makingourway

Healthy sleeping tips

2009-10-12T21:37:00.003-05:00

My favorite tip from consumer reports is that you:

(this is from National Center on Sleep Disorders Research, American Academy of Sleep Medicine, and individual sleep-medicine experts they consulted):

Use the bedroom only for sleeping or sex.

I wonder how many other things we use our bedroom for?

Little children make it very difficult for parents to have private time for intimacy / romance - especially when the little ones join you in the bedroom (every night!) it's unlikely if impossible that the bedroom will be used for anything other than:

1. sleeping (a little)
2. jumping on mommy and daddy to wake them up
3. jumping because it's fun
4. vomiting or anything else that comes out of a sick child
5. a place to watch tv in bed with mommy and daddy (think safe secure nest)
6. a great place for folding laundry
7. an inconvenient place for building puzzles (try moving the puzzle to go to sleep)
8. a second kitchen when under the weather
9. a mysterious warren of comforter and pillow tunnels ripe for exploration

regards, makingourway

Losing our transit benefit

2009-10-12T21:35:00.001-05:00

It's unfortunate, but big company has decided to economize on certain HR benefits.
One, which I really enjoy and will be sad to miss, is our transit benefit.
I was able to pay for more than $200 a month in transit costs using pre-tax dollars. This is like an $80 decrease in pay!!! bummer!!

Oh well. Think hard, make more money!

Regards,
makingourway

updating our children's furtniture

2009-10-12T21:31:00.002-05:00

Looks like our little ones are getting a bit too big for the hand me down furniture they've been living in (a day bed from my bachelorhood) and a convertible crib (now bed) from our first.

Our strategy looks like we'll do the following:

1. convert the convertible crib bed to a full bed $200 (conversion rails). I'm hoping we can save the full size mattress from the day bed.

2. buy a new bedroom set for our littlest. I'm sure it doesn't mean that mommy and daddy's bed is any less attractive, warm, cozy and less scary, but... it does make a nicer cozier room for our littlest. I'm guessing this will be a full bore furniture set from costco $1200 - $1800.

Anyone have any alternatives?

Regards,
makingourway

quick update on net worth - overall about 13% down on investments

2009-10-11T13:39:00.002-05:00

Did quick overview of investments.
Very difficult to track in quicken when rollovers seem to reset investment performance at the time of rollover.
However, most of the rollover assets were similar, so I'm estimating my investments to be down 13% since the market plunged - that's a fairly good recovery.
I did manage to convert some cash back into stocks and did make nice returns on the upturn, but i didn't fully leverage the rebound and kept most of my cash in cash for maximum liquidity.
Anyone have good ideas for tracking absolute portfolio returns?

Overall, our networth is up at about $830k. Not the progress we'd like, but nonetheless progress.

Regards,
makingourway

ipod choices

2009-10-11T13:33:00.002-05:00

i finally gave in and bought an ipod touch. something i'd been avoiding for a long time.
Now the question is what do i do with my CD's i'd like to rip? rip them in mp3 format or put them in apple's aac format?
Honestly the only way we listen to music is through the ipod or an ipod clock radio (at least for now), so I am uncertain which format is best.
i'll investigate further.
regards,
makingourway

finally getting satelite tv

2009-10-11T13:30:00.002-05:00

Well, we've been offline without any cable tv for a long time. Seems like inlaws are the primary driver of having satelite so they can watch overseas tv. I'm ok as long as we don't have English channels. It'll force the children to work on their foreign language skills and we can maintain control over what they watch in English by controlling their DVD purchases.

Regards,
makingourway

Watching our investments slowly come back (maybe 6.66% off)

2009-09-13T10:47:00.004-05:00

It's been quite a while since our investments lost about 35% at the bottom of the market. They're slowly getting better at about 6.66% off accroding to quicken. However, i think they may be further off as I rolled over my old 401k and I suspect that quicken reset the cost basis. This could get tricky.

How do you handle it?

I've been thinking about some fun / speculative investments.

IFF has done very well from me, having lowered my average purchase point far below what I had originally bought it at, unfortunately, it's not very leveraged.

I've been thinking about other ocmanies like Grainger, which seems to have a very interesting business model (as retailer and distributor). I need to look more deeply into their stock performance and fundamentals. I wonder if they're at the peek of their cycle - they've managed phenomenal historical growth and have a very compelling history. They sell must buy products at healthy margins.

Regards,
makingourway

start thinking about your 2009 income taxes

2009-09-12T15:04:00.002-05:00

It's time to start thinking about your 2009 income taxes.
Will you owe money, will you be owed money?
If you plan and project your tax situation now, you'll be able to accrue / save extra cash and be prepared for the april 15th tax bill.

On the other hand, you would add withholding allowances to keep extra money and eliminate the wait that you would otherwise have for the federal government to pay you back.

Another item to think about is multi-state income - do you work in more than one state? will your employer report such earnings? many state income taxes vary. plan with the right numbers.

regards,
makingourway

Rethinking the basics

2009-08-20T22:47:00.001-05:00

When's the last time you re-examined how you do common activities and decided to learn how to do them better?
Reinvesting in the basics can be a huge liberator, bringing minutes or hours back into your schedule every day.
Just ask yourself simple questions, such as how much time do I spend in Microsoft Word or MS Outlook or Firefox? If I spend alot of time there am I using them well? Could I save time by doing it better?
When I go grocery shopping, would i save time by bringing a list - perhaps one that was sorted by section?
Am I commuting to work in the most time efficient manner?

Granted these questions should be asked periodically and not constantly, but they can bring you very big answers and results.

Regards, makingourway

blackberry vs. iphone

2009-08-13T03:58:00.002-05:00

i'm wondering if i should switch from my personal blackberry to an iphone. Switching would entail:
1. canceling my current phone contract (est. $150 fee)
2. buying an iPhone and a bunch of chargers
3. figuring out how to balance the cost effect on my remaining non-at&t phone accounts; i.e. no longer free mobile to mobile calls

Why i might switch:

1. iPhone is more fun
2. Coverage isn't that different
3. I don't really use most of the blackberry features for personal use
4. much bigger screen for personal internet use
5. better than the horrible chicklet keys on my blackberry - i hate the number of typos (this is really pain #1)
6. i could download and use gps aware apps - like trapster and metromix
7. I would get a bigger discount through my employer (23%) on monthly service

Overall, cost for a personal plan at 900 minutes seems to be about $60 cheaper per month. Rate of payback would be 2.5 months for disconnect fees, for total costs including disconnect, equipment and apps would be 13 months.

hmmm... something to think about. I'm ready to throw the blackberry through the window due to typing frustration.

Regards, makingourway

paying attention to corporate discounts

2009-08-11T07:50:00.001-05:00

My former employer provided a 17% discount for verizon wireless. May new employer provides a 23% discount for AT&T.

After looking at the various plans, it seems cheaper to put everyone on at&t.

I wonder how many other corporate discounts exist that we can take advantage of?

Do you have a favorite discount?

Regards,
makingourway

Woe to the mortgage bankers

2009-07-21T21:54:00.001-05:00

Just had a very interesting conversation with an old friend - a mortgage banker.

I think he's going to quit his job.

He talked to his other friends at other big banks, like BofA. His other mortgage broker friends are considering quiting too.

I asked him why - he says: "no business".

He complains that the underwriting standards and product guidelines keep changing. Getting someone approved is a multi-month ordeal - maybe five months in duration.

By the time they're ready to close the underwriting guidelines have changed too much.

My suspicion is that the underwriting criteria are much more conservative.

The mortgage brokers that grew up during easy money have far fewer clients to sell mortgages to.

I asked about other real estate opportunities. The perspective was equally negative.

Many mortgage brokers diversified into real estate ownership. He says short buying is too difficult to finance right now.

I'm quite amazed how things turned upside down.

Regards, makingourway

blogger buddy

2009-07-21T21:29:00.001-05:00

Life has been crazy and hectic, so i've had little time to keep up. during a break i found blogger buddy, it's made by the same company that makes the xm vista sidebar client.
I'm testing it to see how it works.
Any common experience?
Regards, makingourway

cheap exercise vs expensive exercise

2009-06-06T00:04:00.000-05:00

After leaving big company, I joined aspiring big company, which brought several new lifestyle changes:
1. I don't travel as much (yet)
2. There's a health club in the building
3. I spend 3 hours r/t commuting

On the advice of a friend I tried very gradually exercising at home. Simple plan to exercise briefly each day.

Day 1 pushups trying to worky my way up to 150 a day in 20 pushup sets. Followed by dips (against a table or chair)

Day 2 crunches and leg lifts with similar goal of 150 in arts of 20 or 40.

I've been doing thud for 2 months and have begun to see muscle definition in chest and arm muscles. Back stengthening, too.

Unfortunately belly still there although some minor definition in upper belly. Very minor.

Seems that there is strength resistance benefit but not enough aerobic to manage weight loss.

So I joined the $60 building gym. But with long commute am challeneged to find workout time. Am wondering if i'll be able to do it.

One question is whether to go to work in workout clothes, shower after workout and change there?

Would save time, but would I actually work out or just shower somewhere else?

Regards, makingourway

Brief notes on our 2008 Strategy Recap

2009-04-12T11:01:00.002-05:00

2008 was a crazy and busy year.

I was traveling almost 100% for work, we still had (and have) the other house we could not sell and work was increasingly unstable (as it was for so many others). We also had some very sick children, which made matters more difficult.

Our goals for the year were simple, minimize expenses and try to bring our spending in line with our unfortunate overhead situation.

All in all, we had net savings and by the end of the year managed to rent out our old house.

I became increasingly disenchanted with my employer and began a gradual job search.

Our new house, we had decided to minimize expenditures, which we did, however, the cost of landscaping and home swimming pool maintenance were still quite large. Inconsistent weather and equipment breakdowns with the pool led us to decide to return to professional care. I hired a landscaping company on a fixed price basis, but overall was unpleased with the quality of their work.

Our house has many appliances and core plant equipment (hvac, water heaters, etc...) that are at or past their expected life span. Although we maintain them regularly, there's little certainty as to when they'll no longer work. we replaced our water heating system. We also shifted to CF light bulbs, which seem to have a $70 impact on electrical fees per month. Wow!

To save interest rate payments as stock market returns wavered, I liquidated much of our non-retirement holdings and used the to pay down our HELOC. This was a fortunate move, as it reduced our market exposure just as the collapse was starting. Though we certainly did not follow this strategy with an eye to timing the market. By the end of the year, I maxed out our HELOC upon hearing of a neighbor who's line had been frozen by his bank. The money now sits in on-line savings accounts. My cost for flexibility is the spread.

Overall for the year, our networth had dropped 71,504.10, mostly driven by substantial declines in our investment portfolio, which had declined about $170,000. This implies we did a good job saving and (most likely) deferring expenses.

We ended the year with a networth of $637k, down from the prior year, which was about $706k.

2008 set-up 2009 to be a year of substantial change and improvement.

