Plugged things in and am making small progress.

Keep in mind, my goal is to increase net worth by $25k-$30k this year.

As of 5/31, I am up $4900.

I just got a statement on the kids' 529. Their investments are officially down $500 for the year.

You can argue if there money should be included, but I figure the more we put in there now the less we have to come up with later, so I count it, for now. For the long run I am sure we won't.

Retirement is up about $3300. We have contributed about $3300 this year, so basically I think it is safe to assume our investment return has been 0%, thus far this year.

We have paid $1600 off of our mortgage (just regular payments).

Oh, and cash is up $500. Our mid-term fund is doing well, but our short-term fund is in the red, for now. It fluctuates much, but makes our cash savings look pitiful for the moment.

I can pretty much break it down to:

$3300 Retirement Contributions
$1600 Mortgage Payments
$ 500 Cash Increase
$(500)Loss on 529s
------
$4900
------

With the market the way it is, our goal will be very hard to meet this year. (Which just means we need to make up for it in good stock years...)

I did it!

I paid the last monster preschool bill. Woohoo.

& that temporary expense is long gone. Phew.

Anyway, it worked out rather well. Ms. Preschool called me yesterday and asked if I could bring the kids T/Th in June.

I looked at the calendar and that would be one less day to pay than M/W.

Woohoo.

So I wrote a check for $560 this month. Not so bad.

I peeked what this meant for July. With the switch back to M/W there will be an extra day to pay for July. & it is a long month. BUT one week is free (owners on vacation) and BM is only attending for half the month.

So July will be $420.

Average month is $600.

I upped my short-term savings to $1k in July, and going forward (diverted $100 of the savings).

I also considered adding $100 to our IRAs in July. I was just setting up everything in Quicken.

I decided to hold off. June is going to be another expensive month with our camping trip, Father's Day, our big date night, etc. July will be a little pricey with Birthdays (maybe). I figure I would earmark the $100-$200 saved for birthdays and camping. Seemed fair.

But August is it. I still haven't decided if I will fund IRAs or bulk up mid-term savings a bit. Or both.

Decisions, Decisions.

I am inclined to bulk up the savings instead. We've got about 12% going to retirement and majorly lack in the "big purchase" savings department. We have for years, but not sure how much longer our luck will hold out.

Then again I had been toying with the idea of doubling our IRA contributions now and doubling them in January (if possible).

We could also commit the entire $200 monthly to cash savings and then know we will have $300/month for IRAs, come 2010 when LM graduates preschool.

I think that is probably our best best since our retirement seems well enough on track. I just have a large urge to save more aggressively for retirement. But I don't want to do that at the cost of our shorter-term financial health.

It's probably the one area we have floundered with, since living on one-income. We haven't saved much cash. Last year I was able to build a decent emergency fund, but things have slowed. We don't have near enough cash outside that when you consider our appliances are aging, our cars aren't getting any younger, our house will need painting soon, the fence needs to be replaced (builders put in crap), etc., etc., etc.

Of course the major reason things have slowed is because we have had 2 in preschool, for a good 9 months or so. So I am optimistic to get back to a much faster savings clip.

July it will be nice to have a little more cash, but August will just be divine with that extra $300. Woohoo!

May is Wrapping Up.

I may sit down and pay the June bills tonight. If not tonight, this weekend I guess. See where we are at.

The credit card sits at about $3k right now with vacations and such. So today was the first time this month I sat down and looked at where we were at, for May. Hard to guage just looking at the balance.

I guess saturday is the last day of the month, but credit card closes Tuesday, so I usually sit down over the last weekend of the month and pay all the bills for the following month, and guess what the credit card will be, to see where we are at.

But I was actually pleasantly surprised:

$2800 card balance (today)
-600 Disneyland
-400 Camping Trip
-250 cash rewards to apply (Disneyland)
-550 Medical bills
-----
$1000
-----

We usually budget around $1300 to credit card, monthly. So we are well on track for the month.

I have to pay some phone bills and dh is driving to the Bay Area twice this weekend, so it will add up fast. But easy enough to hit $1300 from the monthly budget.

The vacation and medical bills are paid from their respective funds.

Well, a sigh of relief. Dh took the kids out to Quizzno's yesterday for dinner and I was not pleased. Seemed a bit unnecessary - we ate out so much this month, with our vacation and all.

Oh yeah, the beauty in this is I have a couple of hundred dollars of cash sitting in the checking account, to apply to vacation. Which means I will probably use $800 of our stimulus to our short-term savings (vacation) and $1k to mid-term. IT was to be the other way around. So, woohoo!

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Which leads me to my rant on people.

I have been rather anti-social of late.

I have this terrible habit of forgetting negative things rather quickly. This probably serves a useful purpose most times (I rarely dwell on the bad). BUT I am so annoyed at myself. I had completely forgotten why I had gotten so anti-social.

I got so fed up with the groups I have been hanging around with. I am sick of planning things 10 years in advance because everyone's calendar is so full, and then being stood up anyway. Completely sick of it.

I ranted about this much in the past.

I decided this year with tax season and then BM hitting kindergarten that I would kind of lose my old circles and find new ones at school. Seemed logical anyway since BM would probably make his own friends there, etc. So I was just kind of starting fresh this year.

I completely had forgotten this game plan though and had been feeling rather anti-social.

We haven't lived here that long and I just don't know that many people. Plus I know it's two sided. With work and family I have little time to cultivate friendships. So I have just been focusing on my family more. Which was a very conscious decision at some point.

I just forgot.

Anyway, I did invite a friend for a playdate at McDs Wednesday, rather last minute, and she told me it was Bunco night. I hadn't gotten the e-mail. The group had dissolved and she has been trying to pick up the pieces. This is the only friend I am probably not peeved at, at the moment.

So I said, sure. I was actually quite excited for a night out and was happy to see some of the ladies. The bunco group, I don't think I had much issue with. It was a good group.

BUT when I signed up there were only 3-4 people signed up. Obviously not enough to play bunko. I figured we would just hang out.

So I arranged my whole day for this outing and around 5:00 I checked the meetup website on a whim. The whole thing had been cancelled because we didn't have enough to play.

Well, duh. I could have told you that when I was invited.

I was just REALLY peeved. I remembered why I had dropped out of all my meetup groups to begin with. Inconsiderate people.

Anyway, I thought of calling her and seeing if she wanted to get together anyway. Probably what I should have done. But it was clear to me the answer was no. I couldn't believe she hadn't told me personally, when there was only like 2 of us to call. So I was just annoyed.

What I took as a "let's hang out" was a, "I am desperate to pull together 12 people at the last minute. But if I can't do that I have other plans." That was how I read it anyway.

So, friends. Who needs 'em?

I think mostly I miss just having someone to call last minute and hang out with. But in this day and age people are far too busy for that. That is one thing I don't like about our lifestyle here. I wish I knew some more "slow," laid back people. That's what I really miss about my friends back home, and past friends who have moved elsewhere cheaper. Bummer...

Anyway, I was stood up and didn't know it until after the kids had eaten. So I treated myself to a Togo's sandwich. But sounded divine after talking to dh.

Last night I tweaked my gyoza sauce. Dh is taking the kids to drop BM off with grandma for the weekend, and I am on my own for dinner. I was thinking of having some gyozas. I like what I came up with - dj's sauce did not have enough spice or vinegar. Well, we'll see what I think tonight.

We are going to pick up BM at the half-way point Sunday. But this is actually all dh's Mother's Day gift. He is helping them with some work on their house. Otherwise, no, I can't say we would be making those drives this weekend. Hard to justify the gas, otherwise.

Though it's equal part gift to the rest of us. LM gets along time with us, and we get a break from the wild one. So, should be a nice weekend.

Oh yeah, and I have a seminar tomorrow so this is a rather short work week for me. Phew.

Yikes. Guess I am in a bloggy mood today...



I whipped up some muffins at some point over the weekend, and had forgotten the leftovers. So grabbed them for breakfast this morning.

I probably already blogged this in the past, but I just LOVE that jiffy hasn't change the look of its packaging, like ever. For it's blueberry muffin mix.

Love the quick/simple treat. But have blogged often how I am sick of going to the store and trying to find plain pepsi in a sea of 50 different kinds of pepsi, and same for the toothpaste, etc. I go mad.

So kudos to Jiffy for keeping it simple. Some of us like it like that.

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

I also had another topic to write on.

Being in California has been interesting since we were in the thick of the tech bubble, when we lived in San Jose, and now we live in the thick of the housing bubble, in Sacramento.

But interestingly, I had some thoughts that I don't see mentioned much in the media.

