A Magnet for Money

Dave Ramsey often tells callers that money is drawn to those who properly manage it.  I think that he means that when you know where every penny of your money is going, you find that you have more than you thought. 

The first written budget we made starts tomorrow – January 1st.  Last night I was balancing my Money register against CEFCU online and discovered an unknown deposit was made earlier in the day in the amount of $666.72.

My husband got an unexpected end of the year bonus for work.  Extremely unexepected, since earlier this month there was some concern that he may get laid off. 

Coincidence?  I hope not.  It would be wonderful to get unexpected amounts of money on a more regular basis, unless of course, it was an inheritance. 

I’m off to check the Illinois database for unclaimed property…

 

***UPDATE*** I did check that site and found 2 amounts for my grandmother (who died in 2007).  One amount is between $10-$100 and the other is more than $100.  My mom is her executor and is going to send in for more information.  She said she’d give me a 10% finder’s fee (mimimum $11 at this point).  Perhaps there is some truth to this money magnet thing after all.

Money, so they say…

Recently, I’ve spent a lot of time thinking about the future of my family’s financial state. My husband and I are in our early thirties. After next week, the only debt we will have is our car loan and our mortgage (when the car loan is paid off, I plan to call the Dave Ramsey show and scream “We’re Debt Free!!”).

We save 15% of our income towards retirement and have (what I consider to be) a good amount of money set aside for our golden years. We have always put the 15% in our company funds, but today I spent some time changing our retirement strategy.

We will put up to the company match in our work funds and then put the rest into Roth IRAs. I have intended to do this for quite some time, but kept putting it off. On Friday, the financial implications of using this new strategy were demonstrated to me in a manner that really hit home.

If at age 30, a couple each invests $5000 annually into a Roth IRA earning 12% interest, they will have a nest egg of $5.4 million at age 65. This can be withdrawn tax free. If the same level of wealth was obtained via a 401(k) or IRA, the couple would be taxed on their withdrawals. Last year, my husband and I fell into the 28% tax bracket, so this would amount to more than $1.5 million in taxes.

Take advantage of your ability to contribute to a Roth IRA! I think the two hours I spent on putting this into place today will provide a great return on investment!

My brother (from the same mother)

At 22, my brother is eight years younger than me. We have never been particularly close, perhaps due to the differences in our ages. Most of the time, I find him to be engaging and charismatic. Other times I am forced realize that even eight years does constitute a generation gap.

My brother hasn’t found his way in the world yet. He works delivering pizzas a few days a week, and seems very happy with his employment status.

Recently he worked thirteen days in a row. This state of affairs made my family suspicious, as he is usually too busy to work more than a two or three days in a week. At the end of the thirteen-day stretch he took a trip to Wisconsin, traveling alone.

Some trolling of his myspace.com page led me to discover that the purpose of this trip was “four days of non-stop poker”. Wow! He made $7,000 in 2007 and he can afford to play poker for the better half of a week?

Reportedly, he came out four dollars ahead on the trip.

The trip makes me worry a lot. On one hand, the stars of the World Series of Poker had to start somewhere, though it is unlikely that he will become a professional poker player. I would hate to see him lose the little he has to a gambling addiction, or to struggle with urges to gamble for the rest of his life.
When he does find his way in the world, I hope that he does it using good financial sense.

Today is the first day of the rest of my life…

Can’t that be said about every day?

I welcomed the New Year by sleeping through it. When I was younger I was very much a night owl. I sometimes stayed up until dawn. My job requires me to get up at 4:30 a.m. every day, so there are very few late nights in my life.

I lounged in bed for a while this morning, then got up and figured out our net worth, which is a ritual that I have performed every New Year’s Day for as long as I can remember.

My husband and I went to see Sweeney Todd. I found the mixture of blood, gore and musical theater to be precisely right. Sacha Baron Cohen’s ‘member’ is quite prevalent, for those who might be interested in seeing it on the big screen.

We then further braved the winter weather to have a nice lunch together.

I just finished an hour on the treadmill. I even ran a little. Hopefully my foot will continue to feel good. I am getting shoe inserts made by my podiatrist on Thursday afternoon. I hope that if I start wearing those I should be able to run again this spring. I would like to participate in several 5k races and the Steamboat Classic. Perhaps I will be a leader for Building Steam again, though I have my sights set on doing Team Steam instead. I have really enjoyed participating in all of the programs offered by Illinois Valley Striders.

Teach Our Children Well

I was shocked when I learned about the newly evolved version of my favorite board game – the Monopoly Electronic Banking Edition.

Money problems are the leading cause of divorce in the United States. A lot of these problems are caused by people living beyond their means, via the use of lines of credit.

I do not think it behooves our society to market a game that uses plastic cards instead of cold hard cash to children as young as 8 years old. There is something to be said about using cash for purchases, about having a budget and having to hand over those two $100 bills that will buy Reading Railroad, about getting a $10 bill for winning the beauty contest.

This game advertises that their cards are more like debit than credit, since the players can go bankrupt. It states that the banker will learn basic bookkeeping skills and responsible money management. Horsefeathers.

My educational background is in finance. I loved playing monopoly when I was a child (especially the special East Peoria version that I got at the East Peoria Centennial celebration). I learned a lot about budgeting from this game – and think maybe some of my initial interest in economics, finance and accounting may have been derived from my love of the game. This change seems as if it will change that learning experience and not for the better.

Luckily this is just a special edition. The next time I update my Monopoly game the box will be full of cash sporting Mr. Monopoly’s face.