To confirm your savings goals in the new year, begin now with a year-end balance sheet. It is like a baseline.
Begin with all those statements that will arrive in January or check for some numbers on line. List your financial assets like savings accounts, savings bonds, mutual funds, and stock values.
In that same column but separate, list real assets like house value, car values, and other things with some resale value. I do not list furniture, clothing, jewelry (I have a few nice pieces but I don't count on reselling them), or collections like coins and stamps as they are too difficult to value.
After assets, list liabilities. Here's the place for your credit card balances, mortgage balances, any family loans, bookie debts, etc.
When you subtotal both sections and subtract liabilities from assets, you discover your net worth.
I maintain my balance sheet quarterly on Excel and add each quarter in the next column. Side-by-side changes are easy to see. Some prefer to let financial software like Quicken track these things and produce nice asset reports and colorful charts.
I will begin gathering 12/31 balances on line over the next 2 days, before the new year activities effect what I will find posted on my bank, Vanguard, HSA, and 401(k) sites.
Start gathering your net worth pieces to establish your starting point.
'til later
Monday, December 31, 2007
Sunday, December 30, 2007
Resolutions
It's time for new year resolutions. Traditionally I do not make annual resolutions. My list would contain one that I feel already defeated by.
However, I am encouraged to break this overwhelming goal down into small attainable pieces. And, I will adjust my attitude.
I am going to create a positive statement. I will post it along with the attainable step (my smaller goal) on my bathroom mirror. That way I will see them regularly.
How about you? Do your resolutions pertain to financial matters? Reduce debt? Increase savings? Make more informed $ choices?
We'll take our 2008 journey together.
'til later
However, I am encouraged to break this overwhelming goal down into small attainable pieces. And, I will adjust my attitude.
I am going to create a positive statement. I will post it along with the attainable step (my smaller goal) on my bathroom mirror. That way I will see them regularly.
How about you? Do your resolutions pertain to financial matters? Reduce debt? Increase savings? Make more informed $ choices?
We'll take our 2008 journey together.
'til later
Saturday, December 29, 2007
Gobbling Up Banks
Our local bank has been bought by National City. The conversion will be complete in early February. We received a packet of information this week.
The local bank personnel have assured us our accounts will be grandfathered. Our personal checking account has no minimum balance, no monthly charges, no maximum number of checks or withdrawals, and earns a wee bit of interest which is posted monthly.
It appears to me that banking acquisitions will one day lead to 6 banks. Competition is a good thing for the consumer.
National City once charged a friend for depositing into her away-at-college daughter's account. To avoid the fee, she was told she could drop it in the drop box outside, it would be posted the next day and there would be no receipt.
'til later
The local bank personnel have assured us our accounts will be grandfathered. Our personal checking account has no minimum balance, no monthly charges, no maximum number of checks or withdrawals, and earns a wee bit of interest which is posted monthly.
It appears to me that banking acquisitions will one day lead to 6 banks. Competition is a good thing for the consumer.
National City once charged a friend for depositing into her away-at-college daughter's account. To avoid the fee, she was told she could drop it in the drop box outside, it would be posted the next day and there would be no receipt.
'til later
Friday, December 28, 2007
More Taxes
Chicago has a new tax going into effect. Tax on bottled water. They are taxing the bottle.
As we travel to Michigan and New York, we have to pay a deposit on aluminum cans. The deposit is returned if we return the cans.
I think this deposit was an effort years and years ago to encourage recycling. Government decided this system was better than waiting for consumers to learn to recycle.
Our family in New York deals with the deposit on cans and glass bottles but they do not recycle plastic or paper. Their energies and space are spent on the state deposits.
We do not have to deal with the deposit and returning empties with every trip to the store but we recycle glass, cans, plastics, and paper weekly at the end of our curb.
Just an example of the government forcing a system that has no end and not encouraging a change in our lifestyles.
'til later
As we travel to Michigan and New York, we have to pay a deposit on aluminum cans. The deposit is returned if we return the cans.
I think this deposit was an effort years and years ago to encourage recycling. Government decided this system was better than waiting for consumers to learn to recycle.
Our family in New York deals with the deposit on cans and glass bottles but they do not recycle plastic or paper. Their energies and space are spent on the state deposits.
We do not have to deal with the deposit and returning empties with every trip to the store but we recycle glass, cans, plastics, and paper weekly at the end of our curb.
Just an example of the government forcing a system that has no end and not encouraging a change in our lifestyles.
'til later
Thursday, December 27, 2007
Year Ending
We are on count down to 2008. Bob and I did a quick review of our 2007 income looking for ways to reduce the taxable amount.
We decided to fully fund our Roth IRAs to the maximum. (Note: Roth IRA contributions are not tax deductible but a wise decision) We reviewed our HSA account and have already funded it completely for 2007. We will fund the maximum for 2008 in the first quarter of '08.
Our business is a Chapter Sub S Corporation (an S-Corp) where the income flows through to our personal return. We made decisions to pay the American Express statement on line so as to get those expenses into this year. Note: cash basis.