The tech bubble probably would have ended much worse, but people started dipping into their homes, much to survive. Sure, I have seen more than my fair share of excess when it comes to home equity. But the reason a lot of people started borrowing way over their head was because of the tech bubble burst. I can hardly think of a family I know that didn't face lay offs in 2002-2004. Significant, long layoffs. Even up here in Sacramento. My dad has never been laid off more than like a month in his life and he was out of work well over a year. We figured much of that had to do with age, but employment opportunities have been booming for him the last year or 2. So it seems it was more economy than anything.

So to be fair, a lot of people around here started digging into their homes, merely to stay afloat.

I was thinking about this since quite a few friends are starting to face layoffs, and lament they have barely recovered from the last round.

& so I do have to sympathize.

I was googling the subject a bit and didn't see much. California stastics showed 7% unemployment level at the peak. Today we are already wooshing past 6%.

IT's all a little deja vu.

I think this makes this forecasted recession much scarier. I am not sure how people will get through this round. The debt solution is pretty much gone.

I don't know.

I am surprised there is not a lot more observation about this though, in the media and in other blogs, etc.

OF course, "significant" and "long" are relative terms when it comes to layoffs. I Was perusing California unemployment data and it hit 10% for much of the 70s and 80s.

Ouch.

So anyway, I am back to, "Who couldn't see this coming?" Who could live in this area and not see this mess unfolding?

I guess a lot of people!

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

That kind of reminds me I haven't seen gas up past $3.99, like gas stations were hesitant to raise above $4. Well today as I drove to preschool I noted $4.10 gas and $4.15 gas at the cheapie gas stations.

WOW!

I can only imagine what the Chevron on the corner here has gone up to. I'll have to look when I leave work tonight. IT had been holding steady at $3.99, prior.

& this reminds me, when all the gas hype started, I think where I Was with the housing bubble. "Who couldn't see this coming?"

Or maybe I just feel behind the times. Gas has taken quite a chunk out of our budget in recent years. I think we felt the pinch much stronger earlier in our one-income years (it had risen more percentage-wise in the years I had my children). So I found this all rather predictable, felt we were nowhere near the worst, and was unsure why the sudden panic. Though obviously we have reached a tipping point for the masses; I reached my personal tipping point LONG ago. PRobably what it mostly comes down to.

But I do admit that today my jaw dropped when I saw Arco for $4.10. Knew it was coming, but egads.

Likewise, I feel much the same about healthcare. Everyone is freaking out, and I wonder where the hell they have been. Where was the panic when rates increased 300% in a few short years? Not that they have for everyone. But in 2003 it was in the ballpark of $200/month to have full insurance coverage and small co-pays, for us. Now we pay $800/month for the privelege of giant copays and less coverage.

I feel like I should have invested in healthcare stock the last decade, and not be so proud of our efforts to keep housing costs down. For the short term, housing is decreasing greatly, and I am not sure how long until our healthcare costs more than our mortgage. Ouch! The interest on our mortgage is $1k monthly, so it's getting pretty close. At least the principal on our mortgage is a return on capital. But it makes our healthcare look that much more astronomical to look at it that way.

Anyway, with all this running in my head I am not sure what it is. I think just being a major planner and forward thinker means I panicked long ago about all of this stuff and have had time to adjust. It's all I can figure...

Every time I pick up the paper, all I Can think is, "Old News..."

Gas prices are insane and the healthcare system is bankrupting families. Well, where have you all been? I've been here for a while.

Maybe I should start making predictions of the economy. Hmmm... Though I have nothing to predict for now. Healthcare is the thorn in my side, for now. But I'll give you a heads up if I find a new thorn.

Actually, I just thought of it. Income taxes on the elderly. You'll be hearing a LOT more about that in 5 years. I'll be yawning at the headlines, as usual.

(I do need to do a post on that - I really do. I guess I have a fair amount of insider info - preparing taxes and all).

Oh I can assure you the next thorn in all of our sides will be taxes, taxes, taxes. Maybe I should start blogging about that. Seriously.

But back to gas, yeah. I used to drive home every day for lunch. Every single day. I stopped in 2006 because gas prices had just gotten so out of control. So 2006 was a bad gas year for our family (well years like 2002-2006 slowly creeped up to that point). It's just something I Could probably never justify again. I miss that luxury. I just held out until my youngest weaned from breastfeeding. Probably would have cut back on the gas sooner, otherwise.

For now we budget $300/month for gas which gives us quite a bit of wiggle room. We can stretch it farther by driving the van less and the compact more. So that gives us lots of wiggle room. When our gas bills regularly exceeds $300/month is probably our next tipping point. At this rate it is not terribly far away, but I have already made the major sacrifices for gas prices, a couple of years ago... SO for that, it is old news to me. Our next step would maybe be selling the van (far more gas guzzler than I ever imagined) and/or carpooling more. Driving to see family less, etc. Just not there yet. Phew. Though I find those all to be rather small sacrifices except for the big one - less affordable to see our family. That is what I dread, and is already affecting our driving decisions...

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

Well, in other news, dh and I are planning an elaborate date. Oooohh la la.

I got an e-mail about a comedy show coming to a small theater in the city. I have a friend who was in some productions, but haven't talked to her in a while, so wondered if she was involved. Anyway, I mentioned to dh that it looked interesting, and he said he had wanted to go see it - his friend was the Director.

Well, lah de dah.

The tickets will be $25 for the 2 of us, so really quite a splurge for us.

Plus the daycare.

I am a little uneasy since it is only on Fri/Sat night, on the later side. Kids stay up late, so no biggie, but we have been taking advantage of the drop-in care at slow times. So it will be a test to drop them off on a busy night. BM is fine, but LM much more timid. He needs more one-on-one care. But he does good with his brother. We'll see. Not sure it's any preferable to see out a babysitter we don't really know. They love the place at least.

I guess this will turn into a true test of our "freedom." The ability to drop the kids off and go out on a Fri/Sat night sounds absolutely divine. A luxury long ago forgotten...

I think with BM we have reached "freedom." I still worry about LM a bit too much...

Of course, I thought while we were downtown, what we really needed to do was to dine at our favorite upscale Indian restuarant. We rarely go because of the prices, but the food can not be beat.

The night will easily be $100, probably more. With show, daycare and food. But I think it will be a nice splurge.

Well we haven't picked a date for our date yet. Sometime in June. I do look foreard to that.

I was just updating Quicken and noticed our retirement balance is a solid $75k. For now anyway.

This is actually my gross salary for the year. So one years' saved!

Of course, the interesting thing about measuring your goals in terms of salary, is that I for one, had already met this goal last year (maybe the year before). Likewise, in past years I way exceeded this goal (because my income was much smaller...)

So though $75k is a new milestone for me, I can't say the one year salary saved is a new or exciting milestone... It is turning into an impossible moving target that makes me feel a little at a standstill.

If dh returned to work tomorrow it would be a long road to save up one year of salary.

Which probably illustrates much why I so love the idea of measuring progress against "annual expenses."

I guess this idea particularly makes sense for us.

In school we both made $10k annually. Out of school we made $60k combined, and that quickly climbed to $100k.

But then we slowed down for kids and lived a couple of years on $45k (the years I took maternity leave anyway). But my full salary was a mere $50k when I had my first child. In the meantime, my income has ballooned to $75k rather quickly. Though a good chunk of the last decade we really made less than $60k. So it is hard to measure progress in terms of an ever growing income.

Of course, no complaints on the ever-growing income.

But our expenses, on the other hand, have remained rather steady. Probably a bit of a jump when we bought our first home (okay, a significant jump since we lived on pennies before that). & probably a bit of a jump when we had kids. But overall our expenses have remained rather steady and predictable. So we find that a much better measure of our forward progress.

We generally live on $50k-$60k annually (after taxes) so we are trying to grow our net worth half of that, annually. ($25k-$30k/year). If our income grows astronomically (possible, could double if dh returned to work) and our expenses remain the same (possible) than we really need to work on goals that support our lifestyle, not our income. So this is where a lot of our thinking on expenses comes in. Income means little to us. (Which is the ideal!)

But $75k is a milestone, indeed. Of course, I was wondering, recently, when our cash and retirement would hit $100k. I think we will probably hit it in 2009. Not so sure on 2008. But we'll see. (We have a fair amount of cash, in addition to our retirement investments).

We've also paid a good $90k off our house. So our more liquid assets seem to be neck and neck with how much we have invested in our house.

I expect that to change greatly in the future. Our goal in the nearer future is to put away $10k/year to retirement, in addition to 10% contributed at my job. So ideally our retirement will be growing $18k/year or so, plus investment returns, while we are only paying the minimum on our mortgage, about $4k principal every year.

I think our 20s was our decade of home ownership. & we have accomplished a chunk there. I would like our 30s to be the decade of retirement funding. Which is also why I don't sweat the mortgage prepayment. We worked very hard while young to keep our mortgage costs down (putting a chunk down and paying it off aggressively). That work will save us tens of thousands, if not more, in the long run. So it feels like it is off to the next battle - Retirement!

