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Net Worth Review: June 2011

cash and net worth

It’s the beginning of the month, which means it’s time to examine last month’s finances and see how it’s affected our net worth. It’s a great exercise to help us see where we’re doing well and what we can improve on.

Our Spending Habits in June

So happy to see that our expenses went down a tad in June. Here are our 3 biggest expenses last month:

  • Home (Mortgages, Extra Payments, HOA Fees, etc): $1,140.75
  • Food (Groceries, Restaurants, Etc): $392.98
  • Bills/Utilities: $216.58

I’m happy that our food bill decreased again this month as we’re trying to limit how many times we eat out and try to have more meals at home.

Checking & Savings

Big news this past month was getting our tax return (finally) and having that automatically deposited into savings. It’s a nice bump and it helped us reach our baby fund goal for the year. We want to increase savings to cover baby expenses that we expect to incur during the rest of the year.

One expected expense is the hospital bill for when the baby arrives. We received an estimate from the OB/GYN for their costs and we got an estimate for the hospital portion. Supposedly we’ll pay the hospital and doctor and my husband will get a large portion of that reimbursed.

Retirement Accounts

We’re still not planning on making any changes to our retirement contributions this year. We really want to focus on more immediate goals of getting ready for the baby. I can’t anticipate the future, but I believe once we have some idea of how we’re going to handle our finances as parents, we’ll look at our retirement accounts and contributions.

My husband’s 401(k) has steadily been going up and it’s bumped up our assets a bit this month. We need to consolidate his accounts, though, and move over some money into a Roth IRA for him some time in the next couple of months.

Our Cars

Both cars seem to be doing well. We’ve had no repairs to do this month, which is nice. We’re still working on building our car replacement fund for the next vehicle. We hope to get a car sometime next year. I believe the VW can handle until then, so we can sell it for additional funds.

In case you’re wondering how I calculate the vehicles’ values, I used Kelly Blue Book. Every quarter I’ll update the values to account for depreciation.

Student Loans

Nothing exciting or new, we’re just chugging along with the student loan payments. Payments have been automated so it’s been relatively easy to keep up with them; we just confirm payments have been made each month. We switched the payments from the end of the month to the middle of the month to break the expenses between our deposits.

House and Mortgage

The mortgage payments are chugging along. As part of our usual routine, our automated extra principal payment (now $175) was sent in on the 15th of the month. When deciding on how much we were going to send in to our lender, our main focus was creating something sustainable and had some impact with the mortgage.

Here’s where we stand today with the mortgage:

  • Total Loan Amount: $110,515.51
  • Interest Rate: 5.00%
  • Loan Term: 30 years, fixed rate

Our goal is to pay off our mortgage way before we retire.  Right now our timeline is about 15 years, instead of 30 years. Once accomplished, we’d love to be able to direct that money into other interests and goals of ours down the road.

Monthly Summary

So glad that we improved and we’re working closer to becoming debt free. Here’s our net worth from the spreadsheet:

Net Worth (as of June 30, 2011): $56,630.81 (+$4,241.37)

Your Net Worth Update

How are you doing with your finances? How are you doing in 2011 so far?

Photo Credit: sushi♥ina

 

Infamous 2 Review

infamous 2 review

In case you didn’t know, besides personal finance, one of my interest is video games.  My husband and I both enjoy them and yes, we do have all three consoles. Last year when we went to E3, it was a dream come true and I loved walking around and trying out the games and gadgets.

Some of my favorite games are action based role-playing games (RPG). They include titles like Knights of the Old Republic, Mass Effect, and Infamous. I enjoy getting immersed into a story/universe and I’m a big fan of the renegade/paragon set up that allows you to affect the story line.

Last month, Infamous 2 came out and we decided to buy it. Usually we wait until the titles are used, but we enjoyed the first so much and went for it the first week. (By the way, I felt the same way for The Force Unleashed and bought the sequel opening week – very disappointed at how short it was).

