Friday, November 30, 2007

Another non-millionaire...

Another post by the Millionaire in the Making Series, featuring the Magtibay family. This family has a geat income, lives in a low cost of living area, and appear to have the ability to save a lot of money. Currently they have $180k in 401k, $23k in IRA, $14k in 529, $81k home equity, and only $3k cash at 38 and 36 years of age. They make $115k/year and have a mortgage of $252k.

First major problem is the Magtibays have very little cash on hand to overcome any difficulties. They used their entire cash savings to purchase a home. This is a bad idea. If either lost their job or became disabled they have no taxable savings to tap to fall back on.

Second, they don't fully contribute to their Roth IRAs annually. This is a fantastic retirement tool while their incomes still allow them. Also they can easily afford to maximize their 401ks with such a high income and low mortgage, but they don't. Why?

Because of problem three. This couple unfortunately loves new cars. So much so they lease new cars every 5 years. Currently they are leasing a Nissan Altima and Pathfinder for $850/month. Honestly if they would just own and keep a car, that $850/month could easily be diverted into retirement/college savings.

According to Money Magazine, the Magtibay should be millionaires by the time they are 50. However I don't think with the lifestyle they lead this will be nearly enough to cover their spending. They'll have to continually generate income to cover a new car lease. Perhaps this couple with degrees in finance need to reconsider their finances.

Thursday, November 29, 2007

Wedding Registeries - Cash only?

Is it tacky to register for cash for your wedding? This question was raised on the WIR message board. My answer "Of course." It is super tacky to register for only cash.

Yes, the couple might be able to use cash for a house downpayment or honeymoon. Or they already have enough things for the house. But honestly charging your guests to come to your wedding/reception seems to me in poor taste and tacky.

A woman wanted to know if it were rude to register online for cash only gifts. Using a site such as Answer from most people was yes. Especially since most people said it's the perogative of the attendee to give a gift.

My main argument against such a registry is there often is a minimum set, such as $25 or $50. What happens if the person doesn't want to "gift" you with $25 or $50? Then perhaps they should give the happy couple nothing.

But what if the happy couple complain? My answer, why did you invite those people in the first place? If you want someone at the wedding whether or not they give you an expensive gift or cash, shouldn't their presence be enough?

Since when is it expected for a couple to get a wedding present? And to set a minimum $ amount? Yes it's nice to bring a gift, but if you only invite people for the gifts they bring, well why are you inviting them.

I can't believe the levels now couples are showing their greed about their wedding presents. You can be sure if I'm invited to a wedding where I am expected to make a cash donation, I'll still buy them a gift and for the dollar value I feel is appropriate. Not a set minimum amount. And this is extremely against both DH and I cultural/background inclinations where we give $$ (cash). And the present won't be as generous either because I'll feel it's forced giving. Typically if I know the couple reasonably well I'll give $50-100. Depends on lunch/dinner and location of the wedding, usually enough to cover our meals. However to be told I need to give $X bothers me a lot.

What do you think? Have people take wedding registries to a new level of tackiness by specifically asking for cash? And by setting a minimum gift amount?

Wednesday, November 28, 2007

5 Brown Bagging Tips...

How to save money by bringing your lunch? These 5 tips help me save money by making it convient to brown bag our lunches.

Tip 1: Pack your own soda. I stocked up on Coke a few weekends ago @ $1.99/12 pack. That is $16.6 cents/can. Instead of 60 or 75 cents/can, pay less than 20 cents. Even better don't drink soda, but that's not an option for my DH. So he takes a can or two cans a day. When he was a graduate student we'd put 2-3 cases of soda under his desk and he'd sell them for 75 cents/can to people too lazy to walk to the vending machine.

Tip 2: Use a reusable lunch bag and tupperware. Some people take actual brown bags and put sandwiches in ziploc bags. This is easy to portion control your servings and even easier to prepare for the week. But it costs money to buy brown bags and ziplocs. Instead use a tupperware and wash it out and use a foldable cooler.

Tip 3: Buy large bags of snacks and portion it out. If you love eating chips, cookies, or veggies, don't buy the individual snack size. Instead buy the family size bags and portion it out. This way you can control your calories by only eating one portion. Plus it's cheaper than stopping by the vending machine to buy an individual package.

Tip 4: Make leftovers. Personally DH hates sandwiches, and with most receipes serving 4-6 we usually have enough for lunch the next day. The great part about this is as a couple we don't waste leftovers. Also it's cheaper to cook in bulk instead of buying smaller portions of meat and vegetables.

Tip 5: Prepare your lunch the night before. This is simple for us. We usually pack up our dinner leftovers and decide what we want for lunch as we clean up. Occasionally we'll make a sandwich. This way we aren't rushing in the morning to prepare lunch. Instead we reach into the fridge go.

These rules make it easier for us to save money buy bringing out lunches. DH now spend $5/week eating out and I spend none. For us we conserve our eating out to dinners when we're tired. A lot of people easily spend $25-50/week eating lunches out. Try these tips to save a few bucks.

Tuesday, November 27, 2007

Festival of Frugality #102

The #102 Festival of Frugality is hosted by cheap healthy good. I submitted my post on "Income versus Frugality."

Couple of great posts is "Make your finances Six Sigma" by PFOdessey. Just made me think of my DH. Second fun post is "Talking money is like French Kissing," by Monevator.

