October Net Worth

Lil’ Sizzlers Portfolio:
Total Market Value: 1,061 (+71)
Total Divs: 32.81

Cash:
1,643+150+696 = 2,489 (-22)

Roth IRA Basis:
4,835 (+250)

Roth IRA Cap Gains/Divs:
-34 10/31 Gains (+216)
+46.21 2014 DRIP
Total: 12

401k:
My Contribution Basis: 1083
Company Match:  1083
Total: 2,166 (+364)

CC Cash Back:
14+20 Chase, 35 AmEx (Credits)

Motorcycle:
3,500

Car:
1,700

Personal Assets:
5000

Total Assets:
20,832 (+731)

“Liquid” Assets (cash, stock and retirement):
10,632 (+731)

Liabilities

Chase Freedom:
55 Payment Bal (-17)

Amercan Express:
412 (0% Interest)

Bank CC:
25

Student Loan:
Paid on loan: 200
Balance: 23,931 (-103)

Total Liablities:
24,423 (+292)

Net Worth:
-3,591 (+439)

Monthly Income: 2,531
Monthly Assets Change: +731
Monthly Liabilities Change: +292
Monthly Net Worth Change: +439
Monthly Savings Rate (IRA/401k+Match/Investments/Cash/StudenLoan): 36% or $931.

This month was decent!  Due to the 3 year anniversary with my girlfriend and a job change that required some shopping, I spent quite a bit more than usual this month (over $500).  I got my third credit card, an AmEx Blue.  They started me at a 5k line immediately, which almost doubled my available credit – nice!  I’ve not got $11,000 available credit.  Also, a recent check of the FICO credit score puts me at 763, while CreditKarma is reporting 750 and 743!  Looking good there.  I am excited to get my $250 cash back after a $1,000 spend on my AmEx as well.  The savings are real!

With the holidays coming up, the cash savings will probably continue to remain stagnant, but retirement and student loans keep the top priority and will not decline.  The current decline in student loan is due to putting half into an account for the girlfriend, who has an immediate college bill that wasn’t covered by financial aid.  All is well here!  Hopefully I’ll be another $1000 closer to that $0 net worth mark after the end of this month as well.

Advertisements

June Net Worth

Lil’ Sizzlers Portfolio:
Total Market Value: 1,065 (-17)
Total Divs: 23.93 (+12.15)

Cash:
1,466+177 = 1,643 (-311)

Roth IRA Basis:
3,976 (+139)

Roth IRA Cap Gains/Divs:
+30 6/30 Gains (-80)
+46.21 2014 DRIP
Total: 76

401k:
My Contribution Basis: 413
Company Match: 413
Total: 826 (+264)

CC Cash Back:
13 (-18)

Motorcycle:
3,500

Car:
1,700

Personal Assets:
5000 (+200)

Total Assets:
17,823 (+201)

“Liquid” Assets (cash, stock and retirement):
7,599 (-23)

Liabilities

Chase Freedom:
520 Payment Bal (Zero % APR) (-40)

Bank CC:
0 (-21)

Student Loan:
Paid on loan: 384
Balance: 24,972 (-195) – Must have miscalculated total at end of last month.  Should be closer to 300.

Total Liablities:
25,483 (-244)

Net Worth:
-7,660 (+445)

Monthly Income: 1,849
Monthly Assets Change: +201
Monthly Liabilities Change: -244
Monthly Net Worth Change: +445
Monthly Savings Rate (ret/inv/cash/loan): 26% or $489

Bah.  Not a pretty month this month.  Moved into a new place with my significant other, and ended up spending quite a bit of cash on things that we needed.  One trip alone was over $200, coupled with a few more trips here and there, really didn’t help my savings rate this month.  Lost a bunch of cash due to abnormal spending.  However, I did keep it above 15%, which is good.  Maintained the normal IRA, student loan and 401k rates, but the loss of over 300 in cash from last month is what really put a dent in an otherwise solid month.  I must have mistyped or did something wrong with the student loan total last month – putting in nearly $400 should not result in a $200 dent to the loan.  Should be back on track next month.  I am working a bit of overtime here and there to hopefully boost the cash influx by a few bucks.  Girlfriend and I are also using a new combined account for all major expenses, so I am losing more income than usual to that.  I pay about 60% and her 40%, due to me earning a higher income.  So my savings may go down a bit as it is from now on if I don’t work overtime or increase cash by other means.

How Did You Spend Your Tax Return?

Tax season can be a time of frustration or jubilation for many of us.  Getting shafted on your return and having to pay even more in to the system can obviously be painful.  On the flip-side, coming out on top and getting a swell return can cause elation for many.  So far, I have been one of the latter people, but as time goes on and my salary/income increases, that could change.

One thing that pains me is seeing folks get a solid tax return, and instantly scream, “I’m going to Disneyland!”  Or something of the like.  Many folks get a very nice first-time homebuyers credit.  Some of them put it towards their home.  Others may do less money-efficient things with it.  Getting a tax return is a fantastic way to give yourself a boost in net worth.  If you’re having trouble getting started with your financial journey, getting a solid return can help give you a kick-start.

It’s okay to reward yourself now and then.  Dropping your whole 1,500 tax return on rewarding yourself/family is not the financially ideal way of doing it.  The most important things to do are to: pay off existing debt, and get started with retirement/portfolio investment as early as possible to get those reinvestments rolling.

The past few years I was able to get very solid tax credits in relation to being a college student.  This past year, I was unable to get any of those credits due to graduating over a year ago, so I was just hoping to come out even and not have to pay in.  Turns out I was able to land a $1250 tax return!  The only credit received was a $200 credit for investing over a certain amount in my Roth IRA.  The funny thing about that was that I would have been ineligible if I had made over 30,000.  My documented income was 29,500!  I barely squeaked by, but was able to get a free $200 because of my retirement investment.

