Friday, February 22, 2013

Happy St. Valentine's Day - Part III

Last week, in honor of St. Valentine's Day, I posted about the marriage tax penalty.

So if you were feeling blue about having to pay more in taxes as a married couple I'm here to let you know that you probably are wealthier if you are married.

Sure when two people combine household there is a certain level of savings by combining forces.  But, that doesn't appear to be the only reason.  Most interesting to me is that the education and capability for wealth may be coming before marriage since college educated folks are more likely to marry. 

But, stay married as those who divorce are financially worse off, on average, than those who never married.

Speaking from my own experience, even though Mr. Sam brought a fair amount of debt into our marriage, getting married has dramatically increased our combined net worth.  As of January 2013 our combined net worth is $1,143,223.  In December 2006 my "individual" net worth was $582,800 (this number included the primary home that we bought together and also an investment property that we bought together).  In 2007 our combined net worth was $807,539, which means that in six years of marriage we jointly increased our combined net worth by $335,694 (or about $56,000 a year).

Thursday, February 21, 2013

2013 Goals - Update

I'm not sure why it takes us so long each year to shake of the holidays and get going with our New Year's financial (and other) goals.  But here we are, its after Valentine's Day and Mr. Sam just got our Excel chart put together for our 2013 savings goals.  I have not updated our spending plan for 2013, but  hope to do that this Saturday.

So, with out further ado, here is our first 2013 savings goals update.

(1) Max out 401k(s) -        $6160 (18%)   (goal is $35,000)
(2) Max out IRA(s) -         $1008 (9%)     (goal is $11,000)
(3) Add to e/r fund -          $1600 (16%)   (goal is $10,000)
(4) Pay down mortgage -   $830 (17%)     (goal is $5,000)
(5) Trading account fund - $50 (62%)       (goal is $5,000)
(6) House projects -          $40 (13%)       (goal is $3,000)

Total to date is $10,048 and we are about $500 short of where we should be.

Thursday, February 14, 2013

Happy St. Valentine's Day - Part II

Are you planning to get engaged or married over St. Valentine's Day?

If so, there is a tool that let's you know whether you'll end up with a marriage tax bonus or a marriage tax penalty.  But, first you'll need to get your hands on your intended's tax return as the tool needs some serious data to give you an accurate result.

A marriage tax penalty is when:

  • a wife and husband pay more income tax filing jointly as a couple than they would if they had remained single and filed as individuals.

A marriage bonus occurs when:

  • a couple pays less tax filing jointly than they would if they were not married and filed singly.

Marriage penalties only hit couples where both spouses work.  And, under the 2013 Fiscal Cliff work compromise, it appears that the marriage tax penalty has gotten worse for those at the upper end of the income range. I'm still trying to sort out all the tax changes from the Fiscal Cliff compromise, but this article from Bloomberg provides some guidance on the various thresholds for when higher taxes and higher tax rates kick in.

I try not to get into politics here at Adventures of Sam, so I don't want to get into a Republican/Democratic Party debate on taxes.  But I'll state for the record that I'm actually in favor of higher taxes and I'm in favor of a progressive tax system.

But, I'm not in favor of a system that provides for a marriage tax penalty on $150,000 in income.  Higher tax rates kick in at $400,000 for an individual and $450,000 for a married couple.  Sure, if a couple is making more than $450,000 a year its hard to have any sympathy for them. But, think about a hard working professional couple in which both spouses are putting in 12+ hour days, they may have significant student loans that paid for those professional degrees, a mortgage, expenses related to kids and our government is penalizing (with higher taxes) either the wife (more often its the wife) or the husband for having a professional career.  I'd like to see the marriage penalty reduced even at the higher income levels, if higher tax rates kick in at $400,000 for an individual than maybe the higher tax rates for couples should kick in at $600,000 or something like that.

Happy St. Valentine's Day - Part I

Happy St. Valentine's Day to you!

What are you doing to celebrate heart day?  Are you sending flowers, going out to dinner, buying gifts for your spouse, your children or your dog?  Do you boycott Valentine's Day as nothing more than a Hallmark holiday?

The Atlantic has a great series of charts showing how much is being spent for today and on who.  Not surprising to this dog owner, a lot of people buy gifts for their pooches.