Today we will review our charitable giving for the year and decide which we will support now in order to have that count on our Schedule A. Note: we itemize.
These are the kinds of thing we can do now with our $ in an effort to affect our taxes for 2007. Time is running out.
'til later
We decided to fully fund our Roth IRAs to the maximum. (Note: Roth IRA contributions are not tax deductible but a wise decision) We reviewed our HSA account and have already funded it completely for 2007. We will fund the maximum for 2008 in the first quarter of '08.
Our business is a Chapter Sub S Corporation (an S-Corp) where the income flows through to our personal return. We made decisions to pay the American Express statement on line so as to get those expenses into this year. Note: cash basis.
Today we will review our charitable giving for the year and decide which we will support now in order to have that count on our Schedule A. Note: we itemize.
These are the kinds of thing we can do now with our $ in an effort to affect our taxes for 2007. Time is running out.
'til later
Wednesday, December 26, 2007
Day After Deals
When Bob bought my Christmas present he received a coupon good for $20 toward any purchase post Christmas at Kohl's.
Today we used that coupon and got a nice queen size blanket. The blankets were reduced by 60% along with many things in the store during the early bird specials.
So, we can count the blanket a free bonus. That is a great bargain.
They say there are many to be had out there today. Good luck if you are venturing forth.
'til later
Today we used that coupon and got a nice queen size blanket. The blankets were reduced by 60% along with many things in the store during the early bird specials.
So, we can count the blanket a free bonus. That is a great bargain.
They say there are many to be had out there today. Good luck if you are venturing forth.
'til later
Tuesday, December 25, 2007
Merry Christmas
This is the day set aside to commemorate the arrival of the newborn king. Let us remember Him today as we gather with family and friends.
May it be a great celebration. God bless.
'til later
May it be a great celebration. God bless.
'til later
Monday, December 24, 2007
Take Time
Yesterday there was a nearly full house for the early service at church. Tonight there will be Christmas Eve services in most churches. Some are early with emphasis on the simplicity of the story geared for children.
Many houses of worship will have later candle light services. Usually all seats are full for these events. They are in the middle of the night to represent the arrival during the night of the new born king.
The angels found the shepherds watching over their sheep in the middle of the night. That's what they did. They guarded over their wards 24-7. They were the first to receive the birth announcement.
Take time today. Let us remember together that a baby was born and His life changed the world. Let Him change our world today.
'til later
Many houses of worship will have later candle light services. Usually all seats are full for these events. They are in the middle of the night to represent the arrival during the night of the new born king.
The angels found the shepherds watching over their sheep in the middle of the night. That's what they did. They guarded over their wards 24-7. They were the first to receive the birth announcement.
Take time today. Let us remember together that a baby was born and His life changed the world. Let Him change our world today.
'til later
Sunday, December 23, 2007
Bank Rates
We have dealt with the same local bank for over 20 years. We have both a checking account and a passbook account with them. We actually have a little passbook that we present when we make a transaction.
We are careful to keep the checking account low as it pays less interest. We just transfer funds out of the savings account as needed. I used to do this over the phone but now it's so easy on line.
I am embarrassed to tell you I discovered the other day that the passbook account makes all of 0.4% and the checking is always half of that! I think we need to consider another type of account with that bank.
If we parked $10,000 there for things like real estate taxes, vacations, emergencies or gifts, it would earn a whopping $40 or $3.33 a month.
If we parked it in our Vanguard MMF is would make close to $460 annually or $38 a month.
I think I'll talk with a banker next week.
'til later
We are careful to keep the checking account low as it pays less interest. We just transfer funds out of the savings account as needed. I used to do this over the phone but now it's so easy on line.
I am embarrassed to tell you I discovered the other day that the passbook account makes all of 0.4% and the checking is always half of that! I think we need to consider another type of account with that bank.
If we parked $10,000 there for things like real estate taxes, vacations, emergencies or gifts, it would earn a whopping $40 or $3.33 a month.
If we parked it in our Vanguard MMF is would make close to $460 annually or $38 a month.
I think I'll talk with a banker next week.
'til later
Saturday, December 22, 2007
Eating Out
Our work takes us away from home about 70 nights a year. We eat out plenty and find ourselves longing for simple meals at home.
Have you eaten out on a Friday evening lately? It has become more popular than Saturday near us. We rarely eat out unless we are away from home.
Three weeks ago I met a girlfriend for dinner on a Friday. We decided to meet at the restaurant early to avoid the crowds. At 5pm we had to wait 15 minutes to be seated. This "chain" does not take reservations. We were surprised how crowded it was.
My suggestion is to avoid Fridays out. Take advantage of coupons or specials some restaurants offer for dining out Monday through Thursday.
'til later
Have you eaten out on a Friday evening lately? It has become more popular than Saturday near us. We rarely eat out unless we are away from home.
Three weeks ago I met a girlfriend for dinner on a Friday. We decided to meet at the restaurant early to avoid the crowds. At 5pm we had to wait 15 minutes to be seated. This "chain" does not take reservations. We were surprised how crowded it was.