Regards, makingourway

last minute thoughts before sending in your income tax returns

2009-04-12T09:30:00.002-05:00

1. Always make sure you've matched and collected your 1098 and 1099-div/interest forms from your banks and other financial institutions. The IRS gets the same forms and if you've forgotten or missed one they'll find it via computer match and send you a letter requesting a correction.
2. Consider, if you can afford the change in free cash, an after tax IRA contribution, big earners, in 2010 will be able to convert these to roth IRA contributions without the previous earnings cap (which otherwise prohibits them).
3. Make sure you have letters or written receipts confirming your cash contributions to charities.
4. document your charitable contributions well. They can't exceed 50% of your income and contributions must be in good condition. I always create a spreadsheet detailing my contributions. information contained indicates: item, description, quantity, condition, estimated or actual market price (for new), and a link referring to a comparable item to justify the price itself. I also take photos of everything possible to prove they really exist. The charities I give to usually sign off on the sheet and give me a formal receipt.
5. If you're filing for an extension, try to estimate what you owe and send that payment with your extension, otherwise you will face penalties for a late payment.
6. Don't be afraid to use a tax professional if you have complex issues like multistate income, rental properties, family businesses and complex stock trades.
7. Always make sure you track post tax ira contributions in order to establish your cost basis - you'll need to have this documented in the future when you begin withdrawing money. You'll use form 8606.

Good luck. makingourway

check out the new carnival of personal finance

2009-03-22T21:43:00.000-05:00

MOW is included in this week's carnival of personal finance. The topic is learn the basics of personal investing. I plan to flip through it myself.
Regards, makingourway

Why do i still need my blackberry?

2009-03-18T02:38:00.001-05:00

It looks like my employer may be providing me with a company phone.
Which is certainly nice if I no longer have to file telephone expense reports.

However, what do I do with the BlackBerry I currently own?

It won't be connected to a Microsoft Exchange server for real time corporate e-mail, calendaring and contacts.

It does still connect to my other e-mail accounts, but that's about it.
No more calendar synchronization, though e-mail calendar invites do seem to show up on the BB calendar.

However, what benefit am I really receiving?

Why not go for an iPhone or something similar?

I'm thinking I pay for alot of corporate overhead that I'm not using in a BB and I miss out on the more convenient consumer features, like a much bigger screen, cool apps, etc....

What would you do?

Regards, makingourway

late night shopping for diaper rash ointment

2009-03-18T02:27:00.001-05:00

I recently had to buy Desitin for one of our younger children. Desitin has the highest percentage of zinc oxide (about 40%) of all the products offered at walgreens.

Traditionally, we've slathered large amounts all over our children's nether regions. The zinc oxide seems to create a thick barrier that protects and "water proofs" there tender skin -- quickly dissipating emerging rashes and irritation.

We've tried many medicines, triple ointment, boudreaux's, etc... Desitin seems to be the hands down winner.

Although it was the least expensive by weight at Walgreens, it was still $15 for a 1 lb. jar. If I remember correctly, I was able to buy it for about $10 at Baby's R Us in the past.

I bought one jar for tonight, but i'll load up on several at baby's 'r us if the price is reasonable.

What struck me is that emergency creams, diapers, etc... available late night at the drug store are most likely to be priced like cold cereal or cigarettes at a convenience store.

I've always been one to plan ahead, but it strikes me as prudent to create a list of things you should always have stocked at home and buy them pre-emptively. Although this may be difficult in today's economy, the extra cost, might be an unaffordable penalty. What would you put on your list?

Regards, makingourway

a nice way to help others... make a meal

2009-03-16T11:10:00.003-05:00

While helping a very sick family member, I was very impressed by the help their neighbors and community provided.

Often people wonder, how can I help? The family has someone ill, can we do something?

The first inclination is often transportation or errands - these are always excellent things to offer.

The second inclination is a question of money or resources, however, if the family is well insured or financially comfortable, money is not always a big need - at least right away.

The third offering, which I hadn't seen much before is help with meals. This is clearly one of the nicest and most helpful things friends and families can offer. Families caring for sick relatives find it difficult to prepare home cooked meals. The meals friends bring over restore a great degree of the normal every day routine that the family so desperately wishes to return to.

The fourth offering is money again. What can a fund raiser(s) do? If the family is financially comfortable, establishing a foundation to give money to others or to support medical research can be a great thing. Otherwise, money may be helpful in paying for expensive medical treatments that are not covered by insurance. Frequently, families know little about what is needed right away, but as things progress, treatment strategies become more clear, as do their associated expenses and insurance coverage.

Regards, makingourway

what a hilarious video "are you good friends"?

2009-03-14T21:46:00.002-05:00

I was recently watching a you tube video when my eyes wandered to "are you good friends"? I followed the recommended link and low and behold it was hilarious!

A young lady discusses her experience at clothing store where she felt compelled through verbal manipulation to buy a much more expensive gift for her friend.

How often do you have challenges with sales people when shopping?

My strong recommendation is to establish a clear understanding of what you want and what your looking to spend up front. It avoids confusion and might restrain the sales person from cross-selling and up-selling (well at least some times).

The most important tool is a strong sense of discipline - either that or shop on-line! No sales people there.

Here's a link to the video for your enjoyment.

Regards, makingourway

Thoughts on what it takes to be rich in Chicago

2009-03-12T21:43:00.004-05:00

I recently read an old blog posting from US News by Rick Newman. He published a discussion and table of what the top 20% and top 5% earned in 40 of the largest metro areas.

The article was most likely spurred by Obama's tax initiatives aimed at those families who earn more than $250,000.

I was very impressed by the great disparity of what qualified as rich <$200,000 in El Paso for families without children and >$750,000 in NYC for families with children.

Although I'm strongly against increasing taxes in general, I'll avoid a polemic here.

One thing I found is that if being rich means being in the top 5% of income earners in the Chicago area, it means your family has income of greater than $578,000 a year. While it's substantial, I do know people who earn that much and virtually all of them do not consider themselves rich.

Fundamentally, very few high income earners succeed in holding or sustaining their living expenses as their income increases. Far too many people "live up" to their incomes. I myself am far too guilty of this, as well.

Part of the problem is the stage of life when these large incomes appear. I've noticed that the younger people are (under 50), the more these incomes are absorbed in every day expenses or luxurious upgrades of the same expenses.

For me, rich does not seem to be a measure of what you earn as much as the ability to live off your savings without diminishing them. That's a very different definition of rich than annual income.

Regards, makingourway

ps, here's the link to the article and table.

Financial models for catastrophic illness

2009-03-05T14:16:00.003-06:00

I have a relative who is quite ill.
I was wondering what information would be out there to create a budget for all of the medical expenses that will occur.

I have to say there was very little if anything available.

Based on my understanding, insurance companies must have models for various illnesses - otherwise, how would they predict the costs in order to set premiums?

I find this conundrum perplexing.

Regards, makingourway

creeping socialism

2009-03-05T14:14:00.003-06:00

What does it mean when the federal government takes over and owns our banking system? Will political entitlement, logrolling and general corruption displace profit oriented decisions?

The long term consequences of our current situation frighten me greatly.

The best example of what the public can do is a public bathroom. Sure it's there, but does anyone want to use it?

Regards, makingourway

a wonderful link to great financial listening

2009-03-05T14:12:00.003-06:00

Subscribers to the economist can listen to word for word reading of the entire magazine. I find it better than NPR's marketplace, however, the link to the consolidated articles was always hard to find.

So, I'm sharing it with you here:

http://talkingissues.economist.com/.

It's free if you're a subscriber.

Regards,
makingourway

19 tax tips to help you save time, effort and money

2009-02-16T18:00:00.003-06:00

1. If your income allows it, you can still make tax deductible contributions to a traditional IRA plan before 4/15/2009 for tax year 2008.
2. Start organizing your information to do your taxes or provide to your accountant
3. Scan tax related documents and e-mail them to your accountant
4. Add-up all of the charitable contributions you've made last year - if any amounts are larger than obvious or you have large amounts in general, use the internet to determine reasonable market price for your donations - you're accountant will appreciate the back-up.
5. Make sure you receive written confirmation from all charities of the amount you've given in cash
6. Have you received all of your w-2 and 1099 statements from your employers?
7. Have you received all of your 1099 statements for interest income?
8. Have you received all of your 1098 statements for mortgage interest paid?
9. Make sure you can document real estate taxes paid.
10. If you have complicated taxes, make sure you choose an accountant in the next few weeks
11. If you had substantial medical expenses - start adding them up. If I recall, they need to exceed 7.5% of your income to be deductible.
12. If you have rental properties, start working on depreciation calculations for your real estate, collect mortgage payments and collect maintenance and operating expenses.
13. If you drove for a charity or medical purposes, some of your mileage may be deductible.
14. 529 contributions are NOT IRA contributions - they are only tax deductible in the year actually made -- not 4/15 of the following year -- they are actually treated as gifts given.
15. Track your accounting expenses from last year, they are also tax deductible
16. Do you have any capital losses in excess of $3,000 from last year? If so, you may be able to roll them forward to this year and use them.
17. Make sure you receive your partnership income and tax expense k-forms from any partnerships you're in.
18. Review all tax related forms from other parties and aggressively make any corrections needed - these are reported to the IRS on your behalf by the other party - you want them to be accurate.
19. If you have more than one job or changed jobs and your social security with holdings exceeds the limit because both jobs collected it (possibly doubling your contribution), you're owed a refund of any contribution over the limit - make sure you document this.
20. If you refinanced and paid points - check into the deductible benefit of these expenses.

Regards, makingourway

using a level to ensure your pictures are straight

2009-01-14T09:31:00.002-06:00

How often do you wonder whether your pictures are hanging on the wall parallel to the ground (i.e. straight)?

We've stood side by side and debated it several times.

All arguments usually end when you place a level on the top edge of your artwork and adjust until the bubble is in the center.

If the painting does not seem straight after the level indicates that it is, you have a much larger problem - your wall is not straight! This happens due to settling and poor construction - more so in older homes.

For those who have not used a level before, he's a link.

The level is a very powerful and useful tool, especially for it's simplicity of use.

Regards, makingourway

Picture hanging - does scotch tape really prevent paint from splitting?

2009-01-14T09:22:00.002-06:00

Every few months my family experiences an explosion of redecoration.

We do not have a large amount of wall art, but enough to spend lots of time moving things around.

Picture hanging becomes an active skill in our house and I'm glad we have our standard picture hanging kit - though I do wish we could find an inexpensive source of brass picture hanging hooks and nails.

Over the last year we've begun to question the traditional wisdom that placing a piece of scotch tape over the x before you insert the nail will prevent cracks in paint while hammering.

What we've learned is that paint my not fall off, however, when you remove the tape, a larger hole often appears.

Regards,
makingourway

2009 Standard Mileage Rate (IRS allowable reimbursement for cars driven on business)

2009-01-14T09:12:00.003-06:00

The 2009 standard mileage reimbursement rate is $0.55 per mile.

The 2009 standard mileage reimbursement rate was divided between the latter half of the year:
7/1/2008 - 12/31/2008 at $0.585 per mile
1/1/2008 - 6/30/2008 at $0.505 per mile

Different rates apply for mileage driven for relocation and medical related driving as well as for charitable contribution.

You can find the details here at the IRS web-site.

Regards, makingourway

PS Please note that I'm not an accountant or tax professional, but a business person like many of you. I post this information for convenient access throughout the year. Please consult your tax adviser before making decisions based on this topic.

