Everybody Loves Your Money

Living for today – Planning for Tomorrow

July 27th, 2009

Cash in the Bank Equals Options

I’ve always been a decent “saver” when compared to most people. I’ve diligently saved in my 401K and have tried to save in other places as well. I always considered saving to be a responsible thing to do and it gave me peace of mind when I was worried about my employment, or other instabilities in our lives.

As a 37 year old, this current economic crisis is really the first one I’ve witnessed. Sure, there was a decent crash in the 80’s and then there was the dotcom meltdown but neither of those really hit me like this one. So far, we’ve been financially unscathed by this ugly economy because we’ve both stayed employed. I’ve actually viewed this as a great opportunity to buy additional mutual funds and a couple stocks. As Warren Buffet would say, “it’s all on sale”. So, we’ve increased our contributions to our 401K’s to nearly the annual maximum. We have also increased the amount we are putting in our daughter’s 529 plan.

What I haven’t done as well as we could is increase our general savings account balances. Sure, we have a decent amount in there but it’s not at the level that gives me the options I want when it comes to real estate. Had I been more diligent about saving, I’d probably have enough to buy an additional property with cash right now. As it stands, I’m short and we are taking a more aggressive approach to saving in hopes that we’ll be able to amass enough cash to buy a property that is near us at the lake.

Never before has it been more clear to me why it’s so important to save aggressively. While many people are suffering in this downturn, there are a group of people out there that are salivating at the opportunity to buy property and investments at prices they wouldn’t have dreamed of a couple years ago. Money is power.

As I was saying, we are taking a more aggressive approach to saving so that we can get our cash balance up to a level that we haven’t seen before. The main reason for this is that we’d like to buy (and control) a rather dumpy property next door to us at the lake. This lot has an old single wide trailer on it and was occupied by a 77 year old man until he passed away last year. His kids have used the place a couple times but they’ve made it clear they plan to sell it at some point. With the real estate market in the tank, it’s likely that whoever buys it will rent it out instead of clearing the lot and building a nice, newer home. Frankly, we don’t want to see the place rented out. The two people that have a lot of capital to buy places like this out there would both love to buy it. Both of them have a track record of renting to shady characters where drugs, partying etc are a normal part of their routine. We don’t want to live near that kind of situation so we’ve decided to try to buy it. Our thought is that if we own it, we can either fix it up and use it as a guest house for people to visit us, or we can clean it up, paint it, throw some cheap carpet in and rent it out ourselves. The beauty is that if we rent it out ourselves we can be more picky about who lives there and if we have trouble, can just send them on their way. If we hadn’t been saving and were living paycheck to paycheck, we wouldn’t even be able to dream of doing this. We’d simply have to sit in our place out there and complain about the situation. Anyway, I have seen the light, so to speak. We will be working hard to increase our account balances so that we can make this deal work. At the same time, we’ll also be working hard to stay employed. :)

July 24th, 2009

Woman Has All the Answers at Her City Council Meeting

This video cracked me up. It’s a woman who has taken a couple minutes out of, what I can only assume, is an action packed day of business meetings, to come tell the Santa Cruz city council how they can solve all their economic problems. Brilliant:

See more funny videos and funny pictures at CollegeHumor.
July 15th, 2009

We Finally Had a New Roof Put on the House

Money has been really flowing out the door lately at our house. While there have been lots of little expenditures like new cel phones (yes, I bought the Iphone 3 GS), we also had the expense of putting a new roof on the house.

A few of our neighbors have already had new roofs put on their houses and have been paying anywhere from $15,000 to $22,000. Yes, it is ridiculously expensive. Here’s why: The old roofs are “shake”. In order to put the new HOA approved Presidential shingles on the house, the old shakes have to be removed and then the entire top of the house has to be “sheeted” with plywood. The reason for this is because when a house has cedar shake roofing, they don’t install plywood underneath. Instead there is what they call, “skip sheeting”. This means that there are roughly 3” gaps between 1X3 wood boards. (That’s probably more than you ever wanted to know about roofing.) So, we had to pay for the removal of all the old shakes, installation of all new plywood, and then we had to install some of the most expensive roofing that money can buy. Our homeowners association only allows homeowners to install either new shake roofing, or 50 year special Presidential asphalt roofing. We didn’t want to install new shake roofing because it’s more of a fire hazard than asphalt roofing and it is also quite expensive.

I got a couple bids for new roofing and most of them fell within the range that I mentioned above. I did get a cheaper bid but I was worried about the quality of the company. In the end, I hired a friend of mine who has extensive roofing experience (along with his cousin who owned a small roofing company). I was able to get the roof done for less than $14,000. While that isn’t a huge savings, at least I could trust them. And heck, saving a couple thousand dollars on the job didn’t bother me one bit.

So, I’m happy to say the roof is complete and we are ready for a rainy winter. Unfortunately our bank account is feeling a little hollow these days. While we still have a decent savings balance, we’ll be focusing on getting our savings back up to our normal level. That’s even more of a priority for me now as my long term employment seems a bit shaky with all the potential layoffs my company is considering.

Other than that, we’ve been busy trying to enjoy our summer weather here in the Pacific Northwest!

July 7th, 2009

Religious Leaders Living Large

I just read an article about David Cerullo. David is the head of the Inspiration Networks religious organization. They have nearly $100 million in annual revenues, mostly from donations by their followers. The church preaches that people who donate are more favored by God.

Unfortunately the ministry is hitting hard times and has had to lay people off, turn down the heat and cut costs wherever it can. Apparently it can’t cut costs at the CEO level. David Cerullo is making $1.5 million per year and is building a $4 million home in a gated community in western South Carolina.

I think I prefer my religious leaders to live a little bit more modest lifestyle…….

http://www.usatoday.com/news/religion/2009-07-02-cerullo-money_N.htm

|
Find out how personal loans just got easier for your family.
Links

Compare Mortgages | Compare Loans