My suggestion is to avoid Fridays out. Take advantage of coupons or specials some restaurants offer for dining out Monday through Thursday.
'til later
Friday, December 21, 2007
Last Minute
Bob traditionally does his Christmas shopping on Christmas Eve. He has found wonderful last minute discounts.
He actually does his shopping via newspaper ads and flyers. Then, armed with a target or two, out he goes for the "kill."
I think women enjoy the pursuit more than most guys. We are programmed to roam stores and malls searching and often without purchasing. We can enjoy the shopping experience more than some men.
One Christmas Eve in 1982 or 1983, the thermometer plunged and wet roads were sheets of ice. The tradition of Bob and Marny (she would have been 4 or 5) spending the day at the mall with a nice lunch turned into Kmart and McDonald's drive through.
Even that year treasured memories were made. Church services were cancelled. We accepted an impromptu invitation to join neighbors. We all sang familiar carols and Rudy read the story from the Gospel of Luke.
Rumor has it Marny is available Christmas Eve for a breakfast/shopping outing.
'til later
He actually does his shopping via newspaper ads and flyers. Then, armed with a target or two, out he goes for the "kill."
I think women enjoy the pursuit more than most guys. We are programmed to roam stores and malls searching and often without purchasing. We can enjoy the shopping experience more than some men.
One Christmas Eve in 1982 or 1983, the thermometer plunged and wet roads were sheets of ice. The tradition of Bob and Marny (she would have been 4 or 5) spending the day at the mall with a nice lunch turned into Kmart and McDonald's drive through.
Even that year treasured memories were made. Church services were cancelled. We accepted an impromptu invitation to join neighbors. We all sang familiar carols and Rudy read the story from the Gospel of Luke.
Rumor has it Marny is available Christmas Eve for a breakfast/shopping outing.
'til later
Thursday, December 20, 2007
Winter?
Is winter here yet? Not officially but it feels like it and looks like it.
I find winter depressing. I do not enjoy snowy or icy driving conditions. I don't mind the cold temps as long as I do not have to be out in it much.
The worse part for me is the lack of sunlight. The long gray days indoors wear on my spirit. I dream of spring and green.
We set the thermostat at 67, wear sweaters in the house, and watch TV at night while wrapped in afghans I have knit.
A cup of tea, anyone?
'til later
I find winter depressing. I do not enjoy snowy or icy driving conditions. I don't mind the cold temps as long as I do not have to be out in it much.
The worse part for me is the lack of sunlight. The long gray days indoors wear on my spirit. I dream of spring and green.
We set the thermostat at 67, wear sweaters in the house, and watch TV at night while wrapped in afghans I have knit.
A cup of tea, anyone?
'til later
Tuesday, December 18, 2007
Fund of Funds
I have an IRA which was rolled out of a previous employer's Keough. It has been in an Oakmark fund for 10 years and has done OK. It faired the '00-'03 period without losing much of its value.
This year, with the market up 4% or 5%, this fund has barely retained value. It's time to roll it to another investment.
I am considering one of Vanguard's target retirement funds. I found one that holds 70% equities and 30% reserves or fixed income.
This fund is comprised of 5 or 6 funds. A fund of funds with some international exposure.
The idea with the target date fund is that over time the fund will automatically reposition itself to more and more fixed income (bonds) and less stocks as the target date approaches. I do not have to concern myself with readjusting things. I like that idea.
The paperwork will be mailed out next week. Maybe it's time to reevaluate and consolidate my other small IRA accounts.
'til later
This year, with the market up 4% or 5%, this fund has barely retained value. It's time to roll it to another investment.
I am considering one of Vanguard's target retirement funds. I found one that holds 70% equities and 30% reserves or fixed income.
This fund is comprised of 5 or 6 funds. A fund of funds with some international exposure.
The idea with the target date fund is that over time the fund will automatically reposition itself to more and more fixed income (bonds) and less stocks as the target date approaches. I do not have to concern myself with readjusting things. I like that idea.
The paperwork will be mailed out next week. Maybe it's time to reevaluate and consolidate my other small IRA accounts.
'til later
Antiques?
They are going to phase out our traditional incandescent bulbs over the next four to twelve years. We are going to energy saving incandescent bulbs or light-emitting diodes.
Already motel rooms are being lit with fluorescent and spiral 12-watt incandescent bulbs. The latter costing $2 each versus $0.50 for our old traditional bulbs.
There are other choices such as Greenlite X-bulbs ($4), Feit Ecobulbs Plus ($5) and GE Energy Smart Dimmable Spiral ($10).
But I have to ask if they emit enough light for reading and needlework. So far in motel rooms, the answer is no. I usually find better general lighting in the motel lobby where the lower lights add enough I can enjoy my book.
Where is the savings if tasks require more lights? Should we buy a case or so of the traditional 60w bulbs now before the go the way of VHS and floppy disks? In the future we may have to search antique shops!