2008 Exclusion on Long Term Care Insurance per diem benefits

2009-01-14T09:06:00.004-06:00

The 2008 exclusion for per diem long term care (LTC) payments is $270 per day. This should cover most ongoing care expenses. You can read more about it here at the IRS website.

I have long term care insurance provided as an employment benefit.

It's fairly unusual for someone so young (usually people in their 50s get it), but as long as I could attach an annual increase rider to the policy, I felt the monthly premium would not be prohibitive.

Long Term Care Insurance does just that, it pays for your long term care should you be in a situation where you need long term care either in a nursing home or with help at home. Not all policies provide the same coverage at home and in a facility, so you should check to see what your options or policy says.

I look at it as a form of protection for disability insurance income. If I were disabled, I could easily spend much if not all of my disability income on care services and have little left over for my mortgage, etc....

regards, makingourway

PS Keep in mind that I'm not an accountant, but an investor and business person like many of you. Please consult your tax and insurance adviser before making any decisions on these topics.

In 2009 IRS increases ceiling for children's investment income tax before taxation at parent's income tax rate

2009-01-14T08:48:00.003-06:00

The IRS has increased the maximum income a child may earn from investments before they are taxed at their parents' tax rate.

The amount a child may earn at their income tax rate has been increased from $1,700 to $1,800. Investment income earned over $1,800 will be taxed at the parents income tax rate.

Children are subject to this tax until the following:

1. They are 18 and their earned income exceeds half of their child support costs
2. They are a student between 18 and 24 and their earned income exceeds half of their child support costs.

A student is defined as someone who takes 5 or more months of school full time.

This is just my summary, and by no means official, you can read the details here at the IRS website.

To me, this increases the value of 529 plans, as the investment income for your child is not taxed if it's spend on qualified educational expenses.

I also wonder if setting up irrevocable trusts for children become more attractive with the option of being taxed at the parent's tax rate.

Regards, makingourway

converted to Mozilla Firefox

2009-01-12T23:53:00.002-06:00

I have to say I'm very impressed with Mozilla Firefox.

Historically, I've always been an Internet Explorer user, but have recently HAD to use Firefox, when my IE browser would not support a Web-based video conference -- Firefox worked.

Once installed I played around with it and fell in love. It manages add-ons much better than IE and has a very healthy add-on community. What I especially love is the ability for Firefox to detect whether add-on updates are available and prompt you to perform the update immediately.

In terms of speed, I don't recall a significant difference - so I can't complain one way or another.

Now I'm curious how google chrome stacks up, but I guess i'll wait a while before trying it.

regards, makingourway

What would you do with $100,000?

2009-01-12T23:44:00.004-06:00

Early last year sold equities to pay down my HELOC. At that time the interest rate was still fairly high.

The HELOC interest rate now is much lower (as are returns for deposit accounts).

I'm wondering if I should pull the cash out of the HELOC and put it into various accounts (depository, investment, etc...). The number isn't exactly $100k, but it's close enough for this kind of thinking.

Why am I thinking this way?

I've heard rumors that some banks have been freezing lines of credit in some areas - though nothing specific in Chicago. I assume the coasts were hit more heavily as the value of home equity dropped there much more severely than in the Midwest.

I need some or much of this money as emergency funds in case I lose my job. (it's not my only potential cash source, but an important one).

Also, considering that the market is quite low, maybe it's time to put some or all of it back into the market.

What would you do? I'm really chewing on this issue right now. If you pulled it out, where would you put it?

To feel more comfortable about my legal situation with the HELOC, I may ask a real estate attorney his opinion on whether the bank can freeze my HELOC. How would you confirm it?

Regards,
makingourway

how emerging markets seem to be heavily correlated with domestic markets

2009-01-12T23:37:00.002-06:00

I've noticed over the last few months that emerging markets (mainly through index funds) seem to take much heavier hits when the domestic US indexes go down - this would give them a beta of great than 1.0. Oddly, many discussions in asset allocation often assume that emerging and foreign markets correlate less and might zig when the US zags.

Here's an interested chart at Yahoo finance that shows a close, but exaggerated correlation between EEM (emerging markets ETF) and the S&P 500.

Over the last few months it seems that almost everything except US Treasuries has zigged downward together - even most commodities.

What should an asset allocator do? I imagine we're approaching a time when we need to rethink asset allocation classes.

Regards, makingourway

Long nights and weekends cleaning up business books - don't overlook these expenses for your company too!!

2009-01-12T23:28:00.003-06:00

I maintain and operate a private corporation that I use as a vehicle for side business ventures, minor royalties and outside of work income.

I've grown lax over the last year - probably due to full time job pressure, but finally have balanced the check books for my business accounts - boy will my accountant be happy!!

BIG TIP NOT TO FORGET
Now the next effort is to review all of my out of pocket expenses related to the business and declare them as debt the company owes me.

Often, people spend money on their side business in the forms of cash, personal checks or on their personal accounts, but fail to account for it as actual business expenses - why? This can be due to effort, confusion, laziness or mere unawareness.

I'm not sure how long it will take, but I'm certainly going to try to pull my largest business expenses by category and include them as accounts payable to me.

Why do this? Good question...

If the company has enough money to pay you back, it's money back in your pocket, tax free since it was a legitimate business expense.

If on the other hand the company does not have enough money to pay you back right now, you can carry the expense forward as part of a loss carry forward (I think you have up to 17 years to carry losses forward). You can also carry the debt forward and pay it back to yourself when the company does have enough money.

What does this mean?

Well, expenses accumulated in 2008, can be used to offset income accumulated in 2009. This is a great thing as it allows you to legitimately take money out of your own business tax free AND pay yourself back.

I wonder how many business owners don't take advantage of this?

If you think your company will never have enough money to pay you back, think of this: other people or businesses might want to buy your company or invest in it in order to absorb the tax loss. Now this is complex tax accounting and I can be imagining something that's not true, but I do recall on several M&A dialogues the value of favorable tax positions in acquired companies.

Hopefully this will give you some helpful ideas.

Regards, makingourway

next steps for 2009

2009-01-04T17:28:00.002-06:00

In addition to aggressively filing documents and papers to assure they'll be available for tax filing, here are some next steps for 2009:

1. Define our family goals for the year and post them (we lapsed in 2008).
2. Assess our financial performance for 2008 (should be very interesting).
3. Elaborate a strategy for reaching these goals.
4. Review and create a budget for 2009.
5. Identify any short term activities that should happen right away.

I'll be working on these items and posting them as they're completed.

Regards, makingourway

a recap of last minute activities from 12/31/2008

2009-01-04T17:18:00.002-06:00

I spent a large amount of time over the final days of 2008 finding new charities and donating quite a bit of unused personal possessions to charity.

We have always been very aggressive at donating and giving away as much of our unused, unwanted and neglected (but still usable) possessions as possible. I suppose it's the most efficient form of recycling as little additional energy is required to change the things we're giving away.

Of course there's also a financial benefit. Good, usable items can have their market value deducted from your income taxes. A the full value of cash contributions, as well.

With my accountant's advice I always document what I give, usually with photos and detailed spreadsheets - if possible I include links to websites that validate the market value I claim.

This year my initial tax analysis determined I'd owe about $6,000 in federal taxes for 2008, so the contributions were quite helpful in trimming half of that number down.

One interesting consideration, a friend asked me if I'd like to donate their furniture and take the tax benefit, as it wouldn't improve their tax situation - I'm not sure if this is legal - I assume it is (I donate a gift I received), but it certainly is interesting.

The other big activities is to start collecting year end statements for mortgage debt, taxes, brokerage accounts, bank accounts, etc.... You can usually count on being sent 1099 and 1098 statements in the mail, but they don't always come on time.

Regards, makingourway

2009 gift tax exclusion rates

2009-01-04T17:16:00.001-06:00

The federal gift tax exclusions for 2009 is $13,000 per giver per recipient.
You can find more details here at the IRS website.

The federal gift tax exclusion for 2008 was $12,000.

Regards, makingourway

Clarifying how the tax year is determined for a 529 contribution

2009-01-04T17:03:00.005-06:00

Although I've discussed this with my accountant, you may want to verify with yours.

Here's how it works:

A contribution to a 529 plan is considered a gift to a person. There are specific limits as to how much money you can give someone as a gift set by the IRS.

The IRS considers the date the gift was given as the tax year of the gift.

This means that you had until December 31, 2008 to make a contribution to your child's 529 plan and have the contribution considered under the gift tax rules for 2008.

Contributions to 529 plans are not the same as IRA and retirement plan contributions, despite the fact that earnings (not contributions) are tax deferred - some states may provide tax incentives for contributions as well.

You can read about the gift tax details here at the IRS website.

The 2008 gift tax exclusion is $12,000 per recipient from each giver. A married couple can give up to $24,000.

These numbers increase $13,000 per giver in 2009 and $26,000 for a married couple.

As 529 plans are governed by states, you should also check to see what your particular plan contributions are.

Regards, makingourway

PS The whole concept of gift taxes falls very close into questions regarding estate taxes and inheritance.

Picasa 3 versus Adobe Photoshop Elements

2008-12-28T12:30:00.002-06:00

For ages I would buy overpriced annual upgrades of Adobe photoshop elements.
I have grown quite unhappy with the annual price as well as the cumbersome mode in which it manages it's catalog files and has challenges with SAN / natwork drives. For the last year or two I've completely given up on the product.

I do want to commend the excellent use of TAGs in the product - that was very well done.

I've recently installed Google Picasa 3.

I'm very impressed with the following:

1. It's ability to access network shares is incredible - this is especially important when I have a shared hard drive with family pics sitting on the network.
2. It does a great job creating virtual albums and exporting them onto SD cards - especially at reduced resolution - I like using this to display pictures in a digital picture frame.
3. It's ability to quickly and easily import pictures from other directories.

Hope your holiday weekend is going well.

Regards,
makingourway

Charity... knowing who you're giving to

2008-12-27T09:21:00.002-06:00

Recently I had a scary experience. A disabled veterans organization called offering to pick-up donations from my house. Since I hadn't heard of their name, I asked who they were. I also asked if they were a non-profit. I was utterly shocked to learn that they were not a charity, but a for profit company!

What deceptive fraudulent marketing. Although they claimed they gave a certain percentage to disabled veterans it smelt and felt like a scam.

While looking for new charity's to donate to, I began searching the web, Charity Navigator is a very nice website that looks at a charity's tax filings to determine it's efficiency. For example, do you really feel comfortable giving charity to an organization that spends most of its money on administrative costs?

I examined several charity's through it and found to my dismay that a national cancer charity was very inefficient, giving more money to its operations than to cancer patients.

You might want to check it out.

Also, here's a great article from consumer reports.

Regards, makingourway

More work to do before year's end

2008-12-27T09:14:00.002-06:00

I've talked with my accountant who let me know that I had a moderate sum of money owed to the Federal government - about $5k.

There are a few approaches to reducing this debt, since I have to preserve cash, cash donations to charity and appreciated assets (aren't any any more) don't make sense.

As a result, I'm looking at charitable material donations. We're immense pack rats and really do have alot to give ranging from furniture to appliances.

So far we've donated about $6,900 in cash and material to various charities, that will give us approximately $2,600 in tax benefit.

I'm going to identify another $2,500 worth of donations for one charity and see if i can't find another $4,000 to another.

Philosophically, we prefer to spread our donations over several charities, averaging about $4,500 each.

