Positive Number 1 - Electric: Got our most recent electric bill in the mail today. It's back under $100 per month ... yea! (We're 100% electric) And I had hoped to not go over $150 during the hot, high A/C months, and in fact our highest bill was $129.
Positive Number 2 - Food & Bev Budget: Don't expect to have any more food & bev expenditures for October (1 day left in the month and we still have plenty of everything), so I'm prepared to declare the first month of our new food & bev budget a success, with $22 left unspent. DH is completely on-board; even tho he enjoys grocery shopping, we agreed that for the time being I need to be the one to do all of the grocery shopping ... DH has not yet learned to resist the urge to throw some sushi or deli Chinese in to the cart. We have a househunting trip coming up in a bit over a month ... I thought we might have to add a bit to the budget to cover all of our eating out at that time, but now I'm thinking that if we can leave some unspent in November as well, we'll hopefully be able to cover the meals on the trip within our regular budget.
1 Negative - Twisted Metal Mess: Yesterday when I got home from work, DH told me he thought something was wrong with the garbage disposal. I stuck my hand in and found a mess of twisted metal that used to be the removable part of our garlic press! It is beyond repair, and we use quite a bit of fresh garlic, so we will be shelling out a bit of $ to buy a replacement. Not the end of the world, but definitely an unnecessary expense of $15-20. The one we had was about 20 years old ... No doubt there have been some improvements since we bought that one!
I'm thinking about the Zyliss ... Have read good things about it, and it looks nice. Any feedback from my fellow bloggers?
(At least the disposal seems to be running fine.)
Archive for October, 2008
Positive Number 1 - Electric: Got our most recent electric bill in the mail today. It's back under $100 per month ... yea! (We're 100% electric) And I had hoped to not go over $150 during the hot, high A/C months, and in fact our highest bill was $129.
In the last week 3 houses on my watch list changed to status "sold." There are now 90 homes on my list, so that's 3% sold in a week. Sales prices were between 95 and 100% of list, and days on market were 9 - 41 days. That's the 2nd strong sales week in a row.
Today I got a 5-lb bag of Nutro Max dog food. They were offering a rebate for the full purchase price; however, as usual with rebates, I had to pay sales tax, and I had to pay postage to mail off my rebate.
So, that bag of dog food wasn't free ... it actually cost me $1.21 (plus a couple cents for the envelope) ... no cost for gas to the store, because I walked over to PetSmart after DH & I were done looking at digital cameras at another store. Even tho' it wasn't free, for $1.23 (or so), I think it was a good deal, especially considering the look on my dog's face when I brought it home!
1. On "Sensible Spending":
Went grocery shopping today. (For those of you following the HEB Banana Price Index, it is holding steady at 49-cents per lb.)
Midway through my trip I realized how much more comfortable my past couple grocery shopping trips have been. I had my list and coupons and pen, and I kept a running tally on my list of how many dollars worth of merchandise I had in my cart. Sometimes I paused to study the product and prices before deciding which item to buy. At one point I whipped out my little calculator before deciding on making a purchase.
What was comfortable about it? Not once did I get a funny look! I used to get funny looks from other shoppers quite often. Today no one looked at me sideways, and I noticed that I had a lot of compadres ... lots of people clutching lists & coupons. A nice older gentleman & I had a brief exchange over which package of frozen vegetables was a better deal with the in-store coupon. I saw something I rarely see ... people stopping and really looking and thinking before pulling something off the shelves, not just grabbing randomly. I saw one woman looking at the prices of soda with a VERY pained look on her face; I mean, I could almost see the internal struggle she was going through written all over her reddening, screwed-up face ... poor dear. I fought the urge to hug her and whisper "tap water ... it's better for you too" into her ear.
2. On "House Hunting":
We have about 80 houses on our watch list. Last weekend a very interesting thing happened ... On Monday, the status of 4 of them changed from "pending" to "sold." I found out the sales prices, and 2 sold for 97% of list, 1 for 99%, and 1 for 100%. Now, this does not necessarily tell the whole story ... for example, if the seller paid the buyer's closing costs, or threw in some appliances or a car or a vacation or whatever, then the sales price as percentage of list can appear inflated. And, please keep in mind that the houses that are likely to make it to our watch list are those that we consider to already be "bargain priced," so it's possible to percentage on our list that are selling is a bit higher than the percentage for the San Diego market in general. But still, it was interesting to see so many go to sold over one weekend (I had not been keeping track before this, but if my memory's correct there was maybe 1 going to sold every 2-3 weeks) and selling for so close to list.