Besides a few heart shaped dog treats for Snarfle I "spent" the following for Valentine's Day.  First, one of the organizations that I support has run a Valentine's Day fundraising event for the last few years.  Donate $20 and they'll send a Valentine's Day card to someone in your honor.  I did three of those cards, so that was a total of $60.

Then I sent my nephew, niece, god-daughter and her sister Valentine's Day cards which enclosed checks.  $50 each for my nephew and niece, and $30 each for my god-daughter and her sister, so that is a total of $160.  Then I send a few regular cards out to a few folks, so I'll say $5 in additional cards and postage.  That gives me a grand total of $225.

You'll probably notice that Mr. Sam is not on this list . . .    Like Christmas, we don't gift to each other on Valentine's Day either.

How about you, how much did you spend on St. Valentine's Day?  

Wednesday, February 6, 2013

ING is no more . . .

Boo hoo, ING is no more.  Just went to sign into ING and now its Capital One 360.  The rest of the site, the features, the set up, the multiple accounts, automatic debits, transfer system all appears to be the same.

As I've previously posted, I'm not a Capital One fan (they screwed me over on a credit card dispute after giving me the wrong information).  Since I'm only earning .75% it won't take much for me to move our money away from Capital One 360 the first hint of trouble.  According to my research Ever Bank is offering 1.05%.

Tuesday, February 5, 2013

Debit Card Diversion

We use our debit cards for 95% of our day to day transactions (the other 5% is cash).  As a result, I review our accounts online at least two or three times a week.

In the middle of last week I noticed a "funny" transaction that was in my pending transactions.  What was funny about it?  First, it was a debit card transaction and I do all of my transactions as check card (meaning I don't enter my PIN code).  Second, it was an online transaction for an entity that I did not recognize.  So that would mean that my PIN code would have been used for an on-line transaction, something that I never do.  I checked with Mr. Sam, as he sometimes uses my debit card, and he didn't recognize the company name either.  But, since the details on my pending transactions become clearer when they are no longer pending I figured I would give it a day or two.

So on Friday, at happy hour, I went to pay the check with my debit card and it was declined.  Yikes!  First, having my card declined embarrasses me no matter what.  So I called Wells Fargo and it was tough getting past the questions they use to verify that I'm me.  Besides giving them the charge/debit card number, my on-line id, the answers to my security questions, they also had to verify recent transactions not just on my personal account (the one tied to my debit/charge card) but on my other accounts.

Once I had verified that it was me, the representative from Wells Fargo indicated that my card had been flagged for fraud based on recent transactions.  She read through the transactions, totaling almost a $1000 and I confirmed that those transactions were not mine (the charges took place at stores that I don't shop at and further took place in another state that I have not visited recently).  So my card was canceled and my friend paid the happy hour bill.

When I got home I went through my online history and called Wells Fargo back, as instructed, and challenged the other transaction that I had eyed earlier in the week and another pending transaction that had occurred in Ohio (I live in Florida).  The transactions that the Wells Fargo representative had covered with me on the phone had all been trapped by the fraud algorithm so that money was never debited from my account.  The second Wells Fargo representative that I spoke to flagged the pending transaction and indicated that they would give me a conditional credit on the first transaction that had gone through and debited my account.

The next day, on Saturday, I visited my local Wells Fargo branch and they gave me a temporary debit/charge card while I await my new card.  The pending Ohio transaction never debited my account and has disappeared as of this week from my online statement.

In the many, many years that I have had a debit/charge card with Wells Fargo (f/k/a Wachovia and First Union) this is the first time I've had a fraud problem.  I was impressed that Wells Fargo's fraud alert system caught the vast majority of the fraudulent charges before they made it to my account and the money was debited.  I was also happy that Wells Fargo promptly provided a conditional credit of the one debit card transaction and that money was in my account the next day.  I am also happy that I have a temporary debit/charge card to use while I wait on my new card.

Monday, February 4, 2013

28 Tricks from ZenHabits

28 helpful tricks from ZenHabits to help you stay on track with your 2013 goals.

Hint # 13 resonated with me since its so similar to the $100 and $300 rule.  When you think you want something, put it on the planner a month from now. When that month rolls around and you still want it, OK.