Apparently donations over $5,000 to a single charity require excessive documentation.

Also, any expensive item donated valued over $5,000 requires appraisal and validation - something that could be costly and time consuming. Better to do this early in the year.

Other options have already been exhausted, such as maxing out retirement contributions, etc....

I'm confident I'll make the $2,500 by year end - it'll require some time and effort, but it will be very rewarding.

Regards, makingourway

capturing indian dividends

2008-12-27T09:08:00.002-06:00

My Indian market CEF (closed end fund) IIF (from Morgan Stanley) has historically paid fairly high dividends. This summer they were quite impressive. The recent market turbulence has pushed IIF from very high prices ($56) to quite low (around $11.xx / share).

In early January dividends will be distributed. I wonder if profits for these companies have declined significantly or their stock price reflects market anxiety or future concerns about US market access.

If the profitability of component holdings did not decline, it's very possible the dividends will be a very large percentage of the share price. I've reinvested some dividends at the much lower price to increase my holdings.

If my finances proceed well - such as finding an new job - I'm likely to build up a larger investment in IIF out of surplus cash - assuming it's near the bottom - I feel guilty as I'm bottom chasing (sounds perverted) and sector weighting - which are contradictory to my investment philosophy, so I'll limit the overall investment, regardless, to something small.

I guess we'll find out what will happen by the second week of January.

Regards,
makingourway

What to do for New Year's eve?

2008-12-27T09:02:00.002-06:00

Mrs. Way and I have been discussing what to do for New Year's eve.

We've been horribly busy and she took the low rung on vacation selection this season - one generous colleague took all three weeks of xmas and new years off - how kind of him to ensure none of his peers need worry about the holiday challenges!

As a result we haven't planned much. Her best friend is traveling and husband and children are unfortunately unavailable - we had been hoping to have them over.

We do have an invitation to join several friends at a country club - not as intimate as we had planned since it doesn't include our children, but after thinking about it - they're certainly too young to stay up late and it will be less stressful.

After thinking about it, I also realized it will probably be less expensive, too.

Entertaining is never cheaper than going out on your own.

Regards,
makingourway

new tenant obligations

2008-12-27T08:59:00.002-06:00

Now that I'm a landlord all over again, there are certain things I have to do:

1. Convert my insurance policy from a home owner's to a landlord's - will save me $400 per year. NC has a wind policy component due to hurricane's that's pretty expensive and doesn't seem to diminish for a land lord's policy. Consider competitively shopping the insurance.

2. Make sure tenant converts utilities to his name - will save about $120 per month.

3. Make sure tenant contancts lawn mowing service and uses them or does hisself - will save $80 - $120 per month.

4. Ensure management company can send me payments via EFT.

Anything else anyone can recommend or suggest?

Regards, makingourway

cable TV versus buying DVDs

2008-12-22T11:29:00.002-06:00

It's been about 6 months or so since we cancelled our cable TV service.

Grandma watches European video over the internet for $7 per month.

We usually go to the library and borrow videos for free.

I occassionally buy entire series on DVD: Heroes, BattleStar Galactica, etc.... My wife and I enjoy watching them together.

In addition we take advantage of occassional used DVD sales from video rental stores. HOllywood Video had a great sale at $3.99 earlier this month and Blockbuster had 4 for $20. It gave us a chance to buy things we'd been interested in.

Ove the two sales I spent $150, which will last us a few months. It's about what a single month of cable had cost me in the past.

One thing I'm tempted with is to buy an on-line video streaming service - perhaps netflix, which is only $8 per month, but I'm not sure we really use it.

Every so often, I watch www.hulu.com for movies and videos. It's free and quite enjoyable. My favourites include Master and Commander and I'm looking forward to Harold and Kumar.

Regards, makingourway

Good news??? - i have a tenant

2008-12-22T11:25:00.002-06:00

Well, we've had tons of trouble selling our house in NC - it's not even an issue of lowering the price - the market for more expensive houses completely disappeared and may be out for a while.

Through a management service we've found a tenant who is moving in this week. The prevailing NET (after fees) rental rate is only about 45%-50% of our monthly mortgage, but it also allows the tenant to offset other expenses, like utilities, lower insurance rates, the alarm, etc....

So I suppose the monthly rental income is something we can positively focus on - it certainly helps my finances if i'm laid off.

Regards, makingourway

a quick recap of this year's investment performance

2008-12-22T11:08:00.002-06:00

2008 was a very interesting year.

In February I liquidated most of our non-retirement holdings, which I had kept in a vanguard 2025 index based mutual fund.

I put the proceeds into our HELOC to help reduce the impact of a >6.5% interest rate. At this point I'm fairly glad I did as we missed most of the drop in the market - though it was not my plan or expectation at that time.

Our remaining invested assets were either in ETFs that I gradually sold off. I placed sell limit orders with a good till 90 day expiration targetting 20% returns.
About 5 out of 7 hit the target and I sold them off - using the proceeds to reduce debt or provide liquidity in an on-line money market account.
two of the ETFs (the Indian ETF and small business) never hit their targets so I decided to hold them for the long term until they recover. The indian fund IIF took very hard hits. I reinvested this summer's dividends (which were almost 50% due to the drop in price) and am tempted to buy more as I feel the Indian markets are incredibly underpriced - I don't see the benefit of offshoring going away during difficult financial times - despite a Democrat controlled congress and threatened trade restrictions - the economic differences are just too extreme.

As to the other investments, they've taken a huge hit, but since they're long term retirement investments, we'll just wait for the up-cycle.
Overall our retirement savings dropped from about $400k to $300k, though it has been creeping up to about $315k.

In addition my wife's employer finally switched their retirement plan to Vanguard, so we'll be putting another $15.5k this month (and last month). I'm going to accelerate my contributions in the beginning of january as well. I imagine I'll schedule things to complete my contribution within the first three months of the year.

My motivation is reflected by my discomfort in the financial condition of my employer and my own sense of political instability within my division at Big Company. Boss left, new boss coming and I'm concerned my head's on the block. What an awkward situation to be in.

My thoughts are it's best to accelerate 401k contributions in case I'm not in a situation to contribute to a 401k plan later this year.

Keeping moneies liquid seems like an important priority right now.

Regards, makingourway

having fun with fat wallet

2008-12-22T11:04:00.002-06:00

A few months ago I became a fat wallet member.

I had used upromise in the past, so i'm familiar with launch pad rebate schemes, however, the discounts from upromise were fairly blase - nothing too special unless the products were quite overpriced - with the exception of occassionally nice discounts from Walmart.com.

Fat wallet seems to combine nice rebates (great stuff with restaurant.com right now) with coupon codes - it's really nice combination.

Furthermore my rebate amount owed has climbed quite a bit faster than with upromise - especially due to judicious use during the holidays.

I've looked at Quicken's new rebate offering, which is integrated with quicken, and find that they have pretty good rates as well (less the coupon codes it seems).

high volue / frequent destination sites seem less motivated to offer rebates.

Regards and holiday wishes, makingourway

529 college savings plan contribution deadline coming up

2008-12-10T11:02:00.000-06:00

I've been planning on setting aside some money for our children's college savings this year, but was uncertain when the deadline is - the answer is 12/31.

It took a while to search the web and find when the actual deadline is.

There's a great morningstar arcticle that discusses it in detail, but the bottom line is that gift tax rules govern the determination of the tax year a 529 contribution is made.

This means that contributions are considered gifts, tax free up to the eligible IRS gift limit (I think it's $12k per spouse per year, for a total of up to $24k). The gift (in the form of cash), falls into the tax year the gift is given - there is legal debate as to when it's cashed, but it seems to be related to intent.

Regards,
makingourway

Great deal at restaurant.com 70% off on gift certificates

2008-12-10T10:46:00.000-06:00

Occassionally restuarant.com offers 70% off on gift certificates. Since you normally pay $10 for a $25 gift certificate it's a nice deal.

Keep in mind that you usually need to spend twice the value of the certificate - so it's really more like a big coupon. I don't mind paying $3 for a $25 coupon.

The real treasures are when you find a $50 certificate for a fairly expensive restaurant.

You need to check the site occassionally as new deals are offered and the more desireable restaurants offer limited quantities.

Regards, makingourway

will insurance companies be relieved of financial pressure?

2008-12-10T10:41:00.000-06:00

The recent adoption of mark to market accounting has put many insurance companies in dire straits. One executive i've talked with was concerned his firm would have to BK.

Recently the NAIC began discussions (this last weekend) to exempt insurers from mark to market accounting. This could be a signicant development.

What is mark to market accounting?
It's an accounting method that forces companies to value their investments at current market price.

Why is this good?
It prevents "phantom capital" from being kept on the books - imagine what a company would be worth if all it's capital were tied up in valueless Fannie May bonds?

What is it bad?
Not all companies trade their investments. Bonds retain their value if held to maturity (provided the bond issuer is solvent at that time). Many insurance companies have long term debt investments that are low in value now but were never intended to be redeamed before maturity - they can do this based on the long time between policy issuance and claims for certain types of insurance - such as life insurance.
however, if you discount the value of these bonds - even if their government bonds - the insurance company will look like it has less money available to pay claims.

Most property and casualty insurers are not at risk here, however, life companies are.

I would expect this issue to be addresses shortly.

Regards, makingourway

How many investors will miss the upswing?

2008-12-10T10:35:00.000-06:00

Over the last few weeks I have talked with quite a few investment managers. Some even manage investments on a wholesale basis for other investment managers.

What I learned is that quite a few people pulled their money out of the market this summer and into cash.

While it's not as frequent (perhaps those that stayed have reconciled themselves to the ups and downs), there are still people interested into moving to cash.

I've heard the recent treasury auction was oversubscribed by 400% for federal treasury bonds paying 0% interest. While renewed faith in the US Government's credit is good, what assets were sold to provide cash for the purchase?

My biggest concern is that many investors will have converted their stocks and possibly bonds to cash and will miss the market rebound. Now it may take months or even years to rebound, but historically they do rebound within 2 years.

The critical response in this situation is to stay the course and follow your long term investment plan.

Regards, makingourway

An interesting review of on-line coupon sites

2008-12-10T10:31:00.000-06:00

There's nothing I find more frustrating than looking for on-line coupons. Far too many of the online sites are scams or have little that's current / effective.

PC Magazine recently posted an article recommending 10 top sites. Fat Wallet, one of my favourites was there.

Has anyone tried the others?

Here's the article.

interesting eye-glasses care thoughts

2008-11-21T23:03:00.000-06:00

I just read the eye glasses care article on wikihow.com.

It was a great article. One of the more interesting points was this:

1. Never clean a pair of eyeglasses with a dirty optic microfiber cloth, by doing so you can actually scratch the lense.
2. Isopropyl Alcohol (70%) is supposed to be an excellent glases cleaner and cheaper as well. The aricle claims that it is the active component of most commercial solutions. Has anyone tried this?

Regards, makingourway

2009 Social Security Wage Base - at what point do you stop paying social security tax

2008-11-20T09:36:00.000-06:00

Per the SSA web site, the 2009 social security wage base is $106,800.

This means that if you earned $213,600.00 each year at one job, you would stop paying social security tax for the second half of the year.

However, you will still pay medicare/medicaid taxes.

