Archive for the 'Personal Finance' Category

Honestly, I haven’t been following the economic stimulus payment schedule that closely. I knew I was going to get one pretty soon but never really figured out exactly when I was going to get it.

Well, I checked my accounts through Yodlee this morning (like I do just about every morning) and noticed the following entry on my recent transactions:

05/09/2008 US TREASURY 220 TAX REFUND 050908 $ 1,200.00 Charles Schwab - Banking

I don’t really have any plans to go out and splurge with this. It probably will just end up being absorbed into regular bills and debt payoff. Still, its always nice to get a little extra cash in your pocket.

I think I am ready to officially declare it spring here in New York. With that, it means its time to do all the summer outdoor maintenance that comes with owning a house. For me, this means:

• Changing the oil and sharpening the blades on my lawnmowers.
• Fertilizing the lawn.
• Repainting areas needing attention.
• Pest control around the house

Pilgrimage to Home Depot

Of course, all this costs money. I went to Home Depot this weekend to purchase all the various things I needed to accomplish my tasks since its close to my house and I had a 10% coupon. Even with that the cost still added up to over $100.

And that’s not the end of the outdoor activities. We will purchase some flowers around Memorial Day for the yard, possibly sealcoat the driveway, and since we have a pool that is another big expense. The joys of home ownership I guess.

Well, finally at the update for the fifth and final of my 5 financial goals for 2008. So far there are some goals I have done well with, and other that certainly need work. Here is a recap of this final goal:

5.) Put 15% Of Our Income Into 401ks
I have been doing this for quite a few years now, however my wife has not. So I would like to get both of us to save this much in our 401k accounts this year.

Status

Well, this has been another difficult goal to meet this year. I have been putting away 20% since the start of the year which has been fantastic. I think I will have no problem continuing this through the rest of the year.

On the other hand, my wife was unhappy at her job so she dropped down to part time status there. She then was working part time as well at another office… so full time hours with part time status at both places. Unfortunately since she was part time this means she no longer had access to a 401k. She was actively looking for a full time position though, so we decided against opening a traditional IRA for a few months.

She has since found a new job which she starts next week and will offer a 401k plan. So once that starts up we should be on track to get at least close to our goal for the year.

Here is an update on my fourth of 5 financial goals for 2008. Here is a recap of this goal:

4.) Earn $5,000 In Income From Side Businesses
2007 was also a bad year for side income. My friend and I have a business but we were both too busy most of the year to do much with it and our profit suffered immensely. I would like to increase my side business income to $5,000 which includes that business and other side ventures I pursue.

Progress

Well so far this year I have only made $451.10 from side income. This is only 9.02% towards my goal for the year.

I knew it wasn’t going to be good. I haven’t done as much work on my side ventures as I had hoped to at the start of the year and the numbers definitely show it. Unfortunately the next few months are going to be rather busy for me as well so I don’t think I will have time to finish up any of the side projects that have been lingering for some time.

Taking some more time to review our 5 financial goals for 2008 a quarter into the year. 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 $630 to our ROTH IRA’s. This represents progress of only 15.75% towards the goal for the year when we should be 25% there.

In order to meet our goal we will now have to contribute $374.44 per month for the rest of the year. Unfortunately this goal has kind of taken second fiddle to our debt reduction goals which I think will continue. That seems like a more important priority right now.

Hard to admit defeat for a goal already this soon into the year though so I will continue to track it.

Here is an update on our second of 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 (3.85%) 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 $133,463.69, which is a 9.97% decrease. The chart below illustrates the decrease so far:

Needless to say I am pretty pleased with the progress on this goal. I thought it was going to be ambitious when we started the year, but we were able to buckle down and cut a lot of extraneous items out of our budget. We were also helped by a rather sizable tax return which mostly went towards this.

I’m not expecting to be able to continue at this pace the rest of the year, but 20% is definitely in sight and I am thinking the goal should be upped to 25%.

Earlier this year I had set 5 financial goals for 2008. I thought I would take some time this month to reflect and check in on our progress on these goals. I’ll start today with out first goal:

1.) Better Merge Our Finances
Since getting married last year, my wife and I still haven’t fully merged our finances. Part laziness, complexity and fear has kept us from doing so. I have been working so far this year on fixing this but it is still not done yet. It probably will take a few more months to get everything fully integrated.

