Saturday, March 1, 2008

The Apartment Search - Something Sounds Fishy

As I've discussed in a previous post, I'm moving back to Atlanta in the middle of April. Last weekend in addition to run/walking 20 miles in preparation for the Georgia Marathon "Fashionista" and I went apartment hunting.

We'd already been internet hunting for sometime and had visited a few places but we just waiting on my official transfer notice before going any future with our apartment seach. Well last weekend we re-visted our top four places and fell in love with one complex and were ready to secure an apartment.

Unfortunately the only two apartments they had available for Mid-April to May were a ground floor unit that was right next to the entrance to the complex and the picnic areas. I veto'ed that one (I don't like people hanging outside my window - I had that in college and hated it). The other was on the 6th floor with an elevator only to the 4th floor of that building and Fashionista veto'ed that one (she doesn't do stairs). Our third alternative which was on the 3rd floor with an elevator and was an exterior unit (pretty much perfect for us) was coming available March 14th, well that was too soon and the apartment complex wasn't willing to hold it or compromise with us so we weren't paying a month for a vacant apartment.

The Assistant Property Manager said she'd talked it over some more with her bosses and see if we couldn't come up with a resolution and be in touch. Fashionista and I just decided to wait it out since I had from April 15 until May 30th to move and she is renting her current apartment month to month since the lease expired in January.

Yesterday at 6pm the Assistant Property Manager (APM) of the Apartment complex we want to live in sent an email to Fashionista and I that said:
"I wanted to let you know I have a new solution for you guys. We have two great apartments currently vacant in the floorplan you want - one is a top floor with courtyard view and one is a 2nd floor with courtyard view. I am able to offer one month free on these two bedrooms tomorrow only. I would be able to hold the apartment for 2 weeks, plus you would get 30 days free rent - oputting you at April 15th. They go for $1310/$1330. Give me a call tomorrow and we can discuss the option! Thanks,"

Huh?? My first reaction is what the heck is wrong with these two apartments, since all the units we looked at last weekend were $1360+ and why all of a sudden can they hold the apartment for essentially 6 weeks. I decided to call Fashionista who's out of town (out of Atlanta) this weekend at company retreat and see what she though. She's all for it. I then called APM,fortunately I'm in Atlanta and not V-town this weekend since all of next week I have to be in Atlanta for work, and scheduled an appointment today to tour the two vacant units today.

I'll have to update you all after I go.

PFBloggers Network

Yesterday I joined the PFBloggers Network and Aggregator, which is a network of Bloggers comprised of mostly newer blogs. From my perspective, its going to be a "support group" of sorts for those of us just starting in the world of blogger. For readers its a great way to explore newer less established blogs that are offering great new perspectives plus the PFBloggers Aggregator offers a place to check out recent posts and highlights from all the bloggers.

Prior to joining I've explored the other bloggers' sites and am most imprssed with what I've read and feel very comfortable in recommending their sites to you all . I hope you all will enjoy these new blogs as much as I do.

The PFBloggers Network consists of the following:

In Debt Blogger
Living Almost Large
Master Your Card
No Debt Plan
Our Fourpence Worth
Pinching Copper
Saving Savy by a Future Millionaire
The Social Marginal
Wide Open Wallet

For you use, I've added a new feature to the blog on the left hand side with links to all of the BFBloggers's sites.

Happy reading!

Friday, February 29, 2008

Net Worth Update

“Wooohooo” – I’ve reached a milestone in my net worth - $90,000. I’ve just updated my net worth and after adding everything up as of today my net worth is $92,189.11.

The more amazing thing to me beyond reaching the 90k milestone is that in the last month I’ve saved over $2,300. My monthly budget, excluding savings, is only $2,000.

Don’t get me wrong I wish I normally saved 50% of my income each month, but my savings rate is normally about 37-40% each month.

I think part of the reason for the savings increase is I received two work expense reimbursement checks that were about $1,000 but on the flip side I had several irregular expenses this month that totaled over $500 (¼ my normal monthly budget). My irregular expenses included a 60,000 mile check up for my car, booking in advance a night at the Hike Inn for Mr. Be-Mine’s B-day in May, and an additional $100 given to charity on top of my normal monthly contributions. All in all still a very nice net worth increase.

