Sunday, January 30, 2011

Kids, Money and Chores

As a kid, I regularly baby-sat and also did pet-sitting to earn money. My brother mowed our neighbors lawns and also has a paper route to, again, earn money.

These days, you don't see kids doing these kinds of tasks as often as when I was a kid. This NYT article mentions that many of these types of tasks have been professionalized. And I recognize that is generally true, I have a professional dog walker, I've also at times used a lawn service, etc.

My across the street neighbors' child recently gave Snarfle a bath. Mary is in 5th grade and she is the second of four children. In the past she has come over with her sisters and all three of them have washed the dog. This time it was Mary on her own. She did a good job, washed Snarfle twice, dried him off, and brushed him for about 20 minutes. I had no idea what to pay her, so I gave her a $10 which was the smallest bill that I had. I think in the past, I've paid each of them $5 or I've given them a $20 to split.

My next door neighbor also watches Snarfle for us when we go away. As I mentioned before, we have a dog walker but we can't leave Snarfle on his own for a week, with or without the dog walker coming in twice a day. I can't put Snarfle into the doggy camp because he is just too old for it. So our next door neighbor who is an animal lover and has 4 dogs of his own, feeds and waters Snarfle and brings him over to his house at night or when he thinks he might be lonely. Our neighbor won't take money from me for watching Snarfle, but he will take it from Mr. Sam if Mr. Sam forces it on him and walks away.

I want to give him money for this service because one I can't really return the favor to even things up and two I know he could use the money. It is a dilemma, we really rely on this neighbor but it is difficult for us to reciprocate or pay him (since he resists taking money from us)

Saturday, January 29, 2011

Times Change

I stopped by my bank this morning (as an aside, we really need a new back so I'm adding that to the list of other financial goals).

I needed a couple of check registers. The bank employee really had to think and then to hunt to find any. And then the ones he gave me were out of date, the little calendar on the back was 2007, 2008, 2009. Mr. bank employee told me I must be the last person on earth who balances her checking account(s).

Well Mr. bank employee, I balance my checking account(s) so I don't give your employer free money via overdraft fees.

Tuesday, January 25, 2011

Additional 2011 Goals

In addition to our savings goals, we have some other financial goals for 2011.

First, we need a new accountant. After last year's IRS audit and the related fiasco with the accountant we obviously have no faith in his guidance or tax preparation services. I've got two recommendations and plan to set up meetings.

Second, I've got an old 401k that needs to be rolled over. That should be an easy one to take care of, but it has been on my to do list for 6 months.

Third, I'd like to get our debt under $600,000 in 2011. At present we have @$613,000 in debt, which is all mortgage debt for our primary home and for our investment properties. We plan to prepay principal in the amount of $5,000 towards our primary home mortgage (see savings goals), and with that extra prepayment we should be under $600,000 by the end of the year.

Sunday, January 23, 2011

2010 Goals - Wrap Up

2010 Goals:
(1) Max out 401ks - $33,000
(2) Max out IRAs - $10,000
(3) Prepay mortgage - $1200
(4) Add to baby fund - $3500
(5) Add to emergency fund - $7000
(6) House/Furniture fund - $3000

Total - $57,700

2010 Results:
(1) - $31,625 (96%) (goal was $33,000)
(2) - $10,000 (100%) (Completed)
(3) - $1,200 (100%) (Completed)
(4) - $3,500 (100%) (Completed)
(5) - $0 (0%) ($18,642 in our emergency fund, goal was $32,000)
(6) - $3,000 (100%) (Completed)

Total - $49,325 (85%)

Okay, first the good news, we maxed out our IRAs, we met our goals as to principal prepayment on our mortgage, adding to our baby fund and saving up our furniture monies.

We came close to maxing out our 401ks. I miscalculated Mr. Sam's contributions so he was a bit short. But, with his employer contributions he saved more than $18,000 so I'm counting that as a win.

We failed at adding to our emergency fund, in fact we took money out for Mr. Sam's investment experiment, if you add that back in our emergency fund is at $25,000+, and for IRS audit and payments.

We came close to saving $50,000 which is about where we top out most years. This year our saving goal is at $63,000.

Saturday, January 22, 2011

2011 Goals - First Report

(1) Max out 401k(s) - $1,716 (5%)(goal is $33,000)
(2) Max out IRA(s) - $4,000 (40%)(goal is $10,000)
(3) Add to e/r fund - $800 (8%)(goal is $10,000)
(4) Pay down mortgage - $415 (8%)(goal is $5,000)
(5) House projects - $0 (goal is $5,000)

Total - $6,931 (11%)

I have my 401k contribution set up so that I will hit $16,500. I think Mr. Sam's is also set right but I need to follow up next pay period to confirm. I have a $400 auto transfer to savings twice a month for the emergency fund which totals $9600, will just need to add a bit here and there to complete that goal. I have an auto payment set up in the amount of $415 for principal prepayment which totals $4980, will just need to add a bit at the end.

As for funding IRAs, I normally fund by throwing all extra cash at them early in the year. And since I had ignored our finances for 45 days, we had extra money in our accounts so I scraped that all together and I've already put $4,000 into my 2011 IRA.

I've got nothing set up for the house project account, I'll have to think about that one.

Friday, January 21, 2011

2011 Goals

These are our savings goals, generally now finalized, for 2011.

