge on the ambulance, but I am starting to think it might only cost a few hundred dollars, instead of an arm and a leg. ??? We'll see... We were paying pretty large copays for all these things anyway, before. I am liking the HDHP!

Anyway, the only thing I don't like is not knowing what my bill will be. We have only ever paid insurance premiums and co-pays. Never surprises like now. But if this is cheaper in the end; guess I can get used to the it. We'll see.

Unexpected Money

February 15th, 2008 at 10:28 pm

Well,I am getting really sick of being sick. We are all just miserable here. I've had a good solid 7 sick days which is crazy. I usually take like 7 a year max. Scares the crap out of me. (Not like we're not busy or anything).

I could maybe work today but dh watched the kids all day yesterday. I worked for a bit and crashed when I got home. I am letting him rest today. Going to take a nap after I sign off. Kids just fell asleep. I had some bills to pay. Haven't been on top of anything for well over a week. So had to take care of stuff or otherwise I wouldn't be on the computer - I'd be napping.

Anyway, I got a $80 check in the mail yesterday. I thought that was pretty sweet. It was rebate on disability insurance. I get it every year. Just not something I think about. So it was pretty fun to get unexpected money. Big Grin

I owe the daycare $35 for taking LM another day this week. (They couldn't take the kids today because the daycare providers are all sick - oh my! But the kids have temperatures today anyway - yikes. I thought they had whipped this). Anyway, dh and I have been talking about having a date night. So the money is spent. Very WELL spent. A treat if we ever feel better.

Likewise no one here has an appetite. Lots of water and juice and jello, but that's about it. No driving. Our credit card bill is going to be nil this month. This is the only plus side. No spending over here. The fridge is full of food and the cars are full of gas. & we are certainly not going to be out living it up this weekend. Big Grin

Anyway, if I am MIA for a while you know why. Sick, taking care of sick, and catching up at work big time!!!

Interesting Graph of the Day

February 14th, 2008 at 07:25 pm



I have seen similar graphs many times and always find them amazing.

It just awes me every time. PArticularly before 2006. Like, where will this bubble end???

(BTW we bought in 1999).

Anyway, it also shows why I have confidence prices won't go below a certain level. It has always been insanely expensive in this state. But wow, the last decade has really taken it to a new level.

On the flip side I know A LOT of renters house shopping right now. I think a lot of the doomsdayers have kind of lost sight of that. Our neighborhood dropped like a rock and is on an upward trend right now, with people snatching up deals. There are a hell of a lot of people around who could not fathom buying real estate in California for the last decade or so. Now they are considering it.

Well, our area has settled into very 2002-2003 prices. Places like LA and the Bay? Yeah, not much of a downturn yet. So those areas are really skewing this chart. Likewise, that is another save for us. One reason prices have plummeted so much here, so quickly, is that so many people came here from other parts of the state, for more affordable housing. But they didn't really have any ties here and fled with their equity in 2004 - 2006. I mean most of the people I have met here? Weren't from here and didn't stay very long. So we were quick to feel the drop. Likewise, we now have this void where we are very attractive to the more expensive areas, again. IT will be interesting to see that cycle renew again.

As far as places like the Bay? As long as people have their jobs, they will hold on. But with resetting ARMs and an unsure economy? I think they are in for a bumpy ride. Recession will most certainly be the downfall of those high prices. Too many families relying on 2-income households to pay the mortgage. So of course, lost jobs will just spell disaster.

Homes in Bubble Regions Remain Wildly Overvalued
http://online.wsj.com/article/SB120276871472760255.html

What a week...

February 13th, 2008 at 05:43 pm

Well last week was a little busy, but this one takes the cake.

BM was having trouble breathing when he woke up Monday so I called 9-1-1. That was the start to our week.

The night before he was up all night and he was driving me nuts. Sunday night dh went out with some friends. BM crawled into bed and I kicked him out. He woke my up again and went in there, and was pretty much, "If you wake me up one more time!!!!!!!" I was still fighting my cold. Anyway, he was babbling in his room and I started to wonder if he just wasn't feeling well. Just very unusual. So I went in there to tell him to quiet down AGAIN and check his forehead. For some reason I touched his hand and could tell he was burning up. I think he was just a bit on the delirious side. Of course he doesn't tell me he isn't feeling well or anything like that (which he is perfectly capable of). It was 2am and his temperature was almost 104. I called dh and told him he might want to come home and get some sleep since BM would not go to preschool Monday.