'til later
Already motel rooms are being lit with fluorescent and spiral 12-watt incandescent bulbs. The latter costing $2 each versus $0.50 for our old traditional bulbs.
There are other choices such as Greenlite X-bulbs ($4), Feit Ecobulbs Plus ($5) and GE Energy Smart Dimmable Spiral ($10).
But I have to ask if they emit enough light for reading and needlework. So far in motel rooms, the answer is no. I usually find better general lighting in the motel lobby where the lower lights add enough I can enjoy my book.
Where is the savings if tasks require more lights? Should we buy a case or so of the traditional 60w bulbs now before the go the way of VHS and floppy disks? In the future we may have to search antique shops!
'til later
Monday, December 17, 2007
Greatest Gift
What is the best gift you will be giving for Christmas? Is there one special gift you have planned and saved for? Are you anticipating the giving? Are you hoping they will enjoy it? Is it already wrapped? Is it waiting under the tree?
Isn't the anticipation great! A part of you is wrapped in that package - your time, your thoughtfulness.
God gave to us, to everyone - the greatest gift. The dearest, planned, anticipated gift to the world. He gave us part of Himself. He's excited about our receiving His Son.
Have you unwrapped that Gift yet? The best relationship is in that package.
'til later
Isn't the anticipation great! A part of you is wrapped in that package - your time, your thoughtfulness.
God gave to us, to everyone - the greatest gift. The dearest, planned, anticipated gift to the world. He gave us part of Himself. He's excited about our receiving His Son.
Have you unwrapped that Gift yet? The best relationship is in that package.
'til later
Sunday, December 16, 2007
Memorable
What are the most memorable gifts you have received?
Mine would include an antique slaw cutter from my grandmother, a meat slicer, diamond earrings, and a leather coat.
Each one was unexpected and fun.
My daughter found the meat slicer. She insisted it was exactly what I wanted and her dad bought it. She was 10 and I had pointed out a food processor. I was surprised by the slicer. It was only when she was in high school that we told her the truth as we were slicing ham for a family gathering.
What will you receive this year? What will be the unexpected and special gift?
My best friend and I give each other time. We treasure it and look forward to it. She and I will spend our time shopping soon after Christmas with a nice lunch along the river in Geneva. We have done this for five years or so and we both look forward to our special day.
Hope you receive something outstanding like that this year.
'til later
Mine would include an antique slaw cutter from my grandmother, a meat slicer, diamond earrings, and a leather coat.
Each one was unexpected and fun.
My daughter found the meat slicer. She insisted it was exactly what I wanted and her dad bought it. She was 10 and I had pointed out a food processor. I was surprised by the slicer. It was only when she was in high school that we told her the truth as we were slicing ham for a family gathering.
What will you receive this year? What will be the unexpected and special gift?
My best friend and I give each other time. We treasure it and look forward to it. She and I will spend our time shopping soon after Christmas with a nice lunch along the river in Geneva. We have done this for five years or so and we both look forward to our special day.
Hope you receive something outstanding like that this year.
'til later
Saturday, December 15, 2007
Ad $
We were in Iowa this week where political ads are everywhere on television. The candidates are spending big $ for prime spots.
Business spend $ on advertising. Kay Jewelers has run several full page ads this week in USA Today. That has to have cost big $.
$ is spent on carefully placed ads on this website even. Without pop-up blockers, my adventures surfing would be hampered with ads - small ads, large ads, video ads, some with audio.
Ad $ for the Super Bowl is priced by the second. How many memorable ads during unmemorable games. How often the morning after the discussions are about the ads and not the game?
Millions, billions spent and we are the targets.
Look here, look at me, want me, look like me, feel like me. Advertising is a science.
The old adage is buyer beware. Don't fall for the seduction. Carefully check the substance.
'til later
Business spend $ on advertising. Kay Jewelers has run several full page ads this week in USA Today. That has to have cost big $.
$ is spent on carefully placed ads on this website even. Without pop-up blockers, my adventures surfing would be hampered with ads - small ads, large ads, video ads, some with audio.
Ad $ for the Super Bowl is priced by the second. How many memorable ads during unmemorable games. How often the morning after the discussions are about the ads and not the game?
Millions, billions spent and we are the targets.
Look here, look at me, want me, look like me, feel like me. Advertising is a science.
The old adage is buyer beware. Don't fall for the seduction. Carefully check the substance.
'til later
Friday, December 14, 2007
$ Rates
Another adjustment this week. The Feds lowered it 1/4% to lighten $ burden, to control inflation or recession. These are smart analysts with great financial wisdom. Probably the right thing.
The stock market wasn't happy and fell. Then there was a deal struck with international banks that is too confusing to follow. All this makes for an unstable feeling in the market. We will be watchful and hang on for the ride.
The rate adjustment? What affect on you and me? I assume my money market fund will pay less. Possibly the car loan for our new car will be lower but I'm not sure.
Were there always these frequent adjustments to $ rates? Maybe it's just me and I've been more aware these past 6 or 7 years? These controls seem pretty tight.
We will all be watching again next month.
