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It has been a Long Time

January 4th, 2009 at 03:51 pm

Happy New Year! Yes, it has been a long time since my last post. Commitments from increased responsibilities at work and graduate school held my focus. I was still able to remain committed to my financial goals. I reviewed my accomplishments for 2008 and updated my financial goals for 2009. I managed to complete most of my goals for 2008.

2008 Goals:

We finally have some breathing room due to our emergency house fund. It allowed us to pay an unexpected tax payment and a car insurance deductible without a major financial crisis.

DH and I were able to take a romantic bed and breakfast trip paid fully with cash for our anniversary!

Didn't stress about paying our life and car insurance. We finally started saving the money every month before the bill was due. Sounds silly but what a light bulb moment!

Used cash money to pay for new wood floors. The current housing crisis led to us finding a great contractor at an affordable price! This wouldn't have been possible prior to the housing bust.

Stayed under or within budget for utilities,groceries and miscellaneous categories. The only exception was the gas budget.

Stayed away from buying wants and used our funds for needs. This was specially true during the holidays. Paid cash for gifts!

We finally have eleven months living expenses saved! Working on twelve months for 2009.

Thank you for all of the good advice that was put to good use for my family financial future!

Car Pooling

June 28th, 2008 at 03:55 pm

I am very conscious of how I changed my driving habits due to the higher gas prices. I fill up when the gas tank is half empty once a week. I think it is mental thing for me to pay $47 - $59 instead of $94 - $118 every two weeks. I know that sounds silly but it my way of coping.

We have been staying close to home lately. Living in the D.C. area allows us to use the metro instead of driving to museums, historic sites and free or low cost events. We also are spending more time walking around the community. It is nice to spend time together due to the outdoor events that our local community is offering this summer. Very cheap date night. That's a big plus! The bad thing is that we cut back driving to see our families outside the area.

I car pool with another runner to drive to our designated running trails three times a week. We take turns once a week and that has helped both of us to save gas money. I also try to combine all my errands (groceries, picking up dry cleaning and etc.) once a week in an organized method without going on unnecessary trips.

I will also find out how much money I saved from telecommuting two times a week at the end of July. Right now I spend $180 - $240 a month for my gas budget. Yeesh! My longer work commute is estimated at $310 - $370. Double yeesh!!

We are still planning to end our satellite premium channels subscription in the event gas is at $5 or more a gallon this summer. I rather have a plan then going into panic mode trying to figure out how we are going to pay for the extra cost. I know we don't have control of the prices but dang it I have control of our budget.

Work and Life

June 27th, 2008 at 05:50 pm

This is my first day of working at home. I got up and dressed for my work day to start at 7:00 am. I ended up with a lot of work accomplished for the day. What a pleasure! I did not realize how much people interrupted my workday routine in the office. I even forgot to take my lunch break at 11:30. I guess I need to put an alarm to force myself to take a break in order that I do not burn myself out. I do need to go to the main office today at to pick up my work cell phone and internet router. This means a gas expense). Frown !

I will connect my driving to work with a grocery shopping trip. I am proud to say that we only spent $269 for groceries for the month of June!! Watching the sales, using coupons and cutting out the processed foods really helped. I hope to maintain my $400 food budget for July.

I finally broke down and turned on the a/c due to the heat wave. Our a/c thermostat is maintained at 78 degrees with ceiling fans on and blinds/curtains closed. The electric bill was $90 pretty reasonable for this month compared to my neighbors $250 bill. She finally asked us how we got our bill so low. We were glad to share our secrets.

My break is over and I need to drive to the office before the crazy rush hour traffic starts!

6 Months Goals

June 24th, 2008 at 09:48 pm

Thanks for the mid year reminder Merch about reviewing my 2008 financial goals. My 2008 financial goals were as follows:

1. Increase 401K to 10% and fully fund
Roth $5000
2. Save $5000 to Emergency House Fund
3. Reduce $4200 debt to $2950 (0%
4. Pay $2088 extra to mortgage principal
5. Help DS#1 to be financially independent

I am on track with my retirement funds. I have a monthly direct deposit for my Roth. I started the year at 10% increase for the 401K. A salary increase resulted with me increasing it to 12% starting July.

$218 a month is automatically transferred into the emergency house fund. Any surplus money at the end of the month is used to fund the account. Still waiting for my economic stimulus check! I didn't really count on it but it would help us reach our goal quicker. I plan to check with IRS on why it is taking so long.

We can do better with reducing the credit debt. We currently paid $830 since February but we can do better. I know it is because of the 0% interest and I have until 2013 to pay it off. My plan was to pay it by February 2011. I can add an extra $75 to have it paid off by November 2009.

We are on point with the extra principal payment. $174 a month is automatically transferred to the mortgage.

DS#1 is doing better with keeping a better handle with his finances. During March he had a problem with him not being aware of his debit card use. Resulted with $60 overdraft fee that got his full attention! He is now keeps track of his spending habits. He pays his school, phone and car insurance bills on time. This is without reminders from his parents. He has maintained his budget and contributes to his (401K and Roth)retirement funds. He is slowly realizing that he actually has more money to have fun. We do not assist him with wants. I think that is the key to his financial development. I did not want to raise a young man feeling that he had his hand in our wallets. Now to work on DS#2 during his summer visit with us.

