It's the end of the world as I knew it...

...I feel fine.

Stop the presses!

I think I'm finally realizing that the two major keys to me saving as much money as possible are sticking to my budget and keeping my spending to a minimum.

:::cue epiphany music:::

Vanguard is trying to make me crazy

Frustration
Originally uploaded by CCBImages

I have a savings account set up especially for my 2009 Roth IRA contributions. Last week I attached that account to my Roth thinking that I'd have Vanguard withdraw from it monthly. Easy peasy right? Wrong. WRONG! I was the Vanguard site tonight trying to set this up to start in February since I already made my January contribution. Why in the deep fried hell does it want to start in December 2008? After spending 30 minutes going round and round with this I gave up. I'll just call them on Monday and figure what what to do.

Automating things is supposed to make your life easy, and I believe it. However no one told me that setting up said automation would be a pain in my beige ass.

2009 Goals

It's taken me a long time to get my 2009 budget and goals together because this year presents several significant challenges.

My fathers illness. He was diagnosed with pancreatic cancer in October with the prognosis of year. Everyone hopes for that and more, however the statistics average around 6 months.

My parents financial situation. Two decades of chronic illness can wipe out any financial stability you had (Oh. I didn't tell you? My father has two other chronic illnesses. Cancer is the new kid on the block). Case in point: My parents had to stop life insurance to be able to afford prescription drugs. They owe an extra ordinary amount of money on their home. Once my father dies, mom will have to try to sell the house and move in with her sister because she wouldn't be able to afford to keep it. If they were able to afford their life insurance, this wouldn't be an issue.

A move for me. If my mom can't hold on to the house, that means I will have to find an apartment in a high cost-of-living city, possibly at the height of moving season when it's difficult to find a decent place at a reasonable rent.

My long-distance relationship. The S.O. and I spent the entire month of December together and it went great. It seems that we could could be long-term partners. However due to my father's illness and the economy we're keeping the relationship as-is. We both have jobs (thankfully), he has a house and I have a sick parent. We want to be together in the same place, however we have no choice but to stay put and keep traveling back and forth.

Continued layoffs at my company. My dept. didn't have many layoffs last fall, but others did. 2009 is predicted to be worse than 2008, so while I'd like to hold on to my job, nothing I have to be prepared for the worst.

All of the above are significant challenges in and of themselves, add to it that I have no real sense of timing on if or when most of it will happen and it seems impossible to plan anything. However I've got something together to help keep me sane and give me guidance while allowing for flexibility. I prioritized each goal with the idea that I would funnel all my savings into each one until the goal is reached, then move on to the next one. I've set everything up so that I meet my most important goals within the first three months to take into account the average prognosis for pancreatic cancer and when I'd have to start looking for another place to live.

Travel: $1,000
This is the only goal where I will stash away a small amount every month for the year. That money will be used for cab/train fare to and from the airport. Actual air travel will be covered by my frequent flier miles. I have enough that should cover me for 7 round-trip fares.

Goals that can be completed within the next three months:
Health Care Deductible: $1,700
This is $200 higher than last years because I opted for slightly less coinsurance (80% versus 90%) this year to allow for more cash in my paychecks.

Clothing: $500
My clothes look like crap and makes me look frumpy. I'm setting aside this amount to help improve my appearance. Luckily, $200 of this goal has been met by a generous gift card from work as a holiday gift.

New Computer: $1,200
At the beginning of 2008 I wanted a $7,000 computer, and I could have afforded it easily. However after it became clear that the economy was making a turn for the worse I couldn't justify that amount so I lowered my amount to $2,400. This year I'm slashing that in half. It should be enough to get me a decent machine that should last me for the next 2 or 3 years.

Other Goals
Charity: $600
I saved $300 last year, I'd like to double that. However if I have to, I can bump it back to $300

Unemployment fund: $16,000
I already have $10k of this, so it's a matter of saving an additional $6k. $16,000 would cover all my needs should I move (rent, utilities, etc.) and COBRA payments for 8 months.

Goals already accomplished
I "re-purposed" some money I had in my savings account to accomplish the following:

Mom: $2,000
Money I will keep on hand for her, as I know she will need it when my father passes.

Housing: $5,000
Includes first and last months rent, any applications fees need, rental of a U-Haul truck, as well as some very basic furniture, cleaning supplies, and cash to stock the fridge/pantry.

Emergency Fund: $1,100
Just $100 added to last year's. Mainly to cover minor events, like if my cat needs urgent care.


Welp. There it is. Wish me luck.

Credit Scores as of January 2009

I was dictating to supportively encouraging my S.O. to check his credit reports and FICO scores. Giving all the reasons why he should do so inspired me to do the same. While I have to wait until April to check my scores (when I can do it for free, since I already checked all three in April of 2008) I decided to check my FICO scores. The last time I check my scores was back in August of 2007.

So I googled a handy-dandy discount code before learning my FICO scores. Pardon my french, but oh my fucking gawd. Check it out:

I had forgotten how long ago I looked at my scores, so I was still going off the 2007 numbers. I wasn't expecting this kind of a jump so clearly I'm thrilled. I'm especially glad about this because if I have to move this year, these scores will improve my chances of getting the apartment of my choice.

I'll try not to knock myself over from patting myself on the shoulder, but yay me!

Coming Soon: My 2009 Goals!

My budget/goals is actually finished, however I still feel like I should tweek it somehow. I suppose it feels a unfinished to me because there are so many unknowns and "guesstimates" in it due to my dad's health, plans my mom has for the house, heck...I don't even know what my paychecks are looking like. At any rate, I'll have something for you to look at before the week ends.

Breaking Up Is Harder to Do After Housing Fall

The New York Times had an article on December 29 about how the current economic downturn is having an effect on divorces.

In a normal economy, couples typically build equity in their homes, then divide that equity in a divorce, either after selling the house or with one partner buying out the other’s share. But after the recent boom-and-bust cycle, more couples own houses that neither spouse can afford to maintain, and that they cannot sell for what they owe. For couples already under stress, the family home has become a toxic asset.
...

Dee Dee Tomasko, a nursing student and mother in suburban Cleveland, expected to leave her marriage with about $200,000 in starter money, primarily from the marital home, which was appraised at about $1 million in 2006. By the time of her divorce last year, however, the house was appraised at $800,000; her share of the equity came to about $105,000.

Though she is relieved to be out of the marriage, if she had known how little money she would get “I might have stuck with it a little more; I don’t know,” Ms. Tomasko said, adding, “Maybe it would’ve made me think a little harder.”

My BF had a similar situation. He was divorced in the Spring of 2008 and he ended up with the house for two reasons: First, his ex wanted to be bought out, and second he has a big dog which he believed would make it tough for him to find a rental. Also he just liked the house and wasn't so inclined to move. However he had to take out a large personal loan to buy her out of the house and settle their debts. I agree that the current housing crisis has created a different tone in divorces. Before couples used to fight over who kept the house, now they are fighting to not be left with it.