(1) Max out our 401k(s) - $33,000
(2) Max out our IRA(s) - $10,000
(3) Add to Emergency Fund - $10,000
(4) Mortgage prepay - $5,000
(5) House projects - $5,000

Total - $63,000

We should be able to take care of goal one since we are generally already set up to max out our 401k(s) or to come close. We should also be able to max out our IRAs since we did so last year and my income has increased by $10,000. We also should be able to pay down the mortgage by at least $1,200 since that is what we did this year. And we should be able to add at least $3,500 to our emergency fund since we saved $3,500 in our baby fund last year. Finally, we should be able to put at least $3,000 towards house projects since we put $3,000 towards furniture last year.

Any amount beyond about $50,000 is ambitious for us, but these are our goals. How about you, what are your savings goals for 2011?

Thursday, January 20, 2011

NetWorth IQ

Yesterday, during my three hours of catch up work I updated our finances. I also reviewed our progress for 2010 and I'm happy to report that our net worth was up @$130,000. The increase is mostly due to increases in our retirement accounts which is mostly due to the rise in the stock market.

And while it is great to be up, really we just sorta made up all the money lost in 2008. Basically, our net worth has remained static over the last two - three years.

Wednesday, January 19, 2011

Get Back on the Horse

Goodness, December is not the time to completely ignore one's finances. It is January 19th and I realize that I really paid no attention to our finances in December or the first half of January. As a result, I've spent three hours today working on getting one check book balanced and up to date. I've also worked on our monthly spending plan, taken care of property tax and some insurance issues, but I've got several hours left to go.

I know that I was busy in December, both with work and with holiday and family visits but I'm really mad at myself right now. I am normally on top of things, organized, bills paid on time, savings automated, etc. So, it is hard to pick up after 45 days and realize I've got a mess on my hands. And while it is easy to get discouraged, I know that I have to get back on the horse and get my rear in gear.

So, three hours today, at least an hour tomorrow and Friday and my regular duties should be caught up. Saturday/Sunday, we need to work on our annual spending plan and make some choices on our 2011 savings plan.

Stock Gamble II Update

Well Mr. Sam sold our stock.
  • He bought the stock on 12/7 and spent $5102 (he had a budget of $5,525).
  • He sold the stock on 1/13 at $6277.
  • Gross profit of $1175, he has calculated a $705 net profit or an 13% return over 40 days.

His plan is to roll net profits into his next stock purchase. He will bank the taxes due into a separate account.

Tuesday, January 18, 2011

2011 Savings Goals

It is 18 days into the new year and we have yet to finalize our 2011 savings goals.

We know that we will continue goals number one and number two from 2010. So goal number one is to max out our 401ks. The 401k contribution limits remain the same at $16,500 per person. Goal number two is to max out our IRAs. The IRA contribution limits also remain the same at $5,000 per person.

2011 Savings goals:
(1) Max out 401ks - $33,000
(2) Max out IRAs - $10,000

Other goals that we have been kicking around include the following.

We need to increase our emergency fund. Adding to our emergency fund was a goal for 2010 and we fell short on that goal. In fact we dipped into our fund for IRS issues and to fund Mr. Sam's investment experiment.

I'd like to work on paying down our mortgage on our primary home. While we have a low, fixed interest rate on our home mortgage, I would love to be debt free. In 2010 we put an extra $100 towards our mortgage each month, so I see us continuing this goal and hopefully increasing it. Maybe instead of $1200 towards the mortgage in annual principal prepayment we could go to $500 a month or $6,000 a year.

Home projects, we have been in our home for seven years and I'd like to put some money towards some home projects that we have put off. I've got window treatments, crown molding, a built in cabinet and maybe a few other ideas for home improvement budget. I need to price the window treatments which are on the yes list for this year and then see how much more we could spend on the other projects. I'm thinking around $5,000.

(3) Increase emergency fund - $10,000
(4) Pay down mortgage - $6,000
(5) House projects - $5,000

Ambitious goals, we probably will need to tweak the numbers on goals 3 -5 downward after we finalize our annual spending plan. $64,000 in savings goals is more than we have done in any past year. Generally, we seem to top out and run out of steam around the $50,000 mark.

Sunday, January 9, 2011


It has been chilly in Florida so this past Friday I went about shopping for some tights to wear for work. Last winter, I bought a pair of SPANX tights that I have been very happy with, they wear well, wash well and they have the SPANX technology (extra thinning powers). But, SPANX tights are not cheap so I googled for pricing and options and settled on a chocolate (brown) and graphite (gray) pair that I could order via However, I balked at paying $4 in shipping so I hesitated when it came time to click "buy".

I contemplated whether it made sense to pay for shipping for ordinary goods that I could obtain via my local mall 5 minutes away. So I started thinking about the cost/benefit analysis (CBA). First, I could conclude my purchase in less than 5 minutes (time already invested by the way) or I could jump in my car drive to the mall, park, walk to the store, and then hunt for the same two items. I would also have to risk that the store would not have the colors, size, etc. that I already had selected. So, to run to the mall would likely require at least a half hour of my time. Second, a drive to the mall would include gas costs, parking costs and the chance that the prices at the store would be higher than on-line.

Third, I had to consider the "know thyself cost". I'm not a "shop to I drop" type of gal, but I also know that if I find myself at the mall I'm likely to pop in to Ann Taylor or Banana Republic, etc. (especially if they have sale signs in the window). And once I'm in the store, I know that I'm likely to purchase something.

As a result, I concluded that the $4 shipping cost was worth it. I clicked "buy" and I await receipt of my new tights. What would you do?

Happy New Year!

I've had a very busy holiday season, both due to work and personal commitments, hence the light posting.

We are working on our annual spending plan and our 2011 goals so I will have more to post about that soon.