2009 Financial Goals

2009 is upon us and it is that time where we start setting out goals. This is the first time I’ve ever publicly stated goals for the entire year, so I may skip around a bit. I’ll try, though to keep it organized.
Balance Sheet Goals:

  • Property – My goals here assume that we pay our normal mortgage payment, which is in our control. The thing that is out of our control is that I’m assuming that our property value remains relatively stable. Hopefully the prices in our neighborhood don’t continue double digit percentage falls this year!
  • Autos – I am assuming that the overall value of our cars goes up, but that we take on a loan. This is assuming that we sell my car, and purchase a used automobile to accommodate the baby. Neither of our cars are very ‘family friendly’ I’m looking at getting something modest and taking on a very small loan, but it’d be nice to not have to take one at all!
  • Mutual Funds – With everything going on this year, we probably will not invest in non-retirement mutual funds. We do hold some, and I’m hoping for a 10% increase in the value, which would mean that the market recovers this year. Let’s keep our fingers crossed.
  • Long Term Savings – We hold cash reserves for emergency fund as well as bigger expenses we expect to pay for in the next several years. I’m hoping that this remains stable (i.e. no big emergencies)
  • Retirement – I’m hoping that the value of our retirement account goes up about 30% this year. That would follow the expected 10% market recovery this year, as well as several other things. First, I’m assuming that I will become fully vested in my company match 401(k), which should happen due to the company being sold last year. Second, I’m assuming that I can contribute 8-10% of my salary and realize the full 6% company match.

If we manage all this and things work out favorably in the market, this would increase our net worth by about 20% this year. This is what I was averaging in years past until the free fall in stock and real estate in 2007 and 2008. It’d be nice to get on the ‘right path’ again.
Personal Goals:

  • Continue my quest to level out our monthly expenses
  • Make a successful adjustment from a two-income household to a one-income household as my wife will not be working following the birth of our first child
  • Don’t freak out when the expenses hit for the baby! I took my first walk through of Babies R Us this week, which was my wife’s way of easing me into it!
  • Maximize our rewards for normal spending. We have a Citi Dividends card which pays us 2% for grocery and gas purchases, and 1% for everything else. We also signed up yesterday for our bank reward program, which gives points for using our debit card. I’d like to make sure we’re maximizing our rewards as the year goes on.
  • Reduce student loan payments by 30-40%. If we can hit this number, then the higher end loan that my wife has will be mostly paid off. This would be awesome!
  • Refinance the mortgage – We are currently paying 5.875% for a 30-year mortgage. This is a good rate, but I think that rates will be below 5% before long to where a re-finance might make sense. It’d be nice to reduce our interest obligation.
  • Begin saving for major house expenses – Our house is about 10 years old. I know that we’re getting a few years away from routine tasks that cost a good deal of money. I expect a new hot water system will be needed within 3 years, a new roof within 5 years, new windows within 7, a new furnace within 10, a new deck and driveway within 12 years. I’d like to begin saving for those now rather than figure out how to pay for them as they come up.

All in all, it will be a very interesting year with a lot of changes. I will look forward to updating throughout the year as well as looking back at the end of the year to see how we did.

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I’m A Little Bit Less Of A Fan Of Amazon

I have always been a big fan of Amazon since the advent of online shopping. I’ve always thought that they had many great features that appealed to me. Some of the best features in my mind included:

  • Excellent pricing – I’ve always felt that they are very fair in price and have good deals
  • Order history – They keep ordering history of every purchase I’ve made. Many sites keep your history for only 12 months, if even that long. I’ve always been able to look back at previous purchases for reference.
  • Recommendations – Many sites have now built in features where you are recommended products based on your ordering history. Amazon was one of the first and I think still one of the best at it.

