It's too early in the year to call it (for 12/31), but we have surpassed our 2017 net worth goal. Woohoo!

As of today, Net worth is up $60,000:
--Investments up $43,000
--Home Value up $10,000
--Mortgage Down $7,000

Will see how the rest of the year shakes out.

MORTGAGE:

I went ahead and transferred my overtime monies ($3,000) to the mortgage. So I put the big "X" on my sidebar goal. I've had the cash since April, but I wanted to see how some of our home improvements shook out and how trip shook out, etc. In the end, trip was not of any significant consequence. We haven't gotten to home improvements yet, but the "biggie" will have to wait until December. That is a large cash infusion month for us, so I just let it go. (Will probably have a lot more cash before we get to it). I still don't have MH's MRI bills (all of them) but I received one and I don't have to pay it until November. So I decided I could live without this $3,000 cash through the end of the year. (I am being way super uber cautious, but that is just how I roll).

HOME VALUE:

The market has been so WEIRD. Our home value has been pretty stagnant for the past four years.

Anyway, our specific home model is more rare and rarely goes up on the market. There is one pending sale behind us that has been remodeled to the hilt. It's GORGEOUS! If we were going to live here for decades I might be tempted. I mean it's my style and I love the colors, etc. (As is, we only plan to stay another 6-10 years? Don't plan to stay in this neighborhood at all, so I guess that part makes it easy to resist).

So it will be interesting to see what that ends up selling for. They were asking about $500k. For reference, we paid $290k. $650k was the peak. Things are starting to barrel towards $500k, but that is starting to feel like bubble territory again. Higher prices are probably a direct result of a mass exodus from CRAZY expensive Bay Area (now twice expensive as when we bailed). I've been surprised how slow that is to hit, given mostly stagnant home values for so long, but as California real estate tends to go: When it hits, it hits!

Anyway, I increased our home value by $10k (up to a $450k sales price), for net worth purposes. It seems likely that I will bump this up more as the year progresses. (Will see what this particular home sells for when the sale finalizes, and then what follows after that. No one seemed particularly scared off by the high asking price; it sold in a flash).

EDITED TO ADD: FINAL SALES PRICE $10K BELOW ASKING. This is about +$35k to my current valuation of our house (450k), but I will hold off and see how this affects future sales.

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

In the interest of privacy, this isn't the house. But our neighbor remodeled very high end with a black/white/grey theme. O.M.G. My favorite color is black. I guess I like black and white when it comes to home decor.

It's kind of crazy seeing my house (which is pretty much my dream house already) in this style. It looks AMAZING. But I just don't care enough to invest in this. Plus, my husband HATES dark colors and would never go for any of this. So I am sure that is also a big factor. I am saving some of the MLS pictures for future inspiration. This is the general idea:





Honestly, I couldn't even find a kitchen that compared, on the internet. They did a really nice job. Makes me wonder how much they spent (or if someone in that house is an architect or designer).

I think it's been a long time since I have done a mortgage update.

The short version is that our last refi was in 2012, for lower interest rate. Given the high unemployment rate here, we've not felt comfortable with a 15-year mortgage. (Well, between that and our health insurance literally going up by $1,000 per month). But we also did not want to reset the clock all over again for 30 years. So our goals with our current (30 year) mortgage have been to pay more principal than interest, and to also not have a mortgage on this house for more than 30 years total.

To that end, as long as we are well employed, we do throw an extra $3,000 per year at the mortgage. I fund with my overtime. (I think we did a bit more in the beginning to have more "principal than interest." Maybe an extra $1,000 in year 1).

We will want to shave off 10 years, so that we don't have a mortgage on this house for 40 years total.

I do have to say that these lower interest rates are absolutely amazing when it comes to mortgage amortization. Our first mortgage on our first condo was $1,500/month. We paid $1,400/month interest! (Only $100 was going to principal). We really barely paid anything down the first 10 years or so of home ownership. (We had basically the same mortgage amortization when we bought our current home).

In contrast, we've paid $40,000 off of our $200,000 mortgage, since our last refi. We are paying off about $8,000 per year, and that is just accelerating with time. So it feels like we are making some real progress. & to be clear, this is with much smaller mortgage payments. It's just that so much less of the payment goes to interest.

