Networth Statement October 2006

Starting this month I am going to tune out the details of my networth and focus on helping readers maximize their networths. I will however post bottom line numbers for older readers who follow my blog.

October 2006 Networth:

Networth September 06  $ 124554.16
Networth October 06    $ 132964.11 +6.75%

Mainly just following my monthly routine of contributing to my 401k, Roth, and Savings. The market helped a little.

How2: Manage Your Money #1 Getting Started

Managing your finances can be a daunting task. The earlier you start and the more you plan, the more satisfied and stress free your life will become. To me starting is one of the most important steps anyone can take. If you have been putting it off, START NOW! The way to start is to figure out where you stand. The easiest way to figure out where you stand is to calculate your NETWORTH. This is pretty easy:

Networth = sum(Assets) - sum(Liabilities)

Your main assets are bank accounts/cash/real estate/stocks/bonds/CDs/material things and your liabilites are credit cards/car loans/student loans/mortgage/etc... I prefer to not count any material things in my assets column. This is mainly because they are not as liquid as one would think. In either case find out where you stand. Congratulations you have completed the first step to managing your money! Next up #2 Goals

How2 Series

Starting this month, Money360 will be restarted with a new focus. I will be presenting series' called How2s. Suggestions to improve any How2s are always welcome.

Re-starting the blog!

I have been thinking that since I started this blog I have only put up a few posts here and there about interesting money stories/emotions/etc... and a lot of my own networth posts keeping track of how I am doing. In order to really help any readers out there get value out of this blog. I am going to consider re-starting the blog with simple personal finance how-to's and building up from there. What are your thoughts?

Networth Statement September 06

Networth Statement September 06
-------------------------------

Assets
------
401k                 $  36710.92
Roth IRA             $   9496.32
Brokerage            $  21703.32
Checking             $   3913.07
Savings              $  38574.47
CDs                  $  15000.00
                     -----------
Total Assets         $ 125398.10

Liabilities
-----------
Credit Card 1        $    786.35
Credit Card 2        $     57.59
                     -----------
Total Liabilities    $    843.94


Networth August 06     $ 115699.21
Networth September 06  $ 124554.16 +7.65%

Positives:

• Another great month, I am on a little roll here.
  
• The ESPP shares that I didnt sell have rebounded quite a bit. I have since sold them now and taken a modest profit (+$1500).
  
• The market rallied again this month which upped my 401k, ESPP, and Roth.
• The 15000 in CDs are actually 28-day T-Bills. T-Bill investing is quite simple as it turns out.
  

Negatives:

• None to complain about.
  

Bottom Line: While the numbers I am posting are spectacular, it really doesnt capture one aspect that I have not included in my Networth calcuation. I am going to need to transfer out some money to family in the next few months for various expenses which I owe but hadnt been calculated until now. More to come...

Chasing Returns: Really Needed?

I was just reading a post over at Daniel's blog MyMoneyPath that got me to thinking that why do we chase returns and is it really necessary? I guess this is really human nature to be the best or try to get the best deal (at least for PF types). I will be the first to admit I do it too. Thats why I now have more accounts all over the place and am thinking about opening up even more (see last post). Even though this is exciting as I obsess about finances all the time, I think this is a very short term outlook on money management. People often chase returns (sometimes at any cost) that they forget their goals. That is why I think its necessary to have long term goals explicitly written down. Again, I have goals but havent formalized them. It helps to gain a clear perspective which inturn will give you an idea of what you need to do. This will help with writing down a plan on how to achieving the goals that have been set. I will have to follow my own advice and put into posts my goals and plans on achieving them. I think you should too.

Everbank at 6.01%

I must say WOW! I didnt think the rates would be this competitive. I have been scouting out Everbank for quite a while now and their introductory rates have been decent. (5.51% a few weeks ago). While this is only for 3 months I still think its a great deal. If anyone has bad reviews about Everbank please let me know before I jump on this. (I will do some research on it before I open up but would like to hear if you have already dealt with them.)

Networth Statement August 06

Networth Statement August 06
----------------------------

Assets
------
401k                 $  35225.82
Roth IRA             $   9188.13
Brokerage            $  20650.90
Checking             $   6869.57
Savings              $  45380.19
CDs                  $      0.00
                     -----------
Total Assets         $ 117314.61

Liabilities
-----------
Credit Card 1        $    444.47
Credit Card 2        $   1170.93
                     -----------
Total Liabilities    $   1615.40


Networth July 06     $ 107044.50
Networth August 06   $ 115699.21 +8.09%

Positives:

• This turned out to be another spectacular month.
• The ESPP shares that I didnt sell have rebounded a little. I am considering selling them now.
  
• I got a nice unexpected bonus of ~6%. This increased my 401k contributions, and my net pay this paycheck.
  
• The market has been mostly positive this month. My 401k, ESPP, and Roth have had a decent run back of late.
  

