A while back I did something I never do: I applied for new credit cards for me and the hubby. After some serious hard thinking, I decided we could do better with our rewards. We switched from an Amazon card to a Schwab rewards card.

We liked the Amazon card, but really, did we need Amazon gift certificates? we used them, but CDs, DVDs, and books are fun but not really getting us ahead. (It had 1 percent rewards)

The Schwab card pays 2 percent rewards, in cash, into a Schwab brokerage account each month. So, instead of a CD we'd actually be getting an investable asset as a reward. Much more our speed.

Caveat:This wouldn't have made sense for us if we didn't already have all of our investment accounts at Schwab. We do.

We already have one brokerage account but decided to open one specifically for this card. It is now the auxillary college savings account for our Beans. Any money we save for college that is above the $2,000 a year per kid we can deduct from our state taxes in our state 529 goes into this account.

After some serious math, we decided we could reach our goal by socking away $4600 a year per kid total in all accounts.

Anyway, I just want to say that after several months the rewards card is working out nicely. It took more than a month for the first deposit to show up, but since then it has shown up regularly.

We charge our day to day expenses and then pay them off every pay day. So far, the card has put about $100 into that account. I deem that a $100 bonus for money we would have spent anyway.

Hopefully I can figure out a way to grow that money for my Beans' college.

New Year's is just around the corner, so I am my usual contemplative self. I sure hope 2009 is easier emotionally than 2008.

As you probably remember, my dad died in July and I added the first baby to our family in April, quit my job, etc. All of that was emotionally very draining. (The baby still is. Good thing he's cute.)

It was a year of unknowns, but here we are.

We made it. Our savings goals were better than I had ever imagined. We managed to exceed our goals for the year. Despite me not having a full0time job. (I freelance, when I can get the work).

We have settled into the routine of being parents. Sure, we don't like spending so many nights at home, but it hasn't been all terrible. Once you get through those first three months, it gets a lot easier.

And, thanks to our No Spend Month experiment (http://www.middlepathfinance.com/no_spend_month/, honey and I talked about money and got on a budget for the first time ever. I'm hoping this will get us in even better financial shape. All of the 2008 goals I did without his input. I just did them, because I manage the money for both of us. (He helped, of course, by working!) Maybe we can do more amazing things in 2009 with both of us on the same page.

Our goals aren't as ambitious for 2009, I admit. They incorporate some more personal goals, like weight loss, travel, novel writing, etc. Money, sure, but it's not as at the forefront, mostly because I have no idea if I can get as much work thanks to the economic downturn. We'll see.

Am I the only one who gets contemplative this time of year?

I've made my final list...

Jan-Feb:Migrate all of my Web sites to a new publishing platform that will hopefully let me take them to the next level content-wise and money-wise! Go to New Orleans to visit my friends.

March: Write a novel in 31 days, it doesn't matter if it's bad. This will be my first. Start a once-a-month Stitch n B*itch at my house.

April-May: Take a vacation with just the hubby either to Mexico or France.

Summer: Take Mom to San Francisco

Health: Join the gym, do yoga, and lose 5 to 10 pounds.

"Green" Goals: Reduce electricity usage by 20 percent by the end of the year, through efficiency upgrades.

Home: Expand my veggie garden. Grow 150 pounds of fruit and veggies at home. Build a stone wall around my flower beds, and build a patio in the backyard.

Financial Goals for 2009:
We will be making less money this year (sigh), but for the first time we have a mutually agreed-upon budget.

$9,000 to savings/EF
$2,500 to hubby's Roth IRA
$2,000 to 529 plan
$600 to new car fund
Total: $14,100

Pay $3,600 extra on the student loan.

I do not know how much work I will have this year, but the goal is to put all of it into my IRA until it hits $5,000, and if there is any more than that, use it all to pay down the student loan.

Tiki Fund/ $20 challenge Goal:
$2,100

A while back I bought some National City stock because the price was too temptingly low to pass up. Now, they a being acquired by PNC bank and NCC shareholders will get 0.0392 shares of PNC common stock for each share of National City.

