Easy Change

Recently I was browsing an internet message board ( Net Worth IQ) and I realized that for the rest of my life I will find personal finance fascinating because so many people have so many different outlooks and perspectives. One person's recent question was essentially: Should I Keep Saving since it doesn't add much to my Net Worth as a percentage of the total? My response is as follows: I think that the real thing you're driving at is whether or not you've reached "critical mass". Bob Brinker uses this term to indicate the tipping point where your investment "dividends" are putting enough out in order to do two things: 1. Generate enough income for you to live your current lifestyle 2. Put out additional income on top of #1 such that the total principal grows enough to keep up with or ahead of inflation. The main point here is that you should keep putting the 1k in each month -- not because you think it will up your net worth by 1, 10, or 50%, but b...

It has been a very long time since I last updated and I've accumulated some stories that I can share about the past few months in my next several posts. I hope that they will be found to be useful and interesting. After a very long period of time, the economy has come back. It seems now, although there are some small shifts day to day and week to week, that the stock market has found some sort of steady point. Of course, there are many that think that this could all change and that there is still a chance of a double bottom. All of this is really a side show in my opinion. What matters most to people is what is happening in their own personal financial life. That is, what is the most important thing in each person's life that keeps them from being happy. For many right now, it is a combination of a lack of a good-paying job and/or an overabundance of expenses. This past six months has been quite good; expenses remain low and the debt snowball continues as I am working toward pa...

I've been using a tool to track my household net worth for years and I think that it has been an enormously helpful tool as a motivating factor for helping me to make the correct decisions. The tool I have been using is NetWorthIQ. You can view a small sample chart that they produce. But I think that more than the chart, it is about the motivation that the chart provides. Besides providing a simple line of how your net worth has grown or shrunk, it shows how your net worth can be impacted by the events of the day and how well you've navigated those storms. Personally, the great opression of 2008/2009 has been awful. It has left me feeling somewhat void. My feelings are not that unique, and my approach is not that unique. From the perspective of making money, it is difficult because the people that tend to do well are people who are far out on the risk curve, people who are doing something different. So, with the net worth tracking tool, I am able to determine that my approach,...

Well, like everyone right now, things are a little scary in this economy. So I'll take this opportunity to focus on some good things that are going on with my personal finances. In a huge feat, I've paid off the car loan (a year early). This reduces monthly outflow by 450 dollars (even though I was paying 600/month). Given the current climate of the job market and the situation with the politics in this country and throughout the world, it seems to me that the safest thing I can do with my money is to pay off debt and give myself more options and mobility. As for the net worth, that has finally come back a little bit with some big contributions for the 401k and the tax returns. Finally, after many months, its finally starting to come back. I'd encourage anyone who is worried about what to do with your money right now that looking at debt as a place to "store" your money is worth considering if you have a fully funded emergency fund (as I do). With these changes, t...

In the latest net worth post I made, I found, unsurprisingly, that my household net worth continues to decline. This in the face of a painfully slow economy, a housing slump, and a languishing stock market. Here's the link to the details: https://www.networthiq.com/people/easychange In short, this month marks a nearly 3.5% decrease in overall net worth. However, all that being said, I feel richer and more secure than I have in a long time. So, what does that tell you? I've made two interesting observations from this: 1. People are aware of the behavioral finance concepts now...especially those who are really 'in tune' with personal finance. That is, if me and my neighbor each has 100k, I feel worse than if I have 50k and he has 10k. The idea being that it is not simply enough to have lots of money, you need to have more than your neighbors to feel good. On some level, it feels a little sad to me, but alas, this is how most people feel/think...and I confess, I am not ver...

This quarter has held quite a bit of interesting stuff. As per usual, the updates to NetWorth continue. Although net worth got over 100k total, I was worried that things would become more difficult with the big drop in the markets. In a strange twist, although net worth dropped, it did not drop below 100k. Big expenses this month have included a new plasma tv (since the old tv broke with a big blue spot that burned in to the center) and a recent purchase of a sliding door. With any luck, things will continue to go well as the financial education continues and the debt continues to be reduced.

Net Worth June has marked a serious improvement for net worth. Largely due to some unexpected income, It was possible to make a serious dent in a student loan. The remainder of this loan is sitting on a zero percent credit card for a few more months and large payments are now going to be directed at it in an attempt to pay it off before the end of the year. That may or may not be a reasonable goal, but I expect that it is. http://www.networthiq.com/people/easychange Business investments continue to do well. I'm satisfied with my paypal interest rate as well as the amount of savings that is now accumulated. I'm also happy with Prosper, of late. The total savings means that given a job loss that there is easily 6 months of expenses saved. This is a huge milestone in terms of emergency fund planning. Of course this will continue to go up and down, but knowing that there is a real cash cushion is something that everyone should be striving for in my opinion. New Thinking I'm r...