Enjoy the Festival.

Cheap Gym Option

A cheap gym option for Costco members is $199/year at 24 hour fitness. I loved that gym because it had so many classes. Also when we lived in CA they were everywhere, so I could always find one close to home to work out.

Unfortunately now there isn't any 24 hour fitness gyms nearby so working out is a lot more expensive. However for those who have a 24 hour fitness nearby check out this deal.

Staying fit and working out should be a priority for everyone. It's great to be financially fit, but you have to be healthy enough to enjoy your money as well. There is no point in saving for retirement if you die before you get there.

Even thin people need to exercise to fight osteoporsis as they get older.

Monday, November 26, 2007

Festival of Under 30: Give Thanks Edition

The Festival of Under 30: Give thanks edition is up at How to Make a Million Dollars. My article on Single Life was submitted.

I like this festival for under 30s. But it's so small, so please try and participate if you are under 30.

Carnival of Personal Finance #128

The #128 Carnival of Personal Finance is up at Stock Trading to go. I submitted my post on "Managed Car Insurance".

Again a fun carnival check out the great posts. Two posts to check out is "22 Money Maximizing Moves" by Moolanomy and "Why passive investing is better than active investing," by everything finance. I wish my DH would read and agree with these articles.

Sunday, November 25, 2007

Have I saved enough?

On a board I visit, I was surprised that someone posted hating saving for retirement. They did not want to save 15% for retirement. Instead they preferred paying off their home. This couple was 33/35 and made $165k/year. However they had saved about $50k for retirement.

A poster on the board put up this link for a nifty retirement savings calculator. Assuming the average age of the couple to be 34, they should have saved at least $94k to have $1M @ age 65. This should generate $40k/year.

However this couple didn't want to save 15% of their income. Instead they preferred to try saving 15% of $40k, or the average family's income. They felt that if the average person saved that much they should be okay. WRONG thinking.

They aren't living on $40k now, so I don't understand why they would expect to live on $40k in retirement. I wonder if people don't justify saving less by saying they'll scale back their lifestyle in retirement? Which might be a problem if you consider rising health care costs and longer life expectancies.

Anyway I apparently need to have saved $57k, which I do. However DH needs to have $67k, which we also have. However we assume we'll need $3M, so we should have 3x that amount. I think we're moving in the right direction because it appears that between 26-27 the amount saved is only $4k. We're saving about 5-6x that much for retirement. But we have a long way to go.

So to that couple, I wish you would rethink you're priorities. I understand it's nice to be debt free, but it's even nicer to be able to even retire. If you place saving for retiement so far down on the list what will you live on in retirement?

What's Important?

What is important in life? What is the bottom line? Is it wealth? Debt Free? Family? Love? Happiness? Health?

The year is ending and it's time for people to make their New Year resolutions. But what resolutions will be at the top of your list? What is important to you?

For my topping my list is losing weight. I am attending weight watchers and have lost 10 lbs. I am doing this to improve my health. It's so I can live a healthier lifestyle and hopefully extend my life with my DH. Sure it costs money, but if I die earlier watching my pennies, then I'll have had little enjoyment in life.

I guess for me what's important is family and love. And being healthy enough to enjoy sharing my life with them.

I just wanted to post to get people thinking about their resolutions for the new year.

Christmas Budget Poll:

Well the poll for Christmas budget closed. It was interesting. It appeared that 10 people spend between $100-$500, while 13 people spend between $500-1000 for Christmas. That equals to 31% and 44% respectively. So the bulk of people fall into this category. I wonder if the majority of these voters fall between $250-750?

Also 3 people spend less than $100 and and equal number of people spend above $1000. This equals to 10% of voters.

I fall into the $500-1000 category for everything. I guess I'm in the median/average number. Do you think this is high?

Saturday, November 24, 2007

Cost of Living Calculator

I thought I'd have fun and see how much where you live matters. So I used the cost of living calculator at Money Magazine to determine different cities I'd live in.

Now, starting out I put in Boston, MA and moving to Seattle using a $100k salary. Woohoo. I found out that I would only need $84k to live in Seattle. Wow a 16% decrease. Awesome. Basically housing and utilities will cost us 20% less, groceries and healthcare will cost 8% less, and transportation is equitable.

Now to move back to San Diego, CA we'd need $108k instead of $100k, which is an 8% increase. Gee whiz. How so? Well housing is about 40% more expensive, however utilities are 23% less. And transportation is 5% more, but healthcare is 8% less and groceries will be 2% less. So it computed 8% more money is needed.

Phoenix, AZ would only cost us $74k to live on instead of $100k in Boston. Wow. That's amazing. Groceries will be 17% less, housing will be 40% less, utilities will be 27% less, transportation 6% and healthcare 22% less.

So where you live matters. It really affects your ability to save and live within your means. So does this mean you should move to an area solely for the cost of living? No. But it probably should be considered when looking at job offers. And how cost of living will affect the lifestyle you desire to lead.

Friday, November 23, 2007

Black Friday

Well today is Black Friday. The first day of the year when most stores finally go into the black. Meaning they are finally out earning their expenses. Sadly it takes them until basically the last month of the year to "break even" or make an income. Crazy. This is the biggest shopping day of the year in the US.