Fortunately, especially for this month or I’d have been in trouble since irregular expenses exceeded ¼ of my budget, included in my budget each month is savings to cover these irregular expense that range from maintenance to gifts, and everything in between. Now if I’d been truly living pay-check to pay-check I’d have had to either adjust my spending habits for the month (but quite frankly there isn’t enough fluff to adjust to account for $500 unexpected spending on a $2,000 a month budget), I’d have had to dip into my loose job/major medical expense emergency fund or I’d have had to put these expenses on a credit card. (Or I supposed all but the 60k mile check up I could have chosen just not to incur that expense if it weren’t for having the savings, but since personal finance is about personal choices, I wanted to do those things and more importantly I had the savings to do them).

PS I’ve changed the format of my net worth on the left-hand side. For now I’d decided to use an excel document but I’m planning to invest some time in networthiq. So be on the lookout for more changes at the end of March when I do my next update.

Thursday, February 28, 2008

Extreme Savings -- What Personal Finance Choices Do you Make?

I’ll be the first to admit, when I hear about some of the extreme frugal savings tips people give it makes me cringe or think about the time wasted that could be devoted to other tasks.

I’m not one of "those people"– not that there is anything wrong with them. In fact I’m quite impressed that they will go to these extremes, I’m just not ready to emulate them yet.

To me savings and being frugal is about making choices and prioritizing. I choose to have a new sandwich baggy each time I need one. Since a box of 500 sandwich baggies is about $2 I choose to not buy dish soap to wash baggies which costs $2 a bottle so I can afford the sandwich bag. I choose to flush my toilet after each use which costs 2.6 cents per flush instead of having to scrub the toilet each night which would cost 6.7 cents for cleaner and paper towels per scrub.

Okay, so that all sounds kind of trivial but what about the “bigger” personal finance choices that I make. I choose to have cable, which a lot of financial bloggers do without. I’m an avid reader but without the TV what do these people do to fill those voids in their life? (yes - I’m just kidding about the voids) Seriously thought, I enjoy the guilty pleasures of TV and it provides an hour or two of entertainment a day and brings me joy. Plus I live alone so I like the noise even when I'm reading or doing something else and yes I could listen to the radio, but I prefer the TV because its more mindless. Yes, people lived with out TV 100 years ago, and yes I’m crazy, and no I don’t think it’s a necessity, but it is a comfort I enjoy. And to be honest I’m really impressed with those people who live without this comfort. Okay now that we’ve cleared that up. On to the personal choice I’ve made. The cost of the cable package I’ve chosen is $30/month. Since I choose to have cable I don’t have a subscription to Netflix approx $10/month for basic package, I don’t go to the movie theaters approx $10/visit excluding food items, or purchase DVD’s $20/each etc. So its all a trade off on what works best for you personally.

What choices do you make?

Wednesday, February 27, 2008

New Blog Feature - Feed Burner

A few very observant readers, may have noticed that a new feature to this blog has been added today and that's Feed Burner which will allow you to track post updates to Savings Savy by a Future Millionaire via email. For the time being I've added this feature at the end of my posts. If only blogger would allow a little more freedom in templates, I'd love to have a right hand column, but for now I can't complain since blogger is free and it works.

Special thanks goes out to Brian for not only suggesting that I add this feature but also for providing the tools necessary to create this feature. Couldn't have asked for anything else!

The reason I started this blog is because I really enjoy the comments and feedback from reads to the bloggers of sites I follow and wanted to have that same type of interaction. Since life is a two way street, if you're going to read and give feedback, I want to provide you the information and tools you want. So if ever there's a feature on this blog you want or a financial topic you want to hear about, drop me an email or leave a comment and I'd be happy to try to provide this for you.

Takin' Care of Business --- My Taxes are Complete!

For some reason I’m on a financial takin’ care of business roll (come on sing the song with me), so last night I busted out the taxes.

Previously I had decided I was going to go to a tax professional this year since there was going to be some changes to my taxes this year. The biggest change in my tax situation stems from the fact that 2007 was the first year I was eligible to contribute to my company’s 401k plan. I was very uncertain about how to handle this change even after researching 401k’s on IRS resources. So whenever I’m in doubt, I go ask the experts.

