Almost a year ago, I signed up for Amazon Mom/Prime program.
What I have learned, and it is also what I expected, is that having Amazon Prime makes it super easy to buy stuff from Amazon. "Free" two day delivery on lots of items means that I often go to Amazon for my buying needs. Does that mean I'm spending more in general? Hard to know. I could be making the same purchases, but simply making them at Amazon instead of other retailers. Or I could be making more purchases since Amazon makes it so easy. I suspect it is both.
Today, I was working on my Amazon Prime subscription box. The subscription service allows one to sign up for purchases that are regularly occurring. For us, that includes diapers, wipes, diaper genie liners, baby sunscreen, baby snacks, etc. If you sign up for five items a month that ups your savings to 15% off on everything and 20% off on diapers.
So each month, we get diapers and wipes. Normally we get some puff snacks for Baby Sam. That normally leaves two items left. We have storage space, so I'm genarlly looking for something we go through a lot of and is a dry good or cleaning supply.
As working parents, coffee is a big thing for us, so today I decided to look at coffee options. On Amazon, even narrowing by Prime, that brings up thousands of choices. Select ground and hazelnut and I'm down to hundreds. Sort by price and I come up with some brands that Mr. Sam buys regularly. Ok, price per bag, price per ounce. No idea if this is a good price. Am I falling into the trap of buying something to get a discount that isn't a good deal? Cross check to the Wal-mart site and yes this is a good price.
Do the same thing for Mr. Clean Magic Eraser and I'm good to go for check out.
So bottom line, discounts can work but you have to be careful about making a poor buying choice for purposes of getting a discount.
Also, being able to get items I need delivered makes my life so much easier. Between, work, baby, family life, maintaining sanity is important.
Monday, May 30, 2016
Thursday, May 26, 2016
Keeping Up With the Joneses - Part III
Earlier I posted about some of my friends and former co-workers that have been engaging in expensive housing purchases. See the posts here and here.
Today, I'm discussing Leslie and John.
Leslie and I used to work together, so we are in the same industry. John works in the arts business. I really have no idea what kind of income John pulls down, but back when Leslie and I worked together she earned considerably more than he did. I don't know if that is true today, but assume it is. Leslie and John have one child.
Last year they bought a $1 million dollar foreclosure home. Yes, a foreclosure at $1 million. Back during the housing bubble, the house had actually sold for $1.7 million so you could argue they got a great deal. I would expect the house to appreciate quickly and, in fact, the property appraiser has it assessed at $1.6 million. As a result, annual taxes on the home are $35,000 ($2900 a month).
The house is 4 bedrooms and has 4700 square foot of living space. It also has a pool. The neighborhood they moved to has an excellent elementary school, but after that it gets mixed for middle and high school.
They have a mortgage in the amount of $750,000. And, they also took out a home equity line of credit in the amount of $100,000. So total debt is $850,000. With a 30 year mortgage their monthly payment is $3800, add in taxes monthly carrying costs are $6700. This does not include insurance, which is expensive in Florida.
Leslie and John previously lived in very nice historic home in a community with a good elementary school. They actually sold that nice home for a decent profit - $172,000. There old home was also 4 bedrooms and had a pool. I'd argue their old home was in a better location because the street their new home is on is very busy.
Today, I'm discussing Leslie and John.
Leslie and I used to work together, so we are in the same industry. John works in the arts business. I really have no idea what kind of income John pulls down, but back when Leslie and I worked together she earned considerably more than he did. I don't know if that is true today, but assume it is. Leslie and John have one child.
Last year they bought a $1 million dollar foreclosure home. Yes, a foreclosure at $1 million. Back during the housing bubble, the house had actually sold for $1.7 million so you could argue they got a great deal. I would expect the house to appreciate quickly and, in fact, the property appraiser has it assessed at $1.6 million. As a result, annual taxes on the home are $35,000 ($2900 a month).
The house is 4 bedrooms and has 4700 square foot of living space. It also has a pool. The neighborhood they moved to has an excellent elementary school, but after that it gets mixed for middle and high school.
They have a mortgage in the amount of $750,000. And, they also took out a home equity line of credit in the amount of $100,000. So total debt is $850,000. With a 30 year mortgage their monthly payment is $3800, add in taxes monthly carrying costs are $6700. This does not include insurance, which is expensive in Florida.