'til later
The stock market wasn't happy and fell. Then there was a deal struck with international banks that is too confusing to follow. All this makes for an unstable feeling in the market. We will be watchful and hang on for the ride.
The rate adjustment? What affect on you and me? I assume my money market fund will pay less. Possibly the car loan for our new car will be lower but I'm not sure.
Were there always these frequent adjustments to $ rates? Maybe it's just me and I've been more aware these past 6 or 7 years? These controls seem pretty tight.
We will all be watching again next month.
'til later
Thursday, December 13, 2007
Sales
Holiday sales. 40% off, 50% off. Glossy pictures, extended shopping hours.
Some items on sale are things I really want. Should I take advantage of the bargains? Should I tell Bob what to buy me - tomorrow between 7am and 10am - get real.
Should I go ahead and buy it, wrap it, have him give it to me Christmas morning?
First, I have to decide if it is truly something I need. If it is, I will go ahead and purchase it. If it's something I really would like to have and could save Bob the headache, I'll wrap it and place it under the tree.
'til later
Some items on sale are things I really want. Should I take advantage of the bargains? Should I tell Bob what to buy me - tomorrow between 7am and 10am - get real.
Should I go ahead and buy it, wrap it, have him give it to me Christmas morning?
First, I have to decide if it is truly something I need. If it is, I will go ahead and purchase it. If it's something I really would like to have and could save Bob the headache, I'll wrap it and place it under the tree.
'til later
Wednesday, December 12, 2007
Car Shopping
2008 will be the year for us to replace one of our cars. I've begun the search on line. I have visited the Honda and Dodge websites. Our first decision is which vehicle to replace.
Is the low mileage 1996 minivan or the above average mileage 2000 Olds sedan headed to a new home? Plus we have an average mileage 1998 Ford Explorer. Our first responsibility is wheels used for our business. So the Olds (our youngest) may go first. I will keep you posted on the progress.
You may ask why do Bargain Barb and her husband have 3 vehicles for 2 drivers. Yes, good question.
There are more expenses having the 3 including insurance and maintenance. The process from 2 to 3 was an opportunity.
In 2002 my dad, due to health issues and limitations, sold us his sedan. The low mileage and full disclosure of maintenance history made the Intrigue intriguing.
It was a good deal for us and the acquisition affordable. Bob uses it for his business travels locally. For trips away of more than 100 miles he rents through Enterprise.
We should pare back to 2 vehicles. Maybe in 2008.
'til later
Is the low mileage 1996 minivan or the above average mileage 2000 Olds sedan headed to a new home? Plus we have an average mileage 1998 Ford Explorer. Our first responsibility is wheels used for our business. So the Olds (our youngest) may go first. I will keep you posted on the progress.
You may ask why do Bargain Barb and her husband have 3 vehicles for 2 drivers. Yes, good question.
There are more expenses having the 3 including insurance and maintenance. The process from 2 to 3 was an opportunity.
In 2002 my dad, due to health issues and limitations, sold us his sedan. The low mileage and full disclosure of maintenance history made the Intrigue intriguing.
It was a good deal for us and the acquisition affordable. Bob uses it for his business travels locally. For trips away of more than 100 miles he rents through Enterprise.
We should pare back to 2 vehicles. Maybe in 2008.
'til later
Tuesday, December 11, 2007
Short?
I was reading a report on how to cut back on energy use. I came across one that has me in stitches.
To save on water, lower the shower head and take shorter showers.
What? On my knees?
'til later
To save on water, lower the shower head and take shorter showers.
What? On my knees?
'til later
Monday, December 10, 2007
Next Door
There's a book called The Millionaire Next Door. My copy is lent out. It tells of the "little guy" millionaire who does not act the stereotype.
He drives an older model car, he has lived in the same house for years, he doesn't wear the latest styles, he doesn't vacation in the Bahamas all the time or visit his Colorado home to ski.
He may not have inherited a bundle. He did not win the lottery. He doesn't make $100,000 a year. He's not an inventor or a drug dealer.
He may work well into his late 60s. He probably shops the ads and clips coupons. He is a content character, comfortable where he is, doing what he loves.
So, again, do not judge that book by the cover. Look around. There may be a millionaire living near you. Be encouraged. He probably got there slowly and steadily like the tortoise in the race.
'til later
He drives an older model car, he has lived in the same house for years, he doesn't wear the latest styles, he doesn't vacation in the Bahamas all the time or visit his Colorado home to ski.
He may not have inherited a bundle. He did not win the lottery. He doesn't make $100,000 a year. He's not an inventor or a drug dealer.
He may work well into his late 60s. He probably shops the ads and clips coupons. He is a content character, comfortable where he is, doing what he loves.
So, again, do not judge that book by the cover. Look around. There may be a millionaire living near you. Be encouraged. He probably got there slowly and steadily like the tortoise in the race.
'til later
Sunday, December 9, 2007
Don't worry?
Doesn't God say that He will provide? Why should we save for retirement? In the Gospel of Matthew there are several verses like: "So do not worry, saying, 'What shall we eat?' or 'What shall we drink?' or 'What shall we wear?'