He had a horribly raspy cough and I was worried. Sounded like he was getting croup. I checked on him a few times but once he had some Tylenol he conked out for the rest of the night.

Anyway, when he got up he was clearly struggling to breathe and I yelled at dh to take him to the emergency room ASAP. I kept asking if he could breathe okay. He kept saying yes, but he was pretty distressed. Anyway, he then told me his throat was closing up. So I just freaked out at that point. 9-1-1.

So he went to bed totally fine, and woke up like that. Egads!!!!! An ambulance and a fire truck came and like a million firemen. LOL. IT calmed him down real quick though - he was excited by that whole thing.

They drugged him up, gave him cold air and a dose of steroid to help the swelling in his throat.

Anyway, he was home before noon and was pretty much good as new at that point. KIDS! He had a couple of night of high fever but yesterday he was mostly good as new. Today he went to preschool.

Anyway, the one thing I had never thought of since it was morning and the air was cold outside they said we could have taken him outside to expand his airway - the cold air.

They also said he was a bit on the old side for croup. He's had it a couple of times before and it is nasty. I hope this means it is the last time.

LM seems okay. No croup anyway. Thank goodness!!!!

Dh and I have been sick. I haven't been to work all week. I just relapsed into some nasty cold with cough. Maybe got it from BM. LM stayed home today because he is sick now. So we've been quite a fun bunch.

We were going to go to the snow this weekend. I am thinking BM will probably be good as new. Maybe grandma will just have to take him. I don't think dh or I will be up to it. We don't seem to be bouncing back so fast. Wink

Anyway, as if that wasn't enough excitement, my sister went in for a sore on her neck. They ended up doing a CAT Scan on her then and there. I am not sure they really told her what they thought or if she just didn't tell us, but lord knows what that is about. So I am really worried about her too.

Well, I have said a million times I had no illusions that we wouldn't use our deductible this year. Our copay last year for emergency room and ambulance? $1k. So yeah I wouldn't be surprised if we get a $3k bill or something. We switched to a HDHP plan this year (which is fine because we saved $3k annually on our premiums for a $3k deductible with no other out-of-pocket. It is much more favorable than our plan the last year which was more expensive and had a bigger out of pocket). My mom offered to help and thought I was crazy to think I might get a $3k bill. I figure they gouge you for that stuff. If it doesn't cost a whole $3k, we'll hit $3k between that and the kids' annual checkups and everything else.

Anyway, of course I said no, but I get the feeling my mom is going to send a check to help. Anyway, we'll see what the big nasty bill is when it arrives. We have been setting $250/month (saved premiums) for the "deductible fund." Will have to pull it out of the efund for now. Since we have only saved $500 thus far. Figures we would use it up so early in the year.

But I am just glad BM is okay!

Balancing Needs/Wants

February 10th, 2008 at 05:39 pm

Just an excellent blog post I saw this week. I think we have always kind of done this subconsciously. I would say this is much the approach we have always taken to balancing our wants/needs. MMND takes it to a very scientific level. So I was amazed when I saw it - what an awesome idea.

http://millionairemommynextdoor.blogspot.com/2008/01/craft-b...

It also likewise reminds me how annoyed I get when other people's luxuries are put down in the forums and blogs (often). When you go through this exercise you don't have to justify yourself to anyone. I always knew all the luxuries we chose were well worth it. Evidenced by not having any regrets when it comes to what we do splurge our money on. This is often our thought process when we decide where to spend our money.

Funny enough, you know what our biggest WANT is? According to this exercise? Our savings!! We save more than we really need to in hopes of future financial comfort. I would say future (& current) financial comfort is probably one of our biggest values. Everything comes easier after this basic building block though. It's not a "deprivation" thing. (I mean if this is a deprived life, LOL. We all should be so deprived). But it's more a "this makes life a lot easier" thing. It's a "you can have your cake and eat it too if you prioritize and manage your money well" thing.

Likewise, I am not going to retire at 40 on $1 mil like MMND. I value financial security way too much. Sounds very risky to me. LOL. (I might semi-retire at 40; which is really my goal). Comes across loud and clear when I do the spreadsheet. Most of our luxuries and quite minuscle. None of them are long term commitments. But savings was way up there. I just found that eye opening.

