Per day one of The Simple Dollar's out with the old, in with the new, I calculated my net worth today. I'm afraid that I'm a bit like Babci when it comes to hard numbers, so I'm not going with exact figures - but although my net worth remains negative, it is about 3% of the negative number I got when I first sat down in 2005 and figured out just how much trouble we were in (answer: a lot). Basically, since then, we have improved our net worth by paying down debt and saving for retirement.
Paying down debt
This is pretty obvious. As the debt goes down, the negative side of the net worth calculation goes down, making the positive side count more.
Additionally, that nasty interest that makes the negative number go up every month, even when you are not adding debt, becomes a smaller and smaller factor. When we started this journey, we had debt on which we were paying 22% variable . Now our highest interest rate is a fixed 1.65%. We got there through a combination of paying down high interest debt and transferring it to places with lower interest.
Saving for retirement
We are a long, long way from retirement, so the smart place for our money to be is in equities. Because we didn't panic, and kept our money in (and kept putting money in) through the 2009 crash, our retirement accounts have actually grown past the value of the money we originally invested in them by about 6%, even though we had 2/3 of our money invested before March 2009. Naturally this number fluctuates every day, but I am comfortable that it will continue to reflect a broad upward trend over the years.
Because most of our net worth is in retirement savings, we also have a big pile of debt remaining. But I am comfortable with my decision to put money into retirement accounts rather than debt repayment for two reasons. First, because the interest rate on our debt is low, so the cost of paying it off over time is low. Second, because Roth IRAs (where all of our retirement money is located) are a very good deal if you believe that income tax rates will be higher for your tax bracket in 35 years, and putting money into Roths is a use-it-or-lose-it deal every year. So I am paying the taxes and interest now for the comfort of knowing that, in retirement, my income tax rate on this money will be 0.
Anyway, it has been a while (at least 6 months) since I calculated our net worth, and I was pleasantly surprised by the result. If we are able to keep up our debt repayment at our current level, we will have a net worth of $0 in 3 months! This will a huge milestone for us; we have had a negative net worth since day one, as I brought a ton of student loan debt into the marriage.
Have you calculated your net worth recently? Was it a surprise or not?
Tuesday, December 14, 2010
Monday, December 13, 2010
Reflecting on 2010
The year's not quite over, but this year I hope to have my goals and financial plans together by the 1st, so I'm starting with a recap of how well I did this year. When I made these goals, I was thinking that the surgeries I had just finished and the physical therapy I had just started was going to give me a relatively pain-free year. Unfortunately, it didn't work out that way, but as of October, I think I'm finally getting my medicines in balance and my pain under control without opiates.
1) Religious / Spiritual:
A)Never miss church unless sick or out of town. Win. I've gotten into a good routine vis-a-vis church, so I consistently make it when I am in town.
B) Participate in a mission or outreach with my church. Fail. This never really got off the ground.
C) Read The Message: The Bible in Contemporary Language
. Fail (s0 far). I'm through to Kings.
D)Write every day in a prayer and gratitude journal. Fail.
E) Continue to Tithe. Win.
2) Health
A) Maintain my weight between 145 and 155 pounds. Fail (but not too badly). Today my scale says I weigh 161 lbs, but my weight does fluctuate; last week it was 158. Not where I want to be, but nowhere close to regaining the 30 lbs.
B) Swim or do Physical Therapy 4 times a week. Fail to Win. Didn't happen for me until July, and I was sick during one month, but I have made it to the gym at least 17 times a month for all of the last 5 months. I see a big difference in my cardiovascular fitness.
C) Do Physical Therapy Exercises Every Day. Fail. The exercises didn't end up helping, and I dropped them.
D) Practice Aikido Every Day. Fail. I barely did any aikido this year.
3) Financial
A) Pay off loan from relatives in the amount of $1000. Win. One more debt paid off!
B) Pay off loan from relative in the amount of $30,000 Fail. My health did not allow me to find any extra money to pay this off. I did keep working on it, though, and I should be able to pay it off in July 2011 if everything goes smoothly. (Update 1/1/2011 WIN - got the money together to pay this off in December 2010)
C) Fully Fund 2009 and 2010 Roth IRAs. Win. And this year the stock market actually went up, so there was some advantage to getting it together early.
4) Dreams
1) Write something besides this blog. Fail. I didn't even do a good job writing on this blog this year.
2) Learn how to Accompany on the Piano. Fail. This fell by the wayside about March.
3) Get officially affiliated with a dojo. Fail/Win. I didn't manage to figure out aikido, but I did find a nice Judo dojo, so I'm back to my Judo practice 2x a week.
4) Keep up with my Chinese. Fail. This fell by the wayside about March.
5) Prosaic
1) Practice with my carry firearms at least once a month. Fail.
2) Keep my house in a reasonable state of neatness. Fail (but not too badly) My house never really got neat, but it is not any messier than it was a year ago.
There's a lot of fail there, but a bit of win too. OK, so the lessons I learned from this to use next year are:
(1) Prioritize goals. I made myself a wish list and called it "goals," but basically it required too radical a lifestyle adjustment in all areas of my life. I need to decide what is really important to me and set a few clear goals at a time to really get this to work.