This has been quite a ride. Net worth for this month is up again, thanks to the stock market and the continued contributions to retirement accounts. After doing some increased contributions at the beginning of last quarter, I'm noticing very little difference in my paycheck, but the increase in my retirement account is quite nice. Of course I'd like to have more money in there, but the balance is quite nice. As for my situation with debt, it continues to get paid down. I'm tracking that separately over at <a href=' http://www.ncnnetwork.com' >No Credit Needed Network</a>. It feels good to pay it down, so I've taken quite a bit of the money from my side income and put it toward this debt. There is still quite a bit of work to do, but I'm feeling good about it right now. Total net worth for my household is topping 60K right now. http://www.networthiq.com/people/EasyChange

When I started this blog many months ago, like most personal finance bloggers, it was so that I could keep myself accountable and also provide myself with a lasting record of how the financial situation in my life changed over time. It is not an easy journey and I realized how frustrated I was with the amount of money I had. It wasn't that I didn't make enough money. That isn't to say I didn't want to make more, I mean, who doesn't? But it simply means that I found myself unable to really feel comfortable about where all of the money was going. It was at that point that there was a bit of a breakdown and things started to change. Over the past six months, I have made between 300-500 dollars per month of side income. But I think that the key about this money is not that I have made it, but that I have not started counting on it. So today I just cashed another check for about 160 bucks. This is good because my business money is in good shape and I've already put a...

With the amazing work that the market has done - and thanks in large part to the retirement accounts, household net worth for this month tops 50k. It sounds crazy, I know, but I am quite pleased. There is a ton of work still to do and the debt just feels like an albatross around my neck, but I think that progress is going as well (if not better) than can be expected. Another major boost comes from the fact that I had not updated the amount of debt that is outstanding on student loans and car loans. I cannot even begin to say how excited I am that these will be paid off soon. I think that my car will be paid off by the end of the year, so that is really exciting. If you want to see all of the gory details, you can check it out here. http://www.networthiq.com/people/EasyChange

So, I went to the mail this weekend and was pleasantly surprised to open up one of the statements and find that a retirement account had twice as much as I thought it had. I don't know if I messed up the spreadsheet I track with or something, but I was quite pleased when I plugged in the updated numbers. This month's net worth entry is going have a nice bump and I am excited. And is it me, or is the market doing quite nicely? I just checked and on the year I am averaging about 5% in my retirement accounts. That is not too shabby; granted, you can make that in a savings account, but if it continues to grow at that rate I should easily get to over 10% on the year which is my target.

Well its that time again. I've updated my spreadsheet and things are progressing along quite nicely. Currently, net worth is up about 1% over last month. This is largely due to savings deposits and such and was not really helped much by the fact that the market has been rather so-so of late. Most of this increase has been in the retirement accounts due to regular contributions. But since I don't think I've really broken this down here before, and I think it is interesting data... http://www.networthiq.com/people/EasyChange/2007/03 Percentage of Total Net Worth Home Equity: ~40% Retirement : ~40% Auto: ~10% Stuff/Cash: ~10% Of course, this is going to change over time, I hope. It certainly doesn't feel very diversified to have nearly 1/2 of the total net worth to be tied up in a property, but then again, its home. So in that sense, it is totally worth it.

I can't believe it, it is only March 23 and the books are closed for the month! It is a great feeling to be paying things online now. I can immediately get things paid as soon as there is available cash. For those of you who have not started paying your bills online, I would encourage you to give it a try. I've been nothing but impressed by the system since I started doing it. I find that I can easily keep track of what is due and make sure that it gets paid on time, every time. Not to mention the amount of money I am saving in stamps. As for the actual numbers, those are good as well. Total expenses for the month are down about 200 bucks from last month.  And debt is continuing to decrease as loans are payed down. There's still a long way to go, but the extra money coming in recently has really helped out a lot. The one negative though is that the average so far for this year seems to indicate that household expenses have gone up way more than the 0.03 percent that I ...