Current status:

We have shaved off 4 years off this loan. So that leaves 6 more years that we want to shave off. Will keep chipping away at it.

{Note: Our last $3,000 payment shaved off 7 months}

We don't have any plans to throw any (additional) extra at the mortgage. We have kids starting college in the near future and so are hoarding up cash and investments to that end. Would rather err on saving up enough for college and not having to take out any new loans.

It's all fairly moot as it is 100% likely that we will sell our house in the next decade (while still in our 40s). I am guessing it is most likely that we will sell before we ever pay off? It seems more prudent to save up the down payment for our next home. (Our plan is to downsize and pay cash for our next home. But I am guessing we will settle in our next home before sell current home. A down payment will give us more options on that front, versus having to wait to sell first).

Our house value has been rather stagnant for 3-4 years at this point. When we moved here (2001) so many people were moving up from So Cal and Bay Area, for the more affordable housing. At the time, the median house price in the Bay Area was $500k. (We thought *that* was absurd). Now? $1 mil! $1 mil-ish, if you just want to buy a small starter home.

& so I have been wondering why things are so stagnant here. I know that was really instrumental in the housing bubble, regionally. Not that we need another housing bubble, but I would expect a little more growth. I guess I have mixed feelings about it all. I do like that housing is more in line with wages and people are being more prudent.

In the end, I saw an article last week that so many people are moving here that we should be building an extra 2,000 homes per year. So I guess it's happening. I just haven't seen it so much myself, and home prices seem to be left in check.

I also got a flyer from a local real estate agent and it listed that a 3-bedroom house (down the street) sold for $450,000. What in the heck!? I figured that must have been a typo or it must have been one of the bigger houses which have been selling at that price point, but I looked it up out of curiosity. Indeed, the largest home model on our block and the smallest home model just both sold for the same price. WOW!

I have to back up a bit though. It's funny when I look back and some of the most ridiculous splurges in our family have ended up being the best long-term investments. & it's not like these purchases were made with any regard to long-term investments or making money. It was just about ridiculous splurging. So, our home is the perfect example of this. We changed cities to lower our housing costs by 70%. The housing seemed so cheap to us, that we decided we would buy a home with space for a movie theater. In the end, the price was an even trade for our Bay Area condo. (We didn't even spend any more money to get the theater space).

The sole purpose of this purchase was "ridiculous splurge". The End. But, we ended up only paying pennies for the extra space. The reason is because land is so expensive here that land is the primary driving cost of housing. If you buy a larger two story house, it's not going to cost a lot more. I've said before, but our first floor cost $130 per square foot. The second floor only cost $35 per square foot. Seriously!

We did buy new construction, which is a lot of why we got such a substantial discount on our home. On the open market, our house had never fetched less than a $100,000 premium over the smaller models, so this was obviously an immediate financial gain we received for going bigger. & of course, bigger was better during the boom. At the peak, our home could fetch an additional $200,000 over the single story homes.

As our house prices have stagnated, I have noticed the trend of increasing values of smaller homes. It's clear that people are buying what they can actually afford, and maybe even embracing that more is not always better.

For the most part, we weren't planning to sell for another 6 years minimum, so it will be interesting to see where things head. A lot can change in 6 years. I expect the market to eventually adjust and allow some benefit for bigger homes, even if it's just a very small premium. I expect that we will see some movement on our home value this summer. Will see.

The other interesting thing is that our house is still a solid $200,000 below the housing bubble peak. The peak is nothing I expect to get back to before we sell. It was pretty absurd in our region. But it just hit me that the single stories in our neighborhood have hit peak levels. Amazing!

**I paid down the mortgage below $175k, as planned. Woohoo! I threw an extra $800 to the last payment of the year, to get there.

**I am happy with financial goals and have updated sidebar. I think financially I am mostly done with this year.

The one goal that I will fall short of is our investment goal. I am waiting for end of year credit card rewards to sort out, but I expect to get to $4,300-ish of of our $5,000 goal. I am actually feeling very okay with this. We will get our total taxable investments up to $10k with our tax refund in a couple of months. & if dh works all year we will be able to throw a lot into investments. So I was okay with the short term sacrifice (being $800-ish short) since the longer-term is looking better than I expected.

