2013 Goals - April Update

(1) Max out 401k(s) -        $13,392 (38%)   (goal is $35,000)
(2) Max out IRA(s) -         $6,010 (55%)    (goal is $11,000)
(3) Add to e/r fund -          $3,200 (32%)   (goal is $10,000)
(4) Pay down mortgage -   $1,245 (25%)     (goal is $5,000)
(5) Trading account fund - $50  (1%)        (goal is $5,000)
(6) House projects -          $800 (27%)      (goal is $3,000)

Total:  $24,697 (23%)

We are a couple of thousand ahead of where we should be.  I'm not sure how that happened except that Mr. Sam is ahead on his 401k contributions which may have occurred when he received his bonus but just showed up now.

An Interesting Analysis of the Envelope System of Budgeting

I enjoyed this interesting post from Slate by Emily Oster on the Dave Ramsey envelope budgeting system.

While I am a big fan of Dave Ramsey's philosophy and we utilized his snowball system of paying down our unsecured debt, I've never used his budgeting plan.

Rather we use a allowance system which works like this.  I pay all the fixed and semi-fixed bills, the mortgage, car insurance, utilities, etc.  Then I allocate and move money to savings which can include savings for upcoming annual bills, i.e. property taxes, or upcoming expenses, i.e. vacations.

Then each of us receives the same amount for day to day discretionary spending which includes groceries, gas, dry cleaning, personal expenses, gifts (but not holiday spending), eating out, entertainment.  And part of the reason for this is our expenditures in these categories changes from month to month as Ms. Oster pointed out.

Example: You go to the store and milk is more expensive than usual (something about the sequester?) Because you have your limited grocery envelope, you have to respond to this by buying less of some grocery. You could buy less milk, or fewer veggies, or less pasta.  However: It may very well be that you’d rather keep with your normal grocery purchase and cut back somewhere else—say, two fewer lattes this week. But because the “coffee” budget is separate from the grocery budget, you end up with the same number of lattes and fewer bananas.

Additionally, neither of us likes to feel overly restricted so with one pot to spend on day to day spending we can spend as we like on different categories but we restrict the overall amount of money.

How do you budget your day to day expenses?

Remote Check Deposit - Follow Up

Earlier, I posted about Wells Fargo's new remote deposit feature which allows you to take a photo of your check and deposit it remotely.

Since its a new month, I used the remote deposit feature of our first two rental checks received in April.  I found the feature easy to use and saved me the 10 minutes of running to the bank to deposit the check at the ATM (times two, saved me 20 minutes).

My only complaint is that I'm limited to $1000.00 remote deposit per day.  However, I'm not clear if that limitation is per account (we have different accounts set up for our rental properties).  So, for the first two rental checks, just under $1000.00 each, I received the checks on separate days and was able to remotely deposit both.  But, the third rental checks is $1500.00 and it was rejected when I tried to deposit it using the remote deposit feature.  I'm going to call Wells Fargo and see if I can get my daily balance bumped up to $1500.00 per day.

You know its spring in Florida when . . .

You know its spring in Florida when you are at the Super Wal-Mart at 6:00 a.m. buying rat traps.

Now I'm not in charge of rat wrangling, rather Mr. Sam is takes care of this landlording task (thank goodness).  So, he was at Super Wal-Mart early this morning buying traps.

Here in Florida we have problems with roof rats due in large part to our climate and the abundance of fruit trees.  And, at one of our rental properties, we have a beautiful, big mango tree that produces tons of fruit.  This tree produces so much fruit that its more than our tenants or ourselves could ever eat.

I've heard about some food pantries that run back yard fruit drives so I'm looking for an agency that is local to us where we can donate these mangos.  In the meant time Mr. Sam is over at the property setting up traps.

Remote Check Deposit

Between the collection of rent checks and reimbursements from work, I can find myself at the Wells Fargo ATM depositing checks multiple times in one week.  While I'm happy to have the money, each of those trips to the ATM takes at least 15 minutes.  And, for some reason my local ATM seems to be out of order on a regular basis so at least one in ten trips requires a second trip to the next ATM.

I just recently learned, while I was at the ATM on Saturday, that Wells Fargo now has smartphone deposits.     I already had the Wells Fargo app for my iPhone so it was easy to simply click on a tab on the app to add remote deposits to my available services.  One of the helpful Wells Fargo bankers walked me through how it works and the process is super easy.  You simply sign into your account on your iPhone, you select mobile deposit from the menu options, take a photo of the front of the check and then the bank, select the account where you want the money to go, type in the amount and deposit the check.  Then you hold onto the check for fourteen days and then destroy it.

I'm very excited about this new option and I think its going to save me at least an hour of time a month.

Free Credit Report

Following up on my earlier post about free credit reports, I decided it was probably time for me to review my credit report.  My last review of my credit report was when we were refinancing our primary home last summer and at that time I purchased my report and score from MyFico.com.

This time around I obtained my report from the official site where consumers can obtain a copy of their credit report from the big three agencies.  Most of the information appeared to be accurate and up to date, with the exception of my home address, which is reported with a variety of errors.  But, I was pleased to see that our home mortgage was accurately reflected as paid in full with Wells Fargo and our new refinances loan with CitiMortgage.

The most interesting part of the report, to me, were the credit inquiries.

American Express is, basically, in love with me in that they inquire as to my status every other month.  In 2012 they checked on me six times and I haven't had an account with them for more than 10 years.  Clearly, they want me back.

I also was intrigued by the number of credit inquires that occurred in the month following our mortgage refinance.  Clearly those who would offer us credit received some kind of notification that we had just taken on a new loan.

2013 Goals - Post Bonus Update

(1) Max out 401k(s) -        $7644 (22%)   (goal is $35,000)
(2) Max out IRA(s) -         $4508 (41%)    (goal is $11,000)
(3) Add to e/r fund -          $2400 (24%)   (goal is $10,000)
(4) Pay down mortgage -   $830 (17%)     (goal is $5,000)
(5) Trading account fund - $50  (1%)        (goal is $5,000)
(6) House projects -          $600 (20%)      (goal is $3,000)

Total:  $16,032 (23%)

With Mr. Sam's added bonus monies, we are currently $109 ahead of where we should be for the year.  Whoo-Hoo!!  I doubt it will last, but I enjoy being ahead.

Bonus Plan

Mr. Sam recently received a small bonus at work.  Nothing huge, but every little bit counts.

First, the bonus was subject to his 401k withholdings, so a chunk has gone to the 401k, which left a couple thousand.

Second, since its Mr. Sam's bonus he wanted to take a chunk, a third to be specific, and put it in his everyday checking account.  His point is that he struggles with our allowance system (true) and he'd like to have a cushion.  I wasn't in favor of this plan because I believe that Mr. Sam will spend as much money as is available to him (hence the allowance system) and that this "cushion" won't last 90 days.  But, he convinced me to let him try* and I guess we'll see what happens.  We probably should have made a friendly wager.

Third, the rest of the money will be put towards our savings goals.

*In our house any expenditure over $300 has to be discussed and agreed and we counted this experiment as such.  I  don't want the impression to be that Mr. Sam's is "hen-pecked" as this rule works both ways.