Update Time

Well, I know that I don't have a lot of content on here...but I don't have many visitors either, so I'm just going to use this for my own tracking purposes.

Here is the latest Networth Snapshot:



Stock market wobbles, depreciation and repair to vehicles, as well as the purchase of the new entertainment center, while partially offset by a large tax refund check, basically reset us back to January as far as progress towards becoming debt free...but progress continues, one slow step at a time.

And, for you Prosper-junkies:



As you can see, Prosper is working! I feel like a mad scientist, rubbing his hands together in glee. :-) I've made over $50 so far...less when you subtract out my costs for carrying the Prosper loan, but still profitable. I'm earning about 23% on my money, while being charged less than 8%, so I'm clearing 15% on the difference. I did pull a little bit of money out when I had a bit of a budget crunch last month, as well as a scare where a couple of my loans ticked over into "Late <=15 Days" status, but as you can see, all of them are current now, and humming along nicely. I should have a little over $50 with which to make a new loan either today or tomorrow...so until something else happens to change my mind, I'm going to try to reinvest all Prosper money back into loans while slowly paying back the borrowed money.

Oh, and Elissa is unemployed right now, so all progress that is made is done so with just my income again, until she can find another job. But she is dilligently looking for gainful employment as I type this, so there is hope that this situation will get better soon.

~Peace

One Giant Leap Backwards

Well, as is my sporadic custom, I have decided to update you all on the state of my Networth and my Prosper Experiment.

Without further ado,


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And Prosper:


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On the positive side...

1. Prosper is humming along nicely. I have successfully deployed all of the available cash from the loan into higher yielding loans, at an average interest rate of over 23%.

2. My TSP, Roth IRA and FolioFN balances are doing well, thanks to regular contributions and a phenominal stock market right now.

3. Regular payments to mortgage, car loan and credit cards continue to reduce the balance due on those loans, and additional principal payments are helping to pay down these balances at an ever increasing rate.

On the negative side...

1. Balances on the "main" credit card have significantly increased since my last post, due to scheduled maintenance on Elissa's car (prevention being theoretically cheaper than a future cure) and the purchase of some large ticket items. Specifically, the 42" Plasma screen TV that we purchased because:

a. We (and by we I mean I) have always wanted a big screen TV.
b. Our current TV did not have the necessary inputs/outputs to work with the surround sound system properly (close-out deal on display model at Sears, last years model, marked down from $700 to $150).
c. It was a phenominal deal. Retail price for the TV was $1300. Bought a returned/opened item for $1170. Recieved 10% discount for using first purchase on a military star card (reducing price to $1052). Recieved CREDIT to star card of an additional 10% for no apparent reason (reducing price further to $945). Military star card also running promotion of 6 months, 0% interest on all electronics. I can totally pay off $945 in 6 months.

2. Account balances at TFCU have dropped to dangerously low levels (at least as far as my peace of mind is concerned). This is primarily due to the purchase of a new entertainment center and armoire to house the new (and old) TV's, as the existing entertainment center was inadequate to the new TV, and inappropriate for the old TV (now relocated). Still, this was a one-time purchase that will not have to be repeated any time soon. This furniture was also bought on clearance from Wal-mart for $440.

3. Elissa's savings accounts have dropped due to her birthday trip to visit her family. She bought lots of things for herself and generally had a great time...which is the purpose of saving up for vacations, so I'm not going to complain on this one. She did, however, spend $155 on an area rug for the new entertainment area of our living room, so I will choose to add that into the overall cost.


In the end, we got a 42" TV with all the bells and whistles, a 5.1 stereo surround sound system with 5 disk DVD player, HDMI cable, huge area rug, TV table, two media towers, an end table and an armoire which combined retails for about $2630 plus tax for only $1700.

I couldn't pass up that kind of deal...not when it's some things that I have wanted for 4 or 5 years now. So...even though it wiped out the last 4 months worth of progress towards becoming debt free....I still think it was worth it, because I got great VALUE for my purchases.

~A Reading from the Tao of Scott

Pondering Retirement

Everyone in the PF blogging community thinks about retirement at least some of the time. Heck, I'd even go so far as to say that MOST people think about retirement sometime, even if they don't actually have a plan in place yet on how to get there. Well, for me, retirement planning is different than it is for most people.

