(+0.67% Month / +23.41% YTD) November 2008 Networth
With the S&P 500 down almost 45% YTD it was nice to see a minimal increase in our networth for the month as well as a steady increase in our YTD networth. Here’s how November shook out….
November Highlights
- As habit now, we saw a steady decrease in our IRA accounts. Thankfully we only have about 30-40% of them invested in the markets and rest is cash, but it is still pretty depressing watching the values drop as fast as they have been. But hey, I guess it’s not lost until you sell it and we don’t plan on doing that anytime soon.
- The majority of our increase came from our cash savings once again. Because we were able to save over 40% of our income this month we were able to get within $9,000 of our $22,500 down payment goal. Although we were hoping to have the full $22,500 saved before we found a house we may have to adjust that plan. I don’t want to jinks us, but we just put an offer in on a house in a great location and priced perfect for our budget. If we end up getting the place we are not sure what we’ll have to bring to the table because different types of loans require different amounts down and we aren’t sure what type of loan we are going to be getting. However, if needs be we will dip into our real emergency fund to cover whatever we are short, but we are hoping to work it out so that won’t be necessary…let’s keep our fingers crossed. Maybe later this month we’ll have a good news post.
- Our credit card bill was a lot higher than normally budgeted this month, but that is because of Black Friday. We had some money set aside outside of our monthly budget for Christmas gifts so that is why our balance is so high. However, we’ll be able to keep our streak alive of never paying a cent of credit card interest.
If you’d like to see how we’ve made it to where we are and how our networth has grown over the year check out the “Networth Page“
How To Go Bankrupt While In Prison!!
At one time or another I think we have all wished we could become millionaires overnight. For some people, especially professional athletes, that is exactly what happens. Many of these athletes have grown up with next too nothing and are then given millions upon millions of dollars over night. Because these atheltes have never really had money, it seems to be very difficult for them to manage.
I ran across an article about how Michael Vick went from multi-millionaire to bankrupt in less than 2 years with one of those years spent behind bars. I’ve listed some of the the more interesting expenses below that were part of his “statement of financial affairs” filed on November 13th.
Amount of deal Vick signed with the Falcons in 2004: $130 million
Pay, per hour, Vick gets for washing pots and pans at Leavenworth Prison: 12 cents.
Amount paid for an Easter egg hunt: $700
Amount of check labeled “chump chang”: $1,000
Amount Vick was sentenced to pay to house and care for the 47 pit bulls: $928,073
Number of cars Vick owned at one time: 9, including the ‘07 Land Rover for his fiancée; the ‘07 Cadillac Escalade for his fiancée’s mother; the ‘07 Land Rover for his brother Marcus; the ‘08 Mercedes Benz for his financial advisor, David Talbot; the ‘06 Cadillac DTS for his pal Rodney White; and the ‘07 Ford F-150 he drove himself.
Sticker price of the ‘07 Infiniti Vick bought for his fiancée to keep in Leavenworth so she has something to drive while visiting him in prison: $65,000
Amount mysteriously categorized as “miscellaneous” over two years: $3.5 million
Vick’s ongoing cost to support his fiancée, their two daughters, his brother, his mother, a former girlfriend and his son with her, per month: $20,000
Amount Vick still owes the Atlanta Falcons from his signing bonus: $3.75 million
Amount Charles Reamon, Jr., a friend Vick put in charge of his finances while in prison, went through: over $3 million……….0% has been accounted for
Here’s the full statement of financial affairs.
CEO To Work For $1
Desperate times call for desperate measures. It looks like the auto industry really is strapped for cash and will do just about anything to get a chuck of the $700 billion bailout. Apparently Ford CEO Alan Mulally, will agree to work for $1 if Ford uses any of the money they are hoping to get from congress this week. That would be a pretty significant pay cut 
.
However, according to Ford, it does not anticipate a liquidity crisis in 2009, “barring a bankruptcy by one of its domestic competitors or a more severe economic downturn that would further cripple automotive sales.” The loan would provide a safeguard against worsening conditions, the company said.