Regards, makingourway

2009 Retirement Plan Contribution Limits

2008-11-20T09:19:00.000-06:00

Here's a quick chart that shows retirement plan contribution limits for 2009, it should be useful, provided our new president does not change things substantially:

Age 49 and less:

IRA $5,000
401k/403b/457 plans $16,500
Simple IRA $11,500
SEP IRA $49,000 (but no more than 25% of income)

Age 50 or more:

IRA $6,000
401k $22,000
Simple IRA $14,000

Roth IRA eligibility phases out at $105-$120k for singles and $166-$176k for marrieds

year end tax planning

2008-11-20T09:13:00.000-06:00

I've been talking with my accountant.
It will cost me about $500 - $1000 for year end tax planning depending upon complexity.
We usually do it to calibrate tax payments.
If you underpay by more than a certain percentage, you not only have to pay the under payment, but also a penalty (10% I think).
Therefore we usually check at year end to see where things are at.
It also allows me to accrue the under payment.

The typical documents required are:
1. pay stubs
2. tax report from quicken (dividends, capital gains/losses, extraordinary expenses, charitable donations, interest earned)
3. mortgage statements for properties (to check how much mortgage interest is tax deductable)
4. professional fees (accountancy)
5. retirement contributions (salary deferal)

I should find out where am at in the next two weeks - if Thanksgiving doesn't present an issue.

Regards,
makingourway

I'm hoping I won't owe that much

planning expenses in times of economic uncertainty

2008-11-17T22:54:00.000-06:00

At the moment I'm feeling fairly unstable in my career - fortunately my wife's is reliable at the moment.

While our finances have improved and we're trying to eliminate a credit card debt that has crept up, here recent raise and mine earlier in the year made a positive impact.

Recently we've begun thinking about larger expenses:

1. holiday / vacation to a warm beach somewhere
2. possible wedding in europe for a family member
3. replacing some exercise equipment

Although the above are not huge, the family vacation can certainly be expensive. As my wife puts it, if i'm working like crazy - what do i have to look forward to? I told her financial ruin if we don't plan expenses carefully - she didn't like that. Once the second house is finally sold, we'll be far more able to examine vacations.

Until then, I've asked her to find the cheapest safest thing possible - apparently the popular mexican resorts are seeing 2/3 decline in occupancy and the dollar has significantly appreciated in portions of europe.

Now all I need to do is remain continuously employed with my current firm or an alternate to help fund the holiday. After all - who wants to pay for a vacation with long term savings?

i'll share what comes up.

Regards,
makingourway

when will the shoe drop for insurance companies?

2008-11-14T13:30:00.000-06:00

Besides AIG, there has not been much noise in and around the insurance industry. How are they affected?
I've heard that some Hartford, CT based companies may have issues, but I wonder what about the rest of the industry.

Many of the life companies have long investment horizons that allow them to more aggressively invest money (and embrace risk).

I wonder what's happening there. Have any of the Big 4 Accounting firms began certifying insurance company financials?

I doubt the traditional parties would be creditable.

Regards, makingourway

Banking thoughts...

2008-09-30T10:54:00.000-05:00

I read an interesting article in the wall street journal comparing the current consolidation in the banking sector with much more gradual consolidation of Japan's banking sector after the collapse of it's real estate market in the 1990s.

The article seems dead on. The Federal Reserve is accelerating a banking consolidation that took much longer in japan.

It's interesting to note that Japan's consolidation cost $440B, while ours starts at $700B. I guess bigger economy, bigger costs.

I had always wondered how quickly our banking system would consolidate. For many years state and possibly Federal laws had made interstate banking difficult. With the gradual removal of those barriers banks like BofA began growing (and growing). however, the article notes that there are still thousands of small local banks and many mid-sized. The local presence is certainly a good thing.

I wonder though, do we need large nationwide banks to reduce the cost of interstate commerce and allow us to compete internationally?

Regards, makingourway

Green swimming pools

2008-09-29T13:27:00.000-05:00

Well my efforts to maintain the pool were unsatisfactory with my wife.
After several weeks of frequent rainfall, the pool failed to stabilize - either too cloudy or to much of a shade green.

The pool company selected a chlorination setting far too wide and we frequently ended up running out of chlorine before the weekly scheduled service.

One hot day the pool turned green. After losing 2 weeks to clear it out, she asked to me desist and call in the professionals to maintain the pool.

All our savings for my labor evaporated with the two additional green pools we had during their efforts.

We're switching providers - the new one i'd prefer is about 5% more expensive, but much more professional - someone my wife can call to service the pool and expect profesional behavior and timely response from.

From my lessons, I've learned the following:

1. It takes about 2-3 months to figure out what your doing if you self-maintain - make sure your family can bear with it
2. mediocre companies are not worth paying anything
3. don't keep the chlorinatoropen if you keep running out of chlorine - it's probably open too wide.
4. Shoot for a chlorine level of 3 or 4 - 1.5 to 2 is far too close to 0

regards, makingourway

does a friends wealth or expertise bias gifts?

2008-08-18T01:32:00.000-05:00

We hosted a party last month. I like wine.
My friends know I like wine. Some of my friends like wine, too, but not all.

Wine is an odd thing. There are so many different vineyards with global marketing reach (probably in excess of 20,000) that very few people really know everything, but instead master fairly specific regions.

I was wondering - is this true for you - if you have a friend who likes wine, do you go out of your way to buy an extra nice or extra expensive bottle? Does your friends wealth or knowledge of wine influence the expense or quality of purchase?

One thing I've noticed is that few people are confident in their view of wine. If they think you know more, they'll readily defer. When you give or serve a bottle of wine, and you're known as someone who likes wine, they often assume it's good -- even if it's not the best.

Now there certainly is an element of trust involved here, but I find the whole thing humorous. I think wine marketing and wine snobbery have convinced people that their own tastebuds should be the primary evaluator.

It reminds me of the story of the doctors making rounds in the hospital. The most senior and respected physician visited each patient, read their charts, listened to the patients' hearts, etc.... At one patient in particular, the senior physician noted a very unusual heart condition. All the doctors took turns listening. One after another they listened and agreed with the senior physician. These were all very experienced physicians with more than 20 years of experience. Grimly and seriously they listened and nodded their heads. Just as everyone was about to leave, one of the medical students had a chance to listen to the patient. She listened and then tried again. Meekly, she raised her voice and asked the senior physician why she could not hear the irregularity. He came back and listend again. they senior physician took off his stethescope. He took out his hearing aid and adjusted it. He then listed for a third time. "No. You are right, this patient's fine." He then smiled and moved on. I often wonder what looks the medical student shared with all of the much more senior medical professionals between her and the senior physician.

Regards, makingourway

hanging pictures & the picture hanging kit

2008-08-18T01:25:00.000-05:00

We went mad hanging pictures this weekend. Actually, we hung quite a few in the family room but have so many more left to hang.

I've built a fairly nice picture hanging kit, it features:

1. Felt pads for the back of frames
2. Rubber bumpers for the back of others

1&2 stop frames from scratching the wall

3. Numerous brass hanging hooks (the kind you can remove and re-use)
4. Mirror hanging kits (with wire for hanging pictures that lack cords in the back)
5. Hammer
6. Tape measure
7. 18" level
8. 48" level
9. Pencil
10. electric screw driver (I've had to use this to install hanging bits on the backs of frames)

What I'd like to add:

11. More brass hanging hooks - you can never have enough
12. More mirror kits - i'm out of wire
13. Frame hanging hooks to replace the jagged teeth hooks on the back of some frames

the jagged tooth hooks are horrible to attach and horrible to balance.

So we hung lots of pictures in the family room. We realized, unfortunately, that we did not have a fair balance of pictures of all of our children. New pictures have been ordered to remedy that.

We still have many pictures in the basement. I think we'll start hanging pictures up stairs soon.

Regards,
makingourway

3 long days of home repairs

2008-08-18T01:13:00.000-05:00

Just finished three very long days of home repairs.
I believe everything cost about $2700, which includes:

1. Two new Whirlpool eSmart gas powered 50 gallon water heaters
2. Cleaned and repaired gutters
3. Repaired exhaust flus for several appliances (stoves, dryer, etc...)
4. Repainted two ceilings, removing water marks and other stains
5. Installed mesh covers over critical areas of gutters to prevent further over flow and leaf build up
6. Repainted eaves of house
7. Fixed leaking skylight
8. Recaulced second floor windows to prevent drafting and water penetration
9. Installed towel bars in powder room
10. Installed new fan in master bathroom

Actually the new fan is incredibly silent. It's quite expensive as fans go - About $160, however, it's so quiet it's hard to tell if it's working. I've always had a problem not being able to hear my wife talk while I'm in the shower. Very frustrating when you're trying to coordinate busy schedules in the AM.

I learned a few things about hot water heaters:

1. buy the 12 month warrantee heaters - they have extra insulation and superior quality - they don't need a thermal blanket
2. they seem virtually identical except the e-smart from lowes which has a slightly higher efficiency factor 0.61 vs. 0.57
3. make sure you have enough room to ventelate the heater if you're using it in a tight space
4. my whirlpool and i imagine other water heaters has a special metal element that should be changed every three years. I believe it manages water hardness.
5. The eSmart line communicates by blinking, which sucks, but no one else provides an lcd interface
6. You probably don't need your water heated to 120 degrees, which will burn skin in 5 minutes.

I'm pretty pleased with the work that was done.

I estimate about $1400 on supplies and materials and $1300 on labor. Not bad for 3 days work. What do you think?

Regards,
makingourway

tropic thunder - ugh!

2008-08-18T01:08:00.000-05:00

We saw it.
We laughed a bit, but couldn't decide if whether the film was more foolish or funny.
Many times we asked ourselves why we were watching it.
I can't recommend it - wait until it comes out on cable.
Although it was funny at moments, I asked myself why was I watching it if I only get to the cinema once a month - wasted time!

Revisiting our online money market interest rates

2008-08-10T06:50:00.000-05:00

A friend recently called and asked where to put her emergency cash.

I recommended placing a portion in a local accessible source and the rest in an online money market account (MMA).

This isn't something we've looked into for a while, so I checked out what we receive from countrywide - which has been a high payer historicaly. Currently it's 3.55%.

I then went to bankrate.com to compare. The MMA rates are a bit hard to find, but accessible on the home page. Here's a short cut.

For the moment 3.55% looks fairly competitive. I'm not sure how convenient the mostly local banks who make the top tier are for access, fund transfers, etc....

An interesting point is that Countrywide's offering did not appear until I selected MMA's with 10,000 or greater deposits required to setup the account. Here's the link. Interestingly enough, the top tier high interest payor group stays the same, but the 3.5% tier is very crowded.

One thing to stay away from is the promotional rate group. I'm uncomfortable with large banks that offer seductive short term rates that eventually become less competitive longer term rates. I remember feeling poorly treated by these same banks as they imposed unattractive terms on my business checking accounts.

Regards,
makingourway

when should incandescent light bulbs be replaced with compact flourescents (CF) - and hidden incandescents

2008-08-10T06:37:00.000-05:00

Today, I noticed a bookcase light that we often keep on all night long. I noticed it because I turned it off - rather than another family member.

As I looked at it, I realized it's a smaller 50 watt flood r-20, but not the larger br-20 that can be found in a can light in the ceiling.

