Emergency Funds are not Fun...but they're important!

It seems like every time I get close to reaching my goal of 5k, something happens and I get thrown back a bit. This time around my emergency fund got frozen* inside my HELOC, basically leaving me with zero now.

Since it was used to pay part of the 2nd mortgage (the heloc), it's not like i really "lost" the money, but I still can't tap it in case of an emergency. In reality, an emergency wiped out my emergency fund!

There IS a lesson to be learned here: Emergency Funds should be totally liquid, and accessible 24/7!

Lucky for me i'm a pretty positive guy, so as frustrating as it is, at least i am learning something :) There's also something to be said from starting with a clean slate. Before this happened, I had accumulated $4,800, but slowly kept chipping away at it until it reached around $3,000. Then I had my "aha!" moment and started adding back to it. At this point, however, I kept thinking i was down 2k and couldn't feel content until i was back at 5k. Thus, every time i added $ into it I couldn't feel at all happy about it as I was just making up for it.

This time around, however, I will leave it alone 100% and watch it grow. So each time I add a little into it, I'll be proud every time knowing that i'm that much closer to reaching my goal. Now I'll be saving up, instead of catching up.

• This year's goal: To reach $5,250 (yahoo!) I'm fairly confident i can make this happen.
  
• My ultimate goal: To reach $10,500, which is what i'd need to survive for 3 months. (scary huh? I am working on lowering this, believe me.)

You can track my progress on the status bars to the right which i update monthly. Let's hope i keep pumping it up and reach my goal! Lord knows it won't be easy...

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*To read more on our heloc freezing up, read my operation heloc: the bad :( posting.
*To read more on why helocs freeze up to begin with, as well as some awesome commentary from users and how it affected them, read this article from The North County Times.

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Checking in on the old New Year's resolutions.

Could it be that i've actually STUCK by them this year? I was thinking about this as i drifted off to sleep last night (pretty dorky, i know) and thought it would be cool to post them here and make sure all is still dandy. And after looking at them for a few seconds, it's actually pretty damn funny cuz all of this was BEFORE this blog was even created :)

I guess it goes to show that if you write them down somewhere, you'll get closer to accomplishing them. Or perhaps even just setting realistic goals, and those that you're actually INTERESTED in! Either way, I'm happy to report that I have broken a 27 year losing streak:

My 2008 New Year's Resolutions:

1) Start using a budget (a what?). A+
Boyyyyy, this was def. the old me! Can you believe i never even USED a budget? haha... good thing i'm still going strong with this blog. Would be pretty embarrassing if i DIDN'T use a budget considering the name and all ;) Budgeting has seriously kept me on track so far - esp. on those days when I wanna splurge a little.

2) Learn more about finances; stocks, mutual funds, reits, etc. B+
Oh yeah, definitely still on track with this one too. While i'm still pretty far away from being an expert, i'm at least starting to pick up on the terms and the main benefits of one category over another. With the only exception of the "reits". I know they have to do with real estate and all, but that's about it. I saw that term in some book i was reading ;)

3) Learn more about web design. A
For sure! Getting this blog up and running was a def. push into it that i needed. While I've always known the basic fundamentals of designing for the web, I hadn't really expanded my knowledge until this guy was up. I'd like to wrap my head around CSS and SEO (Search Engine Optimization) a bit more though, so that's next on the list to do.

4) And finally, read more....helps 2 & 3 out, eh? A+
This has been my biggest obstacle, but i'm proud to say i've been kicking it's a$$ since January! haha... And by "kicking it's a$$" i mean by reading books like a normal person ;) I say that because i usually HATE reading, and thus never used to do it. This year, however, i've learned that choosing the right books makes a world of difference. As of date, i've finished 3 finance books - The Millionaire Next Door (review coming soon), The Automatic Millionaire, and A Million Bucks by 30, and continue to read the following magazines monthly: Money, Smart Money, and Kiplinger's Personal Finance.

And they say people with A.D.D. can't keep goals ;) It has been a remarkable year so far, and I'd like to thank some final people before I retreat to the office for some actual "work-work". As much as I'd like to say i'm THE MAN here, i cannot take full credit. (cue the tears)

First, I'd like to give a BIG thanks to Mrs. Budgetsaresexy. Your frugalness is far sexier than you will ever know, and I heart you like woah!
Secondly, I'd like to thank all of YOU guys here in Blogtopia. Without you, I'd be a goner :)
And lastly, I'd like to thank the Academy...i don't know why.