Checking Account

We have made quite a bit of progress on this so far. We’ve been working to switch to a joint Charles Schwab Investor Checking account. So far I have switched over most of my finances and direct deposits to this account. My wife has been paying some of her bills from this account and some from her other checking account while we are still making the transition. I’m hoping by the end of next month to have this fully converted. Checklist for this is as follows:

• Pay all utility and house related bills from checking account.
• Stop using our individual checking accounts and just use our joint one.
• Convert all credit cards to new checking account
• Get both us more involved with expenses out of this account so we do not overdraft.

Credit Cards

We have not begun merging our credit cards yet. You’ll notice I still called some expenses “her” bills. This is something that definitely needs to be worked on before the end of the year in order to meet our goals.

• Phase out my wifes American Express and merge her account into mine (since I have had mine longer and we both have the same card). This will be our primary credit card.
• Stop using our other individual credit cards and settle on some joint ones.

Taxable Accounts:

$942.13 - Liquid Savings - 3.55% APY HSBC Savings Account
$15,363.16 - Savings - 4.25% APY Countrywide Savings Account
$8,197.60 - Checking - 3.01% APY Schwabb Investor Checking Account
$15,616.64 - Stocks - Misc. Direct Investments
$5,060.36 - Stocks - Ameritrade Izone
$3,589.11 - Stocks - Zecco
$2,677.38 - Bonds - TreasuryDirect

$51,446.38 TOTAL

Retirement Savings:

$16,547.68 - ROTH IRA - Vanguard
$1,088.86 - ROTH IRA - Scottrade
$55,088.74 - 401K - T. Rowe Price

$72,725.28 TOTAL

Debts

$2,925.53 - Student Loan - AES (3.625%)
$3,975.00 - Credit Card BT - Chase(0%)
$17,116.28 - Credit Card BT - BOA NEA (0%)
$7,057.18 - Credit Card BT - Juniper (0%)
$4,730.95 - Credit Card BT - Bank Atlantic (0%)
$19,405.00 - Credit Card BT - Upromise (0%)

$55,209.94 TOTAL

Housing / Automobiles

$264,066.14 - Mortgage - Countrywide
$339,500.00 - Approximate Home Value
$8,765.00 - Approximate Car Value - Edmunds.com

$84,198.86 - TOTAL (Approximate Equity)

Read the rest of this entry »

The time at my company has finally come to give out our yearly reviews and salary actions. Working remote often makes this a bit difficult as its kind of informal to do it over the phone, but luckily my manager was able to combine it with some other meetings he was flying into town for so we could meet face to face at their hotel.

It went pretty much exactly the same as last year. I was in the “above expectations” category (5/6) and received a 6% raise.

I will also be bumped up in title from “analyst” to “lead analyst” which will put me into the next pay band> Unfortunately it has not officially gone through so my manager was not sure if it was going to mean a pay bump when it does or not until next year.

So I am pretty happy with that, 6% should be enough to keep up with rising costs around town and give us a little extra money to play with at the same time.

The 142nd edition of the Carnival of Personal Finance is up over at The Baglady. It has many great personal finance articles in one spot, including my post on Startups Offering Credit Scores / Reports.

Carnival of Personal Finance #142

It seems like a new free credit site is popping up every day now. Quizzle is yet another site, but unlike some other sites it offers a free credit score and report (Experian PLUS). It is also owned by Quicken Loans which may ease some of your concerns over giving your person information to an unknown company.

What It Provides

The site also gives you some information beyond just your report and score. It takes some information you provide as well as some from your credit report to determine your financial status. Below is a screenshot of the main screen once logged in:

As you can see, it also gives you an approximation of your home’s value (though I have no idea where they are getting this information from), the equity you have available from your mortgage, and grades on your estimated budget and your rainy day fund. I didn’t find any of these numbers particularly useful since I have no idea where this is coming from and prefer to do my own analysis.

The site does offer your exact credit score as well as a detailed credit report with everything in it, which is a plus. It does also give you a bit of analysis on ways to improve your score as well.

Overall Impressions

Overall, if you are looking to get both your credit report and credit score for free Quizzle is a place to check out. Unlike some of the other new sites out there they are not making their money off Advertising, but rather trying to upsell you a loan so you may get some junk mail or phone calls as a result of it (yet to be seen).

Quizzle.com

For those of you looking to stay on top of your credit report, there are a couple new startup companies that may help. Checking your credit report regularly for inaccuracies can help you make sure there are no surprises when you go looking for a loan, new credit card, or even a job.