Whether last weekend was a funny little blip or part of a trend remains to be seen. Very curious to see what will happen THIS weekend.
3. On "Investing & Risk Tolerance":
I've been thinking about this a lot the past few days ... You know those risk tolerance calculators that you can find on all of the mutual fund web sites (and other places)? Did they not work? Do they need to be re-calibrated? Or did people either just not bother to do them or not answer them honestly or without much self-awareness? Why do so many seem to be invested in things they very clearly did not have the risk tolerance for? The tools were right there for the taking, free of charge ... Did not enough individual investors not use them? Or did they not work as they should have? It's so baffling; am I missing something?
4. In Spite of the Craziness in the Stock Market, One Truth Remains: Numbers Don't Lie!
Yesterday my husband started talking about how he was thinking of moving his entire SEP-IRA to bonds - GASP! I knew I had to stay calm, so I just asked him why, and he started moaning about how much money he has "lost" (his word, not mine). I told him "you haven't lost money." And he said "how do you know?" I pulled out the good old-fashioned yellow sheet of lined paper from the front of his SEP-IRA file where I keep track of his annual contributions and I showed him how much he has contributed out-of-pocket and how much his balance is now, and whaddayaknow ... He hasn't lost money ... He has made money. Not a ton, but a bit. Up about 3-1/2% per year since he started contributing to his SEP (formerly a Keogh), tax year 2001, this in spite of the recent downturn. I think I've managed to talk him down from the ledge ... for now. I wonder how many other people have actually done better long-term than they think they have? They should look at the numbers ... they don't lie ... and they aren't emotional either.
Today DH & I went to The Salt Lick BBQ for lunch. It's an Austin classic. Not only was it fun, it was yum-yum-yum. I wish I could describe the pit where they barbeque the meat ... But trust me, it's really cool.
They served very generous plates full of meat (DH had ribs; I had a combo of brisket, rib, and sausage), potato salad, coleslaw, beans (hate to be picky but this was the only item that didn't really taste very good ... too salty), bread, pickles, and onions. I brought half of mine home, so I'm getting 2 meals out of it.
Poor DH was so delighted with the delicious taste that he started gobbling his food too fast and had polished off his whole plate before realizing how full he was getting ... He started complaining on the car ride home about being too full! Funny since initially he wasn't 100% sold on the idea of going ... His reservations disappeared as soon as he took the first bite.
Plates were $9.95 each; with tax & tip we spent $25. Absolutely worth it! It was a great outing. With the exception of the free breakfast at Ikea, this was my first time out to eat in about 6-7 weeks, so I think that added to the pleasure.
On a side note, I am deleting the Bat Flight at Congress Ave Bridge from my list of things to do. Bats are a big part of life here in Austin (they help control the mosquito population), and the bridge bat flight looks really cool. But I found a grove of trees near where I live where several times I was able to watch bats taking flight at sunset (right after birds flew in to roost ... it was like they were trading places), and I saw several bats when I went on the cavern tour. While that's not the same as seeing the big bat flight, I'm satisfied that I've had enough "Austin bat experience" and I can save the expense of driving to and parking downtown without feeling like I'm missing out.
Where have you had most luck buying the best home furnishings? "Best" means the right combination of price and quality ... whatever that may mean to you.
I am starting a list of places to shop for home furnishings (mainly furniture) after our move, and this is what I have so far. What I'm really looking for is alternatives to the "regular" retail stores, tho' I will start there for pricing benchmarks. I am totally receptive to the idea of buying 2nd hand (with some exceptions, such as mattresses).
www.shopgoodwill.com (Goodwill auctions)
What am I missing?
The Time: Yesterday
The Location: Suburb of Austin, Texas
The Setting: Wife is sipping her morning coffee while reading the Wall Street Journal; Husband is perusing the news on the internet; Wife looks up from paper, and the "easy" conversation begins ...
Wife: What do you think the odds are that the Fed will cut interest rates?
Wife: Yea ... So, should we move some of our short-term money to a short-term CD?
