2014 May Income / Expenses

201405IS

This month I spent quite a bit of money. I ended up splurging in a whole bunch of different areas.

Food and Dining – $100 over budget.

Misc – I bought a tablet for my brother that cost me close to $300.

Personal Care – I bought some soap, sunblock, and some misc. items. I don’t expect this to be so high again for a while.

Travel – I went to Miami again to enjoy some R&R.

Work – I had to purchase some things for an interview. This cost is also high in June.

If you were to take out the tablet purchase, and trim down on the food, I would have been in much better shape. My plan for June is to try and cut down as much as I can, to try and close this gap.

 

On the goals front I’ve been doing poorly in attaining them.

  1. Meditate Daily – Fail
  2. Seek Fulfilling work – Semi Pass
  3. Reading – Fail (I’ve been reading financial websites)
  4. Exercising – Semi Pass
  5. Call Friends – Pass
  6. Call Family – Pass
  7. Attend Monastery – No longer working towards this
  8. Toast Masters – Pass
  9. Three Domestic Trips – Pass
  10. One International Trip – Unknown
  11. Keep Things Simple – Failure – I feel like I’ve been agonizing over things.
  12. Keep Things Clean – Semi Pass – For a good while my room / dishes / everything else was clean. Now not so much. I need to jump back onto this.
  13. Being healthier – Semi pass. Eating better, exercising more.

Rules of the game Day #1

I’ve been having a hard time getting out of my comfort zone, and this is one area I’d to improve. A friend of mine in college recommended Rules of the Game as a guide to get out there. I recently found a PDF copy and decided to share my progress with my readers. Here goes….

1. Write one or two sentences describing how you believe other people

currently perceive you.

Other people perceive to be a confident but very conservative person. I believe they view as cautious to approach new ideas. Furthermore, they see me as a pessimist.

2. Write one or two sentences describing how you would like to be perceived by others.

I’d like to be perceived as someone who is confident and willing to try new things. I want to be seen as someone who rarely fears going outside of my comfort zone.

3. List three of your behaviors or characteristics you would like to
change.

1. Laziness. I’d like to be more proactive.
2. Punctual. I’d like to get things done on a more consistent timeframe.
3. Scatterbrained. I’d like to be more focused in what I’m doing.

4. List three new behaviors or characteristics you would like to adopt.

I think this is the same as number 3. I don’t see a difference.

Mission of the day: Talk to five people.

1. The first person I spoke to was walking a dog, I asked this person what type of dog it is, and if i could pet it.
2. The second person I spoke to was a chef at the local grocery store. I asked what meal she was making.
3. The third person I spoke to was the cashier, I asked her how her day was going, and that the weather was nice.
4. The fourth person I spoke to was a manager, I asked him what time the store closes on weekends.
5. The fifth person I spoke to was when I was walking home. I asked him how he was doing.

Overall Success of the mission:
Success!

Simplifying Finances… Kinda

1. Keep things simple. As much as I want to chuck money into individual stocks, it’s too much work. I don’t want to unwind positions anytime. I’d rather just throw money into a preset allocation and call it a day. This is also true for credit cards. I’m not against taking advantage of credit card rewards, but I can do that in better ways. I won’t be canceling cards, but i’d like for all spending to be on one single card. Finally, close any accounts that aren’t being in use like my fidelity account. It serves no purpose to me.

A couple of months ago I wrote the above quote. Over this last week I’ve taken steps to get closer to that goal. When I first started investing with Vanguard at the beginning of this year, I only had $3k for the Vanguard Long-Term Municipal Bond Fund. Over the course of these last couple of months I’ve been able to save enough to hit the $3k minimum for the Vanguard Total World Stock Market Fund, and have taken the steps to invest in both.

Where is the magic? The magic is now that the allocation is set with 50% going to municipal bonds, and 50% going into the total world fund, I don’t have to watch these funds at all. The only thing I have to do is login once  a year and transfer money to an IRA, and if I choose to do so, rebalance. Otherwise, everything is set on auto-pilot with no more necessary interaction required of me.

Taxable Accounts: Once a year rebalance if necessary.

IRA / Retirement Accounts: Once a year contribution to buy all four assets of the Permanent Portfolio.

I wish I could say that thus far I haven’t logged into Vanguard everyday to watch my balance ping pong around. Unfortunately, I have done just that… This may take some work. :P

2014 April Income Statement

I’m late publishing this information, unfortunately one of my banks takes a while to publish interest information.