(2) Don't make the perfect the enemy of the good. On the other hand, I've got several goals that, while I did not succeed, I made some progress. For instance, I won't be paying off the 30K loan this year, but I did keep throwing money at it, and, barring unforeseen problems, we will pay it off in July.
(3) Sometimes life kicks you in the nadgers. Some stuff on this list did not get done and should have. But a lot of stuff just fell by the wayside while I tried to regain a modicum of reasonable health. Although I should have re-prioritized sometime around March (when I knew that there wouldn't be a quick fix), I kept thinking it would turn out OK and that I'd have time to catch up.
The Simple Dollar is doing a "a daily series focusing on specific activities you can do right now to set the stage for a great 2011." I'm thinking about using it as my template for resolutions next year. How are you going to set goals for next year?
1) Religious / Spiritual:
A)Never miss church unless sick or out of town. Win. I've gotten into a good routine vis-a-vis church, so I consistently make it when I am in town.
B) Participate in a mission or outreach with my church. Fail. This never really got off the ground.
C) Read The Message: The Bible in Contemporary Language
. Fail (s0 far). I'm through to Kings.D)Write every day in a prayer and gratitude journal. Fail.
E) Continue to Tithe. Win.
2) Health
A) Maintain my weight between 145 and 155 pounds. Fail (but not too badly). Today my scale says I weigh 161 lbs, but my weight does fluctuate; last week it was 158. Not where I want to be, but nowhere close to regaining the 30 lbs.
B) Swim or do Physical Therapy 4 times a week. Fail to Win. Didn't happen for me until July, and I was sick during one month, but I have made it to the gym at least 17 times a month for all of the last 5 months. I see a big difference in my cardiovascular fitness.
C) Do Physical Therapy Exercises Every Day. Fail. The exercises didn't end up helping, and I dropped them.
D) Practice Aikido Every Day. Fail. I barely did any aikido this year.
3) Financial
A) Pay off loan from relatives in the amount of $1000. Win. One more debt paid off!
B) Pay off loan from relative in the amount of $30,000 Fail. My health did not allow me to find any extra money to pay this off. I did keep working on it, though, and I should be able to pay it off in July 2011 if everything goes smoothly. (Update 1/1/2011 WIN - got the money together to pay this off in December 2010)
C) Fully Fund 2009 and 2010 Roth IRAs. Win. And this year the stock market actually went up, so there was some advantage to getting it together early.
4) Dreams
1) Write something besides this blog. Fail. I didn't even do a good job writing on this blog this year.
2) Learn how to Accompany on the Piano. Fail. This fell by the wayside about March.
3) Get officially affiliated with a dojo. Fail/Win. I didn't manage to figure out aikido, but I did find a nice Judo dojo, so I'm back to my Judo practice 2x a week.
4) Keep up with my Chinese. Fail. This fell by the wayside about March.
5) Prosaic
1) Practice with my carry firearms at least once a month. Fail.
2) Keep my house in a reasonable state of neatness. Fail (but not too badly) My house never really got neat, but it is not any messier than it was a year ago.
There's a lot of fail there, but a bit of win too. OK, so the lessons I learned from this to use next year are:
(1) Prioritize goals. I made myself a wish list and called it "goals," but basically it required too radical a lifestyle adjustment in all areas of my life. I need to decide what is really important to me and set a few clear goals at a time to really get this to work.
(2) Don't make the perfect the enemy of the good. On the other hand, I've got several goals that, while I did not succeed, I made some progress. For instance, I won't be paying off the 30K loan this year, but I did keep throwing money at it, and, barring unforeseen problems, we will pay it off in July.
(3) Sometimes life kicks you in the nadgers. Some stuff on this list did not get done and should have. But a lot of stuff just fell by the wayside while I tried to regain a modicum of reasonable health. Although I should have re-prioritized sometime around March (when I knew that there wouldn't be a quick fix), I kept thinking it would turn out OK and that I'd have time to catch up.
The Simple Dollar is doing a "a daily series focusing on specific activities you can do right now to set the stage for a great 2011." I'm thinking about using it as my template for resolutions next year. How are you going to set goals for next year?
Friday, November 5, 2010
Why the Next Congress won't Fix the Deficit
The WSJ has an article about what percentages of your taxes the federal government spends on what programs. There's an attached table showing two hypothetical families. This table shows that the first 44% of our tax dollar goes to (in descending order) Social Security, Medicare, Medicaid, and Interest on the National Debt. The next 18% pays for the military (they broke it down into the categories of non-Iraq/Afghanistan operations, Iraq/Afghanistan operations, personnel, weapons, and research). That's 62% of tax revenue right there; in order to cut the deficit we'll either need to make deep cuts in everything else or cut some of this stuff out.