Leslie and John previously lived in very nice historic home in a community with a good elementary school. They actually sold that nice home for a decent profit - $172,000. There old home was also 4 bedrooms and had a pool. I'd argue their old home was in a better location because the street their new home is on is very busy.
Tuesday, May 17, 2016
Keeping Up with the Joneses - Part II
Earlier, I wrote about some of my friends and co-workers whose house purchases have caused me to suffer house envy.
Next on the list, Jessica and Tony. Jessica and I used to work together and she and I are in the same industry. Tony works in the engineering field. They do not have any children together, Tony has children from his prior marriage and just recently concluded his support obligatins. They live in the same county we live in.
Last year, they built a home that cost more than a million dollars. The home is more than 5000 square feet and has four bedrooms along with a pool. Taxes on the home are $20,000 a year. They have a $1.1 million dollar mortgage mortgage. Carrying costs, assuming 30 year mortgage and not including insurance costs (which in Florida are expensive), are $7000 a month.
As a comparison, taxes on our home are approximately $3500 a year.
Also, when Jessica and Tony sold their prior home they lost $125,000 on the sale. They had bought pre-recession and the value of their prior home had not yet fully recovered.
What do you think about this type of real estate purchase? On the one hand, Jessica and Tony have a gorgeous home in a great location. On the other hand they have a $1.1 million dollar mortgage and that type of debt would keep me up at night.
Next on the list, Jessica and Tony. Jessica and I used to work together and she and I are in the same industry. Tony works in the engineering field. They do not have any children together, Tony has children from his prior marriage and just recently concluded his support obligatins. They live in the same county we live in.
Last year, they built a home that cost more than a million dollars. The home is more than 5000 square feet and has four bedrooms along with a pool. Taxes on the home are $20,000 a year. They have a $1.1 million dollar mortgage mortgage. Carrying costs, assuming 30 year mortgage and not including insurance costs (which in Florida are expensive), are $7000 a month.
As a comparison, taxes on our home are approximately $3500 a year.
Also, when Jessica and Tony sold their prior home they lost $125,000 on the sale. They had bought pre-recession and the value of their prior home had not yet fully recovered.
What do you think about this type of real estate purchase? On the one hand, Jessica and Tony have a gorgeous home in a great location. On the other hand they have a $1.1 million dollar mortgage and that type of debt would keep me up at night.
Real Estate Update
Just did an update on our networth numbers. Our three investment property mortgages are each, now, under $100,000 in debt.
The current mortgage balance numbers are as follows:
$98,207
$85,483
$74,520.
We also are about to get under $200,000 on our primary home mortgage, right now the balance is $201,583. Next month's mortgage payment should get the balance below $200,000. This makes me happy especially in light of my recent house envy.
I seem to respond more positively to reducing our debt than I do to increasing our savings.
The current mortgage balance numbers are as follows:
$98,207
$85,483
$74,520.
We also are about to get under $200,000 on our primary home mortgage, right now the balance is $201,583. Next month's mortgage payment should get the balance below $200,000. This makes me happy especially in light of my recent house envy.
I seem to respond more positively to reducing our debt than I do to increasing our savings.
Friday, April 22, 2016
Keeping Up With the Joneses - Part I
So, for the past few years, probably five or so, more and more of my friends and peers, and even people who report up to me at work (so, I'd consider them non-peers) have been buying homes at purchase price points ranging from $700,000 to a million.
I find this phenomenon strange, but also incredibly alluring.
Let's start with an analysis of these folks. I will start with the ones who started this trend, and I do believe there is a somewhat contagious trend among friends that equates to keeping up with the Joneses. The ones who started the trend, in my humble opinion, likely made smarter choices.
1. It started with my friend Mary, all names changed to protect the innocent, and her husband George. Back in 2011, they actually got a great deal and paid mid $500s for a home that is now likely worth close to $800,000. They bought a 5000 square foot McMansion in a better school district, they have a small child, with 5 bedrooms, 4 baths in a new development. Their family consists of 3 people and they do not plan to have any more children so this is a house bigger than they need. Their real estate taxes are more than $8000. They took out a $400,000 mortgage. Five years later they are putting in a pool. The house they sold they had owned since 2002 and they made about $50,000 profit when they sold it. They were buying in a buyers market due to the 2008 real estate crash which means they were also selling in a buyers market.
