Archive for October, 2008

I came across a nifty little website today called Cost to Drive. It calculates the cost of gas for your car trip so you can get an idea of how much you will spend in gas for the journey.

You simply input your starting point, destination, and your car year/model and it will do the calculation for you. It uses the distance of google maps, the average mpg of your car type, and the average price of gas in that area. Its obviously not 100% accurate, and also on some trips I tried it did not factor in tolls (perhaps an idea for a future enhancement) which can certainly add up as well. But overall its a fun and easy tool to get a rough estimate of gas costs.

www.costtodrive.com

Once again looking back on our 5 financial goals for 2008. Our third goal for the year was:

3.) Fund at least $4,000 in our ROTH IRA’s
I have to admit, before purchasing our new home I was doing a lot better with the ROTH savings. I slacked in 2007 and even in 2008 $4,000 is less than I would like to commit but seems like realistically possible. That however means savings of about $333/mo which has not happened in January so we are already behind.

Overview

My wife and I currently have 2 separate ROTH IRA funds. My ROTH is through Vanguard and I have a direct deposit setup from my paycheck to deposit $75 there (biweekly). My wifes ROTH is through T. Rowe Price and she currently contributes $50 per month.

Goal Progress

So far this year we have contributed $1380 to our ROTH IRA’s. This represents progress of only 34.5% towards the goal for the year when we should be 75% there.

In order to meet our goal we will now have to contribute $873.33 per month for the rest of the year. This goal has become secondary to our debt reduction, so it was kind of thrown by the wayside. The way the market has been going lately it seems like we actually lucked out on this.

I was ready to admit defeat on this goal a quarter into the year, and now I’m so far off it seems I’ll be lucky if I hit 50% of the goal.

With the recent downturn in the stock market, the fed has reacted by slashing interest rates. This has caused a number of banks to lower their APYs on savings accounts:

• WAMU lowered their savings account rate from 4.0% to 3.0%
• Schwab lowered the rate on Investor Checking from 3.0% to 2.2%
• ING Direct lowered their Orange Savings from 3.0% to 2.75%

I expect more cuts on their way, so if it hasn’t hit your account yet don’t be shocked when it does.

This is the second checking of my 5 financial goals for 2008. The following is a recap of this goal:

2.) Pay Down 20% Of Our Non-Mortgage Debt
This is a pretty ambitious goal but I think we can do it. After the wedding and home purchase though we have quite a few assets our debt has been steadily increasing. I would like to get this completely eliminated within 3 years, and 20% will be a great start. Most of this debt is at 0% or other reasonable rates so that is why I am not overly worried about paying it all off before all else.

Starting Point

We started this year at a rather staggering sounding $148,240.40. The majority of this debt however is my wife’s student loan debt which is at a fairly low interest rate (3.25%) as well as on some 0% credit cards that have been lingering for a while.

Progress

So far this year the debt has been reduced to $122,836.94, which is a 17.14% decrease. The chart below illustrates the decrease so far:

At last update I was thinking 20% would be hit rather quickly and I should up the goal to 25%. Well, I’m at 17% with a few months to go. I think 20% is definitely within reach but 25% may be a little much with the Holidays coming up.

Overall I’m very pleased with the progress of this goal so far this year. I have made steady progress on it throughout the year and am looking forward to seeing it down to a more reasonable number next year.

Taxable Accounts:

$771.26 - Liquid Savings - 3.25% APY HSBC Savings Account
$15,644.35 - Savings - 3.50% APY Countrywide Savings Account
$6,334.56 - Checking - 2.2% APY Schwabb Investor Checking Account
$15,292.03 - Stocks - Misc. Direct Investments
$3,838.72 - Stocks - Ameritrade Izone
$2,864.72 - Stocks - Zecco
$2,730.62 - Bonds - TreasuryDirect

$47,476.26 TOTAL

Retirement Savings:

$15,222.01 - ROTH IRA - Vanguard
$879.21 - ROTH IRA - Scottrade
$53,561.34 - 401K - T. Rowe Price

$69,662.56 TOTAL

Debts

$2,676.45 - Student Loan - AES (3.625%)
$2,604.89 - Credit Card BT - Chase (0%)
$16,225.12 - Credit Card BT - BOA NEA (0%)
$6,745.50 - Credit Card BT - Juniper (0%)
$4,454.13 - Credit Card BT - Bank Atlantic (0%)
$17,887.44 - Credit Card BT - Upromise (0%)

$50,593.53 TOTAL

Housing / Automobiles

$261,169.42 - Mortgage - Countrywide
$339,500.00 - Approximate Home Value
$8,545.00 - Approximate Car Value - Edmunds.com

$86,875.58 - TOTAL (Approximate Equity)

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