Anyway, this is just an excellent, excellent exercise. If you struggle with your wants/needs. Or if you just don't know where to begin. It kind of quantifies much my approach to my own finances.

I had my own post on the topic:

http://monkeymama.savingadvice.com/2007/01/19/priorities-fee...

But I think MMND's method is more useful/practical than my post. Big Grin Mine is more commentary how we apply the same kind of idea in our own life. (I have to add though that I always whip out that calculator and determine how much I have to work to pay for anything we don't "need." ALWAYS).




Filed!

February 9th, 2008 at 09:20 pm

I already did my tax return, but was waiitng for all the 1099s to pour in - to double check everything.

Anyway, I always do my tax return like 1/31 (in this case I think I started in 12/31/2007 because I had all my data in Quicken). But I usually figure the return, and rush to file in case of refund. Wait to April in case of payment.

E-file changes all that. You can file early but don't have to send in your check until April 15th. Which is sweet since no matter what I always get a state refund. I only withhold $50/paycheck now. Still refund! But I am not going to lower my withholding any further...

So I saw that these rebates will be issued in order 2007 tax returns were filed. Figured I'd better get on the ball. (Got all my 1099s as of last week).

I'll get a $62 state refund, to be exact. But $1182 due to the Feds, to be exact.

I'll get the refund in a couple of weeks.

I'll mail my IRS check April 15th. Big Grin

& now I have secured my place in line, for rebate. Yay! We'll see if this is true...

Which reminds me, I know they are saying May to start mailing out rebates. But wow, I really wouldn't hold my breath. We'll see but the IRS is SWAMPED!!!!!!! The government sure has put a lot on them the last couple of months, and they were already swamped, as is. Which makes MY life difficult. Blech. I mean it's impossible to resolve anything with them these days without "We'll get back to you in 6 weeks about your simple inquiry - we have a backlog." Anyway, I think Congress and government has been pushing for April rebates. Maybe it was the IRS who said, "are you kidding??? May at the earliest!" So maybe May it is. But we'll see.




Paying Bills

February 9th, 2008 at 05:58 pm

Paid a pile of bills today, which did not take very long (online).

Credit card & mortgage.

Auto insurance bill was due.

Finally got water bill.

So paid all February bills and had - $0.02 in checking. I am expecting a $5 auto reimbursement, so sounds good to me. Surplus? It's been a while. Holiday season is just so crazy.

Yes, my whopping $5 surplus!!!

I have auto license renewal here - due in about 6 weeks. Think I'll just throw it on the card in 6 weeks. I think this is the only government bill I have ever seen you could card without a fee. I certainly will take advantage!

Anyway, April is going to be brutal. $1200 due to IRS. $2300 due to county for property taxes. $500 life insurance premiums due April 1. Blech!

Oh we're prepared for it. But it always sucks to fork over all that money. !! April and December are just our sucky months. Some reason we just lumped all the big crap together. That's what we get for buying homes in December. Got steals for buying in the off season, but always have those big bills (home insurance) due with Christmas and property taxes. We have some other life insurance and disability insurance all comes due December too. Figures.

We usually don't owe much to the IRS. (Usually our state refund equals our IRS balance due). So that one was unusual. Just made it more difficult this year.

Squeaked By

February 8th, 2008 at 10:39 pm

Well I have been busy. & sick too. Blech. So not much bloggy bloggy.

Yeah, work is insane. Being sick doesn't help.

I just saw the tax rebate news. I am not thrilled with the whole thing, BUT we could use the money I guess.

Anyway, well, we just squeaked by! I assume they are using 2007 income to figure the rebates? Perhaps 2006?

For 2007 my income was like a penny over $75k. But I also had my ROTH conversion to push that way up.

Likewise, if they use 2006, the ROTH conversion will be my savior. Our income wouldn't have made it otherwise. Either way we got it covered. I think that is sweet. Makes the ROTH conversions that much more a SWEET deal. We had decided to do the conversion while we were still in a lower tax bracket.

Which leaves us with $1200 rebate plus $600 for the kids.

Um, I owe the IRS $1200 so that is a wash.

I am getting $250 cash back from the card around May, as well as that will be our vacation. So I am thinking around $850 to our May vacation. Probably plenty. I don't even think we'll spend it all. But sure puts a load off me.

Anyway, I will pay the $1200 IRS tax (I get a $100 state refund) in April from the efund, but guess I will get it back soon after.