I have made yet another change to how I publish information. Where I use to include my net worth, now it’s my income / expenses for the month excluding any capital appreciation. This is to show my net cash balance.

As youll note I’ve been bleeding quite a bit of cash in order to hit my savings rate (56% of gross salary). As I further cut down on one off expenses, return some items, and have a groove for my spending, I expect to add around $100 a month to cash or have no MoM changes.

I had some higher than usual spending in Auto & Transport, Home, Misc., Shopping, and work. For transportation, I’ve been driving much more to go to various fitness classes and volunteering. For home expenses I bought some stove top cleaner, and an organization tool for my closet. Shopping included buying a new suit that I will with 99% certainty return. Work expenses were for some dress shirts that I will more than likely return as well due to sizing issues, if i’m allowed to exchange, I will. FInally for Misc., I lent my room mate some money, and I recoup this amount in next months rent payment.

One area that I did really well in was Food & Dining. I went out to eat, but the bulk of my cooking was done at home which kept costs low. This is always an area that I feel I can improve upon, but I question the wisdom in living life too frugally.

Other than the above, it’s a fairly standard month. Oh! I almost forgot. I bought 4 shares of Amazon trying to catch a falling knife. It was sold in May (next month). I ended up losing (.37) on the entire transaction, commissions included.

Income
/ Expenses
Y/M/$
2014 Grand Total
Category 1 2 3 4
Auto & Transport
(179.60)
    (179.55)
(169.54)

(183.35)

(712.05)
Car Insurance           (85.00)       (85.00)         (62.22)         (62.22)         (294.45)
Fuel – Car           (39.10)       (39.05)         (51.82)         (65.63)         (195.60)
Marta           (55.50)       (55.50)         (55.50)         (55.50)         (222.00)
Business Services
(50.52)
      (65.87)
(5.00)

(5.00)

(126.39)
Advertising           (50.52)                 -                    -                    -             (50.52)
Domain Purchase / Renewal                     -         (10.87)                  -                    -             (10.87)
Hosting                     -            (5.00)           (5.00)           (5.00)           (15.00)
Networking                     -         (50.00)                  -                    -             (50.00)
Fitness
(5.00)

(5.00)

(64.98)

(38.92)

(113.90)
Gym                     -                   -           (59.98)         (29.99)           (89.97)
Health Miles              (5.00)          (5.00)           (5.00)           (5.00)           (20.00)
Supplies                     -                   -                    -             (3.93)              (3.93)
Food & Dining
(423.31)
    (275.51)
(240.80)

(165.51)

(1,105.12)
Alcohol                     -            (9.72)                  -                    -                (9.72)
BOCC                     -         (10.69)                  -                    -             (10.69)
Groceries                     -       (182.59)       (145.57)         (91.55)         (419.70)
Outside         (423.31)       (81.05)         (98.32)         (91.71)         (694.39)
Refund                     -              8.54              3.09           17.75              29.38
Gift & Donation
(124.13)
      (21.00)
(20.00)

(20.00)

(185.13)
Monastery                     -            (1.00)                  -                    -                (1.00)
Non-Profits           (20.00)       (20.00)         (20.00)         (20.00)           (80.00)
Other              (4.13)                 -                    -                    -                (4.13)
Wedding         (100.00)                 -                    -                    -           (100.00)
Health
(237.68)
    (185.09)
(313.55)

(317.17)

(1,053.49)
Dental Premium           (11.14)       (11.14)         (11.14)         (11.14)           (44.56)
Doctor         (137.46)                 -         (187.81)                  -           (325.27)
Healthcare Premium           (47.42)       (47.42)         (47.42)         (47.42)         (189.68)
HSA Contribution           (41.66)     (232.00)       (232.00)       (232.00)         (737.66)
HSA Reimbursment                     -         105.47         181.81                  -             287.28
Supplies                     -                   -           (16.99)         (26.61)           (43.60)
Hobbies & Entertainment
(6.67)
      (36.16)
(18.77)

(6.67)

(68.26)
Bars / Clubs                     -         (12.00)                  -                    -             (12.00)
Dancing                     -                   -           (12.00)                  -             (12.00)
Park & Recreation                     -            (6.00)                  -                    -                (6.00)
Toastmasters              (6.67)          (6.67)           (6.67)           (6.67)           (26.67)
Volunteering                     -         (11.49)           (0.10)                  -             (11.59)
Home
(562.00)
    (567.72)
(562.00)

(583.19)