Likewise, I look forward to do the day our cash/investments far exceed our mortgage.

Well, we're getting there.

Anyway, I don't think we will put $10k to our IRAs anytime REAL soon. My goal is about $1500 this year, and $5k next year. But I think we may make it in 2011, when LM is entirely out of preschool. Working up to it. So though our goal is $10k/year, to IRAs, we got a ways to go.

Of course, in our 20s, retirement was only a mere afterthought, after the token 10% contributions we have always done. So I look forward to what we can do with retirement as the forethought. I expect to zoom ahead rather quickly... In fact, my roundabout goal has been $150k in retirement by age 35... (So doubled in 4 years?). Kind of aggressive, but doable.

My dh is going to buy some kind of Nintendo(?) game system for $40 today. Used, with a pile of games.

He told me last night and I think I was only half listening. Then I said, "Huh?????" That woke me up.

I said, "Dude. How many game systems do you have? Seriously."

So he starts listing them all off and we counted 10. & today we will be proud owners of 11.

But I am okay with this. In the grand scheme of things it is a cheap hobby. I just hadn't really realized what a collector he had become.

He also wants to buy a Wii, when they come down in price, of course. He'll probably get one for Christmas in a year or 2.

So yes, my spouse, the game system collector.

The funny thing was he tried to tell me he really only used 2-3 regularly. He just doesn't want to sell the old ones. Perhaps trying to defend himself. I said, "That is not true." Which I actually prefer if he has all this "junk," that he uses it. Except for 2 extremely old game systems he keeps for sentimental reasons, I think all of them get pretty good use. I will give him that.

Likewise, he doesn't buy new games, which is the expensive part of gaming.

So at face value I know many people would think, "OMG - 10 game systems???" and think $$$$$$. But really, it's kind of the opposite. I am amazed at how well some of these were made. Dh bought a great number used, but some of these systems were made in the 1980s. So it is a slow accumulation over time.

As far as the games, for the longest time he subscribed to game rentals similar to netflix. Which is perfect for most games, that are his style anyway. In the last year or 2 he has been selling his old ones for credit at the used store and buying newer games on credit. So the cash flow has been about 0 on the game front. We also get free game rental coupons with our blockbuster online movie rental subscription. He is generally content with one game at a time, and has quite the collection from when we were young and had more cash flow. So it is not an expensive hobby in that regard.

Likewise, our PS2 has always functioned as our CD player and he primarily bought the PS3 for the Blu-Ray player. So they double in function in that regard.

But what do we have?

*Gameboy & Gameboy Advance - I am not sure he uses the old Gameboy at all. The Advance has largely been replaced by the DS2, but I know dh and BM play some games on here occasionally.

*DS2 - This is a FUN toy. We ALL play with it. Maybe LM not so much. (It's a portable system like the Gameboy). Doubled as a TV on our road trip (some kid shows downloaded onto it).

*PS2 - We have a lot of games on this that the kids love - from our childless/bigger cash flow days. We have the snow boarding games which I LOVE, and BM has taken to. We have a really cute muppet game. Dh plays all his big games on this.

*GameCube - There was some reason for this purchase that I don't remember... It gets used for certain games.

*PS3 - used as a movie player more than anything. But dh and BM play games on here.

*PSP - dh got this used rather recently (in trade) and it has all sorts of fancy uses beyond gaming. Don't even ask me what they are. I don't remember but I think dh watched TV wireless - could be HDTV quality. Not sure. He had it modified for some wireless capabilities. He gets all excited about that stuff, I don't even remember what it does. LOL.

*Nintendo - he already has 2 systems. One that is I believe defunct, and one that he has set up upstairs on some old TV. He has a few kids games that they love, up there.

*Atari - defunct. Though I think he would love to set it up. It's just sitting in a pile for now. Not sure how usable it is.

& that's 10...

But yeah, I can say most of this stuff gets regular use. So I will give him that.

Hard to believe, but we don't play video games every day. We REALLY limit with the kids (like 20 minutes at a time - they are so young). Dh used to spend days playing video games, so he has REALLY cut back. He may play a lot while I am at work, but it's not anything I notice him spending an inordinate amount of time on.

I know, hard to imagine with all those games...

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

However, thinking about it, it reminded me of our computer situation.

I probably am rather biased since I am from Silicon Valley and our dads collect computers and computer parts.

But I remember being on an online community like a decade ago and I remember when anyone talked about money problems people would come back and say, "well if you are so poor - how do you have a COMPUTER." I remember always laughing at that. Were they serious? I could find a computer pretty quick for free if I Was willing to go used or hand-me-down.

I always thought maybe the internet subscription was more worrisome, to someone who was really broke. Anyway the idea that only rich people had computers, was foreign to me. Though I am no spring chicken I have always had a computer. I got my first one when I was 3 or 4 (a hand-me-down, of course).

But anyway. Likewise, I have heard the topic come up often how horrible and excessive and expensive it is for kids to have computers.

I sheepishly think, both my kids have computers. LOL.

But we just buy quality and keep everything forever. We have 5 computers, 4 in use. I don't even remember the last time we bought a computer, except for the laptop we bought much more for luxury, in 2005. It's not a very big part of our budget. Every 5 years or so we upgrade one computer and the rest get shifted down. The top dog is dh's editing computer which he uses to do his work. He needs a lot of power for that thing and he has been talking about an upgrade, which won't exactly be cheap. But it's been a good 5 years.

But when he upgrades, everyone in the house will get a new computer. I'll get his. BM will get mine. LM will get BM's, etc.

I couldn't tell you how old our monitors and printers and peripherals were because we have pretty much never replaced them. Not in adulthood anyway.

So yeah, when you buy quality and do the hand-it-down method, we all can have a computer at very little cost.

We probably have a significant advantage in that our dads are computer junkies. PArticularly dh's dad who likes to collect stuff and has just about anything you need sitting in his garage. Dh's monitor did go kaput a while back (it had been on its last leg for YEARS but we finally gave in) and I am pretty sure he got one free from his dad - he just had it sitting in his garage. We have learned to always ask before buy. Which means I don't think we have bought anything computer, outside free store of father-in-law, in a long while.

We haven't upgraded at all to the fancy monitors or anything. But a working monitor, if you don't mind clunky, is easy enough to find for free. Particularly in a computer heavy area like this.

I think when BM starts school we will consider moving one of our older computers into his room and buying him a mouse and keyboard more his size. Give him my old monitor and maybe I can get a new one. A more modern monitor is certainly on my wish list. Just completely unjustifiable for now. & I guess the other plus is we have held out so long they are probably cheaper than I even imagine at this point. Though we will go for long lasting quality over "cheap." You see why...

But with both game systems and computers, we generally let everyone buy the premium, going new. We wait for prices to come down, ourselves. Even if it takes many years. Patience pays.

The kids have computers earmarked for them, but not really in use, for now.

So anyway, I just had to share because I would find it ironic that people would look at our computers or game systems and assume we were broke. In the end we will probably spend $100 this year on game systems (& games). I would be surprised if dh's top of the line computer cost more than $100/year. If he spends more than $500 every 5 years for a faster computer. He builds his own and reuses the parts he can. Though I think he has his eye on something more in the $1k range. We'll see. Technically, he uses his computer to make money, so would probably pay for itself quickly, if he committed to some paid projects to pay for it.

Of course I can't tell you how much stuff we have in our house that we have had since we were kids. The stereo system in our family room is the one I bought as a teen.

When you buy things to keep for decades, it doesn't mean a large annual expense for electronic pleasures. Quite the contrary.

Now, if we had to have the latest and greatest of everything? Well, yeah, I have no idea how people afford all that! That is certainly not our style. We may buy more of that if we resume back to a 2-income lifestyle. But if not, "old and trustworthy" is fine with us. Sometimes it's the only way to have your cake and eat it too.

Of course, thinking back to the games... We're only 30 and dh has quite a collection. I will probably have to work on him in the future in maybe getting rid of some of the old stuff. Maybe for each new system an old one goes. I just don't want to be 50 and have 100 game systems.

Likewise, one of these days we may have to dispose of a computer. Imagine that!

Yesterday we went to a pleasant birthday party. It was to be at the community clubhouse/pool, but the weather was rather windy and cold. Figured.

This is a family that always has a bounce house (egads) but otherwise has always gone for the simple parties. Most of the time they request "no gifts." Only other people I know who do this, besides us, so we appreciate.

So I told the kids as we walked over yesterday that though dh and I had no interest in getting in the pool, that there would probably be a bounce house.

Boy was I wrong! The kids mostly ran around in the grass and climbed trees. I don't think they could have had a better time. So it was a very simple party and we were rather pleased.

