Happy (early) Independence Day! My wife and I are spending tomorrow on the lake with her father and step-mother. We’ll be enjoying lots of sunshine, boating, and BBQ.
As I get older, I realize more and more how blessed I am to live in America. This country offers priceless freedoms, amazing opportunities, and unending inspiration.
Have a safe 4th of July.
We had a lot of money flowing out in June, going over our budget in almost all categories (click on spreadsheet below). I’m beginning to sound like a broken record when it comes to our budget.
My wife and I have committed to doing a better job of watching expenses in July. In fact, we have already declined a couple of social events to help us get July off to a solid start.
Working on it.
We had a lot of financial action in June. Our investments ended on a down note, but we still increased our net worth by $3,979.67, to $13,022.20 (click on the spreadsheet below).
We’re tracking nicely to meet our 2007 net worth goal of $22,000. It’s just over half way thru the year and we’re currently at 59.19% of our annual goal.
Unfortunately, July looks like it will be a very weak month for our net worth. We went so far over budget in June that we will have to use money that would have been deposited into savings in July to cover our June expenses. We also used a $1,000 reimbursement check from my company to get my Roth funded a bit earlier. If the business charges post to the credit card next month, we’ll have to use most of our savings to pay it back. I’m hoping the charges will hit after our July statement, as I receive 3 paychecks in August and will be in a much better position to pay.
My wife and I started attending a bible study on Wednesday nights a couple of months ago. It runs just under 2 hours, and attracts a large group of people. We’ve enjoyed attending immensely, but I have to say, last nights class was my favorite discussion yet.
FINANCES! I would have never expected that this would be one of the topics we would cover. I expected it to focus on tithing, but it was equally, or more, focused on getting out of debt.
Did you know in the bible:
Faith is mentioned under 500 times
Prayer is mentioned about 500 times
Money is mentioned more than 2000 times
So, I guess it’s an appropriate subject for bible study.
The pastor explained how he and his wife were in debt $250,000 at one point, living in a rental home, with creditors calling daily. Here’s how it happened:
He landed a great graphic design job right out of high school (he went to a vocational school) and a couple of years later, he and his new wife moved into their first home. He began to fill that home with expensive toys. He took pride in these material objects, enjoying being the guy on the block with all of the cool stuff. He got in the habit of spending more than he earned, ended up getting over his head, and losing everything. He lost the house, the cars, the boat, etc. He said it was the lowest point of his life, and that he could understand why people consider suicide. He began working two additional jobs so they could pay down their debt. During this time, he also began praying, going to church, and even tithing. In fact, the week he began tithing, he was called into his boss’ office and fired. He couldn’t believe it, he felt like he should be getting blessing that week, not fired.
The owner explained that they hadn’t made money in 3 years and he was sick of losing money because of the company. Not sure what to do, he pleaded for his job and explained to the owner numerous ways that he thought he the business could be improved and made profitable. After hearing him out, the owner said, “if you think you can do such a great job, why don’t you take over the company’? He told the owner that he didn’t have any money, and the owner’s response was, ‘I didn’t ask you for money’. He ended up making more that first month he was running the company than he made in all three of his jobs the previous month. That allowed him to quit his two other jobs, and spend more time fixing his relationship with his wife, and getting involved in the church.
They focused their income on paying off all of their debts, and succeeded in paying everything off, including their mortgage, in 7 years. They then bought a new house, and began renting their other house. The $1,200 of monthly rental income was added to their mortgage payment, and they paid the new house off in 8 years. They used that same technique with another house, and now have 3 homes paid for. Now financially independent, he became a full time pastor.
He didn’t give us his testimony to brag. He wanted to show that having even a basic understanding of finances can improve your life dramatically.
I could see that he was getting people in the room excited to pay off their debt. He even provided a debt reduction worksheet to help people get on a plan. This was a real world financial education being taught in bible study. He was careful to explain that where your treasure lies, your heart will follow. And that you don’t want to be in love with money, but to be a good steward with what God has provided you.
My wife received a psychology degree from a UC school; graduating with a 3.5GPA. She currently has a good paying, flexible outside sales position, but wants to get into pharmaceutical sales. I have no doubt that with her education background, leadership skills, and personable disposition, that she will be successful in any endeavor she wishes to pursue. Plus, she’s gorgeous, so that helps too.