I usually enjoy Black Fridays because it's fun to get deals on things I plan on buying anyway. And I'll get up early to enjoy it. I don't stand in line, but I will go after the store opens. At least that's what we did this morning.

We went to circuit city, best buy, sports authority, and sears. All in all it took us with driving and parking 3 hours. Not bad. This year we were considering staying at home until an ad by Circuit city drove us out. Our two big items we wanted were Mario Galaxy for $35 and a Sony car stereo for $99.

Yep normally we buy a game here and there, and I've been dying for Mario Galaxy. However due to our schedule we thought to wait to buy it used at Christmas. Well low and behold CC had it on sale for $35! We sold our used Paper Mario for $40 after buying it for $50. I bet if we finish this by Christmas we can sell it for $40.

As for the car stereo, mine's been broken for a few months. And we've been looking at used car stereos and a replacement face on ebay. But it hasn't been a priority. However this stereo was $99 including installation! What a great deal, plus it has an ipod adaptor. DH could do it himself but he didn't want to so when we saw the deal we made a huge push to make sure we went and go it.

And since we were going out anyway we decided to swing by the other 3 stores and pick up things we needed. I got two sweaters and two workout pants, DH got a sweater. We also got Fever Pitch, 2 handsfree bluetooth headsets and ipod accesory kit. Now all I have left is CVS shopping and we're done for Black Friday.

Did you score some major deals? Previously we've scored some nice deals including an external harddrive, computer monitor, telephone, and camera. But this year we didn't really need much.

Thursday, November 22, 2007

Happy Thanksgiving!

Happy Thanksgiving! I enjoyed a great meal of smoked turkey, cranberry & grapefruit relish, stuffing, apple pie, homemade ice cream, candied yams, butternut squash and pesto casserole, green bean casserole, and spinach and artichoke dip. The only thing not homemade was the gravy, I cheated since we smoked the turkey.

And I guess while I'm at it, I'm thankful for my DH, family, friends and everyone's health and well-being. A lot of family has passed early in the year, but now it's better. I am ever greatful for the blessing heaped upon my family. The most important is their well-being.

So onwards to the new year!

Wednesday, November 21, 2007

Single in your 20s?

What's it' like being single in your 20s? It's a time when you are getting established, working your first real job, and making real money. However you are also encountering your first real expenses like paying back the student loan, rent, utilities, car insurance/car payment, setting up your own place, etc. None of these adult behaviors are cheap.

However, an important area of your life is meeting the right person. And in meeting the right person having a courtship, planning a future together, and eventually entering coupledom.

But the courtship proces is a long and difficult one. Because the average age of women and men marrying has increased it appears that people are becoming more selective and careful during the dating process. But because of this, the dating process has also become much longer and more intensive. People can spend years dating before marriage.

So what's expected in your 20s? Well the problem is that you have to be able to go out to eat dinner. At least once. Maybe not the first date but at least maybe your second or third dates. And if you are the man you should treat (so much for feminism). Then as the women you might pay for drinks. And then it follows from there. Unfortunately couples also go out to pretty nice restaurants, not just fast food. So it costs more than in college. Apparently it's to establish how well off your are.

All these extra financial expectations are hard to meet in your 20s. So what should you do? Should you try to keep up? Or give up entirely? I've heard from all my single friends and the thing is, even when you aren't dating, you're pretty lonely at home so you often go out and eat with other singles or couples just to be kept company. You also participate in more activities to keep not be alone. So singledom is expensive.

So pondering my friends comments, told them, well you're investing in your mental sanity. You can either go out and have fun and try to find "the one" or sit at home popping anti-depressants. Sure it costs money to but if you aren't happy, sitting there counting every penny saved with no one or even people to share it with is lonely.

I feel their pain. Of course marrieds in the 20s...well we have a whole other set of problems...

Festival of Under 30

How to make a Million dollars hosted the "Festival of Under 30." Looks like a small carnival but it might be interesting for those under 30.

Tuesday, November 20, 2007

Heating going up..

Well I thought I lived in an expensive area. Looks like according to Energy Department the most expensive area to heat a house is Boston. I guess I was right. Here's an article discussing heating costs.

Yes the northeast is not colder than Minneapolis or Buffalo. However, the cost of heating using natural gas or oil is substantially higher in the northeast. So though people in New Englad use less energy to heat their homes, their bills look disproportionately larger.

Another factor is that in New England people heat using inefficient oil. But it's very expensive to update a house and install a natural gas system. I'm fortunate in that I have a natural gas furnance and just installed a gas fireplace insert. Unfortunately I still live in an area where it costs 40 cents more a therm for natural gas heating than Minneapolis.

Hence why I complain about my $200/month electric bills for 650 KwH a month. Yet when comapred to other people who use 2000 KwH and pay $200 as well. So I'm using a lot less electricity for a the same amount of money. And why I try to buy the most energy efficient solutions because in the long term they will pay off for me.

We leave our house at 60 when not home and usually 65 when home. This year we can finally heat the bottom floor to 65! Before we left it at 50 because that's what the furnance in the ATTIC would get it too! It would struggle to push heat down 3 stories.

Right now DH is tracking our heat pumps, new fireplace, and regular furnance. We have some baseline readings but we've only done about 2 weeks. We really need the cold weather to kick in and a longer period, maybe a month before we make a determination. I'll post when we figure out our efficiency more.