Another point that I found interesting was that they plan on selling their 5 corporate jets after the CEO’s of all three automakers flew to Washington in separate jets to ask for financial assistances. That just makes me laugh.
It was good to see congress force these auto makers to give a better explanation of why they needed this money and what plans they have to become profitable and repay the money….I wish that would have happened with some of the earlier bailouts. If you are intersted, here is the rest of the article
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November 2008 Spending Report
As you can see, November was a pretty ordinary month for us. We were able to hit our savings goal of 40% to stay on track for our down payment and Black Friday didn’t affect us too bad 
. Here are a few of the highlights.
Miscellaneous
Normally we try and keep our misc category to a minimum. That way we are able to better track exactly where each dollar is going instead of throwing any random/odd charge into misc. So if we need to make an adjustment it will be easier to spot our problematic areas. Our goal has been too keep the miscellaneous expenses under 5% of our income, but as you can see this month we were 7%+. In looking back at why this happened I think a lot of it was because of Black Friday. We were searching for Christmas gifts for friends and family and ran across a couple deals we couldn’t resist. Isn’t that how it always happens? If you go out on Black Friday, you’re bound to bust the budget. When all the dust had settled and we had returned what we really didn’t need, we still ended up a little over budget so we made some adjustments to other categories to compensate for the over spending. Hopefully now, the majority of our Christmas shopping is behind us.
Savings
Once again, we feel like we should just be counting our blessings. We were able to keep our savings goal of 40%+. Although we aren’t able to put 100% of this 40%+ towards the down payment of a home (part of it is 401(k) & HSA savings), about 25% of it goes towards our down payment fund. We are now more than half way there and should be able to reach our goal a month faster than we had previously projected.
Gas
Gas wasn’t a huge part of our budget, but that is a good thing. I think one of the positive aspects of the downturn of the financial markets has been the fact that gas prices have been dropping just as fast. Just last night I was able to fill my tank up for $1.42 a gallon. That is more than half of what it cost less than five months ago. It has eased the stress on our budget which has been a huge blessing during this holiday season.
$25 PayPal Cashback
Every once in a while I run across a deal that may be of interest to others and today I saw one from Blockbuster and PayPal. If you sign up for a Blockbuster membership using your PayPal account you will can receive a $25 cashback reward…the only catch is you must be a paid subscriber for at least one month. If you quit before the month is up you will lose your eligibility. The good news is you can get a plan for as cheap as $3.99 / month which means if you cancel your subscription after one month you’ll still be netting $20+ and you’ll have free movie rentals for a month.
When you click the link to see the deal be sure to click the “see all plans available” link above the checkout button to see all of the subscription plans available. Offer valid thru December 22, 2008.
As always, be sure to read the fine print, here are a few of the highlights.
Terms & Conditions: Any BLOCKBUSTER Online plan qualifies for the $25 Cash Back Offer, so long as you remain a paid subscriber for one monthly billing cycle. Please note however that any plan changes made to your account prior to the end of your free trial will nullify the remaining period of your free trial and you will be charged for the new plan selected.
Eligibility:You must be a new BLOCKBUSTER Online subscriber in order to take advantage of the free trial to BLOCKBUSTER Online and this Offer. Current BLOCKBUSTER Online (BLOCKBUSTER Total Access™ or BLOCKBUSTER® By Mail) subscribers are ineligible for this Offer. Additionally, you must have a United States PayPal account to be eligible for this Offer. Your PayPal account must be in good standing. Restricted, locked or closed PayPal accounts are ineligible. You must have a confirmed email address (confirmed by PayPal) to redeem your cash back payment from your PayPal account.
Click here for further details
146 Days 39 Minutes & 12 Seconds
What’s that you ask? That is how long it has been since my last post. During that time I’ve gone through a number of life changing events, but now that things have settled down I hope to be able to focus more attention on the blog and doing the things I love to do. I will be much more consistent at posting to the blog and will return to the habit of daily posts.