Overall, these goals were pretty aggressive and I never really expected to meet them all. I will say that often writing down the goals seems like 99% of the battle. Sometimes it just seems to happen magically. Certainly not always, but this year was more of a magical kind of year.

**I expect next year to be more of a savings year and less of a splurge year. Will see what we can do. I am thinking we can maybe save 40% of our income next year. Need to sit down and work the numbers though, probably mid January when I find out my salary for next year. A lot of our bills/utilities are creeping up, and I know we have some home improvements to tackle, plus expect a lot of medical bills. It could be a spendy year on the not-so-fun stuff. But on the flip side, we can probably boost our savings rate by about 10%, if we save everything dh makes.

Just got back from annual camping trip in the Sierras.

Life continues to be stressful and crazy. The minor annoyances continue to pile up.

While my dad was here (we camp with my dad and in-laws) he fixed a couple of minor things around the house for us. But we found a new problem that we will have to call the gardener to fix.

Of course, we appreciated the break and our trip went smooth as could be. Phew! (A nice sea of calm in a month of crazy).

Finances:

**Dh has been earning tons of google credits and amazon gift cards for whatever survey stuff he is doing. He ended up getting a new roku for $25. (Our old one has been clunky for a while but I didn't really want to spend the money. In the end he spent a whole $25 and it is 10 times better).

I suppose that is unofficially his Father's Day present.

**I sent a payment to the credit cards today. I had booked summer classes for BM, our random wildlife vacation, and had charged dh's MRI. I had charged that all in June wanting to push off actual payment to next month, BUT the credit card balances were getting kind of crazy. Plus the one card has a low limit and so I think it was best to pay it down before the end of the month.

So much for delaying those expenses...

**I had to deposit my big check in person. For whatever reason (I guess since I was very nonchalant about it) they made it available immediately. Which was nice since I received the check Saturday night and we weren't back home until yesterday. Seriously, they asked me when I NEEDED it and I shrugged. Apparently that is how you get immediate access to large sums in this day and age. (If you haven't had a large deposit lately, they usually put a hold on some of it).

So I went home and took all the money out (online). I didn't NEED it but if it was available I might as well allocate it.

**So... I went ahead and made my big mortgage payment.

Mortgage balance is now $177,999. I project that we will be at $174,999 by end of year. $169,999 by April 2016.

**I had already opened a $10,000 CD (at my credit union) for a 1.50% rate and so opened up a second one. I don't know that I felt entirely comfortable tying that much up in CDs, but... we also expect a chunk of cash in December. I am always way too cautious, anyway. Odds are we will probably never never touch this money. (I consider about $15k of our cash savings completely untouchable but for extreme emergency). Of course, the CD is easy to access and there isn't much downside if I have to raid it later.

**Money continues to rain down from the sky. I had my piccolo on consignment and apparently it sold recently. Received a $300 check in the mail yesterday. Woohoo!

I am putting this $300 into investments.

{It was in disrepair and this was a very easy route to get it sold for more than I am sure I could have gotten on my own. Certainly was far less hassle than FB and CL have been of late}.

It was funny because I swung by that area yesterday and was stuck in the heat and traffic staring at the music store for a while wondering if they would ever sell my piccolo. (It's an area that I do not frequent). The check was, at that time, on a mail truck en route to my home. Ha! (We kind of reasoned summer/fall would be a good time to sell but had left it at the store at some point in the spring. Better than gathering more dust in my closet).

**The kids just told me that they have no piano lessons next month and so the snowflakes continue to fall. That's another $200 that I will move to investments. Plus credit card rewards this month (About $90?). Plus $30 to investments since we don't have a Ting bill this month. We also have a REI dividend to cash out.

Possibly a $600+ snowball for this month.

**I received my overtime for the year (paid as an annual bonus) and was able to fund a chunk of my savings. For the rest of the year all our monthly savings goes to IRAs, and my 2014 raise will go to savings. To top off those goals in my sidebar.

I can't believe how behind I feel still after last year. That said, though I would like to fund 2014 IRAs in 2014, it's not a necessity. That buys us a little buffer if crap happens.