Flourescents cost about $7 at Menard's. I'll try to pick one up today.

It's amazing how many lights we have in our house, appliances and even furniture.

I wonder if a multi-day audit isn't worth doing.

With the cost of compact flourescents in transition - many dimmable or less commonly shaped bulbs are still expensive - I wonder if replacement is best done by prioritizing usage; i.e. what stays on longest should be changed.

The question is, who has time to audit their light bulb usage?

My thinking is that any bulb that's noticeably used for more than 3 hours a day - or as a night or safety light - is probably a good candidate for immedaite replacement.

Other candidates may be out of the way bulbs that are difficult to reach - they can be replaced opportunisticly when service people are available.

I've talked with friends and read articles about people who gradually replace incandescents with CFs as their bulbs burn out. I imagine this will lead to most bulbs being replaced within 2 years, however, it doesn't seem to have the immediate economic (and environmental) benefit of immediately replacing the high usage bulbs.

One category of lights we haven't replaced are our outside lights. While I've hesitated due to the importance of immediate light (sometimes we can't wait 30 seconds for the bulb to reach peak illumination), I wonder how often we use these lights due to timers.

Regards, makingourway

Reconciling our desire for SUV comforts with mileage requirements

2008-08-10T06:31:00.001-05:00

My wife really enjoys the above the road feeling of an SUV, however, our mileage, is poor, compared to alternatives - about 19.x miles per gallon for substantial highway driving.

It seems that what she should have is a smaller commuter car that's safe, drives well and obtains better gas mileage, however, I wonder if any of those fit the raised view of the road.

Maybe a raised view will become less important as many light weight trucks and SUVs sit idle due to high gasoline prices? I don't see any alternatives. I wonder if this interest is behind seeing so many suburban house wives driving physically large (manly looking)SUVs?

We're looking at the honda civic hybrid, but the performance of other hybrids has been quite poor - so we're skeptical that this one will work out. We should know next week.

Regards,
makingourway

More pool fun - or what's that brown stuff on the steps?

2008-08-10T06:24:00.000-05:00

Last week the pool started turning green. Not like a pea soup, but the blue-green color began losing the blue color.

With advice from a local pool store after water analysis was performed we hyper cholorinated the pool.

Several days later we found brown stuff on the pool steps.

Our treatment: brush the steps to put the most likely dead organics back into the solution, then treat the pool with a non-cholorine shock. Keep the polaris unit (think old fashioned roomba for swimming pools) running.

Seems to have done the trick, but boy did that brown stuff disturb my wife!

One thing that is interesting, the hypercholorination lasts quite a while. Chlorine levels are very high for several days. We're told that's a good thing and that it helps eliminate the algea that was forming.

We have a persistent problem managing the rate of chlorine consumption in our pool's chlorinator. Too often the chlorinator will run out of chlorine tablets (think white hockey pucks) before the week is out.

I've finally ratcheted the chlorine dispersion rate down, but am still curious as to what's the right setting. The hyper cholorination obviously confuses things.

Soon we'll try an anti-phosphate treatment. Phosphate is the limiting factor in algea growth. The product claims to dramatically reduce phosphates in your swimming water. We'll see if it works.

Regards, makingourway

Weekend spending goals

2008-08-03T13:55:00.000-05:00

This weekend looks like a financial success - predominantly becuase we've been so busy.

At rough guess we've probably spent $120 - $60 on a birthday gift.

We'll be entertaining - so the pool is helpful from that perspective.

Regards,
makingourway

Very intersting article discussing water heaters and formula to calculate water heater operating costs

2008-08-03T13:51:00.000-05:00

I found a very interesting article here that discusses water heaters and provides an excellent formula for calculating water heater oprating costs.

For me, this was most useful in comparing the benefits of water heaters with various efficiencies.

The most interesting note was that the Lowes eSmart line of Whirlpool water heaters is more efficient, but the efficieny is not a significant monthly savings.

Regards,
makingourway

Living within $300 per weekend - status

2008-08-02T05:19:00.000-05:00

Here are my thoughts and a quick update.

The reason I tried to cap weekend spending, is that it's the most likely period where we have time to spend our weekend budget.

If we don't use it for lots of spending we'll be less likely to spend the money.

So much of our weekend spending actually went to standard living activities like, groceries, etc.... My regular weekly grocery budget was $300, but we were averaging much more, maybe $500. Changing how we shop at costco will make a huge dent. In general fruits and vegetables should come from the mexican green grocers - they cost almost half. Grandma loves the big 4 pound tubs of strawberries at $7 each, but we can buy 1 lb for $1 at the green grocers.

Our first weekend was fairly on budget, but only because I used a store credit to buy several home repair items - so I'm not sure how to really count that weekend.

Our second weekend was a failure - we spent about $500 or so. Groceries weren't so bad, but I had to buy some birthday gifts and wine to host a party so spend went up.

I'm hoping we can do better this weekend. We'll certainly see.

I still think the goal and aspiration is worth doing.

Regards, makingourway

home repair review - water heaters and more

2008-08-02T05:10:00.000-05:00

I met with our handy man and reviewed the upcoming major project.
This is what will likely be included:

1. Replace two water heaters - thinking about the lowes 50 gallon energy smart tanks at about $650 each - it's about $70 more than regular 50 gallons, but a bit (not alot) higher in efficiency - not sure of the exact benefit. 12 year warrantee model. The digital controls may be useful when travelling, etc... to manage energy usage. Additional hardware and service fees for combined two heater replacement estaimted at $400 - $500. [does this make sense?]

2. various paint, nail pop and try wall repairs - including a stain from a sky light.

3. Fix the several external appliance exhaust covers outside - caulk, replace broken, screw into wall when needed.

4. Fix stove top exhaust - caused immense draft in winter.

5. Replace high ceiling lights with either 8,000 or 25,000 hour compact florescents. Too high up for me to change on my own so will buy long term ones.

6. Fix roof gutters - put screen covers over valleys to prevent future over flow.

7. Fix peeling paint on portion of roof to protect wood.

8. caulk, reseal and repair pella window.

9. replace noisy bathroom shower fan with much quieter panasonic fan. fan is expensive at $200, but alledgedly ultra quiet. cheap fan i have is so noisy i can't hear anything else.

That's the majority of the work.

I'm figuring one team will focus on the water heaters and another on the rest.

My guess is that all non water heater work would cost about $300 - $400 plus parts, but i'll see.

At this point in time, I'm basically trying to aggregate all of the little things that I can't do on my own and have them addressed at once.

I'm very tempted to have the network installed, but think it unwise as it could cost $800 - $1200 - which I should save until financially more comfortable.

Regards, makingourway

would you replace a leaking water heater?

2008-08-01T09:27:00.000-05:00

i'm planning on replacing mine.
The edge of the container - not a fixture - is rusted to the point that it's continuously dripping. i'll review with contractor tonight to see his oppinion.

it's not under pressure, so i'll constantly have a small amount of water on the ground near the drain - figure 3-6 ounces. is this a mold risk?

should i wait a year or until it's unbearable or do it right away?

regards, makingourway

computer repairs - buy or fix

2008-08-01T09:25:00.000-05:00

I've had two computers recently take hits:

Desktop - chose to repair for $100 - seemed clear cut - though you can buy 3 ghz xp refurbished models with small hard drives for $200 - $400.

Laptop - 17" premium laptop. Cost $75 to mail to vendor. I figure $400 in repairs. A refurbished similar type might be $700 - $900. New high end $1500. I decided to repair it, but at 3.2 GHZ with ati 800 video card, i might benefit from the newer technology. i'll see what upgrade options the vendor offers.

what would you do?

regards,
makingourway

When will mobipassword work on vista?

2008-08-01T09:22:00.000-05:00

I've been a mobipassword user for years - mostly for windows password synch with palm or pocket pc hand helds. It's a great program that stores bookmarks, data and passwords.

Unfortunately, I haven't been able to use it since the beginning of the year.

I'm now almost completely converted to Ascendo Data Vault - which also runs on the blackberry.

However, I do miss the real time password entry of mobipassword - it does a better job than Data Vault.

BTW, I've e-mail mobipassword's makers multiple times for support and have only heard backf from their automated acknowledgement system.

Regards, makingourway

quick...buy this machine - it still hase XP!!

2008-08-01T09:20:00.000-05:00

This is the oddest message I've heard in the last few weeks, but it seems to make sense and reminds me of past epochs regarding gamers and windows 98.

Several friends replacing machines were bragging how they managed to obtain PC's running windows XP - which is becoming increasingly difficult.

I understand their aggravation. Most want to avoid forced adobe and microsoft product upgrades, while others are concerned about application compatibility where upgrades are still in doubt.

Honestly, I like Vista, but I have lost some important applications that can't be upgraded.

Regards, makingourway

Frequent miles versus cash back - which to choose?

2008-08-01T09:18:00.000-05:00

Here's a great article favoring cash back, but there are also several excellent responses in favor of miles.

My gut says that cash back will rule as airlines continue to squeeze their loyalty programs.

This should reverse in the next few years as defection reduces airline loyalty.

If I continue to travel frequently for work i'll be garnering many miles through usage.

Regards, makingourway

what remains to convert to compact flourescent

2008-08-01T09:13:00.000-05:00

The following are difficult to convert and unfortunately, some are fairly commonly used:

1. outside lights - takes too long to turn brighten and a pain to install
2. chandeliers - i have several (kitchen, foyer, dining room). It would cost a fortune at $9.00 each to convert. and they still aren't that attractive. let alone figure out how to climb all the way up to the taller fixtures.
3. loft lights - i have a few in a lofted ceiling - when service men come to fix a gutter, i may convert them too.
4. dimming ceiling sconces - requires candlesticks.
5. dimming canned lights - i have about 20!!! mostly in the basement.

The kitchen chandelier is used most frequently.

On the whole, i have quite a bit of work to do, but figure about 80% of my commonly used lights are converted. Still, the others could save money, however, the cost is daunting.

i'm tempted to convert them onesy twosey style, but my better sense says to wait and see what new technology is introduced.

How do we know if any of the bulbs we're buying to day will make sense in light of new products 2-3 years from now?

Regards,
makingourway

dimmable compact flourescents - sylvania's work

2008-08-01T09:09:00.000-05:00

I've been using Sylvania's dimmable compact flourescents. You can buy them at Menard's in the Chicago region.

The price is competitive about $8.50 - $9.00 per bulb, however overall, I feel they are way overpriced as a product - Menard's is well priced compared to others.

They do not buzz, however, they dimm only fairly well.

I have however, had significant problems with non-dimmable bulbs ($4.50 each) for ceiling fans and candle stick types in fixtures meant to dim. They buzz, flicker, etc....

Regards,
makingourway

very interesting airfare blog - with great advice and savings .... airfarewatchdog.com

2008-08-01T09:08:00.000-05:00

I've really enjoyed looking at the postings here.

Of course many of them are disappointing.

Regards, makingourway

Reducing subscriptions and ongoing costs and new ones

2008-08-01T08:56:00.000-05:00

Here's a quick update on the effort to reduce continuing costs:

1. We are cancelling the unnecessary insurance policy - will save $65 per month over the next 12 years. That's $9,360!!
2. Cancelled Park District membership. Saves $135 per month. Looking back the whole thing was a mistake. We can take classes without being members - if we were to do so - and it would cost $5-$10 extra. But we would never take so many that it made sense to join. Plus they receive a tax subsidy so my conscience is salved.