This will go a long way to making 2008 easier for us. That tax bill was going to move us backwards a bit.

I was also saving $100-$200/month for stuff like vacation. Some of that might get diverted to ROTHs at year-end, since we don't need it now. We'll see...

P.S. I just saw another foreclosure in our neighborhood, was asking $350k (after one sold for $370k). Well, it just went for $410k. What do I know!?!

Looks like things are looking up a bit. It sold pretty fast too. So, um, yeah, good!!!

I also saw 50% listings in the area were "distressed" listings. It's been steadily climbing. (From 33% in the fall).

We'll see where it settles. I think it's still early in the whole thing, but the uptick is nice.

Also helps our refi prospects. I was worried with it dropping like a rock. $410k puts us 50% equity. I think that will do. (I likewise wouldn't be suprised if it dropped to 25% in like a day, which is apparently the new PMI threshhold for areas like this. I guess lucky for us we don't NEED to refi. Not like that still won't happen. It's just crazy out there).

ETA: I think I read that wrong on the $75k. I am seeing further details emerge. I haven't been at work so I will probably get more thorough details on Monday at work. Everything in the news is vague and conflicting. I am still pretty sure we are getting $1800. But that's about all I am sure of. I think also I will file my return VERY soon to get in front of the line. Big Grin They say they will issue rebates, based on 2007 returns, in order received. So I better go file!!!!







Mortgages & Taxes & Gas

February 5th, 2008 at 03:11 pm

I can't help but wonder if our auto fuel will go down this month. I filled up 17 gallons for $50 yesterday, which really wasn't horrid. (It's been worse). & I thought I could probably get away filling up once more this month. Dh does not to the preschool drive any more so should save him a tank. Plus no San Jose drives planned which will save 2-3 tanks over the last 2 months. I think he'll fill up twice which will put us at $160 for the month. Maybe $210 for a 3rd fill up at the end (not sure I can really make it to the first on 2 tanks). But we have been spending $300, so this is very preferable.

I also saw that post on driving for better gas mileage. My dh thought I was getting worse gas mileage than him and I rolled my eyes. I said since I drive to preschool and sit at a line of lights to get there, of course I get worse gas mileage. We generally don't do a lot of city driving otherwise. Freeway and little traffic, or just quick jaunts down the street.

Anyway, but I do have a bit of a lead foot in a sense and so I did think about it. I did try to drive really calm yesterday and cruise at 65 on the freeway. I have found setting the cruise at a slightly lower speed helps the gas mileage (in the past). Anyway, I couldn't set it any lower lest I get run over.

I was wary since the drivers around here are SO BAD. Our auto insurance doubled when we moved here and I quickly saw why. We used to pay $200/year each for perfect driving records. Now we both pay $400/year for the same thing. Blech. But god forbid you get in someone's way!!!! I mean I moved from the BIG city and so it was kind of a surprise. There are a lot of traffic issues here, and hence a lot more road rage. So I thought driving calmly might prove to be scary. It was okay, but I did see quite a few people make a point to zoom past me with a red light up ahead. Of course that might have been me last week. LOL. I am not going to do that anymore.

Well, making a bit of a game of it for now. My goal will be to only spend $100 on gas this month. It's pretty aggressive, but I'll try. At least stay as close to that as possible. Of course dh might get through the month with only one fill up of $30 (he has a much smaller tank). He has been getting out more, but most the stuff he does is quite local. Driving to work is what costs us more gas than anything. It's not a long drive; it just adds up, going there every day and all...

I have to add I am not feeling much pinch. I always leave a lot of room in my budget for things like gas and groceries. I was thinking future inflation (or gouging). As far as groceries, we have cut our bills 20% but I still leave the old budget. IT's a big round easy # to remember, and no doubt as the kids grow they will EAT more. My point being, when you do a budget, try to think down the road a bit more. Makes it easier to weather rising prices. We cut out diapers, formula, lots of milk, etc. this last year. But the kids also eat at preschool twice a week. So I leave that old big budget in place for when we have to feed them every meal again. They can eat A LOT now but I understand this will get much worse when they are teens. LOL. Luckily, have a long while to prepare for that.