Festival of Frugality #101

This week Rather Be Shopping is hosting the #101 Festival of Frugality! Lots of great posts including my tip on "Entertainment Book Frugal tip".

Check out these couple of articles. "Have a Christmas you can Afford" by Jennifer Derrick @ Savings Advice. Which is a website I enjoy reading. Seriously have the Christmas that is appropriate. But more on that later.

And is "Frugal Living the New Trend?" by being frugal! I sure as heck hope so. I'll be in with that group of people.

I guess the truth is in my heart of hearts I'm a frugal gal and unlikely to change anytime soon!

Monday, November 19, 2007

Carnival Of Personal Finance #127

The Carnival of Personal Finances #127 is up at Moolanomy. I submitted my article "Do I need a FICO score?"

Looks like a great carnival. However check out these articles by Quest for a Million "Car Lessons", wowsa I can't believe how many cars this guy has had. I feel so indulgent having even one car bought new. He's had 9 cars, sure maybe some were used, but if I buy one car a decade for the next 5 decades of my life I wouldn't have so many cars. I should poll how many cars people have had.

Also check out a Penny Closer for "Home Financing Options". Personally on our first condo we did an 80-10-10, which is pretty good considering how little we made. We did consider a 90% mortgage without PMI offered by Washington Mutual, but were determined to pay down the 10% asap. Turns out it was a better deal. But check out what a Penny Closer did.

Managed Car Insurance...

Today's the day auto insurers propose new rates for car insurance in MA. MA is the only state which state regulators set the auto insurance rates. This article in the Boston Herald discusses the new proposal. So today insurance makers will show state regulators new proposed rates. These rates if accepted will go into effect April of 2008.

The reason for the regulation of car insurance in MA is the fact people are terrible drivers. About 30 years ago the state attempted to have a free market car insurance, but rates tripled. Hence the current system in place is one which manages risk for all drivers by making insurance affordable. Basically it penalizes all "safe" drivers.

So should I support this new car insurance? Well when we lived in CA, we paid a premium being under 25 with new cars although we were good drivers. However since moving to MA, DH does not have the best record. So honestly this managed system of car insurance benefits us a lot. After DH's accidents our insurance only went up $100/year. Not to say we weren't paying a lot for liability insurance about $2k/year for 2 cars and 2 drivers.

However, I cringe when I think what our rates might be if we were to go to a competetive rate system. I think we're personally better off under the current system and so are most MA drivers. Everyone we know has a lot of damage to their cars, even supposedly good drivers. Friends who have moved from elsewhere and never had accidents before, claims that they've had tons of accidents/damage to their cars since coming to MA.

So will this system really work? Can a truly free market system work for car insurance in MA?

Sunday, November 18, 2007


This article is about millionaires in the making, featuring the Bergmans. Unfortunately I don't think money got this at all right. This couple is young 25 and 28 years old. However only due to an inheritance were they able to have any money saved. They make approximately $60k/year.

They have $9300 in a TSP (military 401k), $4500 in a Roth IRA, $8500 in a 529, Mutual Funds $15,200, and $2300 cash. What's the problem?

Two years ago they inherited $50k and yet they have no savings. They also sold a house and made a $25k profit, and again there isn't much savings. Instead they paid off CC debt (great move) about $15k. And they invested $10k in mutual funds.

However they put $21k down on a Honda Odessey. They still pay $440/month on the van and $230/month on a new Toyota Corolla. Because of this they spend about $800/month on car related expenses, which is about 16% a month of gross income on cars.

I don't think they are really used to saving. They spend more on cars than they do on saving. This is for a family living on base with minimal expenses.

According to the article they should hit millionaire status in their 50s and at 41 when Micheal retires from the military they should have $300k. Honestly I think it should be substantially more if they had used the inheritance more wisely and instead of buying a car invested it.

What do you think?

Saturday, November 17, 2007

No Match 401k?

Well someone ask Walter Updegrave about whether contributing to a 401k without a match is worth it?

His answer was yes, try and maximize your retirement savings before you start investing in a taxable account.

This is exactly my thoughts exactly. Because the 401k has many advantages over the taxable account. First there is a tax break. That means you don't pay taxes on the income until you withdraw it.

Second, the gains are not taxed annually. In a 401k the gains are reinvested and compounded. However in a taxable account you have to potentially pay taxes on gains, dividends, interest annually. That amount is not compounded and reinvested.

Third, the limit on the 401k is a lot more than Roth IRA. It's hard to imagine retiring on just $4k/year. However with the 401k you are able to save $15.5k/year. That's substantially more. Plus this increases the diversification of your portfolio. How so? Well instead of just saving in a Roth IRA and taxable account, you also have a tax deferred retirement account. The more diversified investments you have the better off you'll be. You never know what the tax brackets/rules will be in the future. It could be that all 401k withdrawals after a certain age is taxed only at 15%.

So overall, I agree with Walter Updegrave. I'm happy that he talks about maximizing retirement savings first instead of ignoring the 401k just because of the lack of a match.

Friday, November 16, 2007

How to accelerate savings?