Monday my “duplicate” W-2 arrived – I guess I am going to have to give away my first born to the Payroll Department – I wonder what I can give them to get my paycheck receipt they same week I get paid. And you know what the whole 401k didn’t seem like that big of a concern since its all noted on the W-2 in box 12. Why couldn’t the IRS have just explained that to me rather than swamp me with form upon form that was like reading Italian-o, which I don’t speak!

Based on the new developments I did what all women’s prerogative is - changed my mind. Instead of going to a professional I figured I could handle this on my own, after all it was all contained within my W-2 and seemed like it would be the same slam-bam-thank you ma’am type tax returns that I’ve done in the past. Luckily last week I received my free turbo tax.

Being the somewhat anal retentive person that I am I didn’t want to just plug and chug into turbo tax, after all I’ve never used it before and hadn’t built up the trust of the software yet so first I went online to TaxAct which is free unless you opt to file with them.

I fully admit I was watching John and Kate Plus 8 when I was doing TaxAct so I’m sure I wasn’t fully focused and could have made a few mistakes but I wasn’t really concerned, I just wanted a quick estimate (don’t worry when I did the real taxes with Turbo Tax I sat down at my kitchen table and turned off the TV). TaxAct calculated my Federal Taxes as being a return of $907 and owing $179 for State Taxes. I thought this couldn’t be the case, I’ve never owed anything to the state before, something must be wrong either by the software or my data input, especially since I had deferred income in a 401k. But at least this gave me a baseline.

I go to the table, turn off the John and Kate Plus 8 re-run, grab my pencil and start turbo tax. After taking about 30 minutes to load the software, Turbo Tax figures my Federal taxes as a refund of $905 and my state as owing $179. Okay apparently Tax Act wasn’t so bad, but still the owing the state concerned me, I double checked everything, and as luck would have it before I could pull out my previous returns Mr. Be-Mine called and so of course I complained about owing the tax money to the state. He said he didn’t understand how I’ve ever received a refund as he’s always received a federal refund but owed the state. I explained that I thought it might be my lack of educations deductions this year but I hadn’t had a chance to look back yet at previous year’s returns. Sure enough, after we hung up and I looked back at my 2006, 2005, and 2004 returns to see what changed and it was the educational deducts. RGGGG, oh well. I guess I should be happy that I no longer have those deducts because that means I’m no longer paying tuition on top of living expense. None the less, having to write a check for taxes is a new experience for me.

PS For those of you like me obtaining a refund, Single Ma recently posted a link that allows you to track your refund. Since I only mailed my federal taxes today, I suppose I’ll wait a week or so before starting to check this.

Tuesday, February 26, 2008

Roth IRA Update

After my wonderful banking experience on Monday I decided to tackle diversifying my Roth IRA today, which is one of my goals for this year. Haha…yeah – not such a great experience, not only did I not get the advice I needed to do what I wanted to do (which I can understand not getting my way) but more importantly I didn’t get very helpful, friendly or knowledgeable people. Usually I really like Vanguard, but then I guess I’ve never had to call their call center.

Currently my Roth IRA is invested only in an S&P 500 Fund. So in theory my Roth IRA is “diversified” in domestic stock but I’d like further diversity as in more than one fund. The one problem with diversifying my Roth is that there is a minimum initial investment per fund of $3,000, unless you invest in the Vanguard Star Fund (which after reviewing this fund, I’d rather stay all in the S&P 500). I only started my Roth in 2007 so there’s only slightly more than $4k in my account.

I contacted Vanguard and talked to several people trying to find some way around this $3,000 minimum, such as using automatic deposit (which I’m currently doing) or paying a small penalty or really any solution and I was told no and given probably the same pat response that’s given to everyone “The minimum investment amount for all funds is $3,000”. Well I’d already done my research before calling and that’s not the case, there is one fund, the Star Fund, that you can invest in with a minimum of $1,000. So I’m very disappointed that that wasn’t even offered to me, not that I’d use it, but at least to prove to me the person I was talking to was at least familiar with the products offered.