Of course I have never been too wrapped up in "today" when it comes to my finances. I am always planning ahead, and it really helps. Of course I feel like I am still recovering from our medical insurance premiums. Those came out of left field and I was lucky to get some decent raises to cover them. This is the first year, since kids, that the increase wasn't astronomical (like 20-40%). So I am enjoying that (enjoying that they only went up 7% - how sad), but knowing it is better to prepare for what I know since often there is a lot you just can't foresee. I Feel like we may be getting this under control, but what's next? Likewise, a little gas or grocery increase doesn't scare me. More to the point, that's nothing compared to what we have been dealing with these last few years. Phew.

Which reminds me, they recommend full fat milk the first year, or something, after formula. Then 2%. Anyway, we have been buying less non-fat milk for us and I have just been taking to drinking the kids' milk (easier). Dh refuses to drink it (which is funny because he needs the fat. He is such a stick). & anyway, I was mentioning the other day. I said it probably wouldn't kill us just to switch to all non-fat and bulk up on sale, etc. I said we could add fat to the kids' diets other ways, I think they will survive.

Anyway, the non-fat was on sale for 60 cents cheaper than the 2% so dh switched when he went to the store yesterday. I have the feeling in the interim we'll drink whatever is cheaper. The kids and I really have no preference. I just worried because I resisted to switching to non-fat for SO long. I didn't want to get spoiled by the good stuff. Hehe. So far I think I am okay. I drink so little milk as a whole.

---------------------------------------

I was pondering what the average payoff date is on a mortgage. I mean, in reference to age. What is the average age Americans pay off their mortgage? I was kind of curious but google did not shed much light on this question. I guess but show that more and more and more people are paying off their mortgages, well into retirement. (Or likewise, never pay off their mortgage).

My only frame of reference is our parents. They both paid them off when their eldest child turn 28. Interesting. Dh's parents are much older so put them in the 55-60 range for payoff. The funny thing is is we never prepay a dime, our mortgage will be paid when our eldest turns 28. No, we didn't plan it that way!

Which takes me to why I wondered in the first place. I am looking forward to refi-ing for a lower interest rate. I have no urge to stretch my loan out longer though. We would prepay the difference, keeping our old mortgage payment in the end. But enjoying the faster payoff with the lower interest rate. 'Tis the point.

Anyway, on these forums and in real life the reaction to an idea of refi is funny. I guess since the norm is to drag out the loan as long as possible and borrow more against it, those are the assumptions people make when they hear refi. Of course, knowing I am staunchly opposed to prepaying mortgage payments TODAY, I think that is much misunderstood.

Um, my goal is to pay off my mortgage at age 45! Likewise, I don't get the lure of extending it forever. But just because it doesn't make sense for us to send in prepayments right now, in no way shape or form means I am against paying off a mortgage.

So I wondered when the average age is. I figured 45 would be rather on the young side. I am starting to think being on the current track to 55 is most definitely on the young side. I just wanted to be clear I have no desire to have a mortgage in retirement. In fact we intend to pay of our mortgage WELL before retirement. But with youth on our side we really have the luxury to do both. To put the mortgage on the back burner for now, focus on our investments, and still pay it off quite young. So I am not inherently against prepaying a mortgage (not considering all the prepayments we will make in our life - and the ones we made when we had more means). I am also not against putting it on the back burner when it makes sense. Wink As usual I fall rather square in the middle. There are benefits to both. In fact, we discuss dividing dh' future wage 50% to mortgage and 50% to investing. A lot of the benefit of investing is lost in that situation since our tax-deferred investments should all be maxed out on my income, by that point, and the rules change when you talk taxable investments. We could pretty much flip a coin, and decided we'd do both 50/50 for a while. & go from there. See what we were enjoying more, or if we should just hedge our bets by doing both. That's more how we do things. We aren't very "either/or," as a whole.

----------------------------------------

I decided my $11500 ROTH conversion cost us $2600 in taxes. Bummer. I also double checked once again, but I think my withholding is really okay. Even with all the balance transfer interest, without the ROTHS, we would have been quite breakeven for the year. So I will leave my withholding as is.

Our effective tax rate in 2007, even with an extra $11,500 in taxable income, was 9% federal and 1% state.

I should look at that again. Honestly, it sounds quite high. I don't think we even paid that much. Now that I think about it I wonder if that rate is calculated before the child tax credit. We got a $2k. I think ROTH conversion and all our taxes were closer to $6k, not $8k. Something for me to check... (I really though the effective rate took into count tax credits though. So I will look that up).