Mary is in the same profession as I am, I assume she makes similar money to me. Her husband is in law enforcement. While he makes less money, he has a great pension that will be coming to him (and soon) such that their retirement savings is less crucial. I have one other friend who will have a federal pension, but she cannot collect said pension until closer to traditional retirement age. George will be able to start collecting his pension in less than 10 years and his pension is for life. As a result, they don't have to save as much for retirement.
2. Jennifer and Alan were next. They are a dual income, professional, couple. Both are in the same profession I am in. They have three kids.
In 2012 they bought a 4 bedroom, 3.5 bath, 5000 square foot home. It also has a 2000 square foot out building (with air conditioning) and a pool. They bought the home for $775,000 (the prior owner had bought it for $800,000 so, again, it was likely a good buy) and it is likely worth close to a million now. Taxes are $14,000 a year. They took on a $620,000 mortgage. Later they took on a $35,000 home equity loan.
They held onto their prior house for a couple of years, while the Florida real estate market improved (likely a smart move), and they later sold it in 2015 for a $265,000 profit. I don't believe they took that profit and reduced or refinanced the mortgage on their current home, rather before they sold their prior home they put it into a trust and I assume the profits also went into that trust.
They have engaged in a variety of real estate and trust maneuvers in the last few years. This is probably because Alan also bought an office building and they are creating protection for their other assets.
Does it sound like I'm stalking my friends' personal business?? Well I guess I am. All of this information, at least in Florida, is public record and readily accessible on line. I also am learning from what they are doing, and that is both positive and negative (more on that later).
I find this phenomenon strange, but also incredibly alluring.
Let's start with an analysis of these folks. I will start with the ones who started this trend, and I do believe there is a somewhat contagious trend among friends that equates to keeping up with the Joneses. The ones who started the trend, in my humble opinion, likely made smarter choices.
1. It started with my friend Mary, all names changed to protect the innocent, and her husband George. Back in 2011, they actually got a great deal and paid mid $500s for a home that is now likely worth close to $800,000. They bought a 5000 square foot McMansion in a better school district, they have a small child, with 5 bedrooms, 4 baths in a new development. Their family consists of 3 people and they do not plan to have any more children so this is a house bigger than they need. Their real estate taxes are more than $8000. They took out a $400,000 mortgage. Five years later they are putting in a pool. The house they sold they had owned since 2002 and they made about $50,000 profit when they sold it. They were buying in a buyers market due to the 2008 real estate crash which means they were also selling in a buyers market.
Mary is in the same profession as I am, I assume she makes similar money to me. Her husband is in law enforcement. While he makes less money, he has a great pension that will be coming to him (and soon) such that their retirement savings is less crucial. I have one other friend who will have a federal pension, but she cannot collect said pension until closer to traditional retirement age. George will be able to start collecting his pension in less than 10 years and his pension is for life. As a result, they don't have to save as much for retirement.
2. Jennifer and Alan were next. They are a dual income, professional, couple. Both are in the same profession I am in. They have three kids.
In 2012 they bought a 4 bedroom, 3.5 bath, 5000 square foot home. It also has a 2000 square foot out building (with air conditioning) and a pool. They bought the home for $775,000 (the prior owner had bought it for $800,000 so, again, it was likely a good buy) and it is likely worth close to a million now. Taxes are $14,000 a year. They took on a $620,000 mortgage. Later they took on a $35,000 home equity loan.
They held onto their prior house for a couple of years, while the Florida real estate market improved (likely a smart move), and they later sold it in 2015 for a $265,000 profit. I don't believe they took that profit and reduced or refinanced the mortgage on their current home, rather before they sold their prior home they put it into a trust and I assume the profits also went into that trust.
They have engaged in a variety of real estate and trust maneuvers in the last few years. This is probably because Alan also bought an office building and they are creating protection for their other assets.
Does it sound like I'm stalking my friends' personal business?? Well I guess I am. All of this information, at least in Florida, is public record and readily accessible on line. I also am learning from what they are doing, and that is both positive and negative (more on that later).
Tuesday, April 19, 2016
Tax Day Update
Well its the day after taxes are due, so its a good time to think about our 2016 progress.
