Wednesday, November 18, 2009

11/15 Numbers

(1) Max out 401ks - $33,000
(2) Max out 2009 IRAs - $10,000
(3) House project and furniture - $6,000
(4) Add to baby fund - $5,000
(5) Add to emergency fund - $10,000
Total - $64,000

(1) $27,769 (84%)
(2) $10,000 (100%)
(3) $1,269 (21%)
(4) $1,202 (24%) ($6,202 in our ING baby account)
(5) $1,962 (20%) ($23,843 in our ING e/r account)
Total - $42,202 (66%)

Getting close to maxing out my 401k, as of next pay check my 401k will be fully funded.

Monday, November 9, 2009

IRS Audit Update

Rather than set up an appointment with the IRS examiner, we were given the option of sending in documents for his review. I gathered the necessary documents (both from our records and from our accountant) and faxed them to the examiner this past week. I also had two telephone conversations with the examiner which included explaining the documents to him.

Not surprisingly, I had been warned, once the examiner started reviewing our tax return he expanded his questions to other issues (beyond what we had been asked to provide in the original written document request).

I was friendly and cooperative, but I did my best to limit the information and the documents I provided to the original requests.

The examiner indicated that he plans to complete his report this week. Keep your fingers crossed for us.

Thursday, November 5, 2009

Early Morning Banking

When you have tenants you have to go to the bank to deposit rent monies, and I do my best to get those rent monies into our accounts ASAP so we can pay the mortgages with rent monies and not with our monies.

So this week, I have stopped by my local Wachovia branch three times in a row (before work, at like 6:30 in the morning). The first time, no issue. Yesterday, a Wednesday, there were no envelopes. This morning, the ATM was out of order.

At 6:30 a.m. I am grumpy, I've had no coffee and I just want to get to work - because that's where I get my coffee. Ugh! Not sure what is going on with my local Wachovia branch.

Wednesday, November 4, 2009

Running Goals

It has been a while since I posted on our marathon training. We took a major break from training in July, August and part of September, just too hot in South Florida to be outside running.

Anyways, we are back on track and I'm back to running a full mile without stopping. We are presently training for a December 5k. The only present problem is the time change, it is not dark by the time I get home, so I'm trying to figure out how to deal with darkness.

Monday, November 2, 2009

NetWorth Numbers

While I try not to get too tied up in our NetWorth IQ numbers, I love, love, love the data. I find it super exciting to look back three years or five years or more and see where we or I (combined our numbers in January 2007) were.

My big net worth jumps show up when (1) I/we buy real estate and (2) when we got married and combined forces. See August 2003 and December 2005 for real estate spikes and January 2007 for marriage spike. Between January 2003 and August 2003 I basically doubled my net worth by saving up and buying my first real estate investment property. I paid $180,000 for the property in 2003 and it is now valued at $392,000.

Otherwise most of our progress is slow and steady. In January 2007 we had $735,054 in liabilities, at the start of our Total Money Makeover baby steps, just after marriage and combination of finances, and now we have $637,504 in liabilities. In almost three years we have reduced our liabilities by $97,550. Similarly, on the asset side, we have increased our assets by $110,637 between January 2007 and now.

In six years my individual net worth has grown from $50,000 to $1 Million combined net worth with my husband.

Sunday, November 1, 2009

2010 Planning

While we are still working away on our 2009 goals, it is time to start thinking about our savings plan for 2010.

The maximum we can contribute to our 401ks remains the same - $16,500 each or $33,000 for both of us. Second, the maximum we can contribute to our IRAs also remains the same - $5,000 each or $10,000 for both of us.

So our 2010 savings goal will include two of the same goals that we are working on for 2009:
(1) Max out our 401ks - $33,000
(2) Max out our IRAs - $10,000

I have also been researching how to and whether it makes sense for us to convert all of/or part of our present IRA monies to Roth IRAs in 2010 (the income limits are to disappear in 2010). So that is also an item on our personal finance planning for 2010.

Mr. Sam's IRA conversion should be pretty easy because all of the money in his IRA was after tax money for which he took no deductions. So, said another way, he already paid taxes on all of the money in his IRA so he will only need to pay taxes on any gains.

I took tax deductions for about a quarter of my IRA money, however that money is still easily identifiable as its all in one index fund. So my tentative plan is to convert the other three quarters of my IRA money, all after tax money no deductions, to Roth IRA and therefore I'll only need to pay taxes on any gains.

The other issue is timing, we can convert our regular IRA to Roth IRA at any time next year and the value of the IRA on the actual date of conversion is the value used to calculate taxes. So, one wants to convert from regular IRA to Roth IRA when the value is at its lowest.