Don't ask me what that rate is once we get the $1600 rebate congress is tossing around. IT will be rather low.

Anyway, our marginal tax rates are 15% & 5%. Even with the ROTH. That's crazy to me. Thank you kids and mortgage. & insane health insurance premiums (not sure I really thank that though. LOL).

I worried about my raise starting to bump us up a bit more to higher tax brackets. But we seen to be nowhere near it. Nowhere near it at all. So I am happy to leave my withholding as is, another year or 2.

------------

ETA: Well I guess I had to re-educate myself. The effective tax rate was tax divided by taxable income. Our taxable income is WAY below our actual income, so that makes sense.

Our effective rates per my calculation (total tax by TOTAL income) were 5.7% Fed & 1.6% state, with an extra $11,500 taxable income (ROTH conversion).

Which means out effective rate without that was 4% Fed & 0.9% state. Which means, yes, I can keep 90% of my paycheck still.

Actually, I Am keeping 86% of my monthly paycheck, but I have pretty much nothing more withheld when it comes to my overtime bonus in the spring. So it pans out. 8.5% payroll taxes (includes CA SDI) and almost 5% to fed/state means 13.5% of my wages go to tax. Not bad. Or keep 86.5% of it all. That's with all the extra interest we are earning now too.

My federal "effective" rate, ROTH conversion and all, will be 3.6% with this whole rebate thing. My tax return will show almost $90k income and my taxes of $5k will be reduced to $3400 post rebate. Crazy.

Does this seem fair to you? Do you see why it scares the crap out of me what my taxes will rise to down the road??? YIKES. Well, I am enjoying. Usually California does not get the fair end of the stick. Certainly not with AMT. Which I guess worries me more, what our taxes will be down the road. I have tried hard not to get terribly used to this. I am sure the short end of the stick will eventually appear. IT's been like this ever since my spouse stopped working. One year the government paid me to have kids. !! We sure had a knack for timing though. IT has been a tremendous help, the one income years, not paying taxes. We didn't really pay any 2-3 years. With all my raises we are starting to pay a little more. But not much...












Energy Star Homes

February 4th, 2008 at 07:55 pm

I guess this is for a small slice of readers. But if I was in the market for a home, and I Wanted to be frugal, I Would really consider an "Energy Star" home.

I find myself continually defending my big home to the assumptions we must get $500/month utility bills to heat such a monstrosity. I think, you have got to be kidding me!! We had a very small, rather new, well insulated condo in the late 90s and when we moved into a home twice as big our utilities went down. This is extra impressive considering we spent little time in our old condo and did not have laundry. Today there is someone home 24/7, we leave the house rather comfortable for the babies/small kids we've had the last few years, and we cook and do laundry (Washing diapers) daily. & with twice the space, our energy bills have gone DOWN.

We leave the thermostat 68 in the winter, 78 in the summer. Off at night (but it would never go above 80 or below 60 over night. WE also get cool night breezes so no need for air at night, though most of the summer days are 100 degrees +). IT's been into the 20s/30s over night but our house never gets below 60 degrees if we turn the heat off at 6pm and flip it back on the next morning. To be clear, I could live with much colder nights, but that is about where the house settles on the coldest of night. IT is usually 63 when I Wake up in the winter, on a more average morning.

Anyway, for comparison, on budget billing, our gas runs $30/month and our electricity runs $50/month. Our electricity is harder to peg since we were apparently under billed the first 4 years. They came out and fixed our meter and now we are paying more. We are about 10 months into that and are still figuring this out. We always assumed our energy efficient house meant insanely low bills. Whacked meter was part of the equation I guess. However, our gas is a mere $10/month or less (sometimes $5 in the summer, taxes and fees and all). But we get a few bigger bills in the winter. January was $101 (coldest month). So the average is $30).

But yes, the reason is we have an Energy Star home. These days they are putting in solar with these homes. which is really a great deal. I Can't say we paid any more for this house because it was Energy Star. IT was very competitively priced with the other new homes that did not meet the same standards. I would go as far to say as we didn't pay a penny more.

OF course, I forget some of the little details, like exactly what it was about the roof that made it so energy efficient, or the type of insulation they said they used. I should really dig out the old paperwork and refresh my memory. I don't know how they have upped the standards over time.