There are a few things on the list that I think should have been gone a long time ago. For instance, Headstart (which sounds nice in theory but, in practice, does not change educational outcomes) takes up .2% of our tax dollars. Agriculture subsidies take up .3%, and, as a sustainable farmer, I'm telling you that the number one thing we could do to improve farming practices in this country is to cut this subsidy. But there's a lot of stuff on the list I don't want to give up, like federal highways (which make up 1% of our tax dollars). So we can't just cut "everything else" and call it good.
So basically, to live within our means, we need to cut either social programs, military programs, or both. Given the powerful interests behind both that are entrenched in Washington, how likely do you think substantive cuts in these areas are right now? Basically, we're going to be wallowing in debt until the pain of the debt is greater than the pain of cutting these programs. Here's hoping we're Greece and not Zimbabwe!
There are a few things on the list that I think should have been gone a long time ago. For instance, Headstart (which sounds nice in theory but, in practice, does not change educational outcomes) takes up .2% of our tax dollars. Agriculture subsidies take up .3%, and, as a sustainable farmer, I'm telling you that the number one thing we could do to improve farming practices in this country is to cut this subsidy. But there's a lot of stuff on the list I don't want to give up, like federal highways (which make up 1% of our tax dollars). So we can't just cut "everything else" and call it good.
So basically, to live within our means, we need to cut either social programs, military programs, or both. Given the powerful interests behind both that are entrenched in Washington, how likely do you think substantive cuts in these areas are right now? Basically, we're going to be wallowing in debt until the pain of the debt is greater than the pain of cutting these programs. Here's hoping we're Greece and not Zimbabwe!
Thursday, October 21, 2010
Friday, October 15, 2010
Blog Action Day - Water Edition
According to Debt Ninja, today is Blog Action Day, and this year the theme is water. Debt Ninja has a nice post up about clean drinking water, and the opportunity to donate to charity: water and make his friends' 27th birthday extra awsomesauce at the same time. I'll admit it - I was touched. I'm also cheap; that measly anonymous donation is totally me. But if everyone who likes Ninja chips in a measly few bucks each, his friends will reach their goal in no time flat.
In my neck of the woods, the biggest issue with water is the Gulf of Mexico dead zone. Basically, the Mississippi River takes all the fertilizer runoff from the middle of the United States (with a side of animal waste from large processing plants and human sewage) and spews it into the Gulf of Mexico. This nutrient-dense stuff causes lots of algae to grow. Algae sucks all the oxygen out of the water. Marine life in the area either dies or migrates. Currently, the dead zone is the size of New Jersey and growing. (For a more complex explanation, see this website or just Google Gulf of Mexico dead zone) For extra special fun, it looks like higher water levels on the Mississippi and possibly the BP oil spill are creating mini dead zones closer to the Louisiana coastline.This is terrible for the enviroment and terrible for all the people who rely on the marine life in the gulf for their livelihood and their tradtional way of life.
There's no easy solution here. We'll have to fundamentally change the methodology of food production in this country to make a significant impact. But the dead zone, along with other feedlot-associated problems like antibiotic-resistant bacteria, makes me think that Mother Nature may not give us any choice. If you're interested, a good place to start educating yourself about the industrial food production system, its consequences, and alternatives is by watching either Food, Inc.
or a local screening of FRESH. If you're more of a book person, I recommend Everything I Want To Do Is Illegal: War Stories From the Local Food Front
.
In my neck of the woods, the biggest issue with water is the Gulf of Mexico dead zone. Basically, the Mississippi River takes all the fertilizer runoff from the middle of the United States (with a side of animal waste from large processing plants and human sewage) and spews it into the Gulf of Mexico. This nutrient-dense stuff causes lots of algae to grow. Algae sucks all the oxygen out of the water. Marine life in the area either dies or migrates. Currently, the dead zone is the size of New Jersey and growing. (For a more complex explanation, see this website or just Google Gulf of Mexico dead zone) For extra special fun, it looks like higher water levels on the Mississippi and possibly the BP oil spill are creating mini dead zones closer to the Louisiana coastline.This is terrible for the enviroment and terrible for all the people who rely on the marine life in the gulf for their livelihood and their tradtional way of life.
There's no easy solution here. We'll have to fundamentally change the methodology of food production in this country to make a significant impact. But the dead zone, along with other feedlot-associated problems like antibiotic-resistant bacteria, makes me think that Mother Nature may not give us any choice. If you're interested, a good place to start educating yourself about the industrial food production system, its consequences, and alternatives is by watching either Food, Inc.
or a local screening of FRESH. If you're more of a book person, I recommend Everything I Want To Do Is Illegal: War Stories From the Local Food Front.
Jinx is so fail ... I am sadpanda
The T-shirts were crap. The woman's T-shirt was so thin that you could literally see through it and the guy T-shirt was sized tall and narrow; it barely fit over my hips, and hung to mid-thigh. So I'm out $10 (shipping and handling, return shipping), assuming Jinx actually processes my return. Lesson learned - never shopping there again.
Monday, October 4, 2010
The evil power of sales ...
Jinx put all of their T-shirts on sale this week, so not only did I get the 8 bit baby, I also got this one:
Subscribe to:
Posts (Atom)