What I Enjoyed About Infamous 2

I wanted to just briefly share what I enjoyed about the game, in case you’re on the fence on whether to buy it or not.

Storyline

While I thought they did a great job on the first game, I felt that the story line was more cohesive and dramatic in the sequel. Not giving away endings, but both paths lead to some significant consequences.

Characters

Zeke is better developed in the sequel. I didn’t understand how he and Cole were ever close in the first game. They more than made up for that problem in this sequel with better dialogue. Zeke came across as more intelligent and sympathetic.

Gameplay/Abilities

While I didn’t like all the new abilities, having so many options is a huge plus and they really had me changing up Cole’s powers based on the missions I went on.

What I Disliked About Infamous 2

No game is perfect, so here’s what I didn’t like about Infamous 2.

Missions

Some of the missions felt extremely long and repetitive. I also hated overcharge – not completely sure why. Maybe it’s because they reminded me of the satellite up-link missions from the original game.

Monsters

Along the same lines as the missions, I felt like some monsters were more annoying than challenging.

Thoughts on Infamous 2 and Video Games

Overall, I’d rate this as a ‘buy’ game. It’s fun and I can play it again and again. How about you? What are some of your favorite video games titles that came out this year? Which ones are you looking forward to getting in the next few months?

Personal Finance Posts to Catch Up On

If you have some free time this weekend and want some tips and information for your finances, be sure to read some of these wonderful posts. There are some handy tips this week to help you out.

I hope you enjoy reading them as much as I did. I also recommend checking out my blogroll to pick up some great personal finance blogs to follow. Please also let me know what are some of your favorite blogs that you enjoy reading on a regular basis.

Married Food Posts

Marroed Food, my blog on enjoying good meals as families, is coming along well. It’s been a really fun month and I noticed a bump in traffic in the last couple of weeks. Here are some of the most popular posts on Married Food in June.

I really enjoyed Wojo’s article on including your spouse in the kitchen. Cooking seems more enjoyable with some company :)

I know many of your have a long weekend ahead, so have fun and please be safe with your family!

Photo Credit: popculturegeek.com

4 Government Cutbacks that Directly Impact You

cutting back

Even though the economy is in recovery, most government budgets for the new fiscal year required cutbacks to public services.  It was no longer possible to try making ends meet with hiring freezes, deferred maintenance or moving funds from one department to another.

The alternative to reducing budgets is increasing tax revenues.  Most people feel it isn’t a good option during a recession and shaky recovery.  Instead governments had to scrutinize their budgets for ways to reduce expenses with the least amount of pain for all residents.

The budget problems brought overgenerous government pensions and benefits to light and hopefully, reform.  It also results in reduction in services provide to citizens.  Here’s a list of common cutbacks you might experience.

Library Access

Since the recession started, libraries have been a resource for inexpensive to free CDs, DVDs, computers and of course, books.  It is ironic that libraries across the country have been fighting for budget dollars when their services are experiencing high utilization.

A neighboring city to me has closed it’s only branch location resulting in one library to serve over 140,000 people.  Fortunately, my city council overruled the mayor’s proposed budget cutback of library hours to 2-3 days of service a week.

Parks

Local, state and federal parks have all experienced budget cuts.  Oklahoma has shut down seven state parks while California is slotted to close 70 state parks after already severely cutting back hours and services for 60 parks over the past two years.

The result will be increased costs when (and if) these parks are reopened for repairs as well as public safety concerns.  Unsupervised parks will now become attractive to transients and those with criminal intent.

Teachers

Detroit is planning to shut down 70 schools this year on top of 59 that were already closed last year.  California issued over 19,000 pink slips to teachers this Spring and 30,000 last year.

Many of the teachers will keep their jobs due to turnover, retirements and reduced budget cuts.  However, the number of kids in our school system is not being reduced by the same margin.  The result could be larger classroom sizes, fewer classroom aides, fewer activities and/or supplies.