Of course, it was HUGE. A lot of people and a LOT of gifts.

Of course while we were sitting on the grass eating cake we could see out the gate to the neighboring neighborhood, and a guy drove up in a loud, obnoxious, portable boom box. I said, "Is that a golf cart or a jeep?" Dh said it's a portable boom box. LOL. IT was all slicked up and had a "Kings flag" on the back. Quite a few basketball players live in our neighborhood, as well as the Maloof brothers (they both own homes here anyway, doubt they spend much time in Sacramento, but they own the Kings team). We had noticed the shiny yellow convertible in the driveway before the boom box pulled up. But this guy opens the garage and there is a big fancy truck and a Hummer inside. Plus there is another garage that holds, lord knows what. A lot of the party goers than noticed the house and ooohed and aaahed over the yellow ferrari.

I thought for a bit that was actually the Maloof house. I had seen it in a magazine and see the back side often when walking around the lake. I noticed the balcony wood work, and thought, "whoa - that is the maloof house." I hadn't realized how we could literally walk there in a couple of minutes time, from our house.

OF course, out of curiosity I zillowed it when I got home. I realized that I was probably mistaken. (Though either way I am not sure). The home was sole for something like $1.3 million in 2007. (Worth $700k today? According to zillow). Probably worth more than that, but has most certainly lost considerable value.

It's not that we live in the nicest area of Sacramento. Certainly not. Just the nicest area that happens to be right by the arena.

Anyway, I told dh that those Maloofs were smart. Looked like they sold the home at the peak, for a pretty penny. But I hadn't heard any rumors of them selling their homes and nothing much showed up in google.

I then realized I was probably mistaken. I am pretty sure there home was a little further out on the lake. I have to assume it was some Kings' player home.

I told dh that I was glad we didn't live over there. This guy, looked like hired help, kept driving around with the boom box blaring. How obnoxious.

It was interesting to enjoy a simple afternoon and to observe so much excess though. ! Kind if entertaining. You don't see that much show these days, in this economy. Seemed most of our neighbors had been trading their Hummers in for more modest cars, lately.

Anyway, the kids had a BLAST, but I think the party was a bit of a yawn. Just about everyone was lugging around a baby and there was much talk of sleepless nights, breastfeeding, diapers, and much talk of returning to work and daycare. *yawn* I told dh when we left that I was SO GLAD to be past those years. I think I am sick of all that. & yet relieved not to be dealing with all that any longer. Moving past it. Phew. It was weird to be somewhere where we had the oldest kids (simply because we did not have a baby I guess). Likewise, whereas this was the small talk I have made much in recent years, I found it really boring yesterday. LOL. Just kind of funny how quickly things change.

& I am extremely relieved not to be searching out daycares or jobs. Though I guess dh may be in that boat soon.

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

With the slow down of summer and also with the kids getting older and more independent, I have been at a loss to do with this new time. I had decided earlier in the year I wanted to take my newfound time to do crafts and do more hiking. So far I am pleased with the results. Though I had forgotten that I had been working on a latch hook cat (almost done; not quite complete). I had forgotten it in tax season madness I guess.

I pulled it out yesterday which was nice. This one is for BM so LM helped me pick out a train to work on, for him, next.

Since we could not hike this weekend (bad weather and crazy schedules) I found myself a little bored locked inside with the rain.

I thought about it and decided I needed something to offset the hiking season. So I decided what I would REALLY love is to get back into more reading.

I reserved a couple of books at the library; dh will probably pick them up for me when they are ready.

My problem lately is my mom friends recommend TERRIBLE books. Seriously. Egads. Likewise, I found a very interesting book community online, but it has been SO LONG since I read much for pleasure, and my reading hours tend to be late in the evening when I am super, that I find it impossible to read these books. I just fall asleep and they are way over my head.

I am afraid I got some books from that category, but maybe reading during the day will help me at least stay awake?

We also have some "kid" books around, like Narnia and some of those I had wanted to re-read anyway. I might work on those to warm up my unpracticed brain. Ideally, I love to read very complicated books. I just am not sure how I am going to work back up to that... But I do know just jumping back in full speed will probably fail me.

Likewise, I have read so many bad fiction books of late, ugh. I am just wary to go there. I need to find a source that recommends books more my style, I guess. As I do REALLY enjoy fiction as well.

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

Ideas for kids birthday (coming up and thought about it much yesterday with the party).

*Compass for BM (perfect gift)
*Room Makeovers for the kids

That's what I got so far. BM's room is okay, but LM's needs some work. He has ripped off much of the wall border and the once "picture perfect" room looks like hell.

I told dh we need to repaint it, this summer, and maybe we could let BM pick a color for his room, as well. His walls are just white. Which is fine. He may be jealous though if LM gets a room makeover...

I mentioned it to BM and told him he would have to pick a color that he would be happy with a LONG time. He said, "How long? A year?" LOL I said, "How about 20? Maybe 10."

Anyway, thinking to birthdays, I had wanted to maybe splurge this year on something.

So I look up the Bouncy House place, and though I don't mind splurging, you can only rent the place for like an hour.

What a rip.

I was not pleased. The drop-in daycare place that the kids LOVE did do birthday parties but I think they stopped. You can only do them Sundays at 10:30am or 2:30 pm anyway.

We were kind of thinking renting a place and then coming back here to eat; to keep it cheaper and simpler. PArticularly for the family. We can hang out here and make an afternoon of it. The kid friends can meet somewhere and we can do cupcakes.

In that regard the 1 hour may work, but $200 for 1 hour? You have got to be kidding me.

I think I just got more peeved than anything.

I would seriously consider a McDonald's party though. My friend had one a while back. They didn't do the McDonalds thing but we met there and she ordered everyone food, and we just hung out while the kids had a blast. For $70 or so you can get cake and ice cream and a co-ordinator too. Either option is looking pretty appealing to me... At least you can hang out with no time push.

Problem with the McDs route is LM is a bit young. There is a play structure more his speed by the daycare though - and where all the friends live. Then the neighbors/family could come here for the extended party. But we don't have to entertain all those kids in our house them.

The average temperature on their birthday is 110 degrees (it is always 110 no matter when we make the party) so going outside is unfortunately not an option. AT ALL. This makes me very jealous every year at everyone else's outdoor birthday parties.

So, I don't know what we will do...

Probably something simple, in home. With LM having his own friends to invite though, it makes me nervous how to keep the big kids occupied... Though I am sure we can come up with something.

I think the simple McDs thing may be the best. Just show up, order a lot of Happy Meals and bring some cupcakes. I am not sure a lot of their friends would come all the way to our house anyway - we live a solid 20 miles away from their preschool. Then we could come home and have ice cream cake and a better spread for the adults and people who just want to hang out a while...

Well, much to think about... Leaning towards that, or just having the entire party here. LM wants to invite 2 preschool friends, which I think is very cute. We usually say "No preschool friends" to avoid the whole invite everyone or no one conundrum. BUT LM has his own little friends now and this will be at the same time that BM leaves the preschool. So I think it will be nice to have a little last hoorah before he leaves. & talk to the parents if there is anyone he wants to keep in contact with.

At McDs? We can just invite everyone... So that may work.

http://www.hurstbeans.com/products.asp

Dh allows the kids to buy treats at the grocery store, sometimes, IF the item is on sale. (Yes, their financial education has already started as they are very involved in the grocery shopping).

Anyway, one day they spotted a package of 15-bean soup (dried product) and thought it looked really good. Dh decided it didn't look like a bad idea.

So we had the Cajun 15 Bean Soup for dinner a while back. We decided it was delish, cheap and healthy. All that for the pretty packaging and varied beans that caught the kids' eye.

So we had it again last night. I think it turned out even better this time. VERY spicy, but we like that. We cooked with sausage.

This is definitely a family fave.

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

As far as grocery shopping we primarily shop at Safeway and Bel Air. I think Bel Air shopping confuses much of the frugal crowd, but they switched to more of a "low-price leader" a few years back and we find the prices on most of what we buy to be very similar, though the store is VERY nice and the customer service can not be beat. I think most people assume we pay a premium for all the perks, but we really don't. We certainly could buy many overpriced items in that store, but as far as the basics we find them to be the best prices.

For the rest, there is safeway.

Plus Bel Air gives us 25 cents of per gallon gas, which is a hard perk to beat (Safeway gives us 3 cents to 10 cents).

Anyway, some of the items we buy in bulk at Safeway are cat food and organic apple juice (we're not strict on organic but it's a great deal - this particular juice).

In the last month or so they discontinued both in the larger (discounted) sizes.

Bummer.

My mom offered to take us over to Costco to stock up on this kind of stuff. We don't buy enough in bulk to justify any warehouse membership for now, but we may have to take her up on it in the interim (use her membership).