Bonus:

$5,000 to savings
$ 300 to mortgage
$ 100 new kids bike

I was planning to spend more on the bike, but we just happened to find a $100 bike this week. So that worked out perfect.

Great-Grandma insists on giving me $300 for doing her taxes. I asked her not to, but I know her. Will see. This way I figure I already threw $300 to my mortgage so I really don't care either way.

If she insists, I could use $300 for summer classes for older child. I don't sweat that stuff any more. Whether they know it or not, Grandma (MIL) and Great-Grandma pay for that. BM is attending a camp with his school next month and I used Christmas money to pay for that. & I get the feeling Great-Grandma is paying for summer school...

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

**My gross check was about what I expected, with extra overtime on a big project last year. BUT, the net did not reflect all that extra work. UGH!! I have said that if spouse worked we wouldn't take anything more home. But, my own income seems to be entering that black hole. It's extra shocking because I am used to literally keeping 90% of my paycheck. You get used to what you get used to.

I ran a tax projection and everything looks fairly breakeven for 2014.

Our tax rate on last $10k - $15k of income is hitting about 25%. So, it looks like we will be doing Traditional IRAs this year. I like the way this works out. Our taxes are even steven if we change our mind. But if we do the Traditional I should be getting about a $2700 refund. Which will go straight back into retirement savings. (This would bring our retirement savings rate up to 18%. But, I don't know if that is all good, as we give up the ROTH contributions to do so. I think it just means we need to save more to pay for future taxes. Saving more doesn't necessarily mean much to our bottom line. Though I suppose I will probably be able to work some tax magic on the back end. When we retire).

I also checked the extra property tax deduction and that would save us about 25% too. For several reasons, will probably do this year. I just want the simplicity of one tax payment per year. But I want to make the extra payment in a year I actually get a tax benefit.

We've been doing ROTHs for so long because we haven't been paying any income taxes of any note, since spouse stopped working. But I am not personally comfortable with paying $2,700 taxes that I don't need to. Circumstances change, so we re-evaluate.

In our young 20s I Was strongly encouraged to fund ROTHs. I kind of understand it more with age. There has just never been any tax break quite like it. So when I entered the tax profession it was, "Are you crazy??? Do the ROTH!!!" BUT, we were young and starting out and paying a crapload of taxes. We chose to fund my 401k and our Traditional IRA. I am sure we could have cashed flowed the ROTHs and whatever, we were saving 50%+ of our income. Not like we NEEDED the tax break. BUT... Absolutely no regrets. When dh stopped working, we converted *everything* over to ROTHs. It was win-win. Get a big tax break up front. Convert over at a lower tax rate. So, I am pretty partial to just taking the tax break. I don't know if we will ever be able to convert again, but we do have $100,000+ working for us in our ROTHs. As Dave Ramsey would say, that will be $5 million or something in 40 years. (I don't think it will ever be near that much, but it will do nothing but grow, and I am happy with that. All our aggressive investments are in the ROTHs, for sure).

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

Housing Update:

I guess housing has settled down here. Absolutely nothing has listed in immediate neighborhood for about 12 months. A house went for $400k last spring, which meant a 65%-ish increase over a couple of years. (Nothing new, around here. It's always a roller coaster!). But then, that was it.

SO... I saw 3 houses like ours up for sale this month and that piqued my curiosity. I just saw that one had sold for $400k. It will be interesting to see what the others go for.

Overall, I think this is a good sign. Anything much more than that is getting back into crazy bubble territory. Our house actually peaked at $650,000. Which is crazy insane. At this point, anything much more than $400k is "crazy insane". Especially given the chronic unemployment, regionally. But even in a robust economy, the local wages just don't support these kind of home prices.

So I am kind of marveling at the restraint. No huge bidding war??? Heck, the other two houses have been up a week and are still available. (Not a common sight in these parts, even when the bottom was falling out). I am hoping these are all good signs, overall. That things are settling a bit. A sellers market is good for us, but another market collapse would not be good. I am all for sustainable home prices.

Though, who knows... Bay Area real estate is crazy crazy crazy right now. & that always blows up our housing prices, because then our real estate looks super cheap compared to that. (Which is the only reason anyone ever paid $650k for a house in our own neighborhood). IT will be interesting to see how things play out this summer.