Husband: Good idea
Sounds easy, right? Well, what followed was "Wife" searching for best CD rates, and then having several discussions off an on over the course of the day and evening with "Husband" about length and amount of CD. Conversation expanded to include general state of the economy, prospects for Husband's business over the next few years, Wife's employment prospects following relocation given current state of economy, how much would be spent on a house, why does Husband's idea on that particular subject (how much to spend on house) continue to swing back & forth like a pendulum, why-oh-why does Husband continue to delude himself into thinking a house can be had for 50% of list, and why-oh-why-oh-why doesn't Wife realize that at any given moment earned income could plummet to zero?
It all ended up with the exaggerations dialed down, Husband & Wife in agreement (GMAC 6-mo CD at 4.00% for a compromised-on amount), followed by a fair amount of laughter, and their record of never fighting over money intact (serious discussions with differences of opion, yes ... neither of them are doormats after all ... but fights, no), but my goodness it was tiring for both of us ... er, I mean "them."
Just in time for your Halloween entertainment... The Kiss of Death, The "State" Edition
Will the scfr curse continue? (For anyone new, I had accounts at both WaMu and Wachovia when they failed or were bought out under duress, and had bailed on Indymac about one year before it went kaput. All 3 of those banks were offering attractive yields.)
Cue the scary music ...
I am now planning to move to California ...
When DH was on his last business trip (overseas), his uncle gave him US$80. Uncle had been to India recently, where apparently they accept US$. Uncle said casually, "Oh, I don't need this anymore. Why don't you take it?" It was like it was play money to him ... and given the current devaluation of the dollar, maybe it is.
Well it's OUR "play" money now. DH suggested we use it to fund the brunch at Fonda San Miguel that is on my wish list ... Yea! We may wait to go until the holidays. Since we have no family here in Austin, the holidays are very low key and it will be nice to do something special.
When I heard a TV commentator end of last week mention that the stock market was down 30% from its high a year ago, I decided to check my Vanguard portfolio to see how it was doing in comparison.
I discovered a nifty little tab labelled "Performance" which showed me my ROR (rate of return) for 1 year, 3 years, and 5 years.
1 year = -12.7%
3 year = +4.1%
5 year = +5.2%
Nice to see things from that perspective ... No, the last year has not been great, but I am still doing fine when looking back over the past 5 years. Not necessarily anything to celebrate, but nothing to get depressed about either.
This is for my account only. DH has not been with Vanguard long enough (he used to be with TRowe Price) to see anything longer than the 1 year ROR.
And just FYI, my portfolio has not always been as it is now. For a time, we had a jointly-owned Vanguard MMF (which we no longer have) which was included in the calculation, and in the past I owned other funds such as Target Retirement funds. But other than the MMF, I have always owned mixed asset funds or a mix of funds consistent with my preferred asset allocation.
1. Gasoline: Yesterday I finally saw a price below $3 ($2.989/gallon for 87). Wouldn't you know it, I had filled up a few days earlier. Oh well, I guess the laws of dollar cost averaging apply to gas fill-ups as well as mutual fund investments ... Maybe the next time I need to buy the price will be down even more.
2. Groceries: I have decided that the "HEB Banana Price Index" is the best way for me to track grocery price trends ... Granted this method is VERY informal and EXTREMELY unscientific, but it is the one item I buy most frequently, and the change in price of that item does seem to mirror the overall price trend of the types of groceries I buy. Back in May I blogged about how prices had gone from 33 to 44 cents per lb. Shortly thereafter it went to 48 cents and very quickly to 49 cents ... Wish I had bothered to note the date but I'm guessing June? Well ... since then the price has remained steady, so nothing to complain about.
3. Revised Food & Drink Budget: DH is on board, although right now it is in more of a "we'll see how it goes" mode. I would prefer a firmer commitment, but I'll take what I can get.
4. Medical Insurance: We pay for our own, an individual policy. Got notice that as of November it's going up $48 per month. Oh well. I won't go without it. Best to focus on what I can control. Sure glad the new food & drink budget is in place.
On a side note, while I am looking forward to the move to San Diego, I am NOT looking forward to possibly having to look for an individual health care policy again (it's just so mind-numbing and such a heavy responsibility). If I can transfer the policy I have right now to Cali I will do that.
