Positive Cashflow
Thursday, November 20, 2008
I tried to figure out my cash flow before, but I wasn't thinking in terms of the overall change in my net worth. But I create XLS spreadsheets for just about every idea I have. I created one where I record the balance of each account at the end of the day on the first of each month. I only have balances for the past six months so far. The first four are real rocky and the net change in that time span is $32.19 in the negative! The simple explanation is that I spent nearly $6000 on the heat pump for my house. But then it gets interesting. From month four to month six, my net worth jumped a whopping $3900. I thought this might be a mistake, but after poring over the numbers and formulas, I decided to copy one of my cash flow sheets and adjust it not to show payments towards things like the mortgage and cars, but simply things that change my net worth. So instead of a car payment, I show the amount of interest paid. Same with student loans and my mortgage. I include all income including paychecks, retirement contributions (and company match) and the rent paid to me by roommates. I include outgoing payments like utilities, groceries and any other expenditure that doesn't reduce my debts. Shockingly, my income exceeds my expenditures by $1900! I still can't believe that's real. I haven't been this healthy financially... ever! At least, I don't think so. Maybe when I first started working full time, I may have expenses small enough to make up the difference, but I doubt it. Now I have a new way to compare financial health to my friend and co-worker. We turn lots of things into competitions, like not eating sugar for 17 days (and counting)! I'm curious to see how her positive cash flow stacks up!
Money in the Mind
Wednesday, October 29, 2008
I don't want to jinx myself, but I've been doing a good job of controlling my spending. Well, mostly. I bought a new suit for a funeral, and I didn't really have to. It's just that I've been under dressed for a lot of events before, and didn't want to repeat that embarrassment. I mean, I'm sure family would overlook that, if they'd even notice, especially at an event of that nature, but then I thought I'd need a suit anyway for an upcoming holiday party. So I bought it, and it's been bouncing around in my head since. I even felt a little sick about it for the first day or two, and even now, weeks later, I debate the decision, and wonder if I could and should return it. But I've bought very little else. To aid in this, I no longer let myself visit http://slickdeals.net/ while I'm at work. I still visit http://www.woot.com/ but since there's only "one" deal each day, it's a lot less likely that I will succumb to temptation.
I set up allowance accounts back when I was dating Emilie (as recommended by my therapist!) and it's something I kept after we parted ways. I don't always stick to it (the suit, for example), but most "wants" come out of the allowance. Dining out, drinks with friends, grabbing lunch instead of packing, and buying new clothes all comes from the allowance fund. That money is spent however I like, guilt free. Of course, when I cheat, I feel some guilt! When I don't cheat, my budget actually turns out the way I thought it would, and it's actually a pretty healthy budget. Since I don't have any credit card debt, I am currently putting $200/month into my growing emergency fund, $130/month into an irregular expenses fund (to deal with quarterly, semi-annual and annual expenses like some utilities and basic car maintenance, as well as less frequent things like tires and appliances), and $250/month extra towards my mortgage.
I think about all of this a lot, and tweak things all the time. Only a month ago, the plan was to put that mortgage money into a high yield savings account so I could afford to refinance if interest rates dropped. But I realized that since I still owe more than 80% of my home value, I need the balance to decrease anyway, and if a good enough rate comes along, it'll be OK to roll the closing costs into the refinance... as long as the total is less than 80%. And though I do enjoy some liquidity, I also wanted to get a little more bang for my buck, so I started a CD ladder with the "excess" in my emergency fund. Every month (for a year), I'll put $200 in a new 12 month CD. Once they are all created, I'll let each one roll into a new CD, unless I need extra money that month... for an emergency. It's kind of funny knowing that after a year, that single $200 CD will only earn $8.50. But the whole ladder could be earning over $100, and the interest will compound over the years. The other day, a piece of my neighbors opened mail (or trash) blew over to my yard, and I saw that it was a notification of a CD maturing. What was once $500 was now over $800. I wonder how long the CD existed! At any rate (pun!), I could possibly create a larger ladder down the line, if I have enough in the emergency fund.
Please Make The Freelance Stop
Tuesday, October 28, 2008
I am very tired. I'm not sure if I had a pinch too much sugar last night, as I drank a few gulps of 100% fruit juice, but I laid in bed exhausted but unable to fall asleep. I did not have coffee late in the afternoon! The last thing I ate was raisin bran, though that was somewhat late at night.
Now I'm having coffee, and it's later in the afternoon than I'd like, but my head is hurting a little, and I haven't been productive at all today. My schedule is terrible, dooming me to a low percentage of hours I can bill this week.
I watched a movie last week, and wrote a review and analysis, but I was pretty tired when I wrote it. Still, I want to get back into that, but I haven't found time yet. I did kill some time playing Civilization: Revolutions over the weekend, but the biggest problem in my life for the past several months has been freelance. Now I really haven't put much of my time into it, because I'm really never in the mood for it. So one little project that wasn't supposed to go beyond May and perhaps June is still dragging on, with increasingly dire messages from my freelance client. But I just can't focus on freelance for long at home without getting rather annoyed with it all. And whenever I'm not doing it, I'm feeling guilty instead of really relaxing and resting and enjoying whatever I'm doing. I want the freelance to go away, but it just lingers, needing my devotion to the project for resolution. As a bonus, I stupidly accepted another project after that, which is dragging in the same way. I should have learned when to say "no". Now, I can't figure out how to make it go away. The easy answer is to complete the work, but it's the last thing I ever want to do when I'm home. I can almost trick myself sometimes into believing it's still a hobby of mine, and that I have some interest in it, but then I see the site I'm working on, and all the disorganized tasks and bugs and requests my client has thrown at me, and my frustration returns rapidly. I just wish he'd find someone else to finish the job by now!
Big Costs
Thursday, June 19, 2008
So as a homeowner, I was pretty fortunate for the first eleven months. But now my central air conditioner (which is a heat pump) has sprung a leak in a critical area. My first estimate was one of the phone calls that woke me up this morning and put me in such a terrible mood. The low estimate for a straight 2 ton replacement unit was $4100. To upgrade the unit and connect the third bedroom adds a whopping $1800 to that bill.
Anyway, I happen to have a pretty good financial situation. I don't actually have much socked away right now, but I do have easy access to a good amount of low interest credit. I can put $2500 on my 4.9% Visa (which would need paid off by December 2009) and the rest can be rolled into a refinance of my car at 3.49%. I'd put it all on the car, but I'd rather use the Visa and be able to pay it off quickly and keep my monthly budget in check.
Passion Fruit
Monday, June 09, 2008
The other day I realized something. I realized what is missing from my life. Passion. I used to be passionate about lots of things. And I thought maybe I was stretching myself too thin. I was passionate about what I do at work, and I even did it at home and earned extra income. I was passionate about photography, so I took lots of photos and uploaded them to my web site regularly. I was passionate about my web site, so I kept it fresh and active. I was passionate about video games so I played them and bought new ones and showed them to people when they visited. I was passionate about building computers, so I upgraded mine and built and upgraded them for friends and family.
I don't feel passionate about those things any more. I enjoy watching movies and reruns of Scrubs, but it's just something to pass the time when I get home, because I'm not motivated to do anything. I'm rather behind on a freelance project because I don't feel this desire to do it and do it well and do it fast.
Well, I have to get some work done so this is going to be a short entry.