Total saved $200 per month

Less tangible - utility bill reduction

1. We have bought and installed additional compact flourescent bulbs. We have probably gone from 60% - 85% converted. This may have reduced the expense further since we've focussed the bulbs on fairly high use areas. I'll post more on this separately.
2. Pool heater - we've lowered the temperature so it may consume less resources.
3. Household - we've been trying to raise the household temperature to 78 - this may reduce our electric bill

Personal trainer - reduced 10 lesson package from $550 to $400 - we'll continue to do this every two weeks, unless we can lower it further, but it's not reasonable to go much lower.

Additions:

Medicine $65 per month - doesn't look like there's a generic for these.

This weekend I'll take a fresh look at year to date spend and try to eliminate a few more expenses.

Regards,
makingourway

The grail has been partially met - flame-tip and dimmable compact flourescents have been found!! -

2008-07-22T00:06:00.000-05:00

I found both flame tip and dimmable compact flourescents at Menard's.

I bought the following:

Compact flourescent flame-tip AKA decor bulbs for approximately $4.88 each for $9.96 in two packs. These were not dimmable, but they do fit into ceiling fixtures, etc.... The ones I bought were made by Sylvania at 40 watts. The bulbs come with a small tip and a converter to the larger standard size.

For some reason the builders of my house force me to use these ridiculous things.

They are quoted at 300+ lumens with 8000 hour life span. They use 9 watts (equivalent to 40 watt incandescent bulbs). Competing bulbs use onlky 7 watts, but provide substantially less lumens. They are also longer and may not fit certain light fixtures.

I also saw a high end 25 watt flame-tip bulb with a 25,000 hour life span for considerably more money - about $12. I need to many to justify the expense. I may replace future bulbs once the flourescents expire - if I don't replace the fixtures.

I also bought several two packs of dimmable compact flourescent BR30 indoor flood lights for $17.99. Unfortunately, the builder of my house put quite a few can lights on dimmers - especially some of my higher traffic areas.

I am pleased to report that they do work - however, the precision they achieve compared with an incandescent is lacking. From my personal impression, it sees if there are three to four dim levels, rather than the gentle gradience one experiences with incandescent bulbs.

However, I never dim these high use areas, so I don't care much. Unfortunately, I can't eliminate the dimmers cheaply, so i buy the more expensive dimming CF's. So these more expensive dimmable comact flourescent floods come to about $8.00 each - i think you can buy BR-30's in packages of 6 for about $3.00 each - so there is a big premium.

Finally, the dimmable bulbs are not nearly as impressive as the other CF's. They do have the 8,000 hour life, but only provide 700 lumens - comparable to a normal flood.

I'm still missing dimmable flame-tip / decor compact flourescents. If I recall correctly, I did see them at another Menards, but the one I visited did not have them. I may have to wait a while for these. As I don't travel in that direction often.

At this point nearly all of the high traffic areas of my house have CF's. I do still have a great need for BR-30 dimmable floods in some less used areas, like my basement as well as dimmable CF candles for two fixtures. Also, I need dimmable CFs for my chandeliers - however, I'd like to wait for another generation for all but one of them. I'll need quite a few.

I still plan to buy dimmable candles for two more fixtures - they are high traffic. The rest of the house can wait until costco works out a great deal.

If you really need to buy dimmable CF candles, you might try on line - it's quite expensive - usually $12+. I'm sincerely hoping I can find the less expensive dimmables somewhere. Who knows?

At the end of the day, I wonder how much this energy savings effort is really worth? I did lower my electrical bill from $220 to $150, but summer cooling and pool filtration costs are driving that number from $150 to $550.

If I'm lucky, raisting thermostat temperatures will help somewhat.

Regards,
makingourway

PS The menards website is pretty hard to use. I couldn't figure out how to look in store product up on line, nor could I place an order on line to pick-up at the store - something you can do with circuit city.

I have found the grale of compact flourescent light bulbs!

2008-07-21T09:12:00.000-05:00

I'll write more on this soon.
While shopping I took the time to stop at a few stores en-route and examine compact flourescent light bulb (CF) offerings.

although it's easy to find 60-100 watt non-dimmable spirals and 65 watt feflectors for Can / ceiling insets - I recommend Costco for these - especially now with the commonwealth Edison sponsored discounts (35%).

I have finally! Finally! found affordably priced decor flame tip style bulbs that are dimmable!

I'll explain what I've learned in the next post.

Misery with our sprinkler service company

2008-07-20T00:35:00.000-05:00

We have quite a bit of land - it can only be watered effectively with a sprinkler system.
We paid about $325 - $390 for de-winterization and start-up. The process was stopped half-way through when the team declared our timing system dead and in need of replacement.
The replacement cost $1300 in labor.
Unfortunately the team did a shoddy job.
They charge $65 per hour, but provide cheap labor.

I asked the sprinkler company to return:
1. set the timers and show me how to do it
2. confirm that all sprinkler heads were properly programmed
3. confirm that all sprinkler heads were working

The cheap labor claimed to have manually tested each head, but our actual field test showed 1/3 of the sprinklers to be disfunctional. The servicor then recommended we replace all of them with new heads.

We asked for an estimate. Grandpa had a strong inclination that the heads were not broken. While I was at work, he spent the next two days digging up the grass around each head and cleaning out dirk and blockage. By the time he was done, all but 1 of the heads were working.

This kind of service is unacceptable.

Quite frankly, I question if the original timing unit was truely broken.

We did have the come back twice:

1. fix obvious leaks
2. fix a stuck valve

While they were here the second time, I had the fix the positioning of the timer box. They did such a poor job installing it, it could not be opened properly.

If i'm going to be subject to cheap labor, i might as well pay cheap rates.

This company will be fired.

I am wondering if i'm due back more of my money! Thanks the stars we didn't accept their diagnosis that 1/3 of the sprinklers should be replaced at $50 per head for the big ones plus labor.

Regards,
makingourway

Weekend spending update $253 spent, $47 left.

2008-07-20T00:29:00.000-05:00

Well...on friday we spent about $90 for camping equipment that we didn't need.
Today we spent $10 on lunch at McDonald's (happy meals).
And...$150 on dinner with a friend visiting from out of town.
I was truely bumbed by the size of the expenditure, but it was the least we could do when we couldn't have the friend over to our house.
We also spent $3.00 at the local library buying discarded books.
My son made out like a bandit - most books were under $0.50 each.
This leaves us with $47 left for the weekend, I recommended to my wife that we go to Aldi for grocer shopping as an alternative to Costco.

Otherwise, I have no guarantee there will be anything I like to eat in the house.
We'll have to draw up the shopping list carefully.

$47 budget left...can we do it?

Regards, makingourway

Goal $300 per weekend and 77 degrees HVAC

2008-07-19T11:35:00.000-05:00

We've discussed the matter and agreed to the following:

1. We'll try to cap weekend spending to $300 on all things.
So far we've spent about $96 at REI and Target (preparing for a cancelled camping trip).

2. We've raised the downstairs thermostat to 77 degrees during the day and 78 degrees at night - we'll see if we can tolerate this.

3. We're going to focus on low cost actvities such as:
a. cinema - pre-bought discount tickets via costco
b. library - borrow new DVDs and perhaps read some books together
c. hanging pictures together
d. perhaps some board games

We've invited our rained out friends to camp at our house. This would be alot of fun if they join us.

We need to commit to the spend and temperature throughout the weekend.

Some things we'll be giving up:

a. High end tickets to places like cirque du soleil - we can go once a year, but not make a habbit of it.
b. Expensive vacations - though we won't go anywhere the rest of the year, anwyay.
c. Personal trainer two times a week - every two weeks for us

More thoughts later.

Regards,
makingourway

Changing spending habits to save money

2008-07-18T23:48:00.000-05:00

I was a bit depressed when I looked at our semi-yearly money spend.

Mrs. MOW and I discussed it and came to a few conclusions (or at least I hope she shared mine):

1. Until 2nd house is actually sold, we have to live within the economic constraints it places on us; that means we can't spend $11,000 on vacations, $1,000 on weekend shopping, etc....

2. We may have to adjust our Costco habit; reduce trips to two times per month. Find alternative low price shopping locations for groceries. Do we need to spend $7.00 on strawberries or grapes? We may restrict Costco to dry goods, instead.

3. Accelerate our search for an SUV replacement - we're eyeing the honda civic hybrid but need to road test it. The thought of not using high test fuel is a big plus in and of itself. My thoughts are that we could save $200 on the lease amount plus another $100+ per month on fuel. We'll have to see what the lease surrender charges are on the SUV and factor them in. At the very least, we should investigate my wife's business travel reimbursement options.

4. New goal: constrain weekend spending to $300;
traditionally I've budgetted $80 for weekend entertainment, $80 for dining out, $20 for movies and $300 for groceries. I'm trying to compress it all into $300 - we'll see what happens. My thesis is that most money is spent on the weekends. If we can work together to avoid spending more than $300, we may not have time to do so during the week.

5. Groceries - we've been spending $1,800 a month on groceries. Mostly at Costco. I am a bit concerned that non-grocery items have been added in, but i usually try to pull them out into distinct categories. We'll see how this works. Costco avoidance may also help. There are a number of hispanic groceries in the region that have a delicious variety of vegetables and fruits and may be priced more aggressively than Costco. Though usually Costco is amazing on bananas at $0.29 per pound.

6. Vacations - no major ones planned the rest of the year, but the $11k in damage has already been done. I think we'll investigate camping alot more - it's quite a bit cheaper.

7. HVAC - I've raised the household temperature to 76 degrees all day. This is close to the maximum I think we can tolerate - but perhaps after a few weeks, we can go a degree higher? We'll see. I wonder how much impact this will have.

Questions and thoughts:

1. I have 3 refrigerators. None of them are very new - say 5-10 years old each. I wonder what they are costing me to operation? Does location matter? One is in the garage, the other in the basement and the third in the kitchen.

2. Should ceiling fans be running if someone is not in the room?

3. I have fairly high end single pane Pella windows. I've always read that replacement cost is very hard to recover. Will it make a big difference?

4. More compact flourescent lights - I have several light fixtures that are on for at least 4 hours a day - all use 40 watt flame tip candles. I remember seeing somewhere - but don't remember where - CF versions. Most websites offer 20,000 hour bulbs at $11 per bulb. That seems very expensive to me - but they are usually dimmable. Somewhere I saw flame tips for $5. At this point I think they're worht getting. Costco doesn't carry them yet, which is a shame. An uniformed oppinion postulated within a year.

5. Rent the second house - paper work is already done - now I'm waiting for a customer.

6. Consider quiting the local Y - I'm paying about $130 a month and not using it - however, I might once school season begins - tough choices - can i let it lapse? Then again I am using the personal trainer - is that included?

7. Reconsider cancelling an old 20 year term life insurance policy. It only costs $65 per month, but it's redundant with the policies we put into our ILIT's.

8. Consider cancelling our legacy vonage lines $42 a month - now only used to forward to our home and mobile. Possibly cancel only 1 on them - still $21 back per month.

