Archive for April, 2007

Vanguard has always been my favorite spot for mutual funds because of their extremely low expense ratios. However they did have an initial investment and fees for those with low balances that made them unattractive for the smaller investor. These included:

• $10 per year for index funds below $10,000
• $10 per year for all funds below $2500
• $10 per year for IRA and ESA accounts below $5000

You could be charged each of these fees on a single fund.

However effective today Vanguard has eliminated all these fees!

The new structure is:

These fees have been replaced with a single account service fee. This $20 fee will be charged annually for each Vanguard® fund in which you have a balance under $10,000 in an account.

But it gets better.

You can avoid the account service fee… sign up for account access on Vanguard.com® and choose electronic delivery of shareholder materials, including statements, confirmations, fund reports, and prospectuses.

So basically sign up for electric statements and you will not have any fees! Certainly helps the average investor who does not have $10,000 to invest in a single fund.

Vanguard Rate Change Announcement

Its always nice to earn a little interest on your checking account since most banks don’t even offer anything. But its almost just a little pointless when you see a line like this on your statement:

$0.07 - INTEREST EARNED AND PAID FROM 03/17/07 THROUGH 04/17/07 INCLUSIVE AVERAGE DAILY AVAILABLE BALANCE $1,660.96 ANNUAL PERCENTAGE YIELD EARNED 0.05%

I’ll be sure not to spend it all in one place…

This is from my HSBC Interest Checking account. I use it primarily as just a last point if i need to pay the few bills I can’t with a credit card in conjunction with my currently 6% HSBC Direct Savings account so usually I hardly have any money in it. However this month with the wedding I had a lot of checks floating around out there so my average daily balance was much higher than usual.

High Yield Checking Accounts

There are a few checking accounts that offer decent yields. ING Direct offers a Electric Orange checking account with a tiered yield (4% - 5.3%). Presidential offers a 4.5% yield on its Checking Plus account (with a $1,000 min balance).

For my purposes though, I like the instant transfers from my HSBC savings account as well as easy ATM access so I will be sticking with them for now

I have to say, I’m feeling a little nervous but not terrible. I’m not really nervous about the wedding itself but rather nervous about being nervous (if that makes any sense).

From a financial standpoint the wedding has been tolling. I jokingly told my fiance she was no longer allowed to see the caterer anymore a few weeks ago because every time she did it was an extra thousand dollars added to the already exuberant cost. I definitely feel like we overspent for the event and could have cut costs in a lot of places. Its gotten to the point where as a finance writer I am embarrassed to say the total amount spent.

But it is her special day. We aren’t saving for a down payment on a house (or even in a starter home), have tons of debt to pay off, or aren’t saving enough for retirement so I guess its ok to indulge this once and hopefully have some great memories.

A carnival highlighting some of the best posts from the under 30 personal finance community. The new edition is up over at My Financial Journey so be sure to check it out.

Festival of Under 30 Finances - 21st Edition

As part of the Festival of Under 30 Finances the question posed by host My Financial Journey is:

At what age do you want/plan to be financially independent (IE you don’t have to work full-time if you don’t want to) and what is your plan to get there?

Ideally I would like to have enough money to sustain me without taking away from principal with reinvesting for inflation. So assuming a conservative 5.5% return for the principal, and assuming inflation at 3.5%, that means I have to be able to live on 2% of my total savings. I figure today I could probably do this on about $40,000 which would be the return from $2 million dollars.

But then there is a curve effect… 2 million today adjusted for inflation is about $2.5 million 10 years from now. So I can’t set my goal of savings 2 million in 10 years or else I will fall short of what is really needed.

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It appears yesterday it was nearly impossible to e-file your taxes on time through TurboTax as their servers were most likely out of commission from the incredibly high volume. This left countless people worrying about the missed deadline and what to do about it.

There is a pretty large thread on the Intuit forums with upset customers. Apparently Intuit is working with the IRS to (hopefully) have them accept all returns as if they were filed on time. From a moderator of the forums:

“Folks, we’re working with the IRS to ensure that returns will be accepted as timely filed despite this situation. Protection of your interest is of the highest priority. IRS and Intuit will provide further details in the morning… thank you for your patience!”

I guess the answer is if you are going to wait until the last minute to file you should file for an extension even if you don’t think you will need it.

I had previously written about how my HOA wanted my opinion on them spending $15k for 2 new signs. Well I received a newsletter stating that only 20% of homes had responded which they didn’t feel was enough to make a decision yet. They also received some other feedback on the proposal so will continue to investigate and ask again later.

Hard to believe so few of my neighbors cared about a potential $86.50 bill they may receive.

For all you homeowners out there looking to spruce up your lawn this spring Discover has a coupon for $10 off $50 at Sears in the lawn and garden department.

Its valid until June 30th and you must use a Discover card when purchasing.

Sears $10 off $50 Coupon

I had stated in February that one of my goals was to finish my taxes. Well, it ended up taxing me until the beginning of April but I finally did it. Once I finished I received a pretty substantial refund which I am slightly embarrassed for not claiming earlier and losing out on a few months worth of interest. I would adjust my deductibles but my taxes next year will be completely different as I most likely will be filing as married instead of single.

I ended up using a combination of programs to complete my taxes, which can be pretty complicated due to a home office, partnership, and home sale. I ended up doing the preliminary numbers in TurboTax which I have been using for years. Then I searched online for a place that would let me e-file for less than the $14.95 TurboTax wanted.

Most places require you to have an AGI under $52,000 to qualify for their free e-file program. However I stumbled upon TaxAct which lets you e-file for free with no restrictions. Even the basic version of the online program gave me everything I needed - from what I read it looks like the only thing you received with the deluxe version was additional guidance on how to fill in the forms. It worked like a charm and I was able to get an exact match to my TurboTax refund.

I ended up mailing in my state taxes as I couldn’t justify spending $15 to e-file those. According to the IRS E-file Chart I should get my refund this Friday which is going right into my HSBC online savings account.

Taxable Accounts:

$8,039.31 - Liquid Savings - 5.05% APY HSBC Savings Account
$14,271.88 - Stocks - Misc. Direct Investments
$6,081.31 - Stocks - Ameritrade Izone
$2,938.26 - Stocks - Zecco
$2,573.22 - Bonds - TreasuryDirect

$33,903.98 TOTAL

Retirement Savings:

$14,978.83 - ROTH IRA - Vanguard
$2,139.51 - ROTH IRA - Scottrade
$40,018.73 - 401K - T. Rowe Price

$57,173.07 TOTAL

Debts

$3,386.22 - Student Loan - AES (3.625%)
$7,368.00 - Credit Card BT - Discover (0%)
$7,438.00 - Credit Card BT - Citi (0%)

$18,192.22 TOTAL

Housing / Automobiles

$269,575.14 - Mortgage - Countrywide
$339,900.00 - Approximate Home Value
$11,079.00 - Approximate Car Value - Edmunds.com

$81,403.86 - TOTAL (Approximate Equity)

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