First, we haven't filed our taxes since we normally seek an extension which is what we did this year.
Second, we skipped 2015 IRA funding. Just didn't happen for a variety of reasons. Lack of discipline, baby and child care expenses, life, etc. So, that means we have a bit of extra savings to put towards 2016 IRA funding.
Third, I'm still waiting on Mr. Sam to make my 2016 Excel savings chart. He's as busy as I am, so it hasn't happened. Hard to track progress without the chart. But see below.
Definite goals:
(1) Max out 401k, $18,000 for each of us, for a total of $36,000. On track.
(2) Finish funding our 2015 IRAs - $8900, Skipped
(3) Fund 2016 IRAs, $11,000 for the both of us, for a total of $22,000. $1100
(4) Baby Sam'college fund, add another $5000 this year. On track
Updated tentative goal, so this is a definite goal now:
(5) Add to emergency fund, $10,000, increased this from $5,000 to $10,000, since we utilized a chunk to buy my nused car. On track
Debt killing goals:
(1) Pay off lingering credit card debt in the amount of $4261. Down to $2403
(2) Pay off Mr. Sam's new car, remaining debt $2000. Down to $1000
Overall debt below $450,000 goal: Total debt $474,731.
First, we haven't filed our taxes since we normally seek an extension which is what we did this year.
Second, we skipped 2015 IRA funding. Just didn't happen for a variety of reasons. Lack of discipline, baby and child care expenses, life, etc. So, that means we have a bit of extra savings to put towards 2016 IRA funding.
Third, I'm still waiting on Mr. Sam to make my 2016 Excel savings chart. He's as busy as I am, so it hasn't happened. Hard to track progress without the chart. But see below.
Definite goals:
(1) Max out 401k, $18,000 for each of us, for a total of $36,000. On track.
(2) Finish funding our 2015 IRAs - $8900, Skipped
(3) Fund 2016 IRAs, $11,000 for the both of us, for a total of $22,000. $1100
(4) Baby Sam'college fund, add another $5000 this year. On track
Updated tentative goal, so this is a definite goal now:
(5) Add to emergency fund, $10,000, increased this from $5,000 to $10,000, since we utilized a chunk to buy my nused car. On track
Debt killing goals:
(1) Pay off lingering credit card debt in the amount of $4261. Down to $2403
(2) Pay off Mr. Sam's new car, remaining debt $2000. Down to $1000
Overall debt below $450,000 goal: Total debt $474,731.
Thursday, April 14, 2016
I Keep Trying to Get Back on Track.......
I've been spinning my wheels now for more than a year.
With the time pressures of a more than full time job, baby, husband, landlording, life, etc. my ability to manage our finances has been backsliding.
I'm not paying bills on time, rent is not being collected (that is Mr. Sam's duty), our savings rate has gone down. I haven't even started to create our 2016 spending plan (our form of a budget), although I've put down on paper what I'd like to accomplish for savings. Mr. Sam has not created our 2016 savings Excel chart.
I know the reason for all of this: full time job, baby, husband, life, etc. I've yet to figure out a solution.
I used to spend 20-30 minutes 2-3 times a week working on finances or reading about finances (money blogs help me stay on track) when I arrived at the office. But, I used to arrive at the office @ 7:30 am. Now, on average, I'm arriving at @ 8:45 am.
The solution is to get up earlier so I can get to work earlier. Today, I arrived at @ 8.20 and spent an hour or so on finances and made good progress.
With the time pressures of a more than full time job, baby, husband, landlording, life, etc. my ability to manage our finances has been backsliding.
I'm not paying bills on time, rent is not being collected (that is Mr. Sam's duty), our savings rate has gone down. I haven't even started to create our 2016 spending plan (our form of a budget), although I've put down on paper what I'd like to accomplish for savings. Mr. Sam has not created our 2016 savings Excel chart.
I know the reason for all of this: full time job, baby, husband, life, etc. I've yet to figure out a solution.
I used to spend 20-30 minutes 2-3 times a week working on finances or reading about finances (money blogs help me stay on track) when I arrived at the office. But, I used to arrive at the office @ 7:30 am. Now, on average, I'm arriving at @ 8:45 am.
The solution is to get up earlier so I can get to work earlier. Today, I arrived at @ 8.20 and spent an hour or so on finances and made good progress.
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