1. Doggy play date at the park (fun for the humans as well as the dogs)!
2. Free breakfast and coffee at Ikea. Available at most locations this weekend (Sat, Sun, and Mon) until 10:30am.
While there, get some doggy clean-up bags. I reuse my newspaper bags, but it's never enough. Ikea's price is 3-cents per bag ($1.49 for a roll of 50), which is the best I've found anywhere.
3. Watch a Netflix movie on-line. That's a feature they added awhile ago, and I haven't done it yet, but should in order to take full advantage of my membership since there's no extra charge.
4. Renew my library books on-line (gotta avoid those fines). Read same books.
5. Introduce DH (who has been out of town again, coming back today) to the new chart on the refrigerator for tracking Food & Drink expenses (both consumed at home & eating out) ... I added a cute (free) clip art picture to it, hoping that would be the spoonful of sugar that makes the medicine go down.
Will he get on board with the idea of squirrelling away $25 a month for 3 months from the alloted amount so that I can fulfill my wish of having a very expensive Sunday brunch ($29.95 per person plus tax & tip) at Fonda San Miguel before we leave Austin?
6. Wash my down comforter. I love having a front-loader machine. Used to take my comforter to the cleaners, but now I can do it myself. (Note to newbies to the world of frugality: A diehard frugalite would rather wash a comforter in the tub than take it to the cleaners. I'm more a "moderate frugalite".)
7. Make Soap Balls using the little slivers I save from the ends of soap bars. (I've been doing this since I married DH. I'm the type of person who will use a bar of soap to the very end, perhaps squishing the last little bit on to the new bar. But DH doesn't like that, so I go ahead and replace a bar when it gets low, but I save the slivers and make balls.) I may not have balls when it comes to investing, but I do when it comes to keeping clean!
Hope eveyone has a great weekend.
There I was ... happily living my law-abiding life ... 30 years driving a car with zero moving violations ... Then one day last week I was not paying enough attention, did not realize I was in a school zone, was going under the regular speed limit but 5mph over what is allowed during "school zone" hours and - BAM! My first ever speeding ticket.
Here in Texas they allow you to take a Driver Saftey Course and have a ticket dismissed once a year (with some restrictions). It's actually a bit more expensive to go the dismissal route than just pay the fine, but I decided to do that so it won't go on my otherwise clean driving record.
I've now figured out what this little lapse of judgement is going to cost me for the filing fee, the driver course, getting a certified copy of my driver's record, and sending things to the court by certified mail: $180. Ouch.
On the bright side, I am about 1/2 way through the driver course (I'm taking it on line) and I am learning quite a bit. Cars and recommended driving techniques have changed so much since I took driver's ed in high school. I have also realized how sort of lacksidaisical I have gotten about my driving ... not paying as much attention as I should, which of course is what got me in to this expensive little pickle in the first place. So I am glad to be taking the course, and I think I am becoming a better driver as a result. Better some inconvenience and cost now than an accident with someone getting hurt in the future, right?
But, positive thinking aside ... It will take many coupons clipped, many meats bought "reduced for quick sale," and many many Pinecone surveys completed to recoup that $180.
Don't be a dumbell like me. Pay attention and drive safe.
John Bogle (founder and former CEO of Vanguard) appeared on CNBC's Squawk Box this morning. The moderator described him as a "patient, long-term investor" which makes him my kind of guy and I'll admit to being a bit of a "Boglehead" (fan). Based on my notes (of which I do not guarantee the accuracy), this is a summary of what he had to say.
On the Economy: He said that he really does not know what will happen with the economy in general. (He mentioned that it is crucial the "toxic" assets get written off of banks books but said something like he does not know the best way to make that happen.)
On the Stock Market: He said that this is the most speculative market in the history of finance. He said that the speculators are betting that other speculators will bet the market is going to get worse, and that is driving the market down. He said that if the speculators want out of the market: "Let 'em out." He said that the fundamentals of the market, what he referred to as "boring stuff" that the speculators don't care about, dividend yields & book value, are sound, and they are what will eventually turn the market around. And when will that happen? Again, Bogle said he does not know for sure (and no one does), but that he thinks it is probable that we are about 1/2-way through the current market decline.