Government Offices

My local DMV office became much more crowded after the state instituted furlough days in 2009 to save money.  All state offices were closed every other Friday.  The impact was not only difficult for the employees who lost income, but the residents dealing with reduced access and busier locations on non-furlough days.

Other states and cities also instituted furlough days or reduced hours.  This keeps people from being able to access services, pay bills and get help at their convenience.  It can lead to lost productivity as workers have to take time off to handle business because evening hours were eliminated.

Have you experienced any cutbacks in public services?

Photo Credit: James Bowe

 

Ask the Readers: Prioritizing Goals and Finances

helping others

I received a message this weekend from someone I know that was having a crisis. He was upset and was feeling completely over his head with all of his problems hitting him. This was a bit over my skills, so I’m hoping you have some tips and advice to help him.

The good news is he’s staying with a relative that can help out with rooming. So he does have a room over his head (huge plus) and rent isn’t an issue.

Here’s the rest of situation that has been stressing him out:

  • He suffers from depression and has a history of bad cycles.
  • He doesn’t have a regular job right now.
  • He’s registered for classes for the fall semester, but still has paperwork he needs completed to get his tuition paid by the deadline.
  • He has some health problems that do need addressing.
  • He doesn’t have glasses and has been using the same contacts for almost a year (they’re meant for 30 days).
  • He has no transportation and remains at home most of the time, which doesn’t help his depression.

Of course, since I’m not there I’m going by what he says. It could be a bit different, but I’ll base my tips on what I’ve been told.

Prioritizing Goals and Finances

It’s hard to deal with several issues at once, so my first piece of advice is coming up with a specific to-do plan.

Immediate Goals

Communicate with others. I think this is key. He has to be honest with his circle of loved ones and tell them his needs. I know that depression can make this extremely difficult, but it is key. As far of resources to tap into, I would suggest organizations like NAMI and local city/county resources. If he’s having trouble getting these calls made, maybe friends can help out.

Short Term Goals

  • Get healthy. My first priority is taking care of yourself physically and mentally. Since he has health insurance, I believe that he should take advantage of his coverage. I believe this is one case of asking friends and family for monetary help. Co-pays are much lower than paying for visits completely out of pocket, so I strongly believe others can step in and help with that.

I want to include a list of resources for those dealing with mental illness and their support network to help them find the appropriate organization.

  • Get ready for school. It sounds as if he’s really close to getting this done. The benefits for him include:
    • 1)it would get him out of the apartment and maybe help him meet new people
    • 2) it would give him access to low cost and free services that he use (a clinic, a credit union, discounts for transportation)
    • 3) it could also help focus his attention on something that he has loved for years

Even if he can’t get it done in time for the fall, at least it’s something he can look forward to in the spring semester.

Keeping it simple is key. If he can only take care of one, getting healthy is it – hands down.

Medium Term Goals

Once he’s able to take care of the immediate needs, I would ask him to focus a few more things.

  • Finding a part time job/income source. I realize it can be hard to find a job with the economy, but I do believe it’s possible to get an income stream started, even if it’s a couple hundred dollars a month. He has the skills to work a couple of types of jobs and maybe he can do work on the side.
  • Have a financial system in place. He needs to get the most basic of budgets set up. I wouldn’t suggest anything remotely complicated until he can handle the very basics.

From there, he can reevaluate his goals goals for the long term and build a list from there.

Thoughts on Limiting Help

We offered our help and hopefully it can alleviate some of the problems he’s having. I’d love to get your take – what would you suggest in this situation? Do you know of any other resources for those who suffer from mental illness.

Photo Credit:  marc falardeau

How to Budget on a Teacher’s Salary

school pencils teachers

Living on a Teacher’s Salary

With the school year done in our area and others, I’ve been able to spend more and more time with my mom on the phone catching up. While she sometimes goes on trips during her break, this year she wants to be flexible as she’s awaiting the arrival of our baby next month, her first grandchild. We’re happy she’s able to offer her help as we get adjusted to our new roles.