Honestly? Well first of all don't have any major fixed expenditures in your budget. If you already commit 25% of our income to housing, another 25% to cars, another 25% to taxes, you'll only have 25% left. How can you save a lot when out of that 25% is your living expenses? And some of those expenses will also be fixed, such as life, health, care insurance, utilities, and groceries.

The best way to accelerate savings is to lower your fixed expenses. That way you have the flexibility to increase and decrease your saving ability as needed.

Another reason to do it early, in your 20s, is that you'll grow into your income slower. You won't get use to spending so much. That way you'll have the flexibility to go back to school, change careers, stay at home with kids, or not work if you so choose.

Savings gives people flexibility of choice. So accelerate your savings by living below your means, and keeping your fixed expenses low.

Thursday, November 15, 2007

Income versus Frugality...

If your income suddenly doubled would you keep the same money habits or would they change? If your income suddenly decreased by 50% would you change your money habits?

This question came to mind last night over dinner. I mentioned buying the Entertainment Book to our roomie. I suggested giving it away to friends as a Christmas Gift. It's $30 and a great deal for couples to go out to eat because most of the coupons are for Buy One Get One Free meals.

Anyway, roomie says most of his friends aren't frugal. They would never use a coupon. They aren't concerned about money. The average income for where live is $100k. Thus most people can easily afford a very nice lifestyle.

Truth is does your income affect your frugality? I think that it does a little, in the sense that you worry less about money. However, I think naturally frugal people still pay attention to spending more than they need to. These frugal people would never pay full price for an item they can get on sale. However, the increased income would allow them to buy a better quality shirt, car, or item than they previously would have. That I think is a trait of frugal people, buying the best quality they can afford.

Unfortunately not all people who are frugal do so by choice. And not all people who spend lavishly can afford to do so.

Hence do you think you're frugal for your income? Or not?

Wednesday, November 14, 2007

Entertainment Book Frugal Tip...

The Entertainment Book is a coupon book for eating out in your area. Most of the coupons are for buy one meal get one free, or 50% one entree. Usually restaurants in the book are trying to drum up business. People usually purchase the book from kids selling them for fundraisers, online, or even Border's.

Yep I bought my book at Border's. Best part about it was that the book was $30 but I had a coupon for 30% off the list price. So I paid $21 for the book. I wonder how much I'll save? I think eating out 2x should cover the price of the book. Although I am considering using my first coupon tomorrow for a hockey game (which will save me $23.50 according to the coupon).

I do realize that by eating out and using coupons I'm spending money to save money. However I look at it this way, DH and I like to eat out. So if we're going to eat out we might as well do it using a coupon. Also it encourages us to try new places. So buying an entertainment book just makes sense.

I write monthly we spend $200-300/month eating out. And I do try to use coupons, for example the McCormick's deal. But for others out there who enjoy eating out, try buying an entertainment book.

But to be really frugal don't eat out at all :)

Tuesday, November 13, 2007

Do I need a FICO score?

Do I need a FICO score? Should I be worried about it? Is it important?

No you do not need a FICO score. At the same time maybe you should be worried about it. And it could be important.

What does that mean? Well it means that if you do not feel a FICO score is important then you don't need one. If you do not want to finance a car, house, or purchase then a FICO score means nothing to you.

However, you should be aware of potential repercussions of not having a score. Currently many potential employers will pull your credit reports during a routine background check to determine how trusthworthy you are with money. This might not be important in some fields more than others such as if you handle money like working at a bank or doing accounting for a company. This could lead the employer to determine if you are likely to embezzle money. Or if you are in research and development at a company, are you likely to sell secrets due to debt? Also some companies use it as a measure of responsibility. If you are a person who pays their debts on time, could imply that you will be responsible at meeting deadlines at work. I've talked with friends in Human Resources and these are a few of the reason they look at a person's credit report/score.

Another reason a FICO score could be important depends on your age. If you are 60, nearing retirement and not planning on financing another home then perhaps it doesn't matter. But if you are in your 20s, 30s, or 40s, and considering moving up in home and still need a mortgage, then it's definitely worth considering. Now people comment all the time about getting a manual underwriter.

However there are two things against manual underwriting, one only a few specific companies do it. So this limits your options about getting a mortgage. If like myself a company is paying for your purchase and you can choose from 3 banks, would you really pay closing costs at a manual underwriter or would you have taken the free closing costs from the company? Second, the rate from a manual underwriter even for the "best" rating is never as good as someone with stellar credit shopping around. Why? Because competition for the mortgage is less so the loan company doesn't need to give out the best rate. I've asked multiple brokers about this and they all say the same thing. It costs more to manually underwrite a loan so they can charge more.

Another reason a FICO score could be important is that it is currently being used for evaluating your risk in car insurance. It's only one factor but not having a score could cause higher rates. Also it determines in many states whether a deposit is necessary to start utilities. The companies want to know what sort of risk they are taking supplying you with cable, internet, or phone.

But do you really need a FICO score? No. Can you live happily without worrying about it? Yes. Just pay all your bills on time and a stellar score will naturally follow. Personally still being in my 20s I definitely am concerned about my score and I do plan on buying more homes. I also probably will move and get another relocation package. So I will have to use again the bank chosen by the company. And I'd rather get a great rate than stuck with a mediocre one because of principals of avoiding debt.