On Individual Investors Who Are 5 or so Years Away From Retirement / Asset Allocation: He says that if there are individual investors who cannot afford to lose even one penny of their investments, then yes, they should get out of the market ... But he also mentioned that they never should have been in that position to begin with. He said that people should have had a percentage of their portfolio in bonds that is the rougly same as their age. (In other words, a 75-year-old would be holding about 75% of their portfolio bonds). He said that people who had set up their portfolios prior to this market downturn in a way that is consistent with what he recommends "are hardly being impacted" (they have lost a few percetage points but it is tolerable for them).
No secret around these parts that I am a conservative investor, so this may surprise some, but right I am feeling some urges to put more money in to the stock market. (Bet you never thought you'd hear me say that, right?)
My great-grandfather did pretty well putting money in to the stock market following the crash of '29. There's a side of me that asks if he had the guts to do it, why don't I? You know the little voice, the one that says:
Oooh ... Dow's below 10,000 ... prices are down so much, so stocks must be a real bargain, right? Maybe ... maybe not. Bottom line is: I don't know. I am not a stock-picking genius. I am not my great-grandfather. I am comfortable with my current investments, and I am going to stick with them. We will continue putting money in to our IRAs (as much as we are allowed), and those new monies will continue going in to mutual funds that are a mix of stocks & bonds.
In keeping with my conservative nature and spurred by the current market drop, I have set a date when I will start gradually pulling money out of the stock market. But that doesn't involve making any changes right now.
We will continue house-bargain-hunting and nurturing my husband's business. We will continue living below our means and saving. Those are areas where we feel comfortable and confident. That's what I know.
But I am NOT going to buy individual stocks or invest in stock funds outside of our tax-deferred savings ... and I can live quite happily with the results, even if I miss out on the next bull run. I will not regret that I did not buy stock XYZ and double my money in 6 months. And just what is stock XYZ, the one that will double in 6 months??? I have no clue.
I may not know a lot, but I do know enough to know what I don't know.
The organization I volunteer with had it's big annual event today, and it was a stunning success. All attendees seemed to have a great time.
One of the best things about our current living situation (living very cheaply ... I'm only working off & on at temp jobs and not looking for anything permanent) is that I've been able to devote some time to volunteering... the amount of time involved ebbs & flows, but at times it's like a part-time (unpaid) job. I'm no PrincessPerky (aka Scouting volunteer extraordinaire), and what I do is itsy-bitsy small potatoes compared to the organization's leader who works full-time-plus for no pay while raising 4 children, but at least it's something.
Not having to worry about bringing home more than just a few slices of bacon once in awhile, and therefore able to devote some of my extra time to a worthy cause, has been a real blessing. This is sort-of how I envision my early retirement years, and I know I'm lucky to be able to do it for a bit in my mid-40's, while my knees & back are still strong!
In addition to the emotional rewards, there are quasi-financial fringe benefits to volunteering. There was a pizza place at the event that was selling slices. When the event ended, they started handing out free pizzas to the volunteers and I got one!
And it was a good workout. I'm so tired ... I must drag myself out to walk my dog, but then I'm going to crawl in to my pajamas and plop on the floor to watch an episode or two of "As Time Goes By" ... if I can stay awake. (Since we don't currently have a sofa, if I want to lie down to watch something on TV, it must be on the floor.)
Wachovia now wants to sell to Wells Fargo, but Citi is objecting:
I hope the parties involved can work this out amongst themselves. (The thought of legal wrangling and court injunctions ... ugh.)
No, the fact that 2 of my banks (WaMu & Wachovia) went buh-bye within a period of 5 days did not cause me to take a long walk off of a short pier. I'm still around. It's just that DH's business and my volunteer activities have really kept me hopping, and I did not want to crank out a hurried blog entry that would end up sounding completely incoherent.
First, on the bank thing. I know you're all sick of hearing about it, but as far as I know I'm the only one around here who has accounts at both of the "W" banks, so you might be curious to know how I feel about the whole business. It's fine. Really. Since WaMu was a bona fide failure, it was more disconcerting. But we had already done what we could (short of panicking and pulling all of our money out) to feel prepared for a failure. And with Wachovia ... well, the irrational side of my brain thought that it would have been nice if I could have had a couple weeks between bank blow-outs to get myself prepared emotionally for it! But then again, maybe it was nice to just get it all over with at once. I'm still keeping my eye on what will happen with my yields. With WaMu, I have an MMA. Don't have very high hopes there. With Wachovia, most of my money is in CDs, so I am hoping that my rates will be in effect until the CDs mature.