I will probably look around online and see if I can find the cat food in bulk; maybe shop some of the pet stores.

I have blogged much that we haven't really noticed grocery prices in our particular budget. Not to say it isn't happening, but just to say it hasn't affected us. But these will be two significant increases in price for us - so we will research our bulk options a little more.

(ETA: A quick online search shows these size changes are at the manufacturing level. So we may have little choice. What a way to sneak in SIGNIFICANT price increases... I've seen many of you blog about this - but WOW).

This month will be impossible to get a grip on our grocery budget (or I should say, a feeling about it) because we were gone a week and have had, what seems like, infinite amount of free meals. Next month will be normal and we'll have to see where we are at.

We did splurge on some ice cream yesterday (drumsticks - yummy).

& as a perfect example, dh found a 3.5 pound bag of gyozas at Bel Air, for $10. The full price at Safeway, for 1.5 pounds, was $6. He had bought the Safeway ones because they were on sale, and I found them to be rather good (as good as Trader Joe's, which is way out of the way for us). So if Bel Air's are any good, I think I am sold.

I can't believe we never thought to buy frozen gyozas before. !! Yum yum yum. Much cheaper than eating out, to find them. Though of course not as good as fresh ones, but they really aren't bad at all.

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

Yesterday was a pretty simple day. My mom came for a visit and we played cards most of the day. ("Spite & Malice" & "Oh Hell" are our favorites - any other players out there?)

I made sloppy joes for lunch and dh did the soup for dinner. We usually get our parents to treat us out but we were in a simpler mood (tired of eating out this month, for sure).

I think we were all on the same page, so worked out.

In the morning, the kids and I went to Fairytale Town (a little park that is more than a park, here). The place opened at 9 and we got there closer to 9:30. We had been planning a hike in Old Town, but there is a huge jazz festival this weekend - all weekend - and we figured we would probably be lucky to find parking. So we were going to settle on something else when my mom decided to come over. So I had promised the kids a trip to Fairytale Town (we have membership, so the trip is "free" and we haven't been getting our money's worth in the winter months). So we headed over there about 1/2 hour after they opened and I swear for about a 1/2 hour we were the ONLY people there. We hung around a couple of hours until grandma got here.

It was COOL having the place to ourselves!

I did have to buy some nachos - what can I say. They are YUMMY. & hey, it's for a good cause...

That was my splurge for the day I guess.

Eventually some other kids came in (not many) and BM made fast friends with a 6-year-old.

He had actually befriended a 7-year-old at LEgoLand and had spent much the day with this kid, so it was much the same.

I think he is officially "graduated" and ready for Kindergarten. I know most people don't understand why we put our kids in preschool. We are fiercely vocal that the kids don't need a fancy preschool to learn academics (they learn them fine at home) and we also tend to be rather frugal. BUT socially/emotionally we really struggled with developing our child. It was probably extra hard with the man staying home, and not being so invited into the primarily female playgroups. But it's more than that. I have friends who don't let their kids out of their sight but expect them to thrive in Kindergarten in the fall. I think they are insane. No offense, but they are insane. I at least appreciate/understand the thinking when it comes to home schoolers. But I am at a complete loss to the emerging trend to shelter your kids 24/7 for 5 years and not let the kid out of your sight, but when they turn 5 they can magically go fend for themselves at school 6 hours a day.

Huh?

Thankfully that is not the "norm," but I see it a little too often.

Color me confused.

For me personally, we knew we always intended to send BM off to public school in the fall, and didn't feel we were properly preparing him socially and emotionally. So that is where preschool came in for us. We felt we needed help in that area, and searched it out. I see nothing wrong in that. To admit we needed help. I know we could have found more frugal help, but we found this route to be the best/easiest, and certainly no regrets there. Some areas we are frugal so we can splurge in other areas.

Anyway, to see him suddenly have the ability to make fast friends with just about anyone he meets, is quite an accomplishment. He has only one more month of preschool, and I think it has done its job.

I also like how he has a lot of "unsupervised time" to interact with other children. I know the 4:1 ratio he enjoys at preschool is nothing near the 20:1 ratio he will encounter in kindergarten. But at least he has spent much time with other kids without momma breathing down his neck and monitoring his every move. I think he will at least be much more prepared than those kids. He's learned, with much practice, how to solve conflict and get along with other kids, on his own, without adult intervention every second of the day.

We'll see how he does in Kindergarten. I notice he does gravitate to older kids. He may have less patience for the kids in his grade. But hopefully a few of them have gotten the emotional/social education he has. & if not, I guess the other kids will learn fast in that environment.

I guess the true test will be he how he does at school in the fall.

Rain??????????

Last night I was talking to my mom and she said tornadoes has obliterated a little town near Denver (my grandma lives in Denver). I guess they were peeved it got little media mention. So I popped in "tornado" in google and saw quite a few stories online BUT then I saw there was rain, snow, AND tornadoes in Southern California. Holy Cow! Glad we came back last week. But yeah, look at that crazy weather.

Fire season has also started (quite a few months early). On our drive to LA, looking at all the dry landscape, we thought to ourselves, "this is not good." Likewise, a number of fires broke out with the hot weather and such. Will be a long summer... Usually the hills dry out in the summer and the fire season starts in the late summer and fall, before the rains come. So May is a tad early - but the vegetation is just so dry this year. & the weather has already been so hot.

Of course, on the plus side, it is raining...

I was quite bummed to hear the rain when I woke up this morning though. We had all sorts of outdoor plans, all weekend. The weather forecast I see is rain rain rain. I was looking forward to more pleasant weather (under 100 degrees) but the rain was a bit of a surprise. Don't expect it to be much to curb the fire danger though.
The 70-degree weather sounds divine though, if it does not rain too much.

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

Last night we had artichokes for dinner. I guess Cali is the only state where artichokes are grown commercially (for the most part) so we are lucky to get fresh artichokes. This is another reason it is worth it to live here - all the fresh, local produce.

We have been enjoying a TV show called "Good Eats." They had a special on artichokes (usually focuses on one food every episode - and VERY interesting). So we watched that and the kids were excited when they saw artichokes in the store. They were on sale so dh picked them up, though he had never braved cooking them before.

So we steamed them for dinner and they came out pretty darn yummy!

I am not much of a veggie person, so we need to work more treats like that into our diet.

I have no idea how much they cost in general but they were on sale for $2.50 each (jumbo size). So yes, definitely a bit of a splurge, but we enjoyed.

They were REALLY jumbo. Almost a full meal for me (didn't expect that).

I asked dh to keep an eye out for strawberries on sale. I love fruit smoothies in the summer but seem to remember finding strawberries expensive in the hottest months. There were many on sale on the side of the road last month. I wasn't thinking. I should have stocked up and frozen them...

But yes, not much of a fruit or veggie person so have no grasp on seasons and such. So I thought to have dh keep a look out for strawberries on sale...

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

I reviewed our investments yesterday (kind of on automatic pilot of late) and it looks like the asset allocation has changed little in the last 8 months or so. For a while I had to keep selling international because it was so on fire, to keep our asset allocations. We are still heavy on cash and int'l funds. We are just adding to domestic stocks until our allocations even out.

So I peeked at them yesterday as I haven't really set any sort of schedule yet on that. I should. But I was surprised little had changed in many months, as far as asset classes and the percentages I hold in each class.

As of yesterday, we also appear to be down 1% for the year.

Not bad...

Dh's Vanguard account is down by 2.6%. My cash is up 2.6%. (CD). & the rest of our investments (primarily managed funds) are up 0.25%. Average it all together and we are down almost 1%, for the year. The Vanguard account is by far the biggest piece, so explains that.

I am pleased my managed funds are doing their job though. I expect them to perform a little better than the indexes, in the downturn. That is the hope anyway.

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

Ugh, I was not prepared for a rainy day... Bummer.

ID-protection firm's clients sue founder
Even He Fell Prey to Data Thieves, Customers Say

http://www.mercurynews.com/businessheadlines/ci_9356426

Um, have you seen this guy's commercial? I just saw it the other day.

He advertises his own SS# in his commercials.

I watch that and think either the guy is an IDIOT or that is not his real SS#.

Well. Jury's out - he's an IDIOT. LOL.

OF course, to be fair, I knew this story:

http://www.ssa.gov/history/ssn/misused.html

So when I Saw this guy, I thought, "Oh boy. What BS - like that is his real number."

Apparently he was a little naive... Though still quite cocky. Ugh.

Anyway, that was an interesting read.

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

Today is SLOW.

I had fun playing "receptionist" today.

IT was fun because:

* No one came by
* No one called
* A client called with a tedious request immediately before my front desk shift. (Good tedious/brainless work for the fromt desk).

