Here are our budget results for August:
Gas - We ended up not spending that much on gas this month, I think it just balanced out with going over on gas in July. The high prices haven’t really affected us since we don’t drive all that much.
Dining Out - We are getting used to eating out less and cooking more. It is making me dine out more consciously so I can still try all the new restaurants that we want.
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Being Poor. Lots of buzz around it, hundreds of comments too.
One line that struck me was:
Being poor is knowing your kid goes to friends’ houses but never has friends over to yours.
I don’t feel I’ve ever been poor at all, but I used to not invite my friends over because I was ashamed to show them our family’s small 2 bedroom apartment (which was smaller than the apartment my wife and I currently live in together alone), while they lived in big nice houses. I wonder if my parents ever knew. I hope not, they’ve provided me with more than I could ever ask for.
Anyways, read the post and the interesting comments too. Don’t miss the last line of the post.
Update: More comments here.
* Found via a commenter, Kyle Welsh’s blog. Thanks Kyle!
I wish the real carnival came to town this often too… but the next best thing, this week’s Carnival of Personal Finance and Carnival of the Capitalists are up. Is it just me or does every time I read “carnival” I think “funnel cake”? Maybe it’s just my diet talking.
I just realized I didn’t set myself a monthly goal for August. My last monthly goal was for July for setting up a budget, which I did. Looking over August, I guess an appropriate goal was to decide on how to handle my 401k rollover, and execute it, which I did. I need to get back on track for September.
Hmm.. future goals… I’m satisfied with the way my retirement investments are set up right now… one focus will be on maximizing the return on my cash without adding too much risk as my time horizon is about 18 months. Also, I am investing time into learning more about the mechanics of real estate investing… as well as learning more about stocks and bonds like options and such. So many things out there to learn.
HSBC Bank has had their no minimum, no fees Online Savings Account around for a while now, but this is the first time they have offered a better rate than ING, VirtualBank, or Emigrant Direct. I don’t have an account there, but it does have some nice features:
Short answer: No, not really, unless you are talking amounts over six figures.
I’ve seen so many people get hung up on this, I think it deserves a post. The easiest way to explain it is with an example. Let’s say ‘DaBank’ compounds interest daily on their accounts, and ‘MoBank’ compounds interest monthly. Let’s say you have a $10,000, 1-Year CD with both of them at the same 5% APR interest rate, and compare how much interest you have at the end of the year. Both credit interest monthly.
MoBank:
Since MoBank compounds monthly, you are getting 5%/12 = .4166% every month. So, at the end of the first month, you will have 10,000 x 1.004166 = $10041.67. During the second month, you will be earning .4166% on $10041.67, not just $10,000. So at the end of the 2nd month you’ll have $10083.51, not $10083.34. This goes on for twelve months:
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First, I’d just like to say just because I’m talking about a certain stock or bond doesn’t mean I’m recommending it or going to go out and buy tomorrow. I love learning about new areas of investing, and right now my focus is on increasing the yield on my cash funds for short-term time horizons. Accordingly, I’ve been reading the articles I mentioned in my previous post on ING Prime Rate Trust. First let’s break this down a bit to my level of understanding.
What’s going on? Corporations need money for their operations. Each corporation is given a credit rating by a company like Moody’s, sort of like the Equifax for businesses, as to how credit-worthy they are. Obviously, the higher the risk for default, the higher the interest rates they are charged. Banks loan money to these corporations, and one type of loan is called a floating-rate loan, in which the rate adjusts like an adjustable rate mortage with an index rate, like the LIBOR. Then loan-participation funds like ING Prime Rate Trust (PPR) invest in a diversified portfolio of these loans, focusing on those with less than investment-grade credit ratings.
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I’m burned out on personal finance books, so I’m excited that I finally got my copy of Modern Real Estate Practice. I bought it for $5 including shipping from Half.com, but it is the older 1999 edition. (Is it me, or is Media Mail getting slower by the week?) This book “has trained more real estate professionals than any other book”. Every real estate agent has heard of this book, and every person I’ve spoke to recommends it as a reference. I suppose I’m giving up some updated information going with an older version, but I’m sure most things haven’t changed.
My goals with this are to prepare for getting a house in the next couple of years, and also to use it to analyze potential investment rental houses now. The books includes sections on real estate law, how agents work, and many of the little things involved in buying property. I’ll post more once I actually start reading it.
I was catching up with my magazine reading when I came across this article in the August 2005 issue of Kiplinger’s Personal Finance* - ‘Big Yields, Not-so-big Risks‘. It introduced me to these closed-end loan funds, that trade like stocks, which invest in low-grade bank loans and produce dividend yields of about 6%. Let’s focus one of their examples, ING Prime Cap Trust (symbol: PPR). This fund caught my eye for obvious reasons.
It currently offers a yield of 6.60%, and is actually trading below it’s Net Asset Value. It has a really high annual expense ratio of 3.17%, but that seems to be the norm for these types of funds. What I really need to gauge is how much risk I am taking on for that appetizing extra yield.
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I finally managed to put up a new site layout, to look more like my other blog, MyHealthBlog. The redesign was inspired by the clean 3-column formats of such blogs as LifeHacker, Blog Herald, The Daily Bite, and Jalopnik. Yes, it is 5am, and yes, I have been up since 8am. I’m not so slick with the html. Due to that and my overall weariness, please let me know if I broke something!
If you have a Citibank or Chase credit card, you’ve probably gotten one of these checks in the mail like I just did:
It sounds too good to be true, someone just sent you a $20 check for trying out some insurance? Sure! You know these people are just hoping you forget and start paying these random fees for who knows how long. I’m very paranoid about these things, but I also love free money. I’ve definitely cleared more than $100 on these checks. So here’s my standard procedure when I get one of these things to minimize time and worry.
1. I only do this for cards that have no balance and are in my safebox. This way, I know if I get a bill there’s something up. You don’t have to search for a random charge hidden in your purchases.
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My have I been out of the loop. The damage done by Hurricane Katrina is much worse than I had thought. I don’t like to preach, so here are some links to learn more if you wish:
- FreeMoneyFinance is matching donations up to $1,000. You can donate anywhere you’d like, just e-mail him where and how much.
- If you are a blogger, you can join the Hurricane Katrina: Blog for Relief Day. If not, try the Katrina Help Wiki.
- My charity of choice is ModestNeeds.org.