9. I think we have to stop buying big ticket event items - we don't do it often, but it's $200 - $300 each time.

Regards, makingourway

What's the cost of cooling a big house in the summer?

2008-07-18T13:40:00.000-05:00

Looks like it's $500 - or at least that's what my electrical bill was at.

I've recently raised the target temperature to 76 degrees. We'll see how this changes things.

Near the end of winter my electrical bill had dropped from about $250 to $170. It ran at that level for several months - I'm hoping it can be attributed to the increased use of compact flourescents throughout the house.

If our average electrical bill is perhaps $200, this means our cooling bill about $300. Interesting.

One thing I've done to cool the house more efficiently is turn the ceiling fans on in common rooms. This should help circulate air better.

Regards,
makingourway

$3000 spent on gasoline over 6 months

2008-07-18T13:36:00.000-05:00

A few days ago I did a year to date search by spending category.
The results were quite disappointing.

One item in particular was a $3000 spend on gasoline.

Granted a few reimbursements for some business related travel were not included, but overall the amounts are large - $500 per month. Oddly, they do seem in synch with the $180 a car a month that some of my friends are paying.

Having 3 cars, we need to calculat how much we're actually spending per car. My wife, who commutes the most will have to consider filing for reimbursement for miles on the job - that will help some.

We'll also keep looking for hybrids. She was quite disappointment with the lack of power and performance in the Toyota Prius. We're wondering if the Honday Camry Hybrid will perform any better.

One question we don't have answered is exactly on which car are we spending the most money. We'll have to get alot better tracking gasoline charges for that to happen. However, i am confident switching from an suv to a compact hybrid should save quite a bit.

Regards,
makingourway

Would you consider an energy audit?

2008-07-12T07:01:00.000-05:00

A friend of mine mentioned that energy audits are available in his municipality - provided by his energy company.

Apparently they presurize your house and look for leakage.

This is fascinating - quite possibly worth doing.

Would you take your energy provider up on such an offer?
Would you pay for it, if it was not for free?

Regards, makingourway

check out Heroes website

2008-07-12T06:53:00.000-05:00

My wife and I are addicted to the Heroes television series. You can check out their website here.

We bought the first season on DVD at Costco and aim to buy the second season when it's released.

I recommend checking out the website for several reasons:

1. They have graphical novels -ALOT- in PDF format that round out the series
2. They have animated episodes that do the same
3. I think you might be able to watch some of the episodes on-line!
4. There's ALOT of content
5. There's also a web only series, too

My wife isn't keen on video over the internet, but maybe she'll check this out with me.

Since we've cancelled our cable television service i've noticed that I need to follow-up on entetrainment news more to see what's worth watching.

We're considering the Lost series. We'd buy it on DVD from costco.

Regards,
makingourway

Compact Flourescent Light Bulbs (CF) - going for 100%

2008-07-12T06:42:00.001-05:00

I've been pondering how we can both help the environment and reduce our electrical usage.

Last weekend at a cost of $110 I replaced the incandescent bulbs in almost all of our ceiling fan fixtures (we have 5).

I still have a large number of sconces and ceiling fixtures that use flame tipped bulbs. Although Costco does not have any, Target does for about $4.50 or so (+/= $0.50) - however these are for the normal ligh bulb width screw base.

I remember seeing a narrower screwbase with an adapter somewhere - but have to track it down.

I'll need 20-30 of them.

With the cost of summer air conditioning, i'm wondering how quickly i'll see a cost savings. Probably not too quickly.

we're currently setting our hvac temperature at 75 degrees. Outside temperature usually goes into the 80s in Chicago for this time of year. I'm wondering if we should raise it 1 degree to 76 - perhaps at night time? Maybe it won't be noticed. We'll have to see how the family accepts this.

I realized that I have not replaced the incandescents in the garage - that may be a morning project.

One of the most challenging projects is replacing the light bulbs in a lofted area of the house that are very high up. Somehow we'll have to tackle that - I imagine as soon as a light goes out we'll replace all of them with long lasting CF bulbs.

Additionally, we should consider converting outdoors lights as well, however, we don't use the outside lights very often.

One question I ask myself, does it make sense to spend $300 - $400 on CF bulbs? We certainly noticed a $50 per month reduction in electrical bills during winter, so i think it does.

One area, where we have little ability to convert are the dimmable can lights in the kitchen (6) and finished basement (12?). The kitchen is a high use area, however, the basement is not. However, I have not yet seen dimmable floods and I wonder how much they would cost. Dimabble flame tip or torpedo style bulbs cost $11+ each. That would be a very big investment!

In the next few years, manufacturers will stop making incandescent bulbs. I can only imagine that chepaer CF and CF dimmable technology will be created. One question remains - will it work with current dimming systems?

Regards,
makingourway

PS I wonder how we're doing lowering our carbon footprint. I have a sneaking suspicion keeping the swimming pool heated in September will not help.

monthly cash flow turns positive

2008-07-12T06:37:00.000-05:00

I'm not sure if this is sustained or sustainable, but our monthly cash flow turned positive. A few bonuses and tax refunds helped.

We'll see if this is a continuous trend.

Our networth is down to about $650k - mainly due to dips in investment values.

Wife is due a raise - this will substantially shore up our ongoing monthly p&l. We'll see if she receives it - otherwise better start updating her resume.

I need to think about updating my resume.

Big company has gone through some rough patches and even though things are improving, overall cuts may make me vulnerable. I hate the feeling that no matter how hard I work and no matter what I achieve (profitability increases), I'm still at risk. Part of this is a leadership issue - regardless of the situation.

I'm not to keen about the opportunities recruiters have been calling me with, but I certainly don't want to be unemployed for an extended time. Very frustrating!

Regards,
makingourway

pool maintenance update mid-July

2008-07-12T06:31:00.000-05:00

Well, i've been doing the pool maintenance and it's moving along.

I think I'm getting the hang of it.

Here are a few useful tips:

1. buy a box of latex gloves from costco to wear while pouring chemicals into the pool. Bases like soda ash require alot of time to wash off otherwise.
2. pour chemicals close to the water so the wind does not blow them on you.
3. look for returns - pour chemicals in front of the returns to facilitate distribution.
4. Leslie's Pool Supply out of Arizona has extremely talented management who can give professionally certificed advice. They also will perform a free chemical analysis.
5. Most pool service firms do not have certified technicians / cleaners.
6. If your inground pool's lights are not working - check the circuit breaker first.

One of the pool's motors broke. This means the filtration system is turned off.

We need to use liquid chlorine while waiting for it to be repaired.
I'm also concerned the chlorinator's release control system is not working correctly; i.e. 1-10 is 8 really 8 or is it all the way open?

Repair costs:

motor $350
Service $90

total $440

Ugh!

maintaining the swimming pool

2008-07-03T23:20:00.000-05:00

Well,

It's been an interesting time. Last week i tried for the first time to maintain the swimming pool on my own.

What a delicate eco-system a pool creates. Just enough Ph, Alkalinity and Chlorine. Don't forget to deal with algie levels, etc....

So far, so good.

I have to check the chlorine level every few days to calibrate the flow from the chlorinator.

I also learned how to increase the PH and have a small warehouse of pool chemicals.

They certainly cost less than what my service was charging.

In a few weeks we'll see if it's been worth the effort.

One thing for sure is that you quickly learn how to use the test kit!

Regards, makingourway

mid-year networth check

2008-07-03T23:09:00.000-05:00

I've been so busy I've had little time to formally update our net worth, but here's a very quick measure:

It's approximately $740,000. For the entire year it has more or less been fluctuating from $730,000 to $771,000. Fluctuations have been heavily driven by overall market performance.

I have reduce my market exposure substantially, by:

a. selling most of our non-retirement diversified market index funds and using them to pay down HELOC on our primary house.
b. selling off most of our ETFs held in non-retirement accounts to provide cash liquidity.
c. I have already made my 401k contribution for the year, maxing out at $15,500.
d. I expect my wife will do the same between August and December.

Otherwise, we have not saved nearly as much as we have in the past.

This is most significantly limited by the economic burden of our unsold house in NC.

We will try renting it, which will staunch the monthly red-ink, but we'll still be negative cashflow on the house, just not our overall monthly budget.

Big company, in it's generosity, has given me a small (very small) second bonus, which I'll receive in July. My wife is scheduled for a raise in August, which will help.

By august, we should be mildly cash flow positive, but not enough to offset the economic damage we would face if Big Company laid me off.

I would love to be in a situation, where we could live off of only one of our incomes and save the other.

Getting rid of house #2, will help alot, but not cover enough of my pay.

In the end, I need to be earning more - perhaps as much as $100k more, plus selling the house. At that point we would have substantial cash savings.

Ahh the good old days, living in a less expensive local, but we should never forget the other challenges it entailed:

1. limited, but expensive shopping
2. over priced and limited professional services
3. very limited income for me unless I travelled 80%+
4. insufficient commericial and retail entertainment
5. challenges of integrating into a small town social network
6. very high fuel expenses
7. limited education options

In the end, we had to move to be true to our values, however, there are moments when I wish we kept renting instead of bought the house. i predict we'll be able to sell it in about 3 more years. How disappointing!

Regards,

makingourway

update on our compact florescent lightbulb push

2008-07-03T23:00:00.000-05:00

While most of our lightbulbs have been converted to compact flourescent (CF), we noticed about a $50 savings in electrical bill during the winter - rough drop from $220/mo to $150. We won't see much new with the air conditioning running this summer.

However, we still have quite a few lamps that are not converted. These are the lamps that do not typically lend themselves to CF solutions:

* Ceiling fans with 4 bulbs - we have quite a few of these - maybe 4 = 16 bulbs
* Ceiling fixtures that take 4 candle stick bulbs - maybe 4 = 16 bulbs
* Can lights with dimmers - we have several of these in key areas

While walking throught target I found several interesting things:

1. Spiral bulb style lights that are dimmable - unfortunately I need floods
2. Ceiling fan lights - on sale for $4.59 each - GE energy smart 40, uses 11 watts - I bought 3 to test.
3. CF candlesticks - I didn't buy one, but am planning to do so - also by GE

What I don't care for is the price. Individual GE CF light bulbs are much more expensive than bulk purchased Feist bulbs from costco. Then again, costco doesn't have 1-3 yet, so maybe I'll have to bite the bullet and pay the premium.

It just so happens that the light fixtures we use the most are the ceiling lights in my office and bedroom and the candlesticks in the hallway.

I still don't have an adequate solution for a dimmable flood, but if I tried, I might find something.

I did find an interesting site called top bulb, which does have an incredibly large volume of CF's of many styles, however, the candle stick bulbs looked almost 100% more expensive than what was available at target.

Perhaps over the weekend we'll move forward and get closer to comprehensive CF utilization.

Oh, one admission, we are not using CF's for outside lights or in our garage - shame on us - we should be. I even have the lamp pole to do the installation!!

Regards, makingourway

20 google tricks and tips - or why it pays to be good at what you use frequently

2008-06-30T23:04:00.000-05:00

There's a nice article at PC Magazine with tips and tricks on using google.
Since most of us google very frequently, doesn't it make sense to spend time learning how to user it better, faster and more effectively?

How often do people fall into inefficient, ineffective, yet comfortable patterns that they refuse to change? Here's a chance to take back some time.

It'll add up over course of a year.

The link is here.