So basically, it was fun to sit somewhere else for a while. LOL. OTherwise it's not exactly my cup of tea. I much prefer to sit in my office uninterrupted, where I don't have to be "on" all the time.

There is no one here and I am not terribly motivated. Finishing the tedious stuff and then running for it.

Have a good weekend!

Dh saw Indiana Jones movie yesterday.

Surprised?

He's the biggest movie buff, so I am not surprised.

I can tell he is getting old/tired though because he did not go to the midnight showing the night before. He took the opportunity while the kids were in school to see the matinee.

Anyway, he was telling me the sound was really bad and kept cutting out.

So he went to complain to an employee. More to say, "um, you might want to fix it", then anything.

He said she could care less (looked annoyed) by his complaints, and just handed him a free movie voucher.

So he got a free movie, but I think he was astounded by the response.

Well that and she was very defensive.

(I can't remember um, ever seeing a movie before with sounds problems. Something people expect - sound and picture - too much to ask?)

But I guess our next date out will be a movie...

Getting spoiled over here. Movies out have just been too luxury for us, for a very long time...

With more reasonable drop-in childcare AND matinees before 6pm weekdays and 2pm weekends - it is VERY in the cards lately. We'll probably do a weeknight date in June.

We are trying to do one date a month and 2 date lunches a month as well. All very new to our budget (with our eldest turning 5). Though we are very open to dates at home or "Free" dates, so far we have been enjoying splurging a little more.

Of course, with me foregoing cash for lunch I Was worried I would be tempted to charge too much. I was WAY wrong. I have not gone out for lunch this month but for dates and meeting friends. I have been funneling my "last minute runs for fast food" budget to date lunches with dh with good coupons. IT wasn't a big budget ($20/month??), but the date lunches have been very satisfying.

Well, as we move past the expensive months of April & May, summer should be pretty good to us. (I hope!)

June is our last payment to our mortgage where interest exceeds $1,000. Woohoo! Our July interest payment is $999.99 (something like that - hehe).

Psychological, yes, and little more. But it is still nice.

Dh told me he is waiting for our principle payments to exceed the interest portion. Agreed, but so that is so long in the future I have to find something sooner to get excited about. We also drop below the $200k balance in 2010. So that will be cool too. Another psychological advance...

Of course, as usual, looking at it - I am tempted to throw $50/month to the mortgage, extra, next year.

I talked myself out of it for now.

Another $150/month would really put us at our goal to pay off in our 40s. Quite simple really. BUT doesn't make much sense for now.

The other thing about this summer is the stimulus check (which will help greatly) and the removal of one child from the ever expensive preschool.

So summer seems like a turning point of sorts, for us financially.

As of summer I hope to have:

*Replenished the $1k I unexpectedly owe the IRS and sucked out of the emergency fund for now.

*$3k balance in our mid-term savings (which has been 0 for a while).

*Contributing $315/month to our ROTHs. (bumps our retirement savings to 15% from 12%. Phew).

I really hope to have another $100/month raise come next year to allocate to the ROTHs and get to the max for one roth and about 17% income to retirement. From there I think it is a good spot and we will just try to increase it 1% a year. (Minimum anyway. Certainly more if we have bigger raises or windfalls).

*Up our short-term savings from $900 monthly to $1k monthly, which really should suffice to cover more of the unexpected things (like a similar IRS bill).

So I would say our retirement and short-term savings should be in pretty good shape come summer.

As tempting as it is to earmark a token $50 to the mortgage, I know we really need to focus on getting our mid-term savings up to snuff. My goal is to save $5k this year, but we have some catching up to do AND I will barely squeak by this but for the help of a large stimulus check.

Of course, I also just remembered the other competing want is college money for the kids. With BM our of expensive preschool I had considered saving $50/month for that.

There's only so many directions it will go. But I admit that is probably where the money is best spent, for now.

Short-Term Savings up to snuff
Retirement up to snuff
Work on BM's college money

I guess all I can hope for is a really decent raise next year so I can put some more to mid-term savings as well. We have cars to save up to buy and home maintenance to save up for.

Dh may consider some temp work with the kids in school. I am not sure we are hot on the idea right now, but the option is certainly nice. It could significantly help the cash savings. (For now is working on a movie script and a movie which I rather him do now while he has some significant child rearing to do. BEcause lord knows I will be pushing for more income if we are not doing better when LM starts public school. Just giving him the space to do his thing for now).

Getting there, but still a ways to go...

Getting so close to where we were before we dropped to one income... That part is nice. I don't think we expected to get back to this point, so soon, on my income alone. & I am excited as we near this sort of crossover point where we are so close to getting back to a larger measure of financial security.

We've done without a lot of savings and retirement contributions and a lot of things as we slowed down to raise kids. I didn't exactly imagine with time we would find a way to have our cake and eat it too (so soon anyway). Our lifestyle for now is far cushier than I imagined it would be when we made sacrifices for our kids. For that I am extremely grateful.

& I am certainly enjoying!

The idea of putting $5k in a ROTH next year is DIVINE. To me, that is luxury.

http://seattlepi.nwsource.com/local/6420ap_id_extreme_makeov...

"Extreme Makeover" recipient in Idaho selling home

The article goes on how the 3600 square feet is too expensive to maintain.

I have to say I have caught the end of this show a few times and wondered the same thing. How in the hell can these people afford to maintain these homes?

I guess I am too realistic.

Though the gift is nice, I think often it is way misguided.

Of course, I also find it a shame to read that this guy's bills have tripled since the change. I know that with some care and planning it doesn't have to be that way.

We had the fortune to move from 1300 square feet to 2600 square feet, for about the same price, moving somewhere cheaper. The thing is for us that none of our bills went up. The house is new so needs little maintenance, as of yet. Our utilities are the same. Our property taxes are the same. All same same same. I doubt few people can say the same. BUT it does irk me when people go on and and on and on about big houses being energy hogs. Says who? We have twice as many people now and are home 3 times as much (home all day/every day instead of just evenings and weekends), but we pay less for our utilities, due to the energy efficiency.

So I think, for one, for these makeovers, you think they would really consider this in the makeover - making these homes super energy efficient so the recipient's bills don't triple. Really. Realistically, the bills could be lowered.

But even so, watching that show, I always figured for the long run there was a lot to maintain. & of course just because things are "new" doesn't make them foolproof.

I've always been far too practical to enjoy that show. LOL. I keep thinking, "how will they afford to maintain that mansion?" Egads.

I can't imagine he is the only one who feels that way. Too bad he feels some measure of guilt selling his home.

REAL ESTATE

Interesting Article Today:

Half of Sacramento families can afford homes in region

http://www.bizjournals.com/sacramento/stories/2008/05/19/dai...

"The Sacramento region, one of the hardest-hit housing markets nationwide, has become the most affordable housing market in the state, with almost 50 percent of families able to buy a home during the first quarter, according to a California Building Industry Association report released Tuesday. The figure -- based on the median annual income of $71,000 and a median sales price of $262,000 -- is a dramatic increase from the 27 percent affordability rate in the fourth quarter."

Not sure if this is big news as my understanding was that Sacramento has been the most affordable area of the state for a long while. (Cheapest housing anyway).

But out of curiosity I pulled 2000 census #s. 2000 - median income $42k and median house price $152k.

That makes median home price divided by median income 3.6 today AND 3.6 in 2000 (before any housing bubble). Then again, the $71k median income looks rather inflated from what I have seen. I think that ratio still remains a little higher, in actuality, for now.

Anyway, made me want to look up stuff back home.

http://www.bizjournals.com/sanjose/stories/2008/05/19/daily34.html

"In Santa Clara County 1,440 homes were sold, compared to 2,009 in April 2007 and 1,105 in March. The median price was $615,000, down from $709,000 in the same period last year."

IT says, home prices have gone down 13% from last year, but they are still INSANE. About what I heard. We fled in 2001 when the median house price was closer to $500k (I would have estimated anyway). Insane enough for us.

Median income around $90k there. Makes the housing to income ratio about 6.8. Eeks! Though it has been much worse for a time.

Of course I notice the median house price of $262k in Sacramento compared to $615k in santa Clara is about a 2.5 ratio (housing there costs 2.5 times as much). That is also about the same as it was when we moved in 2001.

I think things are settling down, though I have the feeling things will get worse before they level out.

But I guess everyone is excited there was an uptick of sales in April. Of course there is. Buyers and investors are forthing at the mouth at these prices. I read the term on another blog: "dead count bounce." Lovely name, isn't it? A lot of people will swoop in now, but probably not enough to make a long-term difference. So hey, look at that dead cat bounce - LOL. Around here I think there are a lot of eager investors who did not learn anything the last go round. (The ones who sat out and think now is there chance. They scare the hell out of me. Though I guess thank goodness for them, for keeping prices somewhat afloat).