If I am a Christian, does that mean I should not prepare for retirement? Or even education for my children? The parable of the wealthy man whose harvest was so large he built another barn to store it comes to mind. But he was called a fool.
The book of Proverbs is full of descriptions of wise men. Proverbs 13:22: "A good man leaves an inheritance for his children's children..." Of course an inheritance is not limited to just $. It can include a good name and faith shared.
Proverbs 21:20: "In the house of the wise are stores of choice foods and oil, but a foolish man devours all he has." This is a good argument for budgeting and not spending it all.
Proverbs 30:25: "Ants are creatures of little strength, yet they store up their food in the summer." There are other verses that tell of storing up for another season. It implies planning for the future.
I conclude it should all be in moderation. To be wise, we have a plan. To horde, is a waste. Abundance should be used wisely. God wants us to enjoy giving unto Him.
We need a plan yet not be selfish. Is God glorified in what we do with our wealth?
'til later
If I am a Christian, does that mean I should not prepare for retirement? Or even education for my children? The parable of the wealthy man whose harvest was so large he built another barn to store it comes to mind. But he was called a fool.
The book of Proverbs is full of descriptions of wise men. Proverbs 13:22: "A good man leaves an inheritance for his children's children..." Of course an inheritance is not limited to just $. It can include a good name and faith shared.
Proverbs 21:20: "In the house of the wise are stores of choice foods and oil, but a foolish man devours all he has." This is a good argument for budgeting and not spending it all.
Proverbs 30:25: "Ants are creatures of little strength, yet they store up their food in the summer." There are other verses that tell of storing up for another season. It implies planning for the future.
I conclude it should all be in moderation. To be wise, we have a plan. To horde, is a waste. Abundance should be used wisely. God wants us to enjoy giving unto Him.
We need a plan yet not be selfish. Is God glorified in what we do with our wealth?
'til later
Saturday, December 8, 2007
Dave Ramsey
Have you discovered Dave Ramsey? He has a daily radio show but it's not available in the Chicago area. You should check out his website.
He is huge on not being in debt. He has several creative ways for people to get out of debt after making a commitment to the goal. His formulas for the path to being debt free are successful.
He is also not fond of mortgage debt and completely against consolidated debt. That is to roll your short term debt into long term debt. The banks and mortgage companies are the ones who gain - always.
Dave is a Christian and his principles are strongly reflected in his books as well. His voice is strong and encouraging. I enjoyed catching his program while we were on the road in western Missouri this week.
As far as mortgages go, I believe they are tools that get most of us into our houses. Of course, a 30 year fixed is best. We pay that debt in future $ with less buying power.
We used a 15-year mortgage to get into this house over 22 years ago. Those $1,100 payments were very difficult on $45,000 a year salary. Now it's paid for! When that milestone was crossed, we had the discipline to invest the mortgage payment on a monthly basis into several mutual funds.
The house, of course, has increased in value but we have no plans to leave it. We just struggle to take care of it. We can afford to as we have all those years of mortgage payments socked away at Vanguard. It worked for us.
'til later
He is huge on not being in debt. He has several creative ways for people to get out of debt after making a commitment to the goal. His formulas for the path to being debt free are successful.
He is also not fond of mortgage debt and completely against consolidated debt. That is to roll your short term debt into long term debt. The banks and mortgage companies are the ones who gain - always.
Dave is a Christian and his principles are strongly reflected in his books as well. His voice is strong and encouraging. I enjoyed catching his program while we were on the road in western Missouri this week.
As far as mortgages go, I believe they are tools that get most of us into our houses. Of course, a 30 year fixed is best. We pay that debt in future $ with less buying power.
We used a 15-year mortgage to get into this house over 22 years ago. Those $1,100 payments were very difficult on $45,000 a year salary. Now it's paid for! When that milestone was crossed, we had the discipline to invest the mortgage payment on a monthly basis into several mutual funds.
The house, of course, has increased in value but we have no plans to leave it. We just struggle to take care of it. We can afford to as we have all those years of mortgage payments socked away at Vanguard. It worked for us.
'til later
Friday, December 7, 2007
Thursday, December 6, 2007
Health Savings
Some employers offer HSAs (Health Savings Accounts) which are usually paired with high deductible medical coverage plans. It lets you set aside tax-free dollars to pay for qualified out-of-pocket health expenses.
There are HSAs available for the self-employed. We set ours up through Health Savings Administrators in Richmond VA. They offer Vanguard mutual fund options for investing the $. The account grows tax free waiting for the day we need $ for medical expenses.
We receive electronic quarterly statements. It is set up for Bob since he's the self-employed family member. It shows myself as beneficiary with our daughter Marny as secondary beneficiary.
We contribute the max for now. It will be there in the future to help with extreme needs or long term care. When we take out $, it is taxable that year.
Just another way to grow $ tax free.
