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Archive for April, 2008

2008 savings goals

April 30th, 2008 at 05:46 pm

A while back, I read the Automatic Millionaire and it inspired me to put my savings on auto pilot. It is a simple idea, but it's been working out great for us.

I was worried that the checking account would dip or we somehow wouldn't be able to keep up with the aggressive saving strategy I had set up for us, but so far it is working well.

I originally earmarked:
$500 a month to online savings act.
$175 a month to 529 plan
$360 a month to brokerage act
$325 a month to hubby's Roth

I recently upped it to
$600 a month to online savings
$200 a month to 529 plan

and added an additional $100 a month to my student loan payment. (On top of the $293 I already pay).

I've also managed to put more into the savings account than I had originally intended each month, so it seems that $600 has become the minimum saved, rather than the total.

If you had told me 6 months ago that I'd be able to put this much away a month, I would have told you you were crazy. Especially since I gave up my full-time income for freelance and we have since become a one and a half income family.

It's amazing what you can do if you just take the plunge and stop talking yourself out of it.

The end result of all this is that we are more than halfway to meeting our 2008 savings goals, and it's only (almost) May.

We have put $10,685 into various savings and investments. Our goal for 2008 was to sock away $18,600. So less than $8,000 to go.

This really makes me wonder what we were spending all of our money on before!

529 Plan investments vs taxable retirement income??

April 29th, 2008 at 03:44 am

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.

Tax rebate came today, and baby hospital bill No. 1

April 26th, 2008 at 10:23 pm

I was surprised to see that my tax rebate has arrived in my checking account already.

Of course, that spurred a heated debate about how to use the money, even though we think the whole rebate thing is a terrible idea.

We agreed that the hubby can buy a new video game, I can 'spend' an equivalent amount (I already put my $100 in the tiki fund), and then we'll figure out what to do with the rest.

We joke that since the gov't was upset that folks will use the money to pay off debt that we should put ours towards our one debt (my student loan) just to represent...

In reality, it will likely go to the bean's 529 plan or to savings because we are planning to get a new roof this summer. Not very exciting, I know.

In other news, the cost of giving birth to our bean was about $9500 for the delivery. Just got the bill. Insurance is covering all but about $336. That's much less than I thought we'd have to pay. Of course, we still need to get the bill for the two days in the hospital following birth. So we'll see. But I was bracing to pay thousands, just because you never know what insurance companies are going to foist on you, so this is a small relief.

$84 to the tiki challenge

April 23rd, 2008 at 08:26 pm

I added $84 to the tiki fund. It's part of an $884 2005 tax refund we just got from the state of Louisiana, after a long and frustrating battle. The hubby took a small part of that and bought a new game for his Playstation, so I took my part of the "spending" money and spent it on the tiki fund.

I'm happy to report that it's put me just over the halfway mark for my year's goal.

No, I don't realistically think I can open a business on a meager $1500 a year in savings. This is just to get my toes in the water to see if I can in fact save something for this bigger goal without putting my family finances on the line.

So far so good!@

$30 to fill up- a Civic?

April 20th, 2008 at 09:30 pm

Wow. I'm not usually one to pay that much attention to gas prices. Hubby and I work from home a lot and live close to shopping, but even I had to take notice when it cost almost $30 to fill up my Honda Civic hatchback. The gas tank is barely 9 gallons!
I really don't know how folks with big commutes are doing it...

Baby Bean is saving us money...

April 20th, 2008 at 12:06 am

I don't want to jinx myself just yet but Beanie is approaching 3 weeks old. I just paid the bills and our spending has taken quite dip during that time. I guess all the late night feedings and changings, the need for 24 hour care, etc. is saving us money so far. No energy to go out, I suppose. Although, we are heading out to a rock show tonight. Just waiting for grandma to show up to take over. But this will be money well spent on a well-deserved night out!

Savings and student loan dribs and drabs

April 15th, 2008 at 04:18 pm

My aunt Cam sent $20 in a card for Beanie's birth. I transferred it into the 529 plan. Every little but helps! Maybe in 18 years that $20 will be worth $25!

I also paid an extra $100 to the student loan this month. It's down to about $15,500. Considering I started with $40,000 in 2001, That's not too bad.

When I worked full time, I'd always used any extra freelance money I earned to pay down the loan. Some months, I put an extra $400 or more to it. My goal is to have it paid off in full in the next two to three years.

That's the news. Nothing exciting. We decided we are going to cash the Louisiana tax check and just hold the money in reserve in case it turns out to be a mistake. If it isn't I'll put some of it toward the student loan and some of it into the tiki fund.