For starters, I have a TSP account instead of a 401(k). The TSP has ZERO matching contributions. So basically, all the money that is in there is MY contributions and earnings from those contributions (compound interest). Now, I would bitch about this except for difference number two which is...

I can get a military retirement from the federal government after 20 years of service. Believe me, I think about this A LOT. I mean, how nice would it be to be in your early 40's and be able to retire with a pension check and medical benefits for life? Every year that I spend in the military equals 2.5% that they add to my retirement benefit up to 75% for 30 years of service.

Still, it does make "retirement planning" kind of difficult. Why? Because I don't know if I'll endure the full 20 years in the military for one. Secondly, how much would I have to save up in order to provide for a comfortable retirement from my second career? I mean...I can't touch the money that I've put into the TSP until I'm 60 without paying an early withdrawl penalty...but I'm not sure that I want to work until I'm 60 either. (I'm just going to go out on a limb and assume that Social Security will be a non-factor)

*sigh*

I want to retire NOW! I want to have money NOW! What good is it going to be for me to be "wealthy" when I'm 60? I'll be too old to really enjoy it!

10 years and a million miles away

Well, my last post didn't prompt any responses whatsoever...but since I plan to be at least relatively active in the PF Blogging community, I'd better whip something up for the latest carnival. Truthfully, I don't really know what I'm doing with this whole blogging thing...but maybe I'll pick it up along the way.

So, without further ado...

10 years from now, I will be living in a four bedroom, three bathroom house in Indiana with a large fenced in yard where my dogs and children can run around.

10 years from now, have just sold my current townhouse, after having lived in it for three years and rented it out for another five. After all, the best way to become wealthy is to leverage YOUR money and use SOMEONE ELSE'S to pay for it. ;-)

10 years from now, I will be managing an appartment complex (or tri-plex) that I bought with the profits from the sale of my current home in my spare time.

10 years from now, I will be four years away from collecting a military retirement check for the rest of my life.

10 years from now, I will have approximately $170,000 in my TSP account at the ripe old age of 38.

10 years from now, the Roth IRA I started as an emergency fund and for the sake of tax diversification will be worth about $20,000...or about 6 months worth of paychecks.

10 years from now, I will finally trade in the car I'm driving now for a hybrid replacement vehicle...and I'll buy it cash from my "Car Fund".

10 years from now, my ING Account will be a fully funded emergency fund as well, with a full 6 months of pay socked away.

10 years from now, my children will be age 7 (Rhys - boy) and 6 (Alana - girl).

10 years from now, I will have finished both my Bachelor's and Master's degrees in Business Management...and I will have learned how to play guitar too. ;-)

10 years from now, my children will have college funds in place for when they graduate high school.

10 years from now...I'll be 38. 10 years will pass whether I achieve these goals or not. Nothing can stop the passage of time. No matter whether you strive to fulfill your dreams for 10 years or spend the whole time complaining about how your dreams are impossible to reach, 10 years will pass.

Strive anyway.

Your goals may be big or small, and they may be out of reach today, tomorrow and the next day...but unless you take that first step towards them, they will never get any closer.

Dream anyway.

10 years or 10 days...a journey of a million miles begins with a single step. No matter how long the trip or how many roadblocks are in the way, you can get there.

Begin today.

~A Reading from the Tao of Scott

What I would do if I won the lottery

I was thinking about this today, and I think that this question has less to do with what I would spend the money on and more to do with how I would choose to live my life if money were no object.

I think that after I did all of the obligatory things (pay off debt, max out retirement contributions for the year, go on a spending spree, etc, etc) that I would take a lot of time for myself to enjoy life for awhile by playing video games and traveling...and then I would start teaching.

Not teaching for a paycheck (although that might happen anyway) but teaching for the sake of teaching. I want to educate young people on personal finance matters, and help them prepare for life after they leave the nest and enter the real world. I could be a great teacher, and there is quite simply a TON of things that I could teach young people that would be more useful to them in their everyday lives than say...basic chemistry or calculus.

The other option that I might consider doing is "fee based financial planner". I ENJOY managing money, creating budgets and calculating expected returns. It's fun for me. :-) If I didn't have to spend any time worrying about my own financial situation, then I think I would like to take the time to help other people with theirs.