'til later
There are HSAs available for the self-employed. We set ours up through Health Savings Administrators in Richmond VA. They offer Vanguard mutual fund options for investing the $. The account grows tax free waiting for the day we need $ for medical expenses.
We receive electronic quarterly statements. It is set up for Bob since he's the self-employed family member. It shows myself as beneficiary with our daughter Marny as secondary beneficiary.
We contribute the max for now. It will be there in the future to help with extreme needs or long term care. When we take out $, it is taxable that year.
Just another way to grow $ tax free.
'til later
Act Your Wage
Act your wage. I heard this phrase on the radio the other afternoon. Does it sound familiar? It sounds like something your mother might have said or maybe your spouse.
We all know people who seem to be living the high life. They drive the right cars and live in the right neighborhoods. Did you ever wonder if they had millions stashed away? Maybe millions that were earning hundreds of thousands?
That may be true. You can not judge a book by its cover. We really can only control what is inside our own covers. We can only live true to ourselves and our God.
My challenge is simply to look inside our own book. Are we conducting ourselves being true to our wage. Are we putting on airs? Are we pretending to have more or be more?
In the end, we answer to our God. And before that we may answer to our spouses. Go and spend wisely this Christmas.
'til later
We all know people who seem to be living the high life. They drive the right cars and live in the right neighborhoods. Did you ever wonder if they had millions stashed away? Maybe millions that were earning hundreds of thousands?
That may be true. You can not judge a book by its cover. We really can only control what is inside our own covers. We can only live true to ourselves and our God.
My challenge is simply to look inside our own book. Are we conducting ourselves being true to our wage. Are we putting on airs? Are we pretending to have more or be more?
In the end, we answer to our God. And before that we may answer to our spouses. Go and spend wisely this Christmas.
'til later
Wednesday, December 5, 2007
If Only
If only I had_____.
Have you heard yourself start a sentence like that? Sure. We all have. If only I had a new car. If only we lived in a better neighborhood. If only I didn't have to work. If only I didn't have a maxed out credit card.
What is the rest of that sentence? If only I had a new car, I'd be happy? If only we lived in that subdivision, we'd have it made? If only I had enough $, I'd be content?
The real question is: would you be happy or content? When is enough enough?
I contend happiness does not equal stuff.
My challenge: dig deep inside and find what you think would truly make you happy and content. If it's not things, what would it be? Maybe we'll discover "it" is something that we can achieve without spending more $. Maybe it's loosing weight, treating our spouse better, being less critical of our children, choosing to not envy others things.
Find your happiness soon. Try to be content with what you have to work with. Try a smile.
'til later
Have you heard yourself start a sentence like that? Sure. We all have. If only I had a new car. If only we lived in a better neighborhood. If only I didn't have to work. If only I didn't have a maxed out credit card.
What is the rest of that sentence? If only I had a new car, I'd be happy? If only we lived in that subdivision, we'd have it made? If only I had enough $, I'd be content?
The real question is: would you be happy or content? When is enough enough?
I contend happiness does not equal stuff.
My challenge: dig deep inside and find what you think would truly make you happy and content. If it's not things, what would it be? Maybe we'll discover "it" is something that we can achieve without spending more $. Maybe it's loosing weight, treating our spouse better, being less critical of our children, choosing to not envy others things.
Find your happiness soon. Try to be content with what you have to work with. Try a smile.
'til later
Tuesday, December 4, 2007
Game Rules
Have you ever played a game and suddenly one of the other players cried out that you made an illegal move. It's like the game rules have been changed.
If the game is creating wealth, as the game progresses, you'll find the rules change on you. As your earned and unearned income (interest, dividends, capital gains, etc.) rise, the rules change.
I'm talking about tax rate changes. You can literally make one dollar more and your rate can jump as much as 5%. The rules change.
Please take time today and check out the tax rates for individuals (Form 1040) for 2007. Go to: irs.gov Don't wait until you set out to do your tax returns. Why now? What can I do now?
If you find yourself approaching one of the rate differences, consider a charitable gift (if you itemize), make January's house payment in December, defer selling stocks/mutual funds that would kick in a taxable gain or sell stock/mutual fund that would provide a loss.
It's best to know the game rules before you start to play.
'til later
If the game is creating wealth, as the game progresses, you'll find the rules change on you. As your earned and unearned income (interest, dividends, capital gains, etc.) rise, the rules change.
I'm talking about tax rate changes. You can literally make one dollar more and your rate can jump as much as 5%. The rules change.
Please take time today and check out the tax rates for individuals (Form 1040) for 2007. Go to: irs.gov Don't wait until you set out to do your tax returns. Why now? What can I do now?
If you find yourself approaching one of the rate differences, consider a charitable gift (if you itemize), make January's house payment in December, defer selling stocks/mutual funds that would kick in a taxable gain or sell stock/mutual fund that would provide a loss.
It's best to know the game rules before you start to play.
'til later
Monday, December 3, 2007
Holiday Stress
This is a very stressful time of year for so many folks. A recently published survey in the Family Circle Magazine lists 40% of respondents claim finances are their big stress maker. Financial overload in December can make for a stressful January, February and beyond.