I went in to my WaMu branch yesterday (had volunteer-related business that had to be taken care of), and the mood there was quite upbeat ... A big change from Friday.
On a really positive note, I did manage to earn some respect points with my DH for the nagging I did to get him to switch his business account from one that was not FDIC insured to one that is. (Side note: As small business owners, we are fully in support of raising the FDIC insurance limit, and think it is long overdue. This is something they have been talking about for years. For many small businesses, ours included, it is darn near impossible to operate efficiently and keep your balances under $100K at all times.)
Thrift-o-rama asked how we were coping with all of the turmoil in the financial markets, and someone else asked what we are going to change. This is what I've done and what I am going to do (and whether I'm right or wrong, I really don't know, but I'm doing what feels right for us.)
- Over the weekend, spurred by the WaMu failure, I printed out two well-known poems that I like and they are sitting on my table so I can glance at them any time I need to. They help me stay focused. One is "If" by Rudyard Kipling, and the other is "Desiderata" by Max Ehrmann. BTW, I know many people like the line in "If" about keeping your head when all about you are losing theirs, and I like that too, but actually my favorite part is "If you can fill the unforgiving minute with sixty seconds' worth of distance run, yours is the Earth and everything that's in it."
- On Monday I turned on the news as I was getting ready to make lunch. Saw the Dow plummeting. On top of 2 banks going under, it did feel overwhelming, and I'll admit I felt anxiety coursing through my body. I found myself thinking "OMG I hope the Dow doesn't drop below 10,000 ... no, it's not a logical response and 10,000 really is no different from 9,999 ... it's purely a psychological threshold ... but it goes to show that no matter how rational we try to be, sometimes irrational thoughts take over. I realized I still had work that needed to be done and I needed to focus. So ... and I admit this may sound silly ... I decided that instead of just throwing together a sandwich, I was going to make myself a nourishing lunch of brain food. I fixed a salmon patty and steamed spinach. That's right ... the Dow plummets and scfr steams spinach!
- Monday evening, after I had finished the work I needed to get done for DH, I popped a Netflix DVD in the player and watched one episode of the old BBC series "As Time Goes By." I love that series ... It never fails to make me laugh out loud. By that point, I REALLY needed a laugh, and it felt good.
- As far as our investments go, we're not changing a thing. Our portfolio was designed so that we could emotionally handle a serious market downturn. I did write a date on my calendar (in 2015) when I will revisit our asset allocation, and come up with a plan to GRADUALLY, year-by-year start moving out of stocks. At a certain age, I'd like to be 100% out of the stock market. (My thinking at this time is that age 65 would be good ... I do realize this is not necessarily a wise plan for everyone.) I feel for the senior citizens whose portfolios are taking a serious beating. I wonder how many of them still have the same asset allocation that they had when they were 40 or 45 or 50 ... and if it made sense for them back then and they just never changed it?
- As far as cutting back, we decided not to renew our just-expired subscription to the Austin Sunday paper (I get the WSJ Mon-Sat). Because we are moving away, we may have decided to let it go anyway, but the country's financial situation made the decion to save $2.44 a week that much easier. I clip a couple coupons in an average week, but do not save enough from them to justify the cost of the paper. Also, DH & I have been discussing our grocery budget and how we might trim it a bit. I am going to be presenting my plan to him when he returns from his business trip next week.
- I have some scrap gold (broken necklace, etc.) somewhere. I'm going to go ahead and sell it ... If I can find it.
- I'm going to vote. Nothing new here, but I do believe it's one of the most proactive things all of us can do to impact the course our country takes.
- We're moving whole-heartedly ahead with our plans to buy a house.
- And now for the more unconventional, and perhaps controversial, idea: When we open our next bank account (if we decide to bail on Chase or Citi for example), it will likely be with a bank that is owned by a non-USA company. For example, since we are moving to Cali, having an account with Union Bank of California makes sense. They are a member of the Mitsubishi UFJ Financial Group. If diversifying your stock portfolio internationally makes sense, then why not diversify your bank accounts as well? Y'all can call me crazy if you like, but as I said, we're doing what feels right to us.