Although it’s been almost 5 months since my last post I do plan on updating my networth statements for the months I missed so you can still see the progress we were able to make during the downturn of the financial markets. Therefore, I may adjust a few dates so it looks like I posted in previous months .
Thanks for your patients and have a wonderful Thanksgiving.
October 2008 Networth
Wow…I really did not think that the market would continue it’s downward spiral like it has, but boy was I wrong. With a more than 10% decrease in our IRA, it was the second consecutive month that we saw a decrease in our overall networth. One bright side of the month was that we only saw a less than 1% decrease in our overall networth while the S&P was down almost 17%…..that’s not YTD, that is one month. I am hoping things will settle down once the election has past and we know who will be leading the country over the next 4 years. Here’s how we look at the end of October….
October Highlights
- We are now a little more than halfway to our goal of $22,500 for a down payment for our home purchase. We did not think we would be able to get there quite as fast as we are, but with the little rent we have to pay each month it has allowed us to save more than budgeted.
- Another month of massive increases in our HSA simply due to the fact that we are full funding it each month and we started it just last month. We were able to deposit a little over $675 plus the company match. It will be nice to have a medical emergency fund established and not have to use our regular emergency fund for medical purposes.
- Overall, another great month after all that has happened in the financial markets.
September 2008 Networth
Another month and another rough go in the financial markets. I was hoping that the markets were going to begin settling down a bit, but it looks like the exact opposite has happened. Although over 50% of our IRA accounts are invested strictly cash we still saw an almost 7% decrease in the accounts. Overall, our networth only dropped about $35, but that is mainly because a good chunk of our networth is straight cash (emergency fund and down payment savings). I guess in a market like this, that’s not a bad thing. Here’s how September ended up looking….
September Highlights
- Our credit card balance was a lot more manageable this month. We got all of our moving expenses taken care of last month so this months balance is about what we are spending each month on our cards. We are hoping to have a balance between $1,100 – $1,500 each month with our normal monthly purchases.
- We had a 200%+ increase in our HSA, but that is becuase it was the first month that we actually had money taken out of my paycheck and put into the account. We are currently depositing the maximum amount allowed each month since it is all pre-tax. We figure we’ll eventually use it for medical purposes so we might as well be paying anything we can pre-tax.
- Our 529 plan saw an almost 5% decrease in the month and that is even after a $50 deposit in the account.
August 2008 Financial Ratios
Another great month of ratios. Our liquidity ratios are looking a little healthier than they actually are because our monthly expenses only include a $575 rent payment and absolutely no utility payments. If we were to actually have real bills I think it would be closer to 6 or 7 months, but still above our goal of 6 months.
Our savings ratios have also been rocking since we have been living in the basement of family. We are currently trying to save up for a down payment and possibly a second car so it’s nice to have almost half of our income going straight into the bank.
August 2008 Networth
It looks like the financial markets settled down a bit this past month which was a nice change after two months of pretty significant decreases in our IRA’s. Also, this past month my work started a 401(k) matching program as well as a new high deductible health insurance plan which included an option of a health savings account (HSA). Here’s how everything shook out…
August Highlights
- It doesn’t show above (becuase I made the transfer at the end of the month and the money hadn’t cleared), but we completely funded our 3-6 month emergency fund at $22,500. That was a big goal we had been shooting for for quite sometime and we finally made it…Horray!
- We set up a new savings account and started our next goal to save another $21,500 for a down payment on our first home. We are hoping to be able to accomplish this within the next six months as we will now begin our search for our first home.
- With the beginning of our 401(k) it felt really good to finally get some free money. You’ve got to love the match. Rule #1 – Never pass up free money, it’s an immediate 100% return on your money. Although I am only getting a 25% match on the first 6% of my contribution, it’s free and I’ll take it.
- Our monthly credit card statement is still a bit higher than we’d like, but it’s because we put our $1000 moving truck charge on the card.
- With a 3.86% increase in our networth we are right on track to hit our annual goal of 25%.
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