Monday, November 12, 2007

Groceries for the week

This is what I bought for meals for 3 adults (2 males, 1 female). We have most of the meat for the week, so all I bought was mostly fruits, veggies, etc. I am posting because I was wondering if there are any coupons out there. Also I wonder if my groceries are cheap or expensive.

Green Peppers .81 lb @ .98./lb = .79
Maille Mustard $3.39
Red Peppers 1.42 lb @ 1.98/lb = 2.81
Yellow Onions 1.47 lb @ .59/lb = .87
Strawberries Qt = $3.98
Broccoli 1.54 lb @ 1.49/lb = 2.29
Carrots 1.75 lb @ 0.49/lb = .86
tangerine .37 lb @ 1.49/lb = .55
Lemon 2 @ $1/2 = $1
Dried Kiwi $2.94
Butternut squash 1.34 lb @ 1.99/lb = $2.57
celery hearts $2.49
Baby Bok Choy 2.25 lbs @ .99/lb = $2.25
Scallions 1 @ .90/2 = .45
Curry Blocks 3 @ 2.19 = $6.57
Panko (bread crumbs) 2 @ 2.29 = $4.48
Coconut Milk 2 @ .79 = 1.58
Coconut Milk 1 @ .89 = .89
Szechuan Peppers 2 @ .89 = 1.78
1 gallon milk $4.39
1 qt Heavy Cream $4.29
Flour Tortillas $2.29
Ginger .11 lb @ 1.99/lb = .22
turnip 1 lb @ .69/lb = .69
white potatoes 1.59 @ .79/lb = 1.26

Total = $55.68 not bad, but I can't believe how expensive groceries have gotten over this past year.

Weekly meal plan
Sunday Dinner - pork tenderloin
Mon Lunch - pork tenderloin leftover
Mon Dinner - strawberry Salmon + rice + butternut squash + bok choy
Tues Lunch - pasta + sausage
Tues dinner - Salmon repeat
Wed Lunch - turkey sandwich
Wed dinner - spinach and cheese pizza + broccoli + carrots
Thursday Luch - spinach and cheese pizza
thursday dinner - macademia halibut + broccoli + carrots
Friday Lunch - halibut leftovers
Friday dinner - seafood mac and cheese from scratch
Saturday Lunch - leftover seafood mac and cheese
Saturday Dinner - take out

I also made scones for breakfast for the week. I'm probably going to buy some ice cream on sale later this week.

Bad Customer Service

So according to MSN, which company has the worst customer service? Can you guess?

It's Sprint! According to this article they listed the top 10 worse customer service companies. Rounding out the top 10 is B of A, Comcast, Time Warner Cable, AT&T, Citibank, Wal-mart, Verizon, Wells Fargo, and DirecTv. Dishonorable mentions include Dell, Circuit City, Best Buy, Home Depot, Sears, and Macy's.

I'm not surprised that Sprint topped the list. I've had quite a few run-ins myself with them. And like many I often felt like jumping off the bridge while talking to and waiting for a customer service rep.

In fact it was with Sprint which sold my account information and had a false account created which wasn't paid and sent to collections. Rather than contacting me directly Sprint went straight to a Collection Agency. When I called they refused to talk and work with me. Instead they stonewalled me and refused to acknowledge some insider had sold my information. Ever since I've had major issues with Sprint.

As for the rest, well what can I say? Read this article about a nice little old lady charged with assault against Comcast. I feel for her, sometimes I feel like that when I talk to Verizon. They have terrible customer service and often I'm put on hold for at least an hour.

But these companies all have major monopolies and a death grip on their consumer. People with cell phones will rarely change because they often choose companies based on which provide their friends and family have. Or where we lived in San Diego, there was only 1 cable company provider, so to get any TV you had to use Time Warner Cable. So of course they can treat customers poorly when there is no other option. Same thing with banks, there often are limited choices with the consolidation of bigger banks buying out smaller banks. There are less branches and atms, so people are stuck with few choices.

But what can the consumer do other then complain? We are guilty of using these services. I hate B of A, but they have many branches and our company paid for a mortgage through B of A. It seemed easier than trying to move our mortgage and checking.

Do you have any companies you hate or won't use?

Sunday, November 11, 2007

Poll Votes: How many CC do you have?

The results are in. Most people (15, 71% of voters) have between 1-2 cards. A few (3, 14% of voters) have no credit card. An equal number have between 3-4 cards (3, 14% of voters). And no one appears to have more than 5 credit cards.

I believe I have more than 5 credit cards. Admittedly I use pretty much two cards, one mastercard and an american express for Costco. But I have never cancelled the other cards we have. I know we have a discover card, best buy, home depot, and Jordan's credit card. I'm not sure if we have any more. Since we don't use them I probably should call and cancel them and make sure no charges have been made. But laziness ensues where I don't feel like taking the time to cancel the cards or look for them. I also need to pull my credit report.

Christmas Budget

I've been slowly decreasing the amount we need to spend at Christmas. I now send a $25 Harry and David Gift Basket to multiple people in the family. My grandmother, great-grandmother, great aunt, 4 siblings, 3 aunts/uncles, 4 cousins, and two parents. The number used to be so much larger when I bought for all my neices and nephews.

But I decided about 2 years ago after we got married, that I would do family gifts. I felt more like a "married" person and grown up than a kid just sending out gifts. I never sent to my siblings instead we would send each kid a $25 GC to a store. Plus my parents, grandparents all got individual gifts as well.

