Easy Change

Despite being out-of-my-mind busy this weekend, I still somehow managed to clean the house and also get started on my taxes. About 95% of the information is into the system now but it appears that I might have forgotten to include the information from my paypal account. It was interesting to discover that interest on bank accounts may still be taxable even if you didn't get a 1099 for it; in fact the 1099 limit appears to be 10 dollars from the information I was reading. Monthly Sweep One of the new techniques that I've adopted this year is to put some padding into the budget and then clean things up by sweeping some of the extra money out into the linked savings account at the end of the month; once I do that tomorrow I will be ready to start putting together the end-of-month figures for January 2007. I wonder how common this technique is. Do many of you use it?

One of the major features of the financial landscape right now for me is insurance. While I am lucky enough to have a job that includes some insurance based on salary, I am still concerned that I might not have enough insurance. The immediate issues are that there is for me is the idea of life insurance, and then after that, disability insurance. Interestingly, I was researching these options this weekend and I went to one of the insurance websites, Metlife.com to see if there was anything that I could use to figure out how much I might need to pay for a 30 year term policy. Term Policies Best? Many people like to figure out whether or not Term makes sense and to me, I think that it does. Since I get a certain amount of insurance from my job already, it makes sense for me to look at getting a term policy for between 20-30 years. I don't view insurance as an investment for my particular situation. I am investing in my retirement accounts and paying off my debts and building assets. ...

Ok, if you're like me, you've finally gotten the last item you need to start working on your tax return. But before you can do that, you need to figure out what you need, and where you put it, likely in a mountain of paper. Here's what I've done so far for the past few years; it seems to work well for me. 1. Make a list of all of the items that you will need in order to complete your return. For me it is mortgage interest statement, student loan interest statement, checking account statements, auto-loan interest statements, and finally, w2s and 1099s. Once you have your list, you are ready to obtain the items you need. 2. Leverage web-access to get these items sooner. You can generally setup accounts and passwords for these websites and access the information faster to get your return underway early. 3. Eliminate the clutter. In order to keep good track of your financial paperwork, it is critical to get organized. It only takes a couple of hours every few months to ...

Recently I transferred over one of my loan balances on to a zero percent interest credit card. It was a card that I already had so it didn't hurt my credit too bad so that was not an issue. And now that it is over there, I am paying no interest until May of this year. And it is likely that I will transfer it again before the time runs out. And with only paying a 75$ transfer fee, I am still ahead by like 400 bucks when it is all said and done. Here is where it gets dumb though. I realize that I am still paying interest on other debt and even though I am paying zero percent on this loan, I am still thinking about working hard to pay it off. However, it makes no sense, strictly speaking, to do that right now because there is no interest on this debt. I know that many other people work out zero percent deals and parlay that free money into interest income but I don't have the money right now to do that. I just wonder if it makes any kind of sense to work on my other debts and just...

I like to watch the Suze Orman show. I know some people don't like her, but most of what she says makes sense to me. Anyway, she started a show that I saw this weekend with one of the most clear explanations of why it is good to own your own home that I have seen in a long time. She gave the following example. If you plan to live in your home for the rest of your life, then it generally makes sense to own it outright. In the later years of a mortgage, the tax deduction is much smaller than at the beginning of the mortgage. However, the payment amount stays the same. In a scenario that you retire early, and then find yourself still paying a mortgage, you will have to ensure your retirement savings are enough to nut each and every month. She gave as an example a 200K mortgage over 30 years that had been paid down for 20 years to a principal of 100K. This would be a 1200/month mortgage payment. And with some estimating at a reasonable return of 5% on retirement savings, you would hav...

This afternoon I was a little surprised. I have been trying to get my taxes filed early but it seems this is not to be. Most of the forms that I need are not available from my loans, my job etc. Despite the convenience of the internet, it still isn't getting it done any faster. It will likely be sometime in february before this is all figured out. The upside was that I found a mistake. This month I prepared my bills online and sent them using my banks bill pay system. However, I saw on my loan's website that my bill was high this month. That seemed strange and I realized that this month was the first month that the new "step" kicked in. So, I have a higher payment than I used to. It was a bit of a downer since that threw my budget off a little, but good for me since I caught it and didn't end up being late. The other nice thing that I did, and you could consider it to if you have a loan that has a "step" or "graduated" repayment plan. Its just ...

Here are three excellent links that I liked this week. If you are like me, the chances are that you will find them to be thought-provoking. The pets link especially is a great starting point if you want to consider the cost of pet ownership. A neighbor of mine had no idea how expensive it would be when she took in a stray cat. Vet bills topped 1000 dollars when she found out that the cat had some significant medical problems. Wandering Tax Pro Blunt Money Talks about Pet Ownership Keep Receipts for Donations