Sometimes, it is just too much to bear. For years, (you heard it right, folks, years), I've been asking how people are getting by when they make so little. I ask this question because I have been fairly fortunate to have my own home, to make a decent salary, and to find myself able to  make a decent life for myself. However, I know that there are people out there who are not making enough. This recent story from msn money explains one woman's life of living just above the poverty line, making 6.50 per hour, living in Montana. http://articles.moneycentral.msn.com/SavingandDebt/LearnToBudget/IMake650AnHourAmIPoor.aspx The unfortunate thing is that I know there are many people in this situation. Through a network that I belong to, I found out about a local man who was in his fifties and had a problem where he and his wife now no longer have a car so that at least one of them could work. This is the ultimate issue; people are not necessarily living when they make wages this low--th...

Before you think about doing something that is innovative or frugal or environmentally friendly, you might want to think twice. According to this article, the guy that has done amazing things for both the environment (in terms of reusing) and also for issues when it comes to our dependence on foreign oil is being asked to post bond. He has been using vegetable oil as a fuel source for his deisel vehicle and it has served him well for many years. The full article explains it in more detail: http://www.treehugger.com/files/2007/03/illinois_man_fi.php The first comment that I read for the article seems to get it spot on: "I don't believe this had anything to do with oil companies. The state probably relies on those taxes for transportation costs, and is afraid of what will happen if everyone moves outside of the normal (taxed) supply chain to get their fuel." - Old Wolf But now this guy is into it with the government. Regardless of your feelings on taxation/double taxation ...

A while back, I wrote about exercising and gym memberships: http://easychange.blogspot.com/2006/06/do-you-really-need-that-gym-membership.html But frankly, I feel like these are cash cow businesses where the average joe gets milked for all he's worth and then ends up back in front of the t.v. on the couch, feeling badly that he wasted all his time and money. Bottom line: exercise is important for health, but keeping up with it is probably just as important as starting in the first place. Personally, I knew I needed to get into better shape. My muscles literally had atrophied from doing nothing but being on a computer and barely even having to walk from my work to my car. So several months back I got a hand-me-down gym for free from a relative and was able to start working out at home. This was much better than a gym membership because it was free and it was convenient. The convenience of having it at home made it very hard for me to not exercise. Sometimes, if I get bored, I find ...

Well, February has ended and the markets were less than kind this week. So I figured now that the carnage is over (hopefully), I figured I'd ask a question to my readers: Take Our Poll from PollDaddy.com Net worth didn't fare so bad over in my neck of the woods since there were tax returns etc to offset the bad week in the market. If you are interested, here's the latest entry: http://www.networthiq.com/people/EasyChange Happy Friday Everyone!

Recently, I joined the blogger network No Credit Needed. It is similar in function to the NetworthIQ site in that it provides charting for your progress toward your financial goals. But in general, rather than tracking net worth, it usually tracks progress toward paying off debts specifically. In addition, it provides a forum where users can update/change/and provide comments on each others' progress. And I am excited to see that it got mentioned in the article. Here is the link:  http://www.nytimes.com/2007/02/18/us/18debt.html This is an excellent step toward broader recognition for all the work that NCN does in terms of keeping members updated and encouraging one another. As for me, I need to get my chart updated at No Credit Needed because this month, I took a big chunk of the tax return money and eliminated a small student loan that I'd been chipping away at for a few years. This was a huge step for me since I know now that I have one less bill to worry about each m...

I've been thinking about moving yet another of my debts to a zero percent credit card: my car loan. As of last night, I found out that the payoff on this loan is hovering at just under five thousand dollars, with just over 300 bucks-a-month as the payment. For those math whizzes out there, thats about 17 more months of payments. After some back-of-an-envelope math (isn't that the best kind), I discovered that I could save myself more than 20 bucks a month by switching to a zero percent credit card. Thats about 350 dollars in interest.   So this leaves me wondering. Are there any downsides to doing this, provided that I can find a deal where I can transfer this non-credit-card-debt to a credit card and I am able to get myself a card with enough of a limit? Again, I'm not racking up new debt, I am transferring existing debt (secured by my car) to an unsecured credit card. I still haven't decided if I am going to go for it or not. I like the the idea of saving money...

Net Worth is just one measurement of wealth, of progress toward goals. However, it is just as important to consider other measurements. This thought came to me recently as I was updating net worth for January. You can see the latest info here: http://www.networthiq.com/people/easychange   At any rate, one of the more interesting things to consider is how much progress has been made with regard to savings to income ratios and debt to income ratios. By age 30, according to some estimates, there should be about 100K of savings in order to stay on track. But I don't know if that is going to happen; the best way I can get further on this is to increase income.   On that note, I thought I'd start thinking about small business/new business ideas. Currently there are various things that I am using for income streams but unfortunately, not enough of them are passive income. Ideally, I'd like to figure out some new businesses that can generate more passive income for m...