Now we just spend about $750 because I try to give a gift around $25. Before it was a lot higher with so many individual presents. Also we spend a bit more than the $25/per family because for our parents we'll be giving out $100 GC to Ruth's Chris. Plus we usually buy something for our office, like a box of candy. It's so much less stressful than trying to pick gifts which people will like.

Also this year since we'll be alone together and at home, I'm thinking of actually buying DH a gift. Usually we don't but I may ask him to splurge and have an extravagent dinner out in Vancouver, but we'll see.

How much do you budget for Christmas?

Saturday, November 10, 2007

Christmas package updated..

Well we booked our package for whistler. Not the cheapest deal, but a pretty good rate. The worse part about booking it was the weak dollar made us pay 10% more because the US dollar is so low compared with the Canadian dollar. arrgh.

So what'd we get? We booked 4 nights in Whistler at the Hilton hotel. Beautiful luxury hotel. I've noticed my DH has been less and less inclined to stay at cheap roach motels. Since I conceded this vacation as his 30th birthday present I can't complain. Plus we included 3 out of 4 days skiing at Whistler-Blackcomb. Combined price of the package is $1042 including taxes.

Right now the trip total is $1042 + 90 flights + $350 dog boarding = $1482. Whew, it seems like a lot, and we haven't even booked a few days in Vancover, eating out, and activities. I wonder if we can do the 8 days for $3k? The biggest expense of the trip was the Whistler hotel and snowboarding lift tickets. Snowboarding each was $180 at least. This might be our only snowboarding trip of the year.

I am just hating the weak US dollar. I remember when the $1 USD was worth $1.6 CAD. That would have made the trip more palatable. Although right now travelling anywhere with the USD is a bad idea.

Friday, November 09, 2007

Dog's Health Plan

I pay $30.95/month for each of our dog's health plans. It is the Banfield Optimum Wellness Plan. My dogs have Basic Plus Plan.

This includes annual vaccines, two comprehensive physical exams, annual dental cleaning, and blood and urine analysis. Also included is tests for lyme disease, heartworms, parasites, etc. Another bonus is at any time we can get a health certificate for travel, which usually costs $50/certificate. Also any extra care is given at a 15% discount. I've found their rates to be competitive with other vets in the area.

The best part of the plan is our ability to see a vet at any time without a fee. Typically an office visit costs $45-50/visit. And because Banfield is nationwide in many Petsmarts, you are allowed to go to any Banfield pet hospital and see a vet free. This is awesome. Once while camping, our dog got a tick and we rushed to a nearby Banfield Hospital.

I guess the question is it worth what we are paying for? We pay $371.40/annually. If we took our dogs in annually once, with vaccinations I think we would spend $150-200/year. So about 40% of the cost of our plan. The difference could be saved in case of emergency or if our dogs needed more care beyond the vaccines. However yesterday I rushed my older dog Stefan to the doctor again after finding a tick on him, and I didn't have to pay the $45 office visit fee.

I think it might be a bit cheaper to go ala carte with dog care, but as our older dog is now almost 12 years old, I think it's better to keep a close eye on his health and monitor more carefully than just one quick visit a year.

Of course the cheapest alternative would be to not worry about it, until he's really old and then just put him to sleep. But that just isn't our philosophy.

Do you have a health plan for your animals? What do you normally spend on them annually?

Thursday, November 08, 2007

October Spending and Net Worth Update

We had a pretty good month overall. We spent $271 on groceries for the month of October. Not bad considering we had guests again for the first two weeks of the month. Plus we spent $224 eating out. Also good considering we had guests for part of the month as well. Also within the $224, was the $79.99 spent on McCormick's Gift Certificates which we still have $50 to eat out with. So overall a pretty decent month on food. What I've noticed is that the price of food has increased a lot over the year, considering I keep a price book and I haven't seen as many deals on foods as I used to. It feels as though food has increased exponentially this year.

Unfortunately with guests we were out and about more than usual and spent $193 on gas for the car. Down from our high of $229 in September. However I've noticed gas is creeping up again, so perhaps it's time to adjust our monthly budget from $120 to $140. We typically fill up about 1 week @ almost $30/tank. I rarely drive and DH switches the cars out so we get balanced usage of the cars.

Other than that our spending was pretty much the same in all budgeted categories.

As far as our networth went we increased our net worth by 3.04%. We increased our retirement by $3117 and our cash on hand was up to $11k. However, since the beginning of the month I noticed that our cash on hand is already down to $5k. Typical of our fixed bills. Looking back 1 year ago our retirement was at $29k and currently is at $68k. I see we're making significant progress in our savings. When I figure out our ESPP that will increase our monthly savings, although it mostly is for DH's tuition.

Wednesday, November 07, 2007

One stock shot...

I am firmly against investing in a company you work for. Why? Because you believe in the company probably more than regular investors. You work there, you buy into the company mentality. You often assume you know more about the company than other people. Also because you work there you often believe in the product and it's potential. And you often turn a blind eye to competitors and faults of the company. Why?

You work there. If you were not a believer why work there. Why dedicate yourself to the company.

Last year DH cajoled me into keeping his company stock because he really believed in the company. Personally, I wanted to sell and thought that it was a bad idea to invest anything in the company. So what happened? We lost about 50% on the stock and had to pay taxes on the original amount. It was given to use as company stock at $45 and dropped to $24.