I think dh and I Were kind of like, "okay, whatever," at the time. We were very pleased with the appliances and dual-paned windows and such. & Sure, extra insulation sounded nice. But I think we chalked a lot of it up to marketing. (In fact we didn't buy the home at all because all of the energy efficient marketing. IT was more other reasons. Dh and I Could barely agree on a home and this is the only one we agreed on).

But 6 years later I have to say we are both very pleased. We have looked at a lot of older homes and an older, more mature neighborhood really appeals to us on many levels. But I am not sure we could ever moved backwards from the construction quality we have gotten used to on this house. WE are so spoiled with what we have.

But I did find this and found it to be VERY true.

http://www.infofaq.com/real-estate-analysis/energy-star-home...

"InfoFAQ: What are Energy Star Homes?

The U.S. Government reports that an Energy Star qualified home uses at least 30% less energy in heating, cooling and hot water, than those built according to the 1993 National Model Energy Code. Energy Star homes may save even more over homes built before 1993.

InfoFAQ: How is an Energy Star home built?

Using energy efficient technology, Energy Star homes are built with energy saving appliances, high performance windows, improved insulation, tightly sealed construction with little air infiltration, upgraded heating and air conditioning systems, efficient ducting, and upgraded water heating equipment.

InfoFAQ: How much money can an Energy Star home save?

Energy Star homes lower monthly utility bills by at least 30 percent. Energy Star homes also have a higher resale value. There are also potential savings by obtaining an energy efficient mortgage from an Energy Star lender.

InfoFAQ: How do Energy Star homes help the environment?

15 percent of U.S. energy use is from home consumption. Home energy use produces 17 percent of U.S. greenhouse gas emissions. Since 1995, Energy Star homes have eliminated four million pounds of carbon emissions nationwide and the U.S. Government has set a goal of reducing greenhouse gases by 9 million metric tons through Energy Star qualified homes by the year 2012.

InfoFAQ: Is it healthier to live in an Energy Star home?

Yes. Energy Star homes are built with tight construction standards, including the air sealing of the joints, holes and seams created during construction. Condensation within the wall structure, which is responsible for mold formation, is also lowered or eliminated. This air sealing greatly reduces the penetration of outside air pollution, pollen, car exhaust, dust, radon and pest infestation.

InfoFAQ: But how comfortable is an Energy Star home to live in?

Because the home is air sealed and tightly constructed, cold drafts are virtually eliminated, outside moisture is greatly lowered, and the home is much quieter. Room temperature is equalized in different locations of the home. Air ducting is balanced, producing the same amount of air flow from each grill, even in remote rooms."

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Anyway, everyone keeps asking me how the hell our energy bills are low. So that is pretty much my answer. Our house is VERY quiet and very toasty in the winter and cool in the summer. We find it all to be very true. & we are very spoiled with that and our low energy bills.

Beyond all that, our home also has a lot of water saving measures as well. We pay a flat rate based on the size of our house, but they just recently switched to the ability to choose metered watering. So far we are cutting our water bill in HALF. I think that is much of why. We are quite conservative with water, having grown up in drought country. BUT I think they base their rates on old homes this size. We just don't use as much water with our appliances and low flow toilets, etc. We're also rethinking our landscaping to cut this down even more. IT is ridiculous to keep a bright green lawn in our desert summers. Which is probably where most of our water consumption goes. Hydrating the yard in the long, hot summer. Suburbia doesn't make much sense sometimes.







5.7% !!!!!!!!!!

February 1st, 2008 at 07:10 pm

I thought I remembered this 8-month CD being renewable at 5.7% (if that rate would be preferable in 8 months).

Anyway, then they sent me paperwork and didn't mention this option to renew at 5.7%. This was really key to making my balance transfers REALLY worthwhile. My hedge if rates went down.

Anyway, I pulled out the original paperwork and didn't see anything. I could not beleieve I did not get that in WRITING!!! I started to wonder if I Was crazy.

Anyway, so I just realized my CD matures Monday and I better call. The option now is 3.2 or something for CDs. (non-promotional anyway).

So I Called and inquired and they said yes, I Was right. In fact, I didn't even have to call, it was set to renew at that rate Monday. Woohoo!

I am quite happy with this. I am not crazy after all. & yes next time I Will get it in writing, just in case.

Everything financially seems to be going my way this week. I am enjoying!

(I guess this could be a bit of a neener neener neener post too. LOL. Earning 5.7% for another 8 months on money that is not even mine!).