Louisiana just can't get it right...

April 14th, 2008 at 08:14 pm

Some of you may know I lived in New Orleans for 10 years, and was forced to move by Hurricane Katrina. (This was my house, which I miss..)

Well, we have been fighting the Louisiana dept of revenue for a good two years over our 2005 tax return. They just couldn't get straight that we moved in Sept. and earned income in another state. Of course, we paid Ohio tax on that income and Louisiana tax on what we earned in Louisiana.

For the past two years, Louisiana insisted that I owed Louisiana tax on all the income we earned, even what we earned in another state.

They wanted us to pay an additional $2,000 or so to them, and had issued a notice that they could start seizing assets. I was very steamed.

After multiple phone calls and multiple faxes of our 2005 state tax returns, I got a surprise in the mail today.

A refund check from Louisiana for a little more than $800. With no note.

I have no idea how they went from you owe us two grand to we owe you $800. I'm almost afraid to cash it, because it's probably yet another administrative error...

I loved New Orleans but general incompetence at every level of government and industry is why we chose to leave after the storm.

This whole tax nightmare has just been a constant reminder not to wax sentimental about going back!

Anyway, I don't know what to do now. Call about the refund or just cash the darn check?

The cost of baby Bean

April 11th, 2008 at 05:15 pm

I have posted about how worried I am about the cost of raising our new baby bean.

He's only bean alive 10 days, so it's too soon to tell, but I wanted to start a tally.

We've tried to be economical with everything.

The avg. new parents spends about $6,700 before the baby is born on thing like cribs, clothes and supplies. We spent $600. Everything was used except the crib. We also received many clothes and boxes of diapers as gifts. They have really come in handy!

Diapers: We spent about $200 on reusable cloth diapers, a brand called Happy Heiny's. They are one size fit all, so they should last. We bought some new and some lightly used through a diaper exchange.

Right now, we're using disposables, just because his belly button hasn't healed up yet and it's nigh impossible to fold down our reusable diapers to keep from irritating it.

Food: Right now, it's all about mama's milk. But the pump we borrowed wasn't getting the job done, so we rented one from the hospital for $60 a month. (about 2x was we expected, but still MUCH cheaper than formula.)

If we have to supplement for some reason, I have oodles of free Similac formula samples that the pediatrician and hospital gave me. I also received some free samples of it in the mail from Similac. It's all in the cupboard just in case.

College: Yes, I've been saving for Baby Bean's college since the first Ultra Sound. Right now, we're putting aside $175 a month into a 529 plan, which is enough to max out the $2,000 a year state tax deduction.

Still no word on the hospital bill. I have a 90/10 plan, and for some reason I'm under the impression that our out of pocket is capped at about $3,000. So we'll see. I am expecting to pay at least $3,000 for our birth plus 2 day stay at Chez Hospital.

Oh, and we did pay a $15 co pay at the pediatrician, and we'll have to do that again later this month.

Overall, I'd say so far so good. Beanie isn't totally breaking the bank.

Although, I am wondering how I am ever going to manage to go back to work....

$15.71 to the tiki $20 challenge

April 8th, 2008 at 02:55 am

Yay! I added another $15.71 to the tiki $20 challenge today, thanks to some sales on my Web site. That brings the total for the year up to $689.66. Not too shabby!

The baby bean has arrived

April 6th, 2008 at 04:18 pm

Well, we finally did it. The new baby Bean (Raymond, after my grandpa who died last March) arrived April 1 at 7 a.m. after only 25 hours of labor. Phew. There is a reason they call it labor and not tickle party.

We've been home from the hospital for 3 days. Everyone seems to be in good health so far. Although, mommy and daddy are exhausted. I knew it would be hard, but I didn't know it'd be quite this hard.

No sleep, constant feeding, crying. Seems like the little guy is either passed out asleep or if he is awake, screaming his lungs out. I'm hoping that's just a phase. He is after all, brand new and the world must seem a bit overwhelming.

He and I are both having a pretty bad week! (Until the week I get the hospital bill...)

Speaking of money...

Not that I can even give it much thought right now but I will have more to add to the tiki fund soon. Probably about $20 but I haven't done the math yet.

And I'll also have another $2,000 to put toward retirement savings, thanks to a check for a freelance project arriving while I was in the hospital. Since I haven't decided whether to do an IRA or a Solo 401k , I'm just going to stash the dough in savings until I have time to think about it.

So that's the news!