I'm a pretty conservative investor, give me an index fund and I'm happy. DH loves big gains and his mom always hypes individual stocks. But recently she's finally taken my advice (and Warren Buffet's from 9/07 Money magazine), that index/ETF mutual funds are teh way to go. I guess we'll see how a year goes and she may yell at me or not. I think not.

Right now, we're in the position of rebalancing our portfolio and making choices for the end of the year. I want to get out of his company stock finally and dump it. I don't think it has potential for going up and I believe the risk (beta) is high it could tank.

So the question now is do we dump our position in his old company (he left for other reasons), or hold onto it in his 401k? We've left the 401k alone for now, but I'd love to consolidate it into his current position. But in order to do so we'd have to dump his company stock, which he really feels is going up.

Tuesday, November 06, 2007

Consumption Tax?

The question was raised on a message board about what sort of tax is fair. Interestingly the majority of people voted for a consumption tax. What is the consumption tax?

Basically it is a tax by the government on the purchase of a good or service. It is based on someone consuming a good or using a service but not a tax on the labor or material of the good or service. In some ways it is identical to a sales tax.

In order for this to be a workable system, taxpayers would still need to be given exemptions and deductions based on number of family members. This to ensure poor people and those with large families do not pay to consume goods. Also all savings would be deductible under a consumption tax system.

Surprisingly a number of people on the message board were in favor of this new tax rate. I was very surprised. Why? Because most of these people were middle class families, with one primary breadwinner, and two children.

Hence their actual federal tax rate after deductions, personal exemptions, child tax credit is less than 5% and many actually got money back from the federal government in form of child tax credit. If this is the case why are these people in favor of a consumption tax? They will pay a ton more in taxes because they definitely consume more than 5% of their incomes.

However, I think they do not even realize how much they consume. Nor how little they pay under the current regressive tax system. I think that these middle class consumers haven't considered the entire repercussions of changing the tax system.

I think more than a consumption tax a better way would be a flat income tax. More about that another day though.

Monday, November 05, 2007

Forced Charitable Giving?

I was reading on a message board about people who are forced to give to United Way at work. It seems that many of the larger companies pressure workers to give. Companies get plaques and recognition for a higher number of contributors from the company. It makes the company look like a member of the community.

I think it can be a good thing if the company matches donations to any charity. But to require giving by employees seems to take it a step too far. I am happy that DH's company matches 100% of charitable giving up to $1000/year. It's a nice bonus just to make employees feel good.

Although I like the idea of companies matching giving, I am appalled that companies feel it's giving when they are forcing or "encouraging" people to give strongly.

Sunday, November 04, 2007

Flex Spending Account...

It's open enrollement time again. I'm not sure how much to put in this year. I wanted to get lasik eye surgery in 2008, but I'm not sure. I consulted the doctor and was told that yes pregnancy does change your vision. Stupid, but I should have done it last year or two. But I had to wait for my vision to stabilize. Arrgh. I hate being caught between a rock and a hard place.

But the choice is pretty difficult and we only have 2 weeks to decide. If I do it, I'll max out the FSA with $5k. I also have to consider if I would like to have some dental work done. I find it difficult to make these decisions so quickly.

Also if we get pregnant this year, we probably should set more aside. All these decisions to be made quickly. I wonder if we should overestimate or underestimate the number? And if so by how much?

Saturday, November 03, 2007

Rich versus Wealthy...

So on a message board someone asked what's the difference between rich versus wealthy? Rich people spend their money in 1 generation, maybe 2 if they are lucky. Wealthy people pass it on for generations building upon it. I thought interesting way to look at it. This was referring to the press article about Britney Spear's spending habits.

Spears is just another star spending lavishly. However the question arises how long can she keep up this lifestyle? The really rich person is probably the one managing her money and writing her a check. Hence she's rich, but the other guy is probably wealthy.

To further the example her ex-hubby K-Fed made $500k last year in endorsements but only grossed $7500 after expenses. How does he maintain the lavish lifestyle? He had got $22k/month in spousal support and $15k/month in child support. But soon that will end and what will he live on? Another case of being rich, but not wealthy?

Is that an adequate description of rich versus wealthy?

Friday, November 02, 2007

Using Mileage...

Tonight my DH spent about 3 hours trying to book our Christmas vacation. We decided to try and use our mileage on United. Typically our schedules are not flexible enough to use mileage. But this time since we're going on vacation ourselves without visiting family, we decided to go whenever was available.

This trip is DH's 30th birthday. But we're trying to cheap out and use our mileage plans and CC rebates to pay for the trip. As of right now we're going to Vancouver/Whistler. The biggest expense will definitely be our snowboarding tickets @ $60/day.

To use our mileage it will cost 25k miles for a roundtrip ticket on United. According to flight groups online, to get the best deal for your mileage it should be calculated at 2 cents/mile. So our tickets should be at least $500/each to make it worthwhile. Currently tickets for this trip would cost about $500 including taxes. So while not the best deal possible, a reasonable return. It however will cost us $45/per person to use the miles.

Though we managed to use 25k miles I found that it difficult to use them. There are so many limitations and it took so long book. I wonder if it was worth the trouble?