I sold 100 shares of National City last week, for a small profit of $75. I still own 100 shares, so it looks like I will be getting a paltry 3.92 shares of NCC, worth about $175. That's about half what I paid for the 100 shares. Oh well. You can't win them all.

I added $5.46 to the tiki fund today. I sold two toys on my web site and after costs, mailing, etc. that is the profit.

I also sold 100 shares of National City today for $3.00 a share. I profited $115 on that sale, after all brokerage fees are accounted for. Normally I don't hold short term, but I thought I would take a chance. And, because it was held in my IRA, I don't have to pay taxes on the profit. At least not yet. That's a wrap for today!

After the hubby and I were left scratching our heads yesterday after the 777 point drop, we woke up today with a new plan. Well, an old plan really.

Yesterday, we didn't know what to do. We weren't going to be dumb enough to sell stock and seal our losses. But we wondered if we should be tightening our belt more and stocking up on our cash reserves. Or, if we should be buying more stock. We just didn't know.

Hubby and I decided to stick with our original investment plan. Several months ago we had discussed a plan to eventually get out of individual stocks and into all Vanguard mutual funds. We based our portfolio on some of those in the "Lazy Person's Guide to Investing" (A great book, by the way).

"When I woke up today I thought, what better time than now to buy some more Vanguard mutual funds?"

Cruising through our accounts, I realized we had $10,900 in cash in various accounts. Just sitting there. I have no idea why. I guess with the Baby Bean we forgot about it and just left it there to earn like no interest.

So, I bought mutual funds on the cheap today.

Our portfolio is a 10 Vanguard fund model, for maximum diversification. large cap, small cap, international, emerging, and bonds, basically.

Today, we diversified with some VIVAX, VISVX and NAESX. (All funds we had planned to buy but hadn't yet.)

I guess, in times of turmoil, sometimes the best plan is no change of plans at all.

When the market tanks, I like to think of stocks as being on sale. Most of our money is in Vanguard funds, but we do have some money we use to buy individual stocks.

So, since they were so cheap, I bought 100 shares each of Huntington Bancshares (pd $4.50/share) and National City (pd $3.50/share). I am very familiar with the operations of both of these banks, thanks to my job.

For very little cash outlay, I picked up 100 shares of each. I figure at these prices, I won't lose too much if they go down more, and if (when) they go up, I could stand to make quite a bit. The key is to sit tight and let the market work out the kinks.

I have socked away about $2700 into the baby bean's 529 plan.

My strategy is to build a diversified Vanguard portfolio, one fund at a time.
So far, the money is invested in:
-Vanguard Aggressive Growth Index Portfolio -Vanguard 500 Index
-Vanguard Developed Markets International Stock Index
I'll add more options once more money is in the account.

Also, I had a conversation with my MIL today. The in-laws want to contribute to his college, but they are retired. Every dollar they would contribute would come out of an IRA, and would thus increase their annual taxable income. They are trying to avoid this as they live in a very high tax state (Vermont).

This is a problem that hadn't even occurred to me. So, we tried to figure out what accounts would work best for them. I'm at a loss, so if any of you have any ideas on how to address this problem, I'd be interested to here them.

I just finished the first Rich Dad Poor Dad book and am halfway through the investing one, which is the third in the series. I'm not sure what I think of them. At first, I was interested because they were a little different than the standard p. finance books out there. But now, I don't know.

In the investing book, there is a lot of talk about generating assets. I think the idea is right on, but I'm not so sure the advice is as nitty gritty how to as I'd like it to be.

I'm wondering if there is another book out there that could give more concrete advice on how to create assets and generate passive income...

One day, I would like to not have to depend on work and jobs for money. And not just in a living off of dividends in retirement kind of way, you know?

Anyway, if you have any thoughts on this. Or any book recommendations, I'd love to hear them.