Negatives:

• My favorite credit card (Citi Dividend Platinum Select Mastercard) just sent me the notice I have already been anticipating. The 5% rebates for gas and groceries are being cut to 2% only. I hope other companies [Chase, etc] dont follow suit.
• It is taking a long time to set up my Treasury Direct account. I still have that hold on it.
  

Bottom Line: I wish I could have this month's performance for the next 240 months!

Vacation!

I will be on vacation for a week. I expect posting to be spotty (which has been the case this past month anyway). Wishing all of you a good Labor Day Weekend.

Which Credit Cards Do You Have?

Personally I only have 2. I know a lot of fellow bloggers are posting about one of the cards that I have which is going to change/scrap its rewards system. Its a shame as its one of my oldest and most loved cards. Id hate to have to just let it sit in my wallet for nothing.

I Have:

• Citi Dividend Mastercard (cashback = 5% gas, groceries, and drugstores, 1% everything else). Their customer service is pretty good. I monitor my usage and use the free option to pay the bill online. Ive had this card for 5 years now and am happy with it. I generally cash out when I reach $100.
  
• Chase Cashback Rewards Visa with the same 5% gas, groceries, and drugstores, 1% everything else. Same as citi in almost all features (online statements, payment, etc). The only slight beef that I have with Chase is that they might not be as customer service oriented as Citi. I say this because I was once out of the country and unable to pay my bill on time and they charged me a late fee without a one time waiver that Citi did for me. Its not really an excuse but just comparing: Citi was nicer. It also could have been because I was with Citi longer than with Chase.
  

Being offered:

• Amex Blue with cashback which is supposedly the same on the surface but is actually a tiered card. This means that all purchases, be they gas/grocery/otherwise are only awarded 0.5% cashback until $6500 worth of purchases. After that the advertised percentages kick in. This could work out to an average of close to 2% with sole use.
• Amex Delta Gold Skymiles with 25000 bonus points which is basically a free ticket. The miles are pretty good too ... basically 2% on everything. The only gotcha with this card is that its only fee free for the first year. I might consider getting it for a year, getting my ticket and then cancelling. Dont know if its worth it because closing will hurt my credit score?
• I do have other offers but they are not worth a mention as this post is getting too long already.
  

Criterion I look for in cards before I apply:

• No annual fee. Why pay a fee? Unless you are getting some extraordinary service which makes the fee worth it.
• High Percentage Rewards on gas, grocery, restaurants, etc...things where I spend most of my money on. Ideally I would like 5% on these but nowadays these cards are becoming scarce. I wouldnt mind a flat 2% or greater on all purchases either.
• Ability to manage account online. Most companies have this so this is not really a concern.
• 0% balance transfers for > 1yr. This is really not one of my criterion as I dont play that game but wouldnt mind exploring it. (In case you dont know the game its: get money from credit card companies, put in high yield savings account for as long as its 0%, pay the minimum + some every month, pay back all the money at the end and pocket the interest). WARNING: this can hurt your credit score for the short term. A great resource if you want to play this game is this post at MyMoneyBlog.

Overall, I would highly recommend both the cards that I have but there are rumours that my Citi card is not being offered anymore. Please share which cards you have and would recommend.

What is the best place to keep your Emergency Fund?

Lately, I have been thinking about where the best place to keep my emergency fund is. This came up because I was pondering the tax difference between a high yield savings account vs. a money market muni fund. Currently I have most of my cash savings at HSBC at 5.05%. I have some cash in my ETrade brokerage account which is invested in a Morgan Stanley Cali Municipal Bond fund with a yield of 2.47% which according to ETrade is a tax equivalent of 4.19% BUT this is assuming the highest tax bracket of 44.3%. I dont know if anyone has done the calculations but I would certainly like to know what works out the best. I know there are some formulas on investopedia but I guess I want to just ask people if they have done this calculation before? Where do you keep your Emergency Fund?

Not Keeping Up

I'll admit, I have not been keeping up with blogging lately. This is partly due to my time going towards all my family that came here from various places for a gathering. I should get back into posting regularly within this week.

Good Advice from Vanguard's Chairman

I was browsing through my usual websites and found a link to this advice that is relevant for people like me. Its highlights are:
- Live below your means
- Invest in the market
- Invest regularly
- Learn about finance and money

Networth Statement July 06

Networth Statement July 06
--------------------------

Assets
------
401k                 $  31532.86
Roth IRA             $   8652.52
Brokerage            $  14651.93
Checking             $  11582.30
Savings              $  37219.44
CDs                  $   5179.39
                     -----------
Total Assets         $ 108814.44

Liabilities
-----------
Credit Card 1        $    886.68
Credit Card 2        $    887.26
                     -----------
Total Liabilities    $   1773.94


Networth June 06     $ 100854.04
Networth July 06     $ 107044.50 +6.14%

Positives:

• This was a good month in terms of cash flow.
• My ESPP shares have come in today and I am wondering whether to sell them off and cash out or not? My company's stock price has recently been taking a beating (just like the Nasdaq of which it is a part of) and is currently selling at what I think is a cheap price.
• I got a nice gift from BoM&D (increase in checking $).