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2008 Net Worth Goal: $100,000

I have to say it feels really good getting all this stuff out there. I've always known I had money saved in different places here and there, but up to 3 months ago I had never put it all together and focused on any type of real "net worth".

I suggest conjuring one up yourself if you haven't already, it's quite empowering!

So, now that i'm done patting myself on the back (you have to right?), here it is - my official net worth as of the end of January. I'm sure my format and calculations will change over time, but as it stands today this a great measurement of my overall financial picture. Daddy's proud, daddy's proud.

Now that I have it organized, I am ready to begin this year's net worth goal - to reach $100,000 by the end of December! I can't believe i'm actually setting something so high (cuz my GOODNESS that's a lot of money), but you know what? Sometimes you gotta just do it like Nike. I mean I'm young, nubile, and by golly it's time to make something of myself! haha... W-O-W, talk about some motivation.

Moving along, here's what we got:

Cash Savings: I'm hoping to add an additional $1,530.97 to reach my goal $5,250. Once this is accomplished, I will leave it alone 100% as it will act as my Emergency Fund.

Roth IRA: As of today, I am not planning on adding any more funds to this *unless* I end up with extra money after my cash savings goal. In this case, I would def. add it into my Roth.

401k: My favorite category of all time :) What's not to love about company matches, direct deposits, and tax benefits? If all goes as planned, this will be my 3rd year of maxing out my 401k! I have been more than blessed w/ generous company matches, so it would be absolutely asinine not to participate. I expect this category to go up at least $2,375 each month, markets willing.

If there was just one piece of financial advise I would give anyone, it would be to put in AT LEAST (very important) the same % as your company matches. This means from the start you are D-O-U-B-L-I-N-G your return from day 1. Now, i'm not a financial pro or CPA by any means, but with the good graces of the stock market, this $ should increase fruitfully until the day comes for retirement. Of course if you could add in more each paycheck, more power to you.

Condo Investment: I am helping my brother out with a personal loan, which will help him with his new condo purchase. I give him $123 a month, and the interest is locked at 5%. Either of us can bail out at any time if needed, and it's written in a simple contract just in case (this was forced by my dad, and I'm thinking rightfully so). Initially I thought of loaning the money interest-free (since it IS a family member), but I wanted him to think of it as a real loan and that it will need to be payed back at a later date. Unfort. i'm not in the position to say, "ahh, just forget about it bro". Well, not yet anyways :) I expect this category to go up $1,353 by year's end, and put this into the Assets category as I count it as an investment.

Home Equity: This is the difference between the price we PAID for our house, and the MORTGAGES left on them. Actually, it's 1/2 of the total equity as I'm only including my portion, not my fiancée's yet until we're married. I'm also heavily thinking of taking this out as housing prices are fluctuating like crazy these days. Plus since houses actually sell for what someone's willing to pay for it, who knows what the sales price will be by that point.

Auto Worth (kbb): This is the value the Kelly Blue Book puts on my car at the time I pull it. Normally I wouldn't put this here, but i need to help balance my car loan w/ something right? This category will def. go down each month...

Credit Cards: For net worth accounting, this includes my personal credit card + 1/2 of all outstanding store credit cards. All cards are either paid off in full each month, or at 0% financing. I am hoping we don't add a lot more because of our upcoming wedding! The current plan is to have all cards wiped out to $0.00 by year's end.

Auto Loan: My auto loan :) My plan is to sell my current car, however, and pick up an oldie but goody. This should def. help out the numbers.

So there we have it - my 2008 Net Worth goal. It suuuure looks sweet, now let's see if I can make it a reality!

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Our store credit cards are back

UPDATE: As of 6/23/08 - NO MORE DEBT!
*For details on how i pulled it off, check out my Zero Credit Card Debt post :)
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I've had zero store credit cards for years, but lately we've been picking up a few. I guess it can't be that bad as they're all at 0% APR right? Another thing to keep in mind is that Mrs. Budgetsaresexy will pay for her half of all this ;)

Here's what we got:

1) Helzberg Diamonds - $1049.96: Picked up 2 Wedding rings. The sucky part is that i literally JUST paid of my fiancee's engagement ring (whew). Ah well, that's life eh? The prices were great though, and the credit deal even better - 0% APR for 1 year. The goal here is to pay off just enough each month so that at the end of the road we get the balance knocked off.