Identity Theft!!!!!!

April 10th, 2008 at 10:48 pm

We received a call from my SIL#1 about my BIL#2 last night. BIL#2 notices a storage unit being delivered to his Detroit home one morning (last week). He runs out to ask why was this storage unit being delivered in front of his yard. He was told by a bank representative that the storage unit was for my BIL#2 personal belongings. His house was being foreclosed. This was a major shock because he pays his mortgage with an extra principal payment a month ahead!

He contacted his church's lawyer who investigated the foreclosure. The lawyer with a church member who is realtor pulled up information on the home. It was found that the house had a $120,000.00 equity line of credit fraudently taken out in 2006 with a second financial institution (Wells Fargo)! Someone or a group of theives (mortgage officer, finance company, title company and financial institution) stole his wife's identity! (The house is in her name.) She and he are of course are angry, violated and totally devasted!

They went to court yesterday and the judge gave them two weeks to prove that this was an identity theft case. BIL#2 has reported this to the police, FBI, his original mortgage company, Wells Fargo, and all 3 credit bureaus. This is a financial nightmare with the potential of losing their home!! They owned their home for over 10 years.

I did some investigation and found that this is the common incident in Detroit. It is also spreading throughout the United States. This is an easy white collar crime with minimal sentencing of 3 years maximum jail time. This is why so many criminals are switching from selling drugs because of the easy money without the lengthy jail time if they get caught. It is very easy to be a mortgage officer in Michigan. This is due to no state or federal oversight of the lending industry. There are no criminal background checks conducted on Michigan's lenders.

Yes, I know that they could have avoided this disaster early if they were vigilantly checking their credit histories with all three credit bureaus. But, they are like a majority of Americans who are God fearing, hard working, pay their bills on time and trying to better their lives for their two young sons. My BIL#2 and wife didn't deserve this. My DH's family are pooling their money together to help them pay for a lawyer to get them out of this mess.

The positive side of this was that my DH finally acknowledged that my persistent checking our credit histories (even our sons) was not a waste of money. He gave me a hug and thanked me! I am really so sad and angry this happened to my BIL#2.

BOA Home Equity Line Suspension

April 5th, 2008 at 12:16 am

We received a letter yesterday from BOA stating that our equity line of credit was suspended due to declining home values in our community. It's funny, we never used our equity line of credit! We pay our mortgage one month ahead and put extra for the principal. I have been using all of the helpful advice from this pf blog and pf books to prepare our family finances. We saved to build our patio and garage storage units. We are saving for new carpets and wood floors. We are also in process of saving for our house emergency fund. At first I was bothered by BOA sudden suspension announcement. But, my DH reminded me that a lot of people have been using their home equity like piggy banks. He noted that we took the time to educated ourselves on not using our home equity. He also stated that we are not upside down on our mortgage and we are employed. Many folks are not as lucky and are going through a rough period. I still feel a little po with BOA but DH is right. He is a laid back guy whose approach about taking life as it comes balances my anxieties. I really do feel that we are better prepared just in case Murphy happens.

Clothes Shopping Demons

March 22nd, 2008 at 02:11 pm

I am going through a major withdrawal! There are so many cute clothes this season that I have an urgent need to spend. I gave my credit card to my husband to lock away. I know this sounds weak but I can't resist the call of new clothes! I went through my closet to remind myself that I have plenty of outfits that I haven't worn yet. I coordinated different looks using my existing clothes for the spring and summer season. I found new uses to my belts, scarves and costume jewelry giving my clothes an updated look. The spending urge is slowly passing but I need to stay away from magazine and TV ads. I don't dare go to a mall or boutique! I am so weak but I noted that I haven't brought any new outfits in 2 months!

Federal Taxes

March 17th, 2008 at 10:03 pm

I am getting ready to rant about about AMT!! I truly hate AMT!!!! We are squeezing our funds down to the penny! We are doing the right thing by paying our bills on time, not using credit, saving for a rainy day, putting money aside for retirement and college educations. I received a pay raise last year at new job plus receive my military annuity pay (I recently retired from the military), and my DH was promoted to a higher military rank. All factors put our income at a higher tax bracket which means we owe IRS. (By no means we are not rich living on a military income!)

I am trying to look on the positive side of life because we are blessed to have paychecks. The good thing is that we are able to pay the money. Frown We now are looking into reducing our pay deductions or pay quarterly estimated taxes for 2008. I really hate AMT!

New to this!

March 9th, 2008 at 09:14 pm

My husband and I both noted that the American Express and debit cards was doing a lot of overtime for us in 2006. Our entertainment and clothing expenses were out of control. Our checking and saving accounts were at an all time low! (Honestly, we played like we both had amnesia! Blaming each other for the financial damage.) We finally decided to live within our income and make saving a bigger priority.

I have been reading and using all of the great advice from this finance blog for the past 18 months. (I guess you can say I am shy.) I have opened an ING emergency fund and several sub-accounts that earned over $700 in interest for 2007! We did this by setting up a spending plan that we actually followed for the entire year. This was due to my husband and I being sick and tired of living paycheck to paycheck without any financial results. I now feel that my family is more prepared if Murphy's Law occurs. We still like to have fun and dress well. Only this time we have a plan that leave more money in the bank.