I had a mortgage broker trying to get us to invest. I actually liked/respected the guy until his fanatacism with investment real estate emerged. It may be a good time for him, but I think he was insane to look at our finances and push us to get into investment real estate as well. I can assure you we can not afford it, for one, and that for two, we don't need any more eggs in that basket. His assumption is rent will cover costs. If he could gurantee that 100% he may have me sold. But I don't buy that for a second.

Oh this was just an interesting story I saw too (if you want to see a suburban pot house - egads).

http://www.sacbee.com/static/weblogs/real_estate/Aspen_befor...

"Pot house chic in suburban Sacramento
Sacramento real estate agent Gary Lee said he had no idea what he was getting into when he took the two Elk Grove listings from a bank that had repossessed them.

They were pot houses.

If anything defines the excesses of Sacramento's housing boom, it's probably those numerous pot houses, where investors got 100 percent financing on new homes and converted them to growing operations. The idea was that who in the suburbs, where people don't readily know their neighbors or ask too many questions, would know the house was occupied by marijuana plants?

Most of those growers have been busted and their homes repossessed.

"As soon as I got access to the properties I was as shocked walking through the front door as anyone else would have been," Lee said.

He had the houses cleaned and sent all the before and after photos to the bank so it knew what it owned. Lee's two homes in Elk Grove "should be hitting the market in about a month," he said.

In the meantime, here are some before pictures he shot after arriving at one of his new listings."

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INVESTMENT CONCENTRATIONS

In other news I Was surprised (lord knows why) to find out dh's entire family is invested with this bozo from a big investment house.

My parents actually were diversified a lot more, but had some substantial assets with another big brokerage. My dad got fed up with them and left about the time I joined pfadvice a couple of years back. With what I learned here I quickly concluded these big outfits were rip-offs. PArticularly the investment broker we had (dh's family's bozo). So I chatted with my dad about it and he was just reaching the same conclusion, though 25 years my senior. So I felt lucky to figure this out quite young.

So dh and I moved our money. Mostly to Vanguard...

We were at a family function a while back though and my dad comes over and tells me he was just talking to dh's aunt and she has her money with this big place as well. HE actually starts to bad mouth the place infront of his grandma and I kind of shhhed him and said the whole family was over there.

I don't know why the thought hadn't occured to me that they all were (knew his granmda invested with the guy) and the whole thing made me a little uneasy. Likewise, I just saw an article that this brokerage is in real hot water with subprime loan investments and such. For their sake, I hope their nest eggs are insured and/or safe.

But it got me thinking how dangerous it was to have so many generations of one family all invested in one place. I really have no idea about his sister and cousins, but would not be surprised if we were the only ones to walk away. As I joined these boards and started to understand fees more I saw we were just being charged fees left and right. Likewise, our mutual funds were WAY under-performing. So all we paid for was crap. & lots of cushy commissions for our broker. We left pretty quickly once I got more educated.

So yeah, I worry about his family. That they have their entire nest eggs invested with this guy.

Likewise, my dad and I have a few mutual funds the same but I am pleased our investment styles are mostly different. We both have some same mutual funds and probably tend to hold too much cash. BUT he likes to dabble in stocks and has many mutual funds in companies I don't use. I have a lot of index funds and also invest in some different fund companies as well. In the end I like that we are well diversified. The reason is twofold. IF for any reason we need their help or they need ours, then at least we are spread out in different baskets. Likewise, I am glad our entire family does not have all of their money in one place. I know my grandma is in ENTIRELY different investments as well.

I don't know if people really think about this kind of stuff much, or if I over-think it. But yeah, I worry about dh's family. There really is no reasoning with them though - just set in their ways.

http://www.tasteofhome.com/Recipes/Spinach-Manicotti

Dinner last night!

Yes, I did have a meatless day. Actually had cheese enchilada at lunch so, yes, meatless. We don't eat meat every day. (Just seems like we have been lately).

Anyway, this recipe is DIVINE. Love it.

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Dh and I are spoiled this week. We had date lunch yesterday, so he could run an errand for me.

Tonight he has a volunteer appreciation dinner. So we will drop off the kids for 2 hours and get a "free" dinner. Daycare will be around $25, but will be worth it. We may even win some prize? Kids will be in daycare about 10am - 8pm. They couldn't be happier. (Weird kids. Grass is always greener... They wish they could go more - and this week they get their wish).

The local public TV station does a great job on their appreciation dinners - we always enjoy. For the longest time it was our only standing date night. One night a year out?

Not much else up this week.

Today BM had an evaluation at the school - for Kindergarten. Dh told me while they were waiting he read a sign about how they had won $10k (a teacher had won some award). NEither of us knew he could read "$10,000." Don't ask me - nothing I showed him. LOL. (Dh figured I had been showing him bank accounts or something).

We imagine he did well enough in the evaluation... He knows things we didn't even know he did. Kids are scary sometimes...

I don't think we have much planned for the weekend, though I may pull for a local hike if the weather is nice. Dh wants to drive to San Jose next weekend, so no driving for us. The car needs a break and so will the gas budget. After all the driving this month... 2 trips to SJ & a trip to LA. Yeesh.

The pool opens Monday and we will enjoy. But mostly low-key, and low-spend, in the plans. We will eat in, watch some TV, run around in the background, go for walks, and go swimming. All free free free. If the weather is awful we will hole up indoors and increase the TV watching I guess. But if not so bad we may go for a drive I guess. Just not too far... OF course if it is bad we will go to the gym. We'll still get our workout but harder for the kids to run off their steam. But these are all very low cost activities.

The calm of it all sounds rather attractive after our big vacation... The low cost sounds even better!

Oh yeah - and free lunch tomorrow - from a vendor. I honestly usually don't get this much free food.

Well I was gone a week but a LOT to catch up on. Hold on for another long one - breaking into a few topics though.

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ADVERTISING

Egads. I don't sweat the advertising thing that much, because rather than shelter the kids and pretend ads don't exist I think it is better to show the kids the flaws in advertising, and not to believe everything they see. It's an educational experience. Might as well learn now - "Can't believe everything you can see" - and, - "If it's too good to be true!"

So last week out of nowhere BM says he thinks we really need some "Clorox Anti-BActerial wipes." Seriously. I asked him why, and he said something about them being the #1 cleaner, or some kind of catch phrase. He's almost 5. I thought, egads, my 4-year-old is a walking advertisement for Clorox. He asked me something similar the other day about another product (I don't remember).

So yeah, we had a talk about advertisements.

So yesterday he tells dh and I we need a new washer and washing machine. I said I don't think so, since all of our appliances are rather new (& for the longest time we settled for the extremely old/used variety). So BM says, well everyone he knows has a washer with top loading, and even Caillou does (a TV show character). Dh and I giggled. We told him yes we used to have one of those, but that our washer was just so new that few people have the front loading. We tried to explain that this was actually luxury and we already had newer stuff than most of what he has seen (& we'll be happy if they lost 30 years+ like our last washer). But I think it is intensely scary how concerned he is suddenly with what everyone else has. I thought at least that wouldn't start until elementary school!

Well, my parents said no to about everything growing up so I have no qualms about that. The "no"s have started.

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CREDIT

I was amazed to read how many homes were to be had in some areas for under $10k (in this foreclosure mess - retailing for more - but banks were selling to many investors for pennies). I told dh that I understood the mess in areas like this, but I don't understand how people who bought $100k homes got in over their heads. I look at that and think we would have had no mortgage today if we could have bought a decent $100k home in this area. My sister bought a $80k home in NC and has something like a $400 payment even financing her car and many other things against her house. (Granted, she had a nice down payment, but she finances everything too...). Color me jealous. If only I could afford a home like that for $400/month, in this state.

Dh said - "It's credit. People don't buy what they can afford anymore." By golly, that's it!

Actually - it was an article in Reader's Digest. It was mind boggling to me how widespread this credit mess was. I guess I didn't realize how hard it was hitting the less expensive areas in the country, and still not sure I understand why.

Anyway, a question was asked in the forums a while back about how to know when it is okay to splurge on a new car and bigger purchases like that. I think, "easy." The big purchases are easy. We pretty much think in a cash mentality. So if we don't have the cash, we don't buy it. That is pretty much how we have looked at everything, except our home. & I always felt we were okay with a mortgage because of how low interest rates were AND the expensive-ness of the area (cheaper than renting anyway). But if we lived in the mid-west or int he middle of nowhere as my sister does I am pretty sure we would have just paid cash (or taken on a very small mortgage and paid it off quickly). So I can't say I am a huge fan of mortgage debt either, but more it is a function of the region we live in. It beats renting which I guess is the main factor. It did when we first bought anyway. Remains to be seen for the near term. Though still confident for the long-term. & we really value stability anyway. (Renting is NOT stable in this market, that is for sure).