So, how did I decide to spend my tax return?  I will provide a breakdown of what I did and how much was allocated to it.

Initial Return: $1250
Step one: Pay $70 for tax service (TurboTax)
Step two: Roth IRA.  I invested $350 into my Roth IRA, which provides dividend and capital reinvestment anually.
Step three: Portfolio.  $350 went to a purchase of UHT, which provides a solid 4.47 dividend yield.
Step four: Credit card.  $200 went to credit card “debt”, which I was NOT losing money on due to 0% interest.  I decided to move my normal balance to 500 from 700.
Step five: Student loan.  $200 went to the current 6.55% student loan I’m paying off, on top of a regular $300 payment per month.
Step six: Profit!  I paid myself the remaining $80 to enjoy in whatever way I will.

Now, let’s see how much hypothetical money I made for myself over the next 10 years by reinvesting most of my tax return instead of taking a vacation with it.  Steps one, four and six are null because they have no financial implications (remember, my credit card is 0% interest and the balance will be paid in full when that time ends).
Step two: Using the Roth IRA Calculator at Bankrate.com, and using a 7% annual gain, my $350 would turn into $689!  That’s a 96% increase.
Step three: Using a DRIP calculator at hughcalc.org, I used a 5% annual gain and constant 4.47% div/yield for my UHT purchase.  My initial $350 purchase would become $865, a 147% increase.
Step five: My #6 student loan is sitting at 6.55% and I applied an additional $200 principal to the balance.  That saved me $131 in interest using a calculator at webmath.com.
Total hypothetical money saved/earned: 339+515+131=$985!  NICE!  I almost got my whole tax return back in compounded interest/reinvestment, and interest savings.  Not a bad way to spend my tax return.

Always think before you act.  Would you rather buy some fun material things or go on a vacation, or instead invest in your future and save yourself even more money with your free money from the IRS?  I would pick option number two every time!

Here are a few things that have helped me and others I know get a good tax return:
*Do your own research, and think before you just go to any random tax place.  I personally use TurboTax.  It’s cheap, user-friendly, and very thorough.
*Always exhaust your ability to get tax credits!  Even some “professionals” are unaware of college/other tax credits (I know someone who was told twice by a major tax business that they were ineligible for certain tax credits or that they didn’t exist – they went to a smaller business and found they were indeed eligible and they did exist).
*Claim the highest amount of taxes to be taken out of your paycheck.
*Invest in your future – tax credits are available for people investing in retirement & make less than 30,000/yr.  This was in my case being “Single” marital status.
*Pay off existing debt.  It’s always good for you, plus paying mortgage interest is a good way to get helpful deductions.
*Keep track of tax-return related expenses.  Per diem, work related costs, and other things help you get deductions.

I’m sure there are lots of other things, but those are ones that I have had experience with, or know of others who have.  If you have any valuable information to contribute, please feel free!  Also, how did you spend your 2015 tax return?  Did this post help you make any different decisions than what you normally would?  Let me know below!

Welcome.

Welcome to myself and anyone who may be reading… So, probably just myself.  I’ve never done this blogging business before so I will just wing it and hope for the best.  It’s a new thing to try and I’m hoping it provides additional motivation and helps keep me on track of my goals.  I also hope to connect with other people like myself who are starting from a limited amount of income and  are planning on maximizing it.  I’ll start off with a little about my main goals and how I plan to achieve them.  It is my wish to eventually achieve “financial freedom” through various avenues of investment.  My definition of financial freedom is being able to live a happy (not particularly celebrity rich status) life and not have to worry about spending the majority of my time at work 40+ hours per week, like many other folks do.  The avenues I have in mind are more traditional; things like long term stock & dividend investment, bonds, precious metals, retirement funds, real-estate and land investment.  Other possibilities include investing in businesses, starting small businesses, publishing books, and others.

This is something I have wanted to do for a long time and it’s time to get started as soon as I can.  I was about to get this going recently but I just found out I am losing my job (thanks John Deere) so it’s going on a temporary hold until I can get something straightened out.  I do have some student loans, and low credit card debt with ZERO APR (I pay in full every month, unless I have 0% APR).  Besides that, I am debt-free.  I had a Roth 401k going via Fidelity but I will no longer be able to contribute to that thanks to my job loss.  I am starting a Vanguard Roth IRA in the near future once I have a steady job.  I have a small portfolio that I started a while ago (literally, tiny) and will continue to expand upon when the time is right.  I also have an incredibly wealthy friend who is on my side, and has given me experience with stock trading and is there for knowledge.

A little about myself.  I’m a college grad with a Criminology Bachelor’s Degree.  My aspirations were to go into law enforcement, and still are, but I am open to all avenues that life has to offer.  Especially one that would help contribute the most to my investing goals.  My main goal right now is to look for a means to an end; that is, the best job for me that allows me to rake in as much dough as possible to build up for my future retirement.  I am an Eagle Scout and a small town kid.  I am a massive Green Bay Packers fan and even have a Green Bay tattoo.  I love shooting guns, playing computer/PS3 (Madden), and drawing.  At 23 years, I’ve had plenty of life experience but have an incredible amount to still learn.  I’ve got an insane attachment to my friends, close family members, and my girlfriend.  Before all else, including money, comes those folks.  Life would be useless without them.  And what better motivation to succeed in my goals than knowing if I do, more time can be spent with them and less slaving away at a job?  It doesn’t get much more inspiring than that.

Thanks for reading.  Stay tuned.