The only reason that I'm not pursuing either of these careers right now is because being in the military doesn't allow me to change career paths like that, and because I would be very uncomfortable either creating a basic finance class or financial planning business without significant funds to rely on for basic bills. In other words, my financial security has not yet been secured enough to where I would feel comfortable taking that risk.

What about you? What would you do if money were no object? What would you occupy your time with if you didn't HAVE to have a job to pay the bills?

Prosper January Update

Well, here we are...about a month after I first requested a Prosper loan for $1500.



As you can see, I've been doing my best to get the money deployed and earning interest. It hasn't been easy though. There aren't many quality loan requests out there, and even if I find good ones, it is taking FOREVER it seems to get a loan to go from "Winning" to "Pending Review" to the "Current" and earning interest category.

Still, it's nice to see that all 16 of my loans are "Current" right now. I've only had one hiccup so far, and she not only fixed the problem with her account, but made an early payment to make up for it. :-)

I'm still trying to stick to the $50 per loan guideline...but when you have $11 extra dollars left in your account from payments, waiting for another $39 to accrue isn't much fun. So, that's why I have one loan out there that is $53.86, and another bid on one that is $61.86...because I didn't want to wait for additional funds to be available.

I'll keep you posted!
~Scott

January Networth And Goals for 2007

I am back from my long holiday with family with an update. I know that the two or three of you that occasionally wander through my blog have missed my horribly boring financial posts terribly. ;-) Here is the latest picture of my networth:

As you can see, things are going well. Or at least, well enough. Progress is being made. My networth has actually increased by $8770 since my first post here on Blogger. Most of that is from three simple things.

1) Automatic deductions from my paycheck to go into the TSP (retirement) account.

2) Paying all of my bills on time automatically through online bill-pay and other such forms of money handling.

3) Lastly, through Elissa having a job.


That last one is HUGE, btw. With Elissa working, we have made significant inroads towards paying off her car (currently charged to the MBNA Mastercard) as well as saved a lot of money on the other side of the equation in the form of extra savings accounts scattered over the globe. These savings accounts are earmarked for things like....new computers when our current ones no longer work...car repairs...car upgrades...etc, etc. Basically, all of the things that I have been denying myself for the past few years because of my obsessive desire to get out of debt and live frugally to do so.

On the other hand...if Elissa wasn't part of the equation, it's entirely possible that the liabilities side of the equation wouldn't be quite so out of whack...but I'm trying to think positively here. Plus, she can only do so much damage on that side of the equation, which is more than balanced out if she continues to work past the time when we get all of that crap paid off.

So, that being said...this is as good of a point as any to put down a goal for 2007.

My goal for our family for 2007 is to more than double our current networth from $23,725 to approximately $50,000.

Think that goal is too ambitious? I don't. And here is how I plan to do it.
Note: all amounts rounded to nearest $25

Regular contributions to retirement accounts for 2007 (TSP and Roth) = $4100
Regular bi-weekly payments to mortgage principle + extra payments = $3850
Regular Ford payments to principle, plus extra principle payments = $4000
Regular Prosper Loan payments to principle = $550
Regular Contributions to Emergency fund (minus Prosper payments) = $725
Regular Investment in the Stock Market = $1050
Regular Additions to "Car Fund" = $775
Regular payments to principle on USAA Mastercard balance = $1450

For a grand total increase in Networth of (drum roll please......) =$16500

Now, that's just my portion of the puzzle. Elissa is also kicking in $300 per paycheck to help reduce the balance on the MBNA Mastercard, which, when lumped together with my $225 allotment from my paycheck towards that balance equals an additional $10,500.

So.

If Elissa continues to work, and I continue to put my money where I've been putting it, and Elissa does the same....and if we can somehow avoid the majority of the financial traps that come up in a year, we could theoretically increase our current networth by $27,000, bringing us to a grand total networth of $50,000.

Of course...I'm counting on the stock market to help us offset the depreciation of our vehicles. I'm also assuming that our house will either stay level or increase in price. But, considering that all of the numbers listed above represent just what I currently pay out each month, I don't think that it is unreasonable to think that I could double my networth this year.

The real challenge is going to be trying to double it AGAIN next year! *lol*

I'll keep you posted on how that goes.

~Scott