Done To Zen

Until I crunched the numbers, I had no idea how December went. I thought that it might have gone positively, but I hadn’t been expecting a big increase in net worth. Well, the numbers tell another story (in a good way)!

Highlights

1. Most of the decrease in emergency fund got redirected to Roth IRA (some of the transfer is still in a holding account — look at the “Others”).

2. Most of the increase in 401K (which accounted for 91 percent of my net worth increase, by the way) comes from contributions. The contribution for November got put in a little later because of Thanksgiving. I had forgotten about this, and so spent three hours trying to account for the increase.

3. I got around $240 refunded from my escrow account, because they found out that they’ve been holding too much money. It pretty much went into Roth IRA.

4. I invested $100 into a DRIP and promptly lost $11 to fees. :-(

5. I also opened another 529 plan this month, though I don’t know if I’ll be able to save into it regularly.

I didn’t think November was going to be bad, but it was. Expenses were so high, savings were not enough to offset them. I was hoping to reach $40,000 by the end of the year, but that seems highly unlikely given the numbers.

Highlights

1. Cash went down because I had to pay tuition. But I’m almost done with college — only two more classes left, and I’ll be free! But it does mean that I have to pay a swear-load of money in December, which will bring my emergency fund to its knees. Fortunately, 2008 will be almost done at that point, and I will go back to a normal paycheck starting 2009.

2. The balance for 401K isn’t exactly accurate, because the second half of my contributions did not get entered as of the time I made the calculations. But considering the 8% decline in S&P 500 Index today, the balance is probably going to stay around the same.

3. I have to make an unexpected payment of over $650 by the 20th. :-( I cannot tell you how incredibly unhappy I feel about it, but at least I have an emergency fund and am able to make the payment without going into debt. :-)

4. The 529 plans and the Roth IRA barely moved an inch as I feel the crunch in cash flow owing to various expenses.

5. I ended up going on a spending binge over the last ten days of November (nothing to do with Thanksgiving, I assure you). I’ll be analyzing this in further detail in later posts.

6. I mentioned before the recurring bill that I thought I would be able to reduce by around $5 - $7: turns out I won’t be ble to do so.

7. I convinced a family member to open a Roth IRA account!

I sat down to calculate my October net worth yesterday. Considering the bloodbath during the first week of October, I was sure that my net worth was going to see another double-digit loss this month, but the calculations proved otherwise. I was so surprised. I was sure that I did the math wrong. I double-checked and triple-checked everything, but apparently the numbers were just fine.

I did very well this month, mainly due to the ridiculous amount of money I put into my 401K so I can max it out by the end of the year. I also deposited most of the $5000 I took out from my emergency fund last month, so that inflated the % change by a significant amount. With the changes in emergency fund, net worth increased by about 34%. Without it, net worth still increased by about 18%.

Highlights

1. Remember that $5000 I took out of my emergency fund last month? A lot of it found its way back into the fund this month. The rest went to pay my daily use credit card. I use this card for everything I can (mainly because of convenience but also max out my rewards), but I pay it off in full every month so I don’t have to pay interest.

2. My 401K account finally crossed the $10,000 mark for the first time! Don’t let the increase fool you into thinking that it did really well: the entire increase comes from contributions; I’d increased my payroll deduction to an obscene percentage so that I can max the account out for 2008 or, at least, come as close to it as possible.

3. I transferred about $1000 from savings to Roth IRA to take advantage of the pounding that stocks took during the first week of October. I wanted to put in more, but I was nervous about taking any more money out of my emergency fund, since I’ll have to dip into it in December to pay tuition.

4. I opened another 529 plan this month. It’s kind of sad that it has more money in it than the one I opened last month. Though I include my contributions to 529 plans in my chart, I don’t count them in my net worth as they don’t belong to me.

5. Though the “Daily Use card” amounts don’t show it, balance for this month was almost $2K. On top of not becoming frugal (like I had hoped to), I went on something of a spending binge over the last two weeks of October. Ah, well.

I’m very late in posting September’s net worth update, but I had to do some soul-searching regarding whether or not to post actual numbers on this site. Posting numbers feels wrong, somehow, but I really like seeing actual numbers when reading net worth updates on other personal finance blogs, so I decided that I would do the same.

Notes

1. Of the $6000 reduction in the emergency fund, $5000 isn’t really gone. I still have it; I’ll put it back into my emergency fund account (most of it, anyway) in about two weeks. The remaining $1000 went towards Roth IRA.

2. The money in the “Other” account is artificially high because I haven’t paid a couple of my bills yet.

3. It’s surprising to see that my 401K balance went up, considering the market conditions. On the other hand, if I had kept my 401K in cash, it would have gone up way more, so maybe it’s not so surprising.

4. I finally opened a Roth IRA account. :-)

5. Credit card debt is so high because I’m paying my tuition on my card. Until now, I’ve been paying for my classes in cash, but I couldn’t stomach emptying my emergency fund again, & therefore ended up getting a 0% APR card that I plan on paying off over the next 12 months. I’ll pay off the “Daily Use” credit card in full so I don’t have to pay any interest.

Overall, net worth went down significantly. Some of it is artificial, but even without the $5K loss, net worth would still have gone down due to the introduction of the student loans. At any rate, September has been a terrible month. However, October can only get better, even considering the stock market’s death rattle.

August went better than I expected. Despite having to pay several thousand dollras for a couple of college courses that I’m taking, my net worth went up by about 4%. The final numbers were surprising enough for me to double-check my math about ten times. On the other hand, I had other sources of one-time but significant income this month, so that’s why.

Good

Bad

Important Events

1. I asked my credit card company to increase my limit because my current limit is too low for tuition fees. I expect that once I’m done with my studies, I’ll ask them to lower my limit again. (No, there really is no reason for me to have that high of a limit; in fact, I would rather not have it, if only to further discourage myself from impulse purchases.)

2. I saved 87% of the tuition reimbursement I received from my company. I plan on saving the rest over this month.

3. I saved the other half of the small bonus I received in July over August, as well. (I had to use half the bonus for some expenses in July.)

4. I am now the proud owner of a one-ounce .999 fine silver bar ($12) .

5. I started a 529 plan ($50).

6. I finally turned in the application confirmation to TreasuryDirect (after two months of procrastination).

7. With a few simple changes here and there, gas (for home) bill continues to go down.

8. I reduced another of my bills by about $7. This hasn’t actually taken place yet, but it should this week. Since this is a recurring bill, the $7 does add up.

9. Finished two more courses, hard though it was to juggle an education and a full-time job with an impending deadline for a big project. The light at the end of the tunnel is starting to be visible, though!

10. Applied for a new 0% APR credit card. The reason for this is fairly simple: instead of depleting my emergency fund completely (again and again, mind you, because I don’t have enough to cover all courses right now), I plan on paying off the tuition for the remaining courses over a period of an year, which is much more manageable.

11. I blew through my budget as if it were made it out of rice paper. The worst offender is the amount of money I spent eating out. Bah!