But when it comes to ANYTHING else we don't buy it if we don't have the cash. This applies to education and cars (which few people think of this way). Home repairs, etc. Of course, I am not saying there is never time to finance a car or an education or home improvements. There are always situations where this can make sense. But if it doesn't make sense, we will not do it. & mostly it has never made sense for us.

Likewise, we never really struggle with what we can afford. When I saw that question I thought, that question would not be asked but for all the available credit. Credit seems to blur the line between what you can afford and can't afford. Suddenly with credit you think you can afford way more than you really can. & this is what has created such a housing mess.

& it makes you wonder if you should buy a brand new car when you don't need one.

As for us, we have $2k in the bank for our next car purchase. It would suffice if dh's car imploded tomorrow (we have never carried collission insurance on our near worthless cars). So I would be confident we could replace his car. But obviously we are in no position to go buy a $20k car (obvious to me). Of course, if dh's car imploded, I would consider a car in the $5k range. One that would probably last forever and be a fine car, and we could pay off within a year. Or we would just buy the $2k car until we could afford an upgrade.

On the flip side, if I had $30k in the bank and nothing on the horizon (in addition to emergency fund) I would consider buying a new car whether I needed it or not. If it was something I wanted to splurge on, and I had the cash, so be it.

So, no, we don't struggle with the big things. If we want a big thing, we save up for it. We struggle a lot more with the little things I guess (which can add up). But I don't identify with the struggle over bigger purchases, and I think it is primarily because we have a "no-debt" mentality. If we don't have the cash, we save it up. & if it is unrealistic to do so, then we do without.

We were looking at a refi briefly (when rates dropped very low for a very short time) and I had discussed borrowing more with dh. I thought it may be prudent to pull out a few thousand and fund our IRAs this year. I think in some regard I regret paying our mortgage so aggressively in past years. Dh did not feel comfortable with this at all, and I was okay with it. I think it made more financial sense in the long run, and I would only do it with the caveat that we would never borrow against our home again (otherwise it would be a slippery slope - don't like the whole "quick fix" thing). I had enough discomfort of my own to not mind that dh did not go for it.

But, out of curiosity I asked my parent's (my financial role models) if they had ever borrowed against their house for anything. I was actually quite surprised when they told me they had financed a car against their house. I had no idea. When they were about the same age actually. Was just, interesting.

Dh told me his parents financed their pool against their home (in-ground) and he never liked that. I am not sure exactly why (seems reasonable to me) but he said if he wanted a pool, he would pay cash.

Yes, you could conclude that dh is more anti-debt than I!

I think we are both even more debt adverse than our parents ever were.

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Inheritances

Well, the MIL is retiring in a couple of weeks and so she has retirement on the brain. (Though FIL is the main breadwinner and will still work for a while).

Anyway, she had a very odd conversation with dh on Mother's Day. He took her to lunch and I guess she was talking much about her impending retirement. She told dh that they were planning to leave us $500k. That they should not have to touch their principal. She is obviously very optimistic. I have to assume that includes their house, since they are relying on social security and pensions more than anything. (I would imagine their cash savings goal for retirement was more like $500k, based on convos they have had with my parents who have much higher savings goals and less pensions to fall back on).

More like they probably have $500k saved and a house worth $500k - they intend dh and his sister to split that.

For one, I thought this was an extremely odd conversation.

Secondly, I think they are a tad optimistic. But we'll see. For one, his grandma seems to be struggling (we have offered to help her) and his parents give us SO MUCH money. I don't know if that money train will stop now that she is not working. But we have always set it aside with a fear they were a little too generous; a little too concerned about us over them. So, we'll see. We set it aside in case we need to give it back...

We are heirs to some significant real estate, just by nature of where they live and how long ago they bought. But the planning in our finances is a big fat 0. Anything can happen and we certainly hope they live a long, prosperous life, well into our retirement. So there is no counting on their money. I worry more about having to take care of them, honestly.

Likewise, their attitude is just so opposite of my parents. Sometimes I marvel at how frugal dh turned out anyway. His parents have always wanted to take care of him, but somehow along the way taught him to take care of himself.

My parents are opposite. They joke that they will leave us nothing. & that is just dandy with me. I can tell you WE are not in their plans at all. They are just worried about being able to care for themselves, and I have always greatly appreciated that. Has made me very self-sufficient, and I know too many people who are struggling to help their young parents, financially. I'll take my parents any day. If they don't give me a dime, but I won't have to support them financially, I think I will be better off.

But yeah, our parents are totally opposite in that regard... I think it is interesting they both have decided to settle where they live, after many talks of retiring somewhere cheaper. Though my dad talks of moving elsewhere in 10 years. In 10 years doesn't sound so daunting. Kids will be almost grown and we will have more freedom to move too. (We are close to our parents and did not enjoy when they talked of moving sooner). My dad told me the other day they were thinking San Luis Obispo (about my favorite place in the state - OMG) or back to Colorado. I vote SLO. We may have to move there too. (Oh, but so insanely expensive. Though they can certainly afford it with their equity! We can visit often. ).

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Appearances

I think one basic lesson in financial health is to not believe everything you see.

I think we are one of the few people we know who are sending our kids to public school. Of course we are. There are SO MANY wonderful options where we live. I mean, hey, if my only option was the public school we were assigned, that is one thing. But that is not our only option...

I have a friend who has her first child at 17 and has 3 kids now and raises them on a shoestring. I greatly admire her and identify with her more than most people I have met here. (She is just very non-victim type, and is very creative in how she supports her family). Anyway, she knows every public school option in the area, and there are many. So I have learned a lot from her.

But talking to the rest of my friends, the #1 reason they are snubbing their public schools is class sizes. This is very mind boggling to me. They all tell me their class sizes are more like 20 instead of 40. (LOL). I am like, um, okay, you do realize most public schools in the area have class sizes of 20 (major financial incentive for the schools to keep class sizes down). I don't honestly know the #s, but talking to people around here and BM's potential school, I got the impression this was quite common. BM's class sizes are 20 in K-3 and they are 21(!) for 4-5. I think it is for most of the school district though.

Likewise, the second guage of school fitness is AP test scores.

I really get the feeling people are not looking into schools beyond that. (from my comments above they have no concrete facts to base their assumptions on anyway).

If one more person tells me their private school is better because classes sizes are 20? !!

So it is refreshing to talk to my savvy friend and get more insights into the school options available to us.

For now we are lucky we live in such a great neighborhood (lots of educators and politicians and people with time and money) and we have an excellent charter school within walking distance, that we are sending the kids to. Was very hard to get in, but we secured spots with volunteer work early on, and I am very pleased with the school. Frankly, I'd take it over most of the private schools I have seen (very showy; many without a lot of substance).

But it reminds me a conversation we had with dh's aunt and cousin the other day. They had both taught in the "best" school district in the Bay Area - probably the most expensive zip code. The school has the best test scores and so real estate in that school district has become very prime and expensive. They told us that the whole thing was a sham. That under-performing kids were strongly encouraged not to show up for the state tests. So people are paying millions to live in this neighborhood and have the best schools. & people like us are thinking, "BS." I have to tell you, dh and I pretty much never would have paid more to live in a better school district. The consideration was pretty much 0 when we bought this house. It's not that we don't care about our kids' education, and this might sound odd to you. But mostly we can see through all the smoke and mirrors. It never occured to us that where we lived would dictate the quality of our children's education. WE would dictate the quality of our children's education.

I guess along the same lines I always found the idea ridiculous when my middle class friends (all in similar subdivisions) would sit around and brag how great their schools were. I wondered if there was any substantial difference as they all tried to brag their school was better. I mean if someone was from the inner city - I'll give you they would have some schooling disadvantage - and I give you that I have no desire to live in the inner city. But to pay a $100k premium on a house because it is located in a district with 10% higher test scores? Eh. Just always seemed foolish to me. I am sure all the schools were similar (of similar economic stature. Just very middle class/upper middle class. I don't think there are really a lot of bad schools in that category, around here). Though I would it far more interesting if people knew anything about the teachers or curriculum. No one knows anything about these areas.

Anyway, we live in the big city and the charter schools are varied and numerous. Many of them mimic private school philosophies. So yeah, if we lived in the middle of nowhere we would have much less option. But I kind of roll my eyes of the idea of where I living really mattering. Beyond the fact that our kids can walk to school (advantage). But if willing to drive them farther out, the options are endless here.

We did go to a tour of the kids' charter school a while back and they do not have a permanent location (which is a downside). BUT some lady was there and she wrinkled up her nose and asked if we had toured the local public school. She said it had much nicer facilities. Dh and I just looked at each other. YEah, not sending our kids for the nice facilities. Of course we would prefer there was nicer facilities. But the curriculum and teachers are excellent. We can live without all the "show."