Mapgirl’s Fiscal Challenge

In a phrase: Unexpectedly crappy.

I am just shocked at how much my retirement accounts shrunk in July, despite a regular contribution to my 401k account. It’s a disaster and a half! I lost almost 4%, and that’s offset by the contribution. Oh well. I know most of it is a dip I took on BRKB. I knew I should waited till it was at the price I really wanted it, but I’m bad at timing the market and that goes against the philosophy which drives the company’s investments, so que sera sera. (Theoretically, any time is a good time to buy a value investment. After all, it should go up…As for the commenter earlier who said I should worry about Mr. Buffett’s health, I am aware of the problem, but something tells me Mr. Buffett does not do this alone and no, Mr. Munger’s health doesn’t bug me either.)

I have a new entry this month for non-retirement stock investments. It’s because of ESPP participation at work. I will be saving about $350 a month in cash, but reporting the value of the stock at the end of the month with each rise and fall. I am happy because this means I get some dividends per the ex-dividend date in a few days. Yay! (Ex-dividend date means you have to hold the stock by this date to get the dividend payout approximately a month later. Watch these dates carefully if you are thinking of buying a dividend yielding stock.)

I left the home mortgage untouched as I cannot figure out the exact number since statements will not arrive till later this month. (For some reason, I don’t check these accounts online and have never bothered to set it up. It’s good enough the way it is.)

The big thing is that I am actually making some progress on my credit cards. Not a lot, but some.

I know Enough Wealth does a monthly roundup. Mine will be delayed a few days while I hit a round of birthday barbecue events for friends this weekend.

I do believe the outlook will be positive due to some new savings I’m doing in an employee stock purchase plan.

No. I’m not some kind of gazillionaire on WoW. But I did have lots of PoE on Puzzle Pirates at one time. Enough to buy a ship. But alas, my pirating life has fallen prey to the ravenous beast known as blogging. Yarr, matey, ’tis true. Blogging be a harsh mistress.

My financial fantasy life is a bit more mundane than pirating and stealing money from computer-generated ships. The only booty I’ve got is my own backside.

My 2008 goals are mere stepping stones to the things I really want to do. I try not to be too focused on the big picture so I can work on the small things, chip away at them and in the process, get the bigger things done effortlessly. It’s easy to get overwhelmed with the big things, especially when your targets have lots of zeroes behind them.

Another reason why these are fantasies instead of goals is that they don’t meet the S.M.A.R.T. goal metric. Click the link to read more about SMART goals. I don’t want to rehash them here.

1. I would like to have a net worth in the millions.
2. I would like my housing to be cheap or free.
3. I would like my credit cards to be paid off.
4. I would like to remodel my condo.
5. I would like to save 30-40% of my salary.
6. I would like an emergency fund of $15K in cash.
7. I would like pre-tax rates of return in the double digits to make up for taxes and inflation on my retirement accounts.

Doable. All very doable if I stay focused on the small things. For instance, the best way for me to increase my net worth in these sagging times of ours is to pay my credit cards down. All those liabilities eat into my assets, and even though my assets may be falling, they will rise again once more if I hold down my spending and reliance on credit.

If I save 30-40% of my salary and push some of that into my emergency fund, then having $15K stashed away somewhere is not a problem.

If I am wise in my investments and get double digit rates of investment, then I could easily have a net worth in the millions down the road. Asset allocation and portfolio rebalancing is the key thing to look at periodically to make sure I am on track.

But you know, there should be less thinking and more doing.

Wow. I took a 6.88% drop in June.

The contractor cashed his check and the cash I was hoarding is all gone. The only saving grace is that I got paid at the end of the month and that artificially bumps up my cash holdings.

What shocks me quite a lot is that my retirement accounts are down by a lot. The last 2 market trading days at the end of quarter have been quite a mess with the spot price of oil going up to $140. Que sera sera. The best thing to do now is to keep on saving and wait till the market rebounds and experience the market rise.

I’m holding onto a lot of cash at the end of April. My net worth is going to look screwy I think.

For the most part, it’s totally artificial because I took out a $5K balance transfer on one my credit cards to cover the bathroom remodel. I wonder if I should hold back some of the cash reported because it’s in reserve for the construction.

At any rate, I’m still gathering numbers for net worth valuation for April. I always have to guess my mortgage numbers since one of the statements doesn’t come until after the month closes. (But usually the guess I make is pretty good, +/- $200)

Here’s to you Ben Bernanke for yet another Fed rate cut. I don’t think it’s really going to do anything for me at the moment. It’s likely working against me since I won’t be able to find a better paying interest rate on my emergency fund CD’s this summer. pooh.

I’m up quite a bit because I was able to get my Medical FSA reimbursement earlier this month. It’s up 14.2% month over month and up about 15% from March of last year.

The main thing I noticed is that my main retirement account holdings is down 8.88% since the year began. That’s a lot and it’s kind of disturbing since that’s an old 401k plan to which I cannot add new funds to dollar cost average out that low dip. I’m now safely past the 60-day holding period for selling off my funds without penalty so I can roll it over and out of the plan holder’s firm. But I think I’ll wait another quarter anyway just to see if the S&P improves any before selling it off and moving the money. Someone told me I can have the fund shares transferred without being hit with penalties for moving money in and out of a fund to quickly, but honestly, nothing in that account really thrills me. I’d rather sell everything in it and reallocate it all.

