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Archive for December, 2009

Year End Reflections

December 29th, 2009 at 03:32 pm

So it took a little over a year but as of December 2009 I am back where I started before I bought a house (Nov 2008). I had figured at the time that the house would set us back a year on our debt repayment and I was right. I must admit though, I hadn't realized both DH and I would have a moment of unemployment in there and a 1/3 of our income cut out this year. As a result, I am a little surprised to see that we stayed on schedule.

We have increased our net worth this year by about 9k with the majority of that being mortgage principal paydown (almost 6k). That's 4.2% of our loan.

The last time we used a credit card (other than paying in full) was in April for the cabinet refacing and that deal will be paid off in March 2010 with no interest paid.

We actually had quite a few big surprise bills this year that we have paid cash for no problem.

From January 2010 on, I will be setting records for my networth which is really nice. DH will be contributing 15% to his 401(k) again and I will finally max out my roth this year (hoping to max out his roth as well but we will see).

The advantage of having gotten so many of our fixer upper projects done this year is that the house is livable and we have lost the desire to move as quickly on future remodeling. Spacing out repairs will allow us to pay off the debt quicker and build a larger savings cushion.

I've estimated our taxes this year and we are looking to receive a refund. I don't want to adjust our withholding though because without the window credit, we would have been paying in this year despite the unemployment. Also DH's income can jump very quickly which makes tax estimating a haphazard guessing game.

Overall its been a good year all round.

Had a bad day, hoping for a better one

December 23rd, 2009 at 03:26 pm

Yesterday, we take the car in to be fixed on our way to work (planned). Of the two potential repairs, its the more expensive one (of course). For the second day in a row I contact a company regarding a nonworking gift certificate (no response on either day) and the crowning piece of disaster, my phone.

I decide I need minutes on my phone but something is up with the website so I call. Guy doesn't listen well and decides he knows what my problem is and promptly deletes my phone number of 5 years (heart attack begins). I spend the next 60 minutes mostly on hold while he tries to fix it. Then the phone hangs up on me. When I call back, the line is so busy that they won't let you wait to talk to someone. He did fix it online eventually but my phone thinks its a different line. Fortunately the real phone number works its just labelled wrong (no I am not going to call so he can break it again). I finally manage to buy minutes for my phone.

This all occured before my work day had even begun. After work, we get the car back and realize that the little rattle they managed to fix but that they created a bigger rattle that made the car sound like it was trying to tear itself apart. *Sigh*

So I both started and ended my yesterday on a sour note. At least a client brought us fancy chocolate wafers and cookies. Dark chocolate makes everything better.

So far today I have had more luck. Got the company on the phone re the gift certificate and sent the car back to the repair shop so they can fix their oopsy. Our current stance is you broke it, you fix it. They are going to have to talk fast if they want us to pay for a second repair since they had all day yesterday to get it fixed right the first time. They didn't call till 4 yesterday despite having told us the repair would only take half a day. The slowness of their work is starting to get obnoxious but until this repair, they did a good job for a decent price so we have been putting up with the repair times.

Is this week over yet? Blah.

The 401(k) dilemma

December 16th, 2009 at 03:13 pm

I like 401(k)s. They reduce the tax you need to pay, they help you save more than you could in an IRA and sometimes you even get matching funds.

Hubby is getting access to one through his temp agency. So what's the problem? Its through the temp agency. Technically hubby is supposed to get hired on by the company he is currently working for so he might get it started and then have to transfer the money because he got hired.

The other issue? Contributing will delay the debt payoff by two months.

That said, I am still leaning towards having him do 15% to the 401(k). If he doesn't get hired by the company he is working for, this will keep our access to a 401(k) so that we can squirrel away money. I hate delaying the payoff but its better to establish good habits now then to wait for a better time later (which may never come).

I will just have to make sure to fully fund my roth by the end of next year (which should be doable despite the setback).

Cashflow vs bang for your buck

December 11th, 2009 at 03:23 pm

I don't actually know which I value more. I have a non-deductible mortgage (since its not big enough to allow me to itemize) at 6% apr and a deductible student loan at 5.15% apr. Come July, I am going to have to decide which I want to start prepaying. If I prepay the student loan, I increase cashflow by $200 once its gone (and its only about $13k now so not big). After that, I can throw all of that at the mortgage.

If I prepay the mortgage (which has fha insurance on it) I get to pay off much more interest but I don't free up my cashflow for a long time. The student loan will naturally be paid off before the mortgage even though the mortgage is a 15 year.

Course all of this changes again if I refinance next year(if I refinance, it would be without the fha insurance thanks to equity in the home) which would also lower the interest.

I have awhile to solve this question or to have things change on me so its not a huge deal, its just surprising that I can't decide which choice I like better. They are a little too close.

Down to two credit cards

December 4th, 2009 at 03:19 pm

Today I paid another one off. I won't get to do that again until February. We also started our allowance diet yesterday which should last till the end of March. It allows us to stay on pace despite some expenses cropping up that we weren't originally counting on. That said, we may have a few more show up to slow us down. In fact, I am practically counting on it. That's part of the reason that I am not making larger credit card payments, I need a cushion of 2k to feel comfortable.

Looking at the upcoming debtfree budget, we will once again have all of our bills and allowance fit on just my paycheck (or even hubby's current base pay since he is making a little less than me momentarily). That's a nice feeling.

Wondering what to do about next year's taxes...

December 3rd, 2009 at 10:49 pm

By my calculations, we will probably get back around $900 this year (only getting that much thanks to 2 months of being unemployed in our house, otherwise we would still be paying in). That's all fine and dandy except that this year we had a $1500 energy efficiency rebate which is the only reason we aren't paying in. Next year we start paying an extra $500 per year in taxes to repay the homeowner credit.

On top of that, Hubby might get hired on full time next year. Full time will mean access to a 401(k) next year so we may be able to sock enough away to get the tax back down. Oh, and most likely I will regain access to an HSA this upcoming year. I bet that could get our taxes down. Still would need the 401(k) though to get it the rest of the way under the $1k no penalty limit...

Bah, this is much easier when both people are salaried. Hubby's overtime kills our tax bill every year, lol.

2010 Financial Goals

December 3rd, 2009 at 04:12 pm

Positive Net Worth (should be reached in Feb)

Debtfree (should be reached in June or July at current pace)

Max out one Roth IRA (should be reached in December, will probably max the other one for 2010 in Jan 2011)

Accomplish 2 home improvement/repair projects(preferably landscaping and electric work).

2 real vacations (don't have to be long, just go somewhere new).

And I am pretty sure we won't have anymore money after all that (well, besides the savings towards more home repairs but that is accounted for another year).