(2,274.91)
Home Supplies                     -            (5.72)                  -           (21.19)           (26.91)
Rent         (550.00)     (550.00)       (550.00)       (550.00)     (2,200.00)
Renters Insurance           (12.00)       (12.00)         (12.00)         (12.00)           (48.00)
Income
5,540.98
   4,061.40     3,958.59     3,943.01     17,503.98
Bank Interest                1.17            2.36              2.95              2.87                9.35
Dividend                1.35          10.96           15.51           17.06              44.88
Health Miles Income                     -         125.00                  -                    -             125.00
Other Payroll Deductions / Additions                0.01                 -                    -                    -                  0.01
Paycheck        5,538.45    3,923.08     3,923.08     3,923.08     17,307.69
Spare Change                     -                   -             17.05                  -                17.05
Misc.
-  
      (80.27)
25.35

(393.60)

(448.52)
Google Voice                     -         (10.00)                  -                    -             (10.00)
Other                     -                   -         (600.00)                  -           (600.00)
Payback                     -                   -             74.14         228.75           302.89
Refund                     -                   -           600.00                  -             600.00
Room Mate                     -       (110.27)         (48.79)       (622.35)         (781.41)
Sales                     -            40.00                  -                    -                40.00
Personal Care
(31.04)
      (53.40)
(8.54)

(8.00)

(100.98)
Haircut           (31.04)       (16.00)           (8.00)           (8.00)           (63.04)
Oral Care                     -         (35.81)                  -                    -             (35.81)
Other                     -            (1.59)                  -                    -                (1.59)
Refund                     -                   -             10.15                  -                10.15
Shower Supplies                     -                   -           (10.69)                  -             (10.69)
Retirement
(976.92)
    (815.36)   (1,026.92)
(815.38)

(3,634.58)
401K Contribution         (553.86)     (392.30)       (392.30)       (392.30)     (1,730.76)
IRA Contribution         (423.06)     (423.06)       (634.62)       (423.08)     (1,903.82)
Shopping
(170.91)

53.12

(0.25)

(81.31)

(199.35)
Books                     -                   -             (0.25)                  -                (0.25)
Clothes         (170.91)                 -                    -           (81.31)         (252.22)
Pleasure                     -            (8.00)                  -                    -                (8.00)
Refund                     -            61.12                  -                    -                61.12
Taxable
(3,001.35)
    (810.96)   (1,018.32)
(841.06)

(5,671.69)
Reinvested Dividend              (1.35)       (10.96)         (15.51)         (17.06)           (44.88)
Taxable Purchase     (3,000.00)     (800.00)   (1,002.81)       (824.00)     (5,626.81)
Taxes
(1,169.63)
      627.86
(765.18)

(784.48)

(2,091.43)
Federal         (502.55)     (325.69)       (325.69)       (334.15)     (1,488.08)
Medicare           (78.41)       (51.87)         (51.87)         (53.68)         (235.83)
Refund                     -      1,407.00                  -                    -          1,407.00
Social Security         (335.28)     (221.78)       (221.77)       (229.53)     (1,008.36)
State         (253.39)     (165.85)       (165.85)       (167.12)         (752.21)
Tax Preparation                     -         (13.95)                  -                    -             (13.95)
Travel
(111.91)

-  

-  

(136.48)

(248.39)
Friends         (111.91)                 -                    -                    -           (111.91)
Miami                     -                   -                    -         (136.48)         (136.48)
VP
-  

-  

-  
  (1,228.87)
(1,228.87)
Stock Purchase                     -                   -                    -     (1,228.87)     (1,228.87)
Work
-  

-  

(161.28)

35.70

(125.58)
Dress Shirts                     -                   -                    -           (92.70)           (92.70)
Interview                     -                   -           (32.88)                  -             (32.88)
Refund                     -                   -                    -           128.40           128.40
Shoes                     -                   -         (128.40)                  -           (128.40)
Grand
Total

(1,509.69)

1,646.50

(391.19)

(1,630.27)
    (1,884.65)



financial stress

I wrote about some goals in my last post, and one of them has been to keep things simple.

I have not been doing this, rather I’ve been over analyzing my financial situation. Day after day I agonize over whether I’ll be able to save enough to hit my goal.

It is ridiculous. It is coming to an end now. No more looking at forums every morning, no more spending hours staring at an excel budget, and no more button mashing on Google finance.

The enemy of a good plan is the quest for a perfect plan. Maybe I will not save enough. Maybe I won’t have the best allocation.

That’s okay!

From here on out the following will be done:

1. Forums will be checked on Saturday
2. Excel sheet will be updated daily close to 345 pm on weekdays.
3. Time will be spent on something non monetary. I don’t care what.