I took a close look at my abnormally high cash holdings. Since I get paid on the last day of the month with my new job, I expect that I will continue to have artificially high cash holdings unless I start doing some planned liabilities to offset that amount. It disturbs me because usually I have a mortgage payment waiting to go out of that money right after the new month starts.

At any rate, I think I can almost double my usual credit card payments in April. I have been hoarding cash a little due to my friend possibly needing to borrow money and wanting to buy a replacement laptop. But I think I am going to buy neither right now. I am going to another wedding in Boston in April and I plan on using a credit card to pay for that trip. It’s mostly just a hotel, gift, and a possible car rental. I hope to use cash for all other expenses that weekend since I can look at it as a self-indulgent spending weekend at home in DC. Costs for meals should be comparable.

Well things have resolved for my friend. She’s going to move back in with her old boyfriend and live as roommates in a little while so she is going to give me back my keys in a few days. Honestly, this is a relief to me since I need to get to my desktop PC and my Quicken! It’s time to do my taxes and my March Net Worth!

She won’t need to borrow any money from me since she forgot that she has a security deposit her ex-boyfriend will buy out her share of their current deposit. That’s good because I had another car repair this month for about $550.00 and miscellaneous wedding expenses, namely advance deposits for a beach rental for the wedding in May. Unfortunately, that means I’ll be putting off a laptop purchase for a few more weeks.

Oh and my girlfriend offered me a few hundred dollars for the last few weeks, but I told her to knit me a nice scarf or something instead. Considering how long it takes to make an item and she has a lot of knitting talent, it’s a pretty fair barter. Hm. But of course, if I took ‘rent’ from her I could take it as a tax deduction…Now there’s a thought!

My Medical FSA check came and I am trying to turn the money around in my checking accounts. Once it goes through, I will have bumped my net worth back up by almost $5K,

I am also holding on to a lot of cash at the moment and probably through April too. For various and sundry reasons, I may have to loan a friend some money. I know many people don’t believe in making loans to their friends. I’m not one of them. I just pick and choose to whom I loan it, just like a bank does.

My friend, the possible recipient, recently landed a new job and it’s been going very well for her. But she needs to borrow the money since before the landing the job, she was unemployed and burned through her savings during that time. (Hey, isn’t that what it’s for?) Having worked with her and idly chit-chatted about many topics, I know she’s very careful with her money and quite good at saving. Borrowing money from me is a question of short-term need vs having the time to save. There are reasons and situations in our lives where the former is necessary, and I’ll be damned if I watch her get an auto title loan or some other crap like that. And please don’t speculate about her situation. I am the one who offered to loan her money. She didn’t ask me for it.

At this time, she hasn’t decided yet what her best course of action is, and neither have I. She’s living in my apartment till the end of the month and then she’ll figure it out from there. Time is all she really needs now. Day after day, week after week, another pay check means more savings she can build back up and then she won’t have to borrow anything from me. I can offer her a rent-free place to live and that’s the best for now. (Otherwise she’d be paying double rent, which is not tenable, possible yes, but crippling.)

Ultimately, this means that I’m holding off on replacing my laptop for about another month till I know what kind of cash I have to spare. Every month my company sends a list of refurbished laptops for sale. There is usually a decent model available for $350-$400. Since I’m holding on to at least twice that amount for my friend to borrow, hoarding the cash for a month or two will not hurt me too much. If she doesn’t need it, then I can go buy a replacement computer right away!

I’m no saint here. My apartment is a god-awful mess. She knows it too. I did a little clean up so she could have a drawer and some closet space to herself. Moved my stuff off the bathroom counter and let her use the internet connection. She’s sacrificing a TV since I don’t have one and the company of her cats, since I’m allergic.

Basically there are times in your life when you have to ask yourself what is the right thing? For me, being able to give her a place to go is the right thing to do. And if I want to reclaim my space, I can loan her the money so she can go find another apartment. I’m not in a hurry at the moment, but she’s aware that my sense of urgency may change over time. But I think it’s best for her to stay focused on herself so she can think clearly to make a good decision.

P.S. If you are wondering, patient boyfriend is letting me stay at his house for now. Since I’m going away for a few days this weekend, I won’t be there 24/7 to get on his nerves.

It’s up just a tiny bit. Liabilities down, assets up. But the credit card number remains fairly static.

I know part of it is that I bought my mother some swimsuits from Lands’ End. The modest cuts are good for old ladies. They even have little skirts, so my mom was happy with her present.

I also know part of the reason my credit cards are up are due to some early purchases for weddings this year. I had to put flights onto my credit card.

My credit card balance being up by only $73 means that the $1000 I usually throw in that direction was negated by about $1000 in charges. Sounds about right, but still a bummer.

U-G-L-Y, at least I have an alibi! It’s UGLY! It’s UGLY!

It’s been so ugly, and I’ve been busy, that I’ve been ignoring the update till now. I have lost a lot of money in the market in all my investment accounts.

I have added almost $5k in medical debt, but it I have a pending account receivable associated with it. I will not accounted for the reimbursement yet on my net worth calculations until I submit my papers.

My credit card debt is stagnating at the moment. But since 2008 is focused on debt payment, I’m most worried about this one and reining in my spending.

My real estate assessment has lost some value, good because it reduces my tax bll, but bad because it also hits my small net worth pretty hard.