A few months ago, my list would have included one more thing that was key: 30-day price protection. Amazon guaranteed that if their price went down anytime within 30 days of your purchase, that you were eligible for a refund. You had to e-mail them the price you paid as well as the new price, and after checking it out, they would refund your credit card. I used this several times.
That was an excellent feature, but unfortunately they discontinued that as of September 1, 2008. I just found out about it today as I was going through and checking my prices, and discovered that the new policy had been instituted.
This is a huge letdown to me.
I can understand the business reason behind it. They were probably losing money by having to return part of the sales back to people. But, I still think that’s a big short sighted. Why?
Well, not everybody checks the prices to see if the price has dropped. There are sites such as PriceProtectr.com which automates this process for you (plug: it works with over 150 online retailers and is one of my favorite sites), but even so, my guess is that a very small percentage of people actually remember or take the time to check.
The people that do take the time are probably among the people that spend the most at Amazon. I feel that this decision might have turned away many loyal customers. Yes, Amazon might save money in avoiding refunds, but what if they lose all that plus more in sales because people gravitate to other e-commerce sites?
In other words, why take the risk of alienating your best customers?
Now, I won’t boycott Amazon and they’ll probably still get a majority of my online business. But, it’s just a bit of a letdown and a bit puzzling that one of my favorite shopping sites got rid of a great feature, and one that gave them a pretty big competitive advantage.

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Save Your Wrapping Paper Scraps For Smaller Gifts

I’m in the middle of wrapping Christmas gifts. My wife has been doing this for a couple of days on and off, and it’s my turn tonight.
Since I’m a ‘typical guy’ when it comes to wrapping, my wife handles all of the wrapping for anybody that gets gifts except for the gifts that I get her, of course. So, my wrapping takes a lot less time.
One thing we realized this year is how many little scraps get cut out that accumulate. My wife started saving anything bigger than a regular sheet of paper, and we’ve found that they can be used to wrap smaller gifts without wasting more paper.
This has saved us quite a bit of paper. The first four gifts I wrapped for her were of paper that had been previously cut. I can’t tell what the gifts were that I wrapped because my wife peeks on here and that would ruin the surprise.
I’ve also found that they come in handy for filling in an edge for paper that’s a bit too short. You know the kind. Either you mis-cut or you have a piece that’s just a fraction of an inch too little. Rather than scrap the whole thing, what I’ve done is to slip in a little piece that fills in the gap, then fold over as normal. 99.9% of the time the person will never see the ‘fill-in’ (though they probably would see the gap if you had just left it), so these little scraps come in handy to patch up mistakes too!
So, remember to hold on to those little scraps because they can really come in handy!
Back to wrapping!

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It’s Official: The Internet Is Killing The Print Newspaper

The Detroit area will soon be the first major city in the United States without a major newspaper that does home delivery seven days a week. The Detroit Free Press and Detroit News announced that home delivery will be cut to three days per week beginning in spring of 2009. The reason: Rapidly and continual subscriber cancellations because more and more people read the paper online.
So, on Monday, Tuesday, Wednesday and Friday, you will have two options. You will either need to purchase one at full price at retail outlets that sell the paper, or you will have to subscribe to the ‘full’ online edition. Both papers have web sites that are free, but they are heavy on advertising and don’t contain the full amount of articles.
This announcement hit our city hard, and was another blow that didn’t help spirits with everything going in in the automotive market.
The logic used by upper management was that this was happening one way or another, and they predict that it will follow in other major markets. Rather than continue to lay writers and staff off, they felt that this would let a majority of workers at the paper keep their jobs.
What they neglected to mention was all the people who work at the presses who will lose their jobs eventually, as well as the people who make a living delivering home newspapers. When I was a kid, it was junior high and high school kids that had the job of delivering papers (my best friend had a route that I helped with), but now it’s pretty much adults that have the responsibility. These people will obviously be hit hard, and a good portion of them will be left scrambling.
I do agree that it seems to be a sign of the times that print media is dying. I also think, though, that the quality of media is somewhat on the decline, and that has something to do with it as well. I don’t see the investigative articles that I once did. The sports writers are very ‘vanilla’. I subscribe to the Sunday paper, and I used to be able to spend an entire morning with a cup of coffee and the paper. Now, I’m done in an hour or so.
I think that newspapers need to go back to their roots in terms of content, but need to adopt to the new times. It’ll be interesting to see how this works and if any other papers in the country follow suit.

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