I’m sure some of you will have privacy concerns over giving a startup all your financial information and social security number (and perhaps rightly so), but for those adventurous ones out there here are some new sites to try out:

Credit Karma

This is a new startup venture that gives you your Transunion credit score anytime you want it. On a scale of 150-950 its not what most people are used to seeing so it may confuse some. FICO reports on a scale of 300-850 so don’t get to exited if you have a higher score than usual.

Credit Karma also offers some statistics on where your credit score falls in the grand scheme of things, from very poor to very good with where your score falls in relation to the average joe. Their business model is to make money on advertising so all of this is free.

Credit.com

This is yet another new startup which gives you a look at your credit report. It doesn’t give you a FICO score or a look at all the information on your report, but rather just an overview of what is on it and an approximation of your score range.

It gives you letter grades in 5 areas - Payment History, Debt Usage, Credit Age, Account Mix, and Inquiries (which are all weighted differently). It also gives you the reason why you received the grade and ways to improve your report. It also has some important summary numbers from your report - credit card debt, total credit limits, total minimum payments, inquiry records, etc. This site also works off advertising as well as upselling other services, so the basic information is free.

Quizzle.com

Quizzle is a new site backed by Quicken loans. It gives you your actual Experian PLUS credit score and credit report. No estimations or summaries, the whole thing.

It also gives you some additional information about your home and mortgage status that I did not find particularly helpful. But if you are looking for a straight look at your report and score this is a good place to check out.

Annual Credit Report

While not a startup, I thought this was worth mentioning. This site allows you to get your government mandated free credit report once a year from all 3 credit reporting agencies (Experian, Transunion, and Equifax). It does not give you your credit score, but gives you everything on your report for free.

Some other sites require you to sign up for a trial service to get your “free” report which if you don’t cancel they will charge you for. This is the official one that everyone should be using once a year that does not make you sign up for anything.

A trick I use is I do not get all 3 reports at once. It allows you to get 1 report per year from each agency, so if you break it up over the course of the year you can check your report every 4 months by using a different agency each time.

Well last week I finally received the 1099 I was waiting for from Zecco. This weekend I was able to finish up my taxes and file them with the IRS. According to the IRS schedule I should get my refund direct deposited on March 7th.

Free Efiling

For the last 2 years I have used TaxAct to do my taxes which offers free federal E-Filing regardless of income. Both years I’ve checked the numbers against TurboTax as well and both have come out the same, and since TurboTax charges $14.95 to E-File I went the free route. TaxAct doesn’t have the best web interface, but it is certainly usable, and you can’t beat the price.

Unfortunately in my state (New York) there is no free option so I mailed those taxes in since it did not seem worth $12 to E-File versus $1 for the postage.

Tax Summary

My refund this year is pretty high - about $6000. It was our first full year in our home, my wife’s first year at her her job, and not a busy year for my side business. I hope to adjust these numbers this year so I don’t keep giving the government such a large interest free loan.

I don’t really have this money earmarked for anything at this point. Probably pay off some various bills and invest the rest.

In a new move, prestigious Stanford University has decided not to charge tuition to students whose families earn less than $100k a year.

This move is largely because the university’s endowment fund is exploding and currently stands at $17.1 billion - a 22 percent increase from just last year. They have been getting some scrutiny for this and have decided to spend some of this money on lowering tuition for poorer families.

Not sure if more high profile universities with large endowment funds will be following suit, but it certainly will help some lower income families who have been unable to keep up with the sky rocking costs of tuition. At Stanford the cost of tuition has risen 63% over the last 10 years. That is 2x the rate inflation has risen prices over the same time period.

From the San Fransisco Chronicle:

In a radical change to its financial aid program, Stanford University will announce today that it will no longer charge tuition to students whose families earn less than $100,000 a year.

In addition, the university will waive room and board fees for students whose families earn less than $60,000 a year.

Full Article: Stanford Drops Tuition For Some Students

The Starwood Preferred Guest program will be updating some of its hotel categories on March 4, 2008. This includes moving quite a few hotels to higher categories so they require more starpoints to get a free night.

Some of you may know I am a frequent user of this program, and I have an Amex SPG credit card that I use for most purchases. However over the last couple years they have increased the hotel categories quite dramatically and this seems to be a continuing trend.

For a complete list of changes visit the link below:

Starwood Starpoints Category Updates