Since it appears I’m not going to have any luck getting around this $3,000 minimum rule I now have a decision to make. I need to decide if I’m going move this goal to next year after my Roth has increased or if I’m going to have to dip into my other savings to fully fund my Roth at once. If I do choose to dip into savings most likely it will be my house down payment savings as I don’t want to dip into my emergency fund and my regular savings for irregular expenses (ie car maintenance) is not sufficient to cover this expenditure.

Here’s the Pro’s and Con’s of each options

Option 1 – Move Diversification Goal to Next Year
Pro: It’s the easiest and simplest option and it does not require adjusting current allocation of savings.
Con: I would have to continue investing in the S&P Fund for this year and then sell a portion to invest in a different fund, which would go against my philosophy of buying and holding.

Options 2 – Fully Fund Roth IRA for the Year at One Time
To do this I would have to dip into my down payment savings and would pay back my down payment savings by the end of this year with what would have been my monthly Roth contributions.
Pro: This would allow me to diversity this quarter and would theoretically be investing when the market is low.
Con: Loose the interest I’m currently earning towards the down payment. Investing in one lump sum means I am no longer dollar cost averaging. On top of that I would no longer have the artificial smaller paychecks with savings automatically directed to Roth savings.

What do you all think? Which option should I choose?

Author's Note: 2/27/08 Trent over at the Simple Dollar Appears to be having the same issues with Vanguard's $3,000 minimum, thought you all might want to check out his post too.

Internet banks are good, but IMHO nothing beats having a great relationship with your banker.

Don’t get me wrong, I just recently started a savings account at an on-line savings bank, primarily because this service could not be provided at my current bank at a competitive interest rate. But I have to say nothing beats being able to physically talk to someone who is really looking out for you and not just a call center staffed with minimum wage workers. So I feel compelled to share my great experience yesterday and why my banker is awesome.

I have an amazing relationship with my current bank, in fact despite moving about 4 hours away and not having access to my physical bank until I go home for a weekend I still stayed with my current bank. Don’t worry while I don’t have physical access to my bank I have online bill pay, mail in deposits etc so I’m not deprived, plus I go back to Atlanta at least twice a month so there’s always night deposits and ATM’s. I opted to stay because of the relationship with the people there and how they treat me plus the knowledge that I’d be moving back to that area in the near future.. The service amazes me, especially because my bank in located in down town Atlanta, a city of over 5.1 million people, not some small town where everyone knows your name.

Case in point of how customer relationship is what keeps me coming back. Yesterday I had a CD that contained a portion of my house down payment (all of my down payment savings are laddered in CD’s) that was up for renewal with a grace period until the 5th of March.

I know I could have clicked on line to renew my CD and I did check online for interest rates before calling my bank’s branch manager Charlie. I’ve met with Charlie in person several times and have banked with him for a few years (note I say him not the bank, although I do love all the other people that work in my branch).

I call him up on his direct line, “Hey Charlie this is Future Millionaire ”. Immediately I get, “Hey , long time no see, how’s Valdosta treating you?” we chit chat for a few minutes and Charlie even glow about how his son just completed a drafting class at the high school and really wants to become an engineer and has started talking about going to my alma mater Georgia Tech. I’ve even met his son one time, because Charlie’s helped me out by coming to the bank on a Saturday when its normally closed so I could get into my safety deposit box. Another reason why I love my bank and banker, they work with you.

I told Charlie that one of my CD’s was up for renewal and wanted to see what my options where. Charlie went through the regular offers that I had already seen online, CD for 3.59 apy 3.65 (better than what I’m getting with Emigrant Direct for a savings account). My philosophy is it never hurts to ask no matter the situation (provided you are nice about it), half the time I get “honestly that’s the best I’ve got”, other times I get you know if we reclassified your money market then you’d qualify for this .1% bump making it 3.69 apy 3.67. Heck yeah! Thanks Charlie I’ll take that.

He was going to fax me the forms to sign and I’d mail them back to him. Ba-da-bing ba-da-boom CD renewal all taken care of and had a nice little chat.

A few seconds later, he called me back unfortunately he couldn’t make it fully work with the system and I’d be about .05% lower that what he said and have a rate of 3.64 with an apy of 3.71. He apologized and was very sorry but he’s already run the numbers and it would be about $6.11 less in interest for the four months, but to make it up he’d take me to lunch the next time I’m in town. No biggy, I’d have loved that extra $6 but I’m still fine with interest rate, its better than I can do anywhere else and I still feel great about the transaction.