Negatives:

• It was a horrible month for my investments. The market has been volatile and mostly negative. I expect this to continue until next quarter when the Fed hikes the rate one last time.
• I learned a lesson in investing. One of my stocks fell 50% in value and I had all the clues to sell it. More of this in another post.
  
• My credit card bills have also been kind of high as I bought some airline tickets for Mom, my uncle, and another 3 people and birthday gifts for my cousins.

Bottom Line: Regardless of my poor decision in stock picking, I am quite happy with a 6.14% increase. The challenge will be to continue saving and investing.

Can Money Buy Happiness?

I know this is an age old topic and do agree that money does not buy happiness BUT I hate when people fail to admit that money does factor into happiness, even if only a little bit. To this point I just read this article by Suze Orman: Count Your Blessings -- And Your Money. I am not really a fan of Suze Orman but I agree with what she says in this article.

Im Already A Guest Blogger!

Yes! Please see my first guest blogging post here. Thanks to all the hardwork by Kira of PennyFoolish we have a place where under 30 somethings can post about personal finance topics for your generation. Come check us out at Under30HonorRoll.com!

Do You Have Status Anxiety?

I would say to some degree we all do. Status Anxiety is a show I saw on PBS tonight as Jane at BostonGalsOpenWallet recommended it. It was a two-part show hosted by the author of the book, Alain de Botton, documenting how different cultures have come to view their status in life. I have to say it was quite interesting. The first part goes over the American view of status (Alex de Tocqueville's observations which still hold true today) and how we live in a meritocracy where anyone can be anything. This meritocracy is constantly making us consider our status since we strive to be better. The second part looks at various other philosophies of Europeans. It even discusses how death alters our whole outlook on life. This show primarily made me think (again) about what I want to accomplish in life and how much is enough. I recommend the show if you can catch it, althought I would say its not for non-philsophical types.

Networth Statement June 06 (My First)

This will be my first Networth post. When I look back, it will give me an idea of where I was when I started blogging.

Networth Statement June 06
--------------------------

Assets
------
401k                 $  30533.19
Roth IRA             $   9080.15
Brokerage            $  12618.35
Checking             $   8440.46
Savings              $  35916.54
CDs                  $   5179.39
                     -----------
Total Assets         $ 101768.08

Liabilities
-----------
Credit Card 1        $    516.67
Credit Card 2        $    397.37
                     -----------
Total Liabilities    $    914.04


Networth May 06      $  95081.59
Networth June 06     $ 100854.04 +6.07% 

I will explain a few things about my Savings and CDs. I have Savings accounts at HSBC and ING. A majority of it is at HSBC since they are offering a higher rate (5.05% vs 4.35%). I opened the CD 12 months ago when I thought 4.00% was a good rate. It matures this Aug and I will just move that money over to HSBC.

Overall, this month's performance was a good one with the market rebounding a little after its May downtrend. Lets hope it recovers all its ground and more. I cant believe I broke the six figure mark! A big milestone as I am likely to stay in six figures for a while :-)

Open for Business

Welcome
Hi to all and dont let the title of this first post fool you: I am not trying to sell anything here! yet :-)

About Me
I am going to try and keep this blog a bit anonymous so please accept the intended ambiguity of certain descriptions.

Economics has always been a fascination for me (on the side of course) as I graduated an engineer in 2004 from a top notch engineering school in the Southeast. My first real job started that July and I moved to Cali for it. /*rant... Cali is EXPENSIVE! ...rant*/ Anyway, I started making decent money (compared to $0) as I did not work in college but I did not put Mom and Dad in debt either. I paid my way through a scholarship and graduated with NO debt. With the money I was making I was interested in figuring out the best way to grow it. Frequently reading through online business and personal finance magazines such as Business Week, Motley Fool, CNN Money, Forbes, Money, etc... I discovered a whole new medium - the PF blogging world. I have followed several blogs for a year now and have finally decided to take the plunge in hopes of inspiring readers and helping them learn from my successes/failures. Making a few PF blog buddies would be nice too.

Inspiration
I was going to start this blog at the beginning of this calendar year but decided to put it off until exactly 1yr of discovering the PF blogging world and exactly 2yrs of work. The inspiration for this blog comes from my obsessive interest in Personal Finance/Investing/Financial Management (economics in general) and from the various like minded people whose stories Ive come to admire. I will soon be putting up a blogroll of these people.

Start your Engines!
Buckle up, and get ready for a (hopefully) great blog ride!