On Patience

I’m not a saint, buddhist monk, nor someone who pretends to be patient. One thing I would like to do is become more patient. I’d like to learn to wait for the perfect moment, that one moment where I deal the most damage. No, I’m not talking about fighting.

You see the above is the problem with what I think of patience. Patience is not about striking, or fighting. Patience is analogous to equanimity, it’s about being calm, being able to watch without hinderance. Yes, transitioning from waiting is action, there is no other course, but before that we must understand patience.

Much of what I face nowadays isn’t anything new. Stress is not new, demands aren’t new, nothing has changed. How I act has changed. I’ve become a man on the defensive, placing blame on externalities, rather than where the blame is due. I’m my own albatross. I’m the exact opposite of patience.

In the song, “I’m the sunscreen”, the lyrics state the many things we worry about never come to fruition, rather it’s time passion along that blindsides us. Worries plague our thoughts, yet sweet, precious time flies by. If only we could let things go, let them play out, and use that time to enjoy ourselves. What a novel idea.

Again, patience is being able to observe as things happen. Watch as events unfold, allow yourself to view it all without emotion, and when that crucial moment arrives, act.

2014 Goals

Last year, 2013, turned out to be a great year financially, but there are some areas of improvement. I wrote about a video on the secret to happiness, and that’s where I’d like to focus most of my effort.

As a recap the secret to happiness is based on four things:
1.Faith – Wondering about the transcendental
2.Family – Close ties with loved ones.
3.Community – Making friends, and being charitable.
4.Work – Creating value. Rather, feeling of creating value.

When looking at these four different areas, it’s not difficult to draw a plan around them.

1. Faith – Meditating daily, and attending a monastery every Sunday morning.
2. Family – Calling my family every week to say “Hello”, and catch up with what they’re doing. Also emailing distant cousins, and local cousins.
3. Community – Going out to eat brunch on weekends, or playing Frisbee with work friends. On being charitable, contributing to good causes, but also taking people out to eat on occasion.
4. Work – Try to get onto project that make me fulfilled. If this isn’t possible, look for another job.

From the Above we can come up with a schedule.

Daily:
1. Meditate Daily
2. Seek fulfilling work

Weekly
1. Call friends
2. Call family
3. Attend monastery

This isn’t where I want to draw the line, as I have some financial and other goals that are hobby based.

I would be lying if I said that I don’t enjoy finance. It’s part of who I am, that being said, I would like to diversify my hobbies as well.

My other hobbies include the following:
Finance (already mentioned)
Reading
Toast Masters
Exercising
Traveling

Incorporating these into the schedule adds the following:

Daily:
1. Meditate Daily
2. Seek fulfilling work
3. Reading
4. Exercising (Daily push ups, chin ups, planks, and bicycle riding)

Weekly
1. Call friends
2. Call family
3. Attend monastery
4. Finance (Try to avoid reading forums daily, wait until week end)
5. Toast Masters (Attend every Tuesday meeting)

Quarterly
1. One international Trip
2. Three domestic trips

There we go, now we have something of a schedule. Everything on here is measurable, excellent. Now to add some more!

I mentioned that I would like to save $22,000 a year. I’ve considered adding other financial goals like generate X amount of income per month or per year, but that’s too much tracking, and subsequently work to be done. F that! I’m going to save $22,000 a year and call that my financial goal.

I’ve considered investing in some single stocks for fun, with only a small amount of play money.

Daily:
1. Meditate Daily
2. Seek fulfilling work
3. Reading
4. Exercising (Daily push ups, chin ups, planks, and bicycle riding)

Weekly
1. Call friends
2. Call family
3. Attend monastery
4. Finance (Try to avoid reading forums daily, wait until week end)
5. Toast Masters (Attend every Tuesday meeting)

Quarterly
1. One international Trip
2. Three domestic trips

Finally.. some other goals that I have:

1. Keep things simple. As much as I want to chuck money into individual stocks, it’s too much work. I don’t want to unwind positions anytime. I’d rather just throw money into a preset allocation and call it a day. This is also true for credit cards. I’m not against taking advantage of credit card rewards, but I can do that in better ways. I won’t be canceling cards, but i’d like for all spending to be on one single card. Finally, close any accounts that aren’t being in use like my fidelity account. It serves no purpose to me.