I’m telling you, I’d willingly settle for slightly less interest (although not in this case) to talk to a person who is actually willing to help me out.

Monday, February 25, 2008

Monday Money Funny - Why People belive werid things.

One of the regular features on my blog is "Monday's Money Funny" which are humorous (at least to me) articles/jokes/just about anything that I've discovered over the weekend when I catch up on all my on line reading that spark a need for knowledge. For example last week's was on the somewhat controversial a topic of flirting in the work place which was mentioned briefly in NY Times Article "Two Paths for Aspiring Alpha Females".

This week’s Monday Money Funny is inspired by an email I received Sunday from a regular reader, Scott (shout out to Scott). We frequently exchange emails, in his recent email Scott advised “You may not want people at work to find your blog. Some people can be jealous and turn into back - stabbers, if they think your going some place or have more then they have ... even if you actually worked hard for it...”. This got me thinking, and not just about not sharing my blog at work (which I don’t, in fact no one who knows me in person has seen this blog – that way I can be totally open and discuss all of my finances, since so often this is a taboo topic for public conversation).

After briefly thinking about my anonymity, I moved on to really thinking over Scott’s comment about people being jealous which got me to thinking about an article that I bookmarked several weeks ago from the LA Times called “Why people believe weird things about money.” In this article the author, Michael Shermer, reports on experiment in behavioral economics.

Below are the highlights from the article:

[…] Would you rather earn $50,000 a year while other people make $25,000, or would you rather earn $100,000 a year while other people get $250,000? Assume for the moment that prices of goods and services will stay the same.

Surprisingly -- stunningly, in fact -- research shows that the majority of people select the first option; they would rather make twice as much as others even if that meant earning half as much as they could otherwise have. How irrational is that? […]

Consider one more experimental example to prove the point: the ultimatum game. You are given $100 to split between yourself and your game partner. Whatever division of the money you propose, if your partner accepts it, you each get to keep your share. If, however, your partner rejects it, neither of you gets any money.
How much should you offer? Why not suggest a $90-$10 split? If your game partner is a rational, self-interested money-maximizer -- the very embodiment of Homo economicus -- he isn't going to turn down a free 10 bucks, is he? He is. Research shows that proposals that offer much less than a $70-$30 split are usually rejected. […]

The last experiment reminds me of a game show, Friend of Foe, that was on VH1 a few years ago and hosted by Lisa Kennedy where you answered questions together with a stranger then had to decided in the end how to split the money. The options for dividing the money were split evenly or one person take it all, if you both chose to split the money you each took home ½ of the winnings, if you chose to take all yourself and the other person chose to split then you took it all, but if you both choose to take it all then no one received any money. Guess which option was most frequently selected --- hmm I wonder why this show is no longer on the air, after all they didn’t have to spend any money on prizes.

The article concludes that: When it comes to money, as in most other aspects of life, reason and rationality are trumped by emotions and feelings.

I admit, I’m a victim of letting my emotions and feelings rule my money. Money is very personal for me, this is why its personal finance. I found a few articles to help us all with separating your emotions from your finances.

"Emotion and Money" from Science Central News help explain how to take risks
"Keeping your Finances and Emotions on an Even Keel" from bnet explains how to not confuse net worth with self worth

Stay tuned for next week's Monday's Money Funny. Also if you run across any Money Funnies please email them to me at and if I use them I will give you credit and link to your blog and if you inspire the “Money Funny” topic, I’ll give you a shout out.

Sunday, February 24, 2008

And the Winner is...

Congrats Katie Gregg you've won a copy The Millionaire Next Door! Email me your shipping address and I'll have it sent to you.

To determine the winner of this contest, everyone who commented on this blog from Friday, February 8 to Friday, February 22 was entered, if you made more than one comment you got entered more than once. I then randomly drew one of the pieces of paper.

Thank you to everyone who participated in the comment contest. I'm thinking of having another one for the month of March. I just checked out The Richest Man in Babylon from the libaray the other day, maybe if its any good I'll purchase a copy for the give away. Any other suggestions on financial goodies to give away?

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