Great job sweetheart!
I was reading about scams the other day and it got me thinking.
I don’ t believe I have been duped many times, but a story that immediately came to mind was a time I was took for $20, and gave it to the guy with a smile. A few years back, when I was living in an apartment, my roommates and I were kicking back in front of our place when a guy walked up looking sweaty and tired. He explained to us that he was our new neighbor in a unit just across the pool, and had run into some bad luck. His moving van ran out of gas down the hill, and he was trying to get everything moved in to his new place before he had to work that evening. He asked if he could borrow $20, and repay it the next day. Wanting to be a helpful neighbor, I gave him $20 and wished him luck. After a couple of days of not hearing back from the guy, I began knocking on the doors of the apartments across the pool. No one had heard of a new neighbor moving in, or had seen the guy. I couldn’t believe how gullible I was. It wasn’t so much the $20, but the fact that someone would take advantage of another person that was trying to help.
Another story that came to mind was the time my buddy bought a VCR (before DVD’s) from a guy selling them out of the back of his trunk in a parking lot. My friend gave the guys $50 for a new, unopened VCR. He raced home, excited to test his new purchase. Upon opening the shrink wrapped box, he realized that instead of buying a VCR, he bought a VCR box filled with bricks. Granted, he deserved what he got for buying what would likely have been stolen merchandise.
Do you have a good story of a time you have been coned?
Special thanks to Silicon Valley Blogger at The Digerati Life for doing a superb job hosting the 91 Ways To Wealth: The Carnival of Personal Finance, Epic Journey Edition. Out of 91 posts, I’m proud that my post Credit Reports and Credit Scores was selected as one of the Editor’s Choice.
Thank you also to Clever Dude, Blunt Money, and Cheap as chips for picking my post as a one of their favorites in the carnival.
401(k)
Our 401(k) is currently at $13,184.13. We have increase our contribution from 2% to 3%, effective July 4. To better diversify our 401(k), we have reduced the percentage allocation of each mutual fund, and added a couple of additional funds. Our current holdings are:
16% – JH Lifestyle Aggressive (1.47% expense ratio)
16% – Pacific Rim Fund (1.46% expense ratio)
16% – Real Est. Securities Fund (1.19% expense ratio)
20% – Natural Resources Fund (1.49% expense ratio)
16% – International Small Cap Fund (1.55% expense ratio)
16% – Small Cap Index Fund (0.95% expense ratio)
I really dislike the high expense ratios of my 401(k) choices, and I was surprised to find they increased on some of the funds since my last post, and went down on others.
My wife is eligible to enroll in her company’s 401(k) plan in October. She will get a 100% match on the first 3% and a 50% match for the next 2%. Needless to say, we plan to invest 5% of her paycheck to get the company match (free money).
Roth IRA’s
My wife and I have opened Roth IRA’s thru Vanguard.
For my wife, we invested $3,000 in Vanguard 500 Index Fund Investor Shares (VFINX) (0.18% expense ratio).
And for me, we invested $3,000 in Vanguard Total Stock Market Index Fund Investor Shares (VTSMX) (0.19% expense ratio).
We hope to have both Roths fully funded by the end of the year.
Taxable Accounts (Brokerage, Prosper, etc.)
Our 300 shares of ADVENTRX Pharmaceuticals (ANX) are now worth $798.00. My parents gave me this stock, and have a large amount of money invested in this stock. Since they first bought in, the stock has almost doubled. They expect it will go to $10/share. That would be sweet.
My wife and I invested $100 in two Proper loans. Both loans are current and our average interest rate is 12.23%, which is great, but for a variety of reasons, I’m glad we didn’t invest more money.
Savings Accounts
With just a $1,286.79 balance, we haven’t made as much progress on our saving as we would like. Most of our spare money has gone to funding our Roth IRA’s. We should be able to build this up the 2nd half of the year. Our goal is to eventually have a $10,000 emergency fund.
We feel that things are clicking along nicely. We’re working towards our goals, while not having to overly sacrifice. God willing, this success will continue.