A possible source to help lessen this stress might be to list treasures on Ebay. Place some gifts received in past years to work. Sell things. Maybe cutting back on eating out. Take a sack lunch to work. Suffer through the office coffee maker rather than Starbucks.
The second stress producer listed by 34% was too many activities. Party invitations all seem to come this month and many for the same day. We all know people who dash between houses of friends and office or professional parties. Talk about stress. A gracious thank you but no thank you. Keep it simple. Drop the guilt.
Down the list in the survey was time with family reported by 17%. We all have an Uncle John who can't stop dominating all conversations or an Aunt Bertha who never helps but rather occupies the best chair for the duration. What to do to help with this stress? You can't change family. I would suggest focus on the positive and keep moving. Uncle John will continue his saga with your brother or your cousin. Aunt Bertha might be lazy but she has great funny stories to share.
Whatever your stress. Find a way past it. Don't let it destroy your joy of the season.
'til later
A possible source to help lessen this stress might be to list treasures on Ebay. Place some gifts received in past years to work. Sell things. Maybe cutting back on eating out. Take a sack lunch to work. Suffer through the office coffee maker rather than Starbucks.
The second stress producer listed by 34% was too many activities. Party invitations all seem to come this month and many for the same day. We all know people who dash between houses of friends and office or professional parties. Talk about stress. A gracious thank you but no thank you. Keep it simple. Drop the guilt.
Down the list in the survey was time with family reported by 17%. We all have an Uncle John who can't stop dominating all conversations or an Aunt Bertha who never helps but rather occupies the best chair for the duration. What to do to help with this stress? You can't change family. I would suggest focus on the positive and keep moving. Uncle John will continue his saga with your brother or your cousin. Aunt Bertha might be lazy but she has great funny stories to share.
Whatever your stress. Find a way past it. Don't let it destroy your joy of the season.
'til later
Saturday, December 1, 2007
Saved $ Making $
Understanding compound interest can be fun. Consider what would happen if you could set aside $100 a month (just $25 a week) and it earned 10%. These days that sounds like great earnings. We're all excited if we can find 5% interest.
Anyway, $100 a month set aside earning 10%. Setting aside $1,200 a year for 20 years equals $24,000.
Enter compound interest. The saved $1,200 earns 10% which also earns 10%. Rate times time. The $24,000 actually earned and set aside to grow would do just that.
It would become $76,500. The gain in total would be $52,500.
If you add more time to the adventure of saving $100 a month, in 40 years you would have $637,000. Your invested earned $ would gain $589,000, over half a million.
Consider setting aside the most you can in an IRA, 401(k), 403(b), SEP, or Roth IRA. Compounding without having to pay taxes on interest income and you will reap a compound interest harvest!
'til later
Anyway, $100 a month set aside earning 10%. Setting aside $1,200 a year for 20 years equals $24,000.
Enter compound interest. The saved $1,200 earns 10% which also earns 10%. Rate times time. The $24,000 actually earned and set aside to grow would do just that.
It would become $76,500. The gain in total would be $52,500.
If you add more time to the adventure of saving $100 a month, in 40 years you would have $637,000. Your invested earned $ would gain $589,000, over half a million.
Consider setting aside the most you can in an IRA, 401(k), 403(b), SEP, or Roth IRA. Compounding without having to pay taxes on interest income and you will reap a compound interest harvest!
'til later
My Advice
My friend Donna has a long commute each day. Her round trip is over 60 miles. She shares the driving with a co-worker and yet they both put many miles on their vehicles.
Recently Donna traded her 7 year old 150,000 miles Sebring on a 2004 Sebring. It's a beautiful car. She looked at new cars and priced what she really wanted at $30,000.
My advice to her would have been not to take a 60 month loan on the "new" used car. That's 5 years to pay off a car that will perform about like her old one and start needing major repairs when it is 6 years old or 3 years from now when she will still be making payments.
Worse yet, when it is 7 years old and she's back looking for a new car, she will still owe a year's worth of payments. I think many people find them selves in that boat. Trading in, satisfying old debt, and taking on 5 year loans - an unending cycle.
Donna's story was all about getting payments down to an amount that would fit her budget. Makes sense. But, it is short sighted. Let's hope the nice used car has a long healthy life.
'til later
Recently Donna traded her 7 year old 150,000 miles Sebring on a 2004 Sebring. It's a beautiful car. She looked at new cars and priced what she really wanted at $30,000.
My advice to her would have been not to take a 60 month loan on the "new" used car. That's 5 years to pay off a car that will perform about like her old one and start needing major repairs when it is 6 years old or 3 years from now when she will still be making payments.
Worse yet, when it is 7 years old and she's back looking for a new car, she will still owe a year's worth of payments. I think many people find them selves in that boat. Trading in, satisfying old debt, and taking on 5 year loans - an unending cycle.
Donna's story was all about getting payments down to an amount that would fit her budget. Makes sense. But, it is short sighted. Let's hope the nice used car has a long healthy life.
'til later
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