I'm a financial journalist, so I think I do a decent job managing my finances. But, every week at the library I load up on 4 or 5 personal finance books and read them all just in case. I call it job research, and usually it's no big deal.

But last night, I read the Automatic Millionaire by David Bach. It was great. So simple. And,even though I do a good job staying on top of the cash as family CFO, it made me realize we weren't paying ourselves first and we could do so much better.

We hadn't "paid ourselves first" since Hurricane Katrina threw a wrench in our plans. But that was almost three years ago. I guess that kind of financial/emotional stress makes you even more conservative, to your own detriment.

So, this morning, I hit the computer and automated our savings.

I set up bimonthly transfers to our stock brokerage account, my hubby's Roth IRA, the high-interest online savings account, and the 529 college savings plan for our soon-to-be-born baby.

The money will be taken out on the Monday after each payday and will be enough to max out our personal savings goals for 2008, and then some.

I hope it will also instill more discipline because now we REALLY only have what's left over to spend.

Today was also great because my hubby's annual bonus finally came through. Although taxes cut it in half (love those taxes), it allowed us to pay off the new windows we just had installed. I had used the credit card as no-interest loan for them, so that's now paid (And I get rewards on top of that...)

I also socked away the "monthly payments" I should have made to the above accounts in January and February, so we will be on track for the year.

I boosted the reserve in our checking account, too. I had run the balance razor thin since Christmas, in part because of the holidays and the window expense. I wanted to pay for all of that with normal cash flow, not savings, even though they were larger, partly unplanned expenses.

And we still have a little left over. I think what's left will (hopefully) be enough to cover any out of pocket expenses we'll have to pay the hospital when our baby is born this Spring. Of course, it's nigh impossible to read the mind of the insurance company...

Well, looks like the stimulus plan is going to make it through. I'm really not a fan of the idea, but I guess it's time to at least entertain the idea of what to do with the money.

Bush won't be happy. It won't stimulate the economy.

Looks like we're in line for $1,200 as a couple.

With a new baby due April 4, we've decided to put all of it into junior's 529 college savings fund. We'd planned to contribute $2,000 this year (that's the max for the state income tax deduction). So we'll only need to put in $800 after that to reach our goal.

Hey, I don't know how expensive having a baby is going to be, so it does feel good to not have to think so much about scraping together the money for that future college education!

Another check from a freelance assignment came in the mail today, so that's another $225 toward the IRA goal. I'm now up to $2,199 out of the $5,000 I want to contribute for 2008.

Here's the rub. I was reading the IRS guidelines on IRA contributions (yes, I'm a geek) and it appears that I have to subtract half of my self-employment tax from the amount I am allowed to contribute. .

If I have a good year, this won't be an issue, as I will have enough freelance income to max out the IRA and then some. But if I make less than $5,000 this year, I won't know exactly how much I can put into the IRA, due to the SEP calculation.

What to do.

I guess these are the challenges facing the self-employed.

At the moment, I've just been putting the entire freelance check into a reserve bound for the IRA account. I guess I can wait and see how much I have in it at the end of the year and do a quickie calculation.

Any other ideas?

I sold two book through the Amazon marketplace, so those profits are going to the Tiki Bar Fund.

(I'm applying the $20 challenge principle to my Tiki Bar Fund-- using new sources of revenue to boost my savings.)

The total sales came to $17.87, but after shipping and fees my profit was only $7. (Boo.) The tiki bar fund total is now $399.19.

I should be able to add more to that by the end of the month, due to some pending eBay sales.

On a more exciting note, I just got a check for $1,947 for a freelance project I did late last year. It's going directly into my IRA.

My goal is to max out my IRA this year with $5,000 in contributions. This is a good jump start. Only $3,053 left to go!

On another note, I just got $75 worth of Amazon gift certificates in the mail. We use an Amazon credit card to and these are our accrued "Rewards". I used the certificates to buy my crib mattress, so that was a nice bonus for baby that didn't have to come out of our pockets.