2) Juniper - $1530.16: Our brand new iMac! It's so H-O-T. Got the upgraded memory, and nice sized screen, + a free printer. We didn't *need* this per se, but it def. helps having a home computer now that's brand new and fresh. I'm a graphic designer and my girl's a song writer/singer, so this should def. help motivate both of us. This will also be our last major purchase now that we have our finances in order, as well as a house for that matter. yikes.

3) Express - $93.33: This one is temporary as they were having a helluva deal man. First off, everything i bought was 60% off original prices. THEN, on top of that, there was an extra 10% off for some reason, and then ANOTHER (can you believe it?) 20% if you signed up for a card. Soooo, here we are ... 3 T-shirts, 2 hoodie sweatshirts, a pair of jeans, and a pair of socks later :) *This will be paid off by the end of the month, and then closed out 100%. no tempty tempty for me.

4) NEW! "House Credit Card" - $4180.10: This is at 5%, not the worst, but still not at 0%. There was no way around this bad boy though, our wedding budget got a bit crazy and the cash flow couldn't be timed right - thus, forcing us to throw some huge chunks of it on here. This will be the 1st to be paid off after our wedding

TOTAL: $2,673.45 $6853.65 $0.00

My goal is to have this paid off by end of 2008. I'd normally pay off first, but since it's at 0% and Operation Heloc has since been stomped out, I gotta breathe life back into my Emergency Savings stat.

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32 more days to not ____.

It's Lent season which means .... it's time to give something up! It actually started last Wednesday, but I didn't have my blog up then so let's must pretend we're back in time a bit shall we? And for those who aren't familiar with Lent, it's basically the 40 day time period before Easter where it's customary to "fast" or what i used to call "give up something small that's not hard to do but you'll technically be in the right!" haha ... that was the old me though. These days I like to play by the rules, both for the church AND for the personal challenge :) And I gotta say, it's definitely rewarding.

LAST YEAR I gave up all Sodas! can you believe that?? AND not only did I last the entire 40 days, i went another 3 or so months after w/out fail. After a while it was really easy and I actually didn't mind at all as my body felt great. I was about to extend the goal to a year, but realized I needed to stop making these random challenges just for the hell of it*, and have since limited myself to drinking it on the weekends only.

THIS YEAR I wanted to do something more financially friendly and decided to put myself to the ultimate challenge: NO BUYING RANDOM CRAP. Also known as "discretionary income". This is *huge* for me as I am the king of all kings on thrift store shopping, Craigslist purchasing, and eBay bidding! Not to mention the weekly shopping trips to Express, Rugged Wearhouse, and Ta Ta Ta TJ MAX. I'm one of those people who shop when their sad/happy/energized/or just plain b-o-r-e-d. And no i'm not a girl (but i do love girls! errr ... my fiancée. I love you honey!) I'm also one of those people marketers love as i am attracted to all things blingy and packaged nice.

I guess I should also clarify those things i'm allowed to spend on, especially so I won't try and wiggle my way out of it in the future.

Things allowed: Mortgages, Utilities, Bills, Food, and anything that improves my wealth or brain (such as mutual funds, finance books, magazines, etc).

Things NOT allowed: Gadgets, Lottery Tickets, Artwork, Decorations (why am i capitalizing all these?), furniture, track jackets as i have wayyyyy too many, t-shirts, and anything on Woot.com, sellout.woot.com, or shirt.woot.com which will be extremely hard!

Okay, that about wraps it up. So far i haven't spent a penny on any of these and my spirits are still high. I think this is exactly what i needed to re-organize my finances and get my budget back on track and alive. Funny enough, i also have wayyyyyy more time on my hands.

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*Once on a flight to Greece a few years back I watched "Supersize Me" and decided to see how long i can go w/out eating McDonalds, my FAV. place at the time...to this day i STILL haven't touched a thing from there! Sure I've been to Wendys a few hundred times, but i still feed like The Man :) As of today it's been 1193 days and my record continues to grow...but who's counting?

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