2. Keep things clean. Looking at my room, it’s an absolute mess, granted, I’ve been sick for a good while. I’d like form good habits that revolve around keeping things clean. This is also true for my car. The funny thing is that this stuff doesn’t have to be rocket science, doing things as they come up can easily solve both these issues.

3. Being healthier. I tackled meditating and spirituality, but as my good friend from Austria says, I need to be more positive. Being honest with myself, I’m a pessimist, and I see the absolute worst in things. I should be cooking better food, and all around, enjoying life.

December 2013 Net Worth

Finally a close to the year, and another month of savings for the net worth chart.

My original plan was to post a net worth update along with a 2013 “in review” in one post, but I’ll make it two.

Asset Allocation

First thing first, I made some more portfolio changes (I know, enough already!). I switched out of domestic stocks funds where I could into Total World Stock funds as I’d prefer to be more diversified. I switched out long term treasuries to Long Term Zero Coupon bonds, my reasoning is that these are ~50% more volatile than treasuries. With all of that being done, below is my total portfolio allocation.

Total Portfolio Allocation

It seems that I have a large chunk of assets in cash, which I’m fine with for both emergency fund purposes and dry powder. In the future the proportion of gold and cash relative to the portfolio should go down as more money will be pushed into world stock and municipal bonds.

 Performance

I don’t track year to year performance as it’s too much work. Rather I track performance from inception.

Since 2011 my IRA’s have returned 2.61% annualized.
Since 2012 my 401(k) has returned 9.51% annualized.

My IRA’s which are in the Permanent Portfolio had a down year for 2013, while my 401(K) which is 50/50, stocks to bonds, had a fantastic year. The net of the two for this year means [unrealized] money in my pockets.

Passive Income

I started to keep track of passive income from sources like credit card rewards, checking account rewards, amazon affiliate payments, and healthmiles (work related). In the future i’ll include my taxable account dividends.

Passive Income

 Revenues / Expenses

Below is an image of my revenue and expenses for the month. From now I expect my average spending to be around $1200 a month not including travel.

Revenue and expenses

I’m extremely happy to see a saving percent of 58%. I don’t think in my future months I’ll be able to save as high of a percentage, but one can hope.

Net Worth

Putting everything above together, we end up with a net worth update. For the month I’m up $1951.64 which is fantastic! I started this year with the goal of having a net worth of $38,000, and later revised that goal down to $36,000. I’m happy to note that I hit that revised target by the skin of my teeth.

Net Worth

And thus concludes the month!

Thoughts / Comments

What do you think? How did you net worth fare for the month?

 

The Secret To Happiness

I watched the below video. I don’t tout this video as a guide to happiness, rather, I find that the video is thought provoking.

The Secret to Happiness by the American Enterprise Institute

I wasn’t a huge fan of the free enterprise message, but that shouldn’t take away from the spirit of the message.

Faith – Wondering about the transcendental
Family – Close ties with loved ones.
Community – Making friends, and being charitable.
Work – Creating value. Rather, feeling of creating value.

I believe Arthur is correct in saying to create habits that facilitate the above. How many times have we seen Ted Talks that bring up a new formula for happiness? How often do we say we’ll do all of the above, but never get around to it?

How can we create habits to facilitate the above pieces of happiness?

Faith – Attend a religious institution every week.

Family – Call a different member of your family on a regular basis. Still have both parents? That’s two days out of the week.

Community – Take your friends out for lunch or dinner when you can. Switch it up, so you aren’t always paying. Schedule brunch or breakfast every saturday morning.

Work – Do something that you enjoy. Out of the four listed this is the hardest for me. I unfortunately can’t bring up some magic formula that will accomplish this.

Anywho, what do you think?

Retirement Changes

In the past my choice of retirement account was always the Roth option. My reasoning was that I didn’t want to accrue any tax liabilities on my balance sheet to pay off in the future. Upon debating this topic back and forth with a good friend of mine, I’ve come to the conclusion that a traditional IRA and 401(k) will be advantageous.

Currently my contributions look like this:
2011 Roth IRA – 5k Contribution
2012 Roth IRA – 5k Contribution
2013 IRA – 5.5k Contribution
Future Contributions: 212.53 per paycheck for a total of $5499.78 (22 cents short of a full contribution) towards traditional IRA.

2012 Roth 401(k) – All contributions
2013 Roth 401(k) – Some contributions
2013 401(k) – Remaining Contributions
Future Contributions: 10% of salary towards traditional 401(k).

My reasoning for this is due to the fact that congress or the IRS may change rules in the future to tax income. I’d rather realize any benefits I can obtain at the present moment, and invest the tax savings.