It’s wonderful having teachers in my family. Many of my relatives have entered into the profession because they want to make a difference. My mom has been an example for them and others due to her genuine desire to help others and creative approach to teaching.

While teaching is her calling, she’s never forgotten the responsibility she had with her family’s finances. She raised a family of four on her income: it took a lot of sacrifice and work to do that though. She’ s been a teacher for decades and so she’s developed a system that works for her.

I thought it would be interesting to see how a teacher can not only survive, but thrive on their salary. For Couple Money readers who are teachers, your thoughts and feedback would make this exercise more practical for everyone.

Teacher Budget Example

Let’s see how we can use an average teacher’s salary to create a doable budget. I’m using the local county’s pay scale for a teacher with a Bachelor’s Degree, certification, and 5 years of experience. That gives us an annual salary of $41,404.20. Payscale has a list of the average teacher’s salary by state if you’re curious for the full list.

I’m made the following assumptions for the net paycheck calculator:

  • Pay Frequency: Twice a Month
  • Federal Filing Status: Married, Filing Jointly
  • # of Federal Allowances: 1

Here’s how the calculator broke down the gross and net pay:

  • Semi-monthly Gross Pay: $1,725.18
  • Federal Withholding: $150.86
  • Social Security: $72.46
  • Medicare: $25.02
  • North Carolina: $108.00

Monthly Net Income: $2,737.68

Monthly Expenses

My goal was trying to get a zero based budget. I’m also trying to keep the imaginary couple expenses within the teacher’s budget as I believe that learning to live on one income can be a big advantage. This would include two income couples. The second income can be a huge boost for your saving, debt reduction, or investing goals.

My basic tool of choice to get a budget framework? Dave Ramsey’s Gazelle Lite calculator. You can easily tweak it to fit your needs.

  • Housing: $820
  • Utilities: $250
  • Savings: $100 (General Savings)
  • Retirement: $200
  • Food: $300
  • Transportation: $300(Car payments, gasoline, insurance, etc)
  • Giving: $180
  • Medical/Health Premiums: $100
  • Personal: $150
  • Recreation: $100 (Eating Out/Movies)
  • Debt Reduction: $200

Total Monthly Expenses: $2,700

Note: While I try to make the realistic, please don’t get hung up on the exact numbers and instead consider the general breakdown of income and expenses. I understand that paycheck can vary great even if there is a pay grade style system. If you’re looking for ways to tweak your own budget, you may want to check out The Saved Quarter’s Cut Your Budget series.

Ways to Keep the Budget

In addition to watching your spending, there are a few thing you need to keep in mind,

  • Depending on where you live, keep an eye on housing. If you live in an expensive area, buying a house within your budget may be almost impossible. If you really want to own, focus on building a big down payment by keeping your expenses low.
  • Avoid credit card debt like the plague. when your income is limited, it becomes even more important to avoid high interest debt.
  • Smooth out your income and expenses as much as possible. If you are paid only during the school year, see if you can either sign up through Human Resources or a local credit union to have your pay distributed more evenly.
  • Don’t get sucked into a bad car loan. If you noticed the amount budgeted for transportation, you’d probably picked up that the average car loan payment ( $464) wouldn’t be feasible. If possible, try to buy your cars with cash.
  • Utilize the second budget wisely. As mentioned before, if your family has dual income, learning to keep the essentials under the budget of one income gives you some financial freedom. Build upon that by making sure you two are socking away enough money for retirement, paying off all your high interest debt sooner, or build savings for a possible entrepreneurship opportunity like starting a business.

Thoughts on Living on a Teacher’s Salary

I enjoyed playing around the numbers with this example, but the real feedback is from you. How do you keep an eye on your budget? What suggestions do you have for those living on a tighter budget?

Photo Credit: D Sharon Pruitt