So perhaps being a Millionare is a matter of being Frugal.....gee, what a shock!

This is pretty funny......an article that describes the path to wealth as one where you "save" and basically spend less than you make.

Hmmm....this is what my parents said to me every single day of their life! What a shock.

All you had to do was talk to anyone who was the product of the great depression, and I suspect you heard the same tome. My parents didn't know anything about leveraged investments......or buying on margin......or any other fancy financing. (debt) In fact, what they knew about that sort of this is that THIS is the thing thta created the depression......investors buying stock on margin and not having the ability to cover what they owed!

So this Motley Fool article seems so funny to me....because they seem to think they have discovered some new truth.

Don't get me wrong.....I'm far from the perfect saver.....sure, I try to be frugal, but I'm not sure I match my mom and dad in so far as their saving and still being generous....but I can see that this "live within your means" stuff isn't some sort of new personal economics....it is back to the future stuff for sure! (lets hope we don't go all the way back by having a depression though)

Live and learn.......

Buy and Hold is my life.....readjust every so often......

GENERAL INVESTMENT APPROACH:
I would like to think that my investment approach is one of "buy and homework" (As Jim Cramer calls it).....but I think it is a bit easier to describe it as a more classic buy and hold.

Every quarter I look at my portfolio and see how it is doing. I do this against what I think the market is doing...and I look at particular items in the mix against each other.

I try not to chase maximum yields, but rather I try to see if the overall blend is performing OK. I tend to leave things along, and perhaps do a small level of "rebalancing" if things are a bit skewed.

But even here, this is normally a once a year activity.


HOW DO I SAVE?:
I do the same for saving...I don't think about it on a daily of weekly basis....I set-up a budget and and allow my savings to simply be an automatic part of my cash-flow. Then I just monitor the items of my budget on say a monthly basis to make sure I don't spend too much and unbalance the apple-cart.

When this works, savings just seems to happen automatically. I don't fret over it. It might not happen in the same level every week, but over the long term it works.

I sort of put it on autopilot.


CASH FLOW IS KING:
Ok...so if all this is automatic, how do I make it happen? What is it that I monitor and adjust?

How keep the whole system described above flowing.....in the black? How do I know my plans and budgets are going along as planned?

Well, I monitor cash flow fairly closely. I find this is the magic lever because that's the place where money is moved.....and is the place where the rubber meets the road. Once I get my weekly spending in line with my budget, I know I'm saving!

Surprised by a calculation and a few words on what money is to me

MY NET WORTH:
Last night I was facing down my two girl's college tuition bills and trying to figure out where exactly to take the money from.

I began my investigation by making a list of the various places we have money invested. (I'm a bit of a worry-wart, so I like to be pretty well diversified.)

So I made a list of both retirement and straight savings.....of money I have and money the girls have too.

My first observation was that I was surprised at the money we had saved. Well, not shocked....but it had grown to level that was slightly higher than I thought. Very close to a goal Cheryl and I had a while back......before the great stock market melt-down early this decade. But here it was, after losing about 25% back then. (and many lost much more.....but being a conservative investor, I don't chase risk....so I also don't make as much as I could either, but it's not about who dies with the most money anyways....right)

MOM AND DAD HELP THE GIRLS:
So after the pleasant net worth surprise, I also remembered some bonds that my mother and father had been buying for Kimberly and Kristen all those years.....earmarked for their education.

You see, over the years my mother bought them EE savings bonds with the idea that they would be used for their education. They were not very large denominations....mostly $25, $50 and a few $100.....but she would do that maybe twice a year...birthday and Christmas.

The idea was that it showed the girls that she was supporting our country and helping them save for college. (My parents were not at all wealthy, but were big into saving.....I believe they only had one credit card, from Sears, and that was just in case a home appliance failed and they needed to get one. They taught me to be a saver.....a cash buyer if you will)

Anyways.....over the years, these savings bonds added up....and over half of them have surpassed their face value. (ex: a $50 EE bond costs $25 to buy, but gets to $50 according to the rule of 72 "Doubling time" depending on the interest they pay....and they keep getting that interest for I think it is 30 years)

NOTE: To be fair....I always talk about my mother when I speak of money....she held the purse strings, but bothy my mom and dad were very good savers...and while my mom knew the value of a buck, I think my dad had a better handle on "the math" any how compound interest was your friend....if that makes sense.

My mother started this bond buying as soon as the girls were born. Kim has 31 bonds and Kristen 18. (It looks as though Kristen was short-changed, but she seems to have larger denomination bonds for some reason)

Kim currently has $12,767.56 and Kristen $10,346.66. (I knew my mother would NEVER have favored one over the other...and the totals show that.)

So why think of this at this point......Kimberly is a senior. This is her last year to use this money for school, and therefore get the interest tax-free. Kristen has three more years to user hers....and since she is planning to go on to a PhD, she has even more time.

WHAT IS MONEY FOR:
My parents were really the best......yes, I suppose I am biased, but I truly mean that. (yes, they were far from perfect....let me state that for the record...but who is anyways?)

My parents were product sof the great depression, and they started out very poor. Bother were not well educated, having dropped out of High School for different reasons (My mom to take care of her mother, and my father to go into the war) but they didn't have a hate or fear of money. (or education for that matter)

In fact, they really appreciated the value of both...and they also saw the negatives and pitfalls each offered too. To some, it doesn't seem as though money or education can have a negative side...but my parents felt that if you let money rule your life, you might never be happy.....and if you let education get you to think you were somehow better, superior or better than others.....you would suffer as well. (and not live up to your potential in terms of your value to society)

So they always taught me that money was a tool....a means, and in no way an end. We didn't work and save to amass money for power...or in any way for greed. If we saved, we did so for good, honest reasons.....and we saved money for a particular purpose.....not just for the sake of saving money.

Saving for a house was great.....we have to have a place to live, and owning a house brings a certain level of stability to life. Saving for education was great.....making ourselves better with knowledge would allow us to be more valuable to the world so we might be able to give back more. Saving money to help others in time of need was good as well.....to them it was ok for money to help with security......but not power and in no way was it the reason to save in and of itself. (saving for retirement was important to them because it allowed the parents to be self-sufficient and NOT become a burden on their kids.....who BTW, they felt had an obligation to help their parents.....so if the parents saved, they would be further helping their kids by NOT becoming a burden)

Bottom line is what my dad used to day all the time:

"Money doesn't make the world go around, but it sure greases the wheel."

It is important....it must be dealt with, perhaps even respected.....it is a tool, but it can not be the end in and of itself.

Layooff announcement makes me think about my budget

The recent annoucement of layoffs by Sun Microsystems has once again made me think a bit about my household budget.

It's not that my budget is out of control....on the contrary, it is running quite well. My cash outlay for my daughters school was never part of the regular monthly budget because it is just too much to be paid for that way. (We saved for it, so it sort of comes out of a pool of money set-aside for that)

But I should get "selected", it is not clear that the severance package will be very big, and I already know what unemployment pays. (eeek....time to go back to the Airport to suppliment my income?)

The good news is that it was only last night that I was called by a start-up company in North Carolina about a job there. Let me be perfectly clear though....I am NOT excited about going to North Carolina.....for many reasons! So even if I was laid off two minutes from now, I would not consider that kind of move. (too many reasons to want to stick around.....friends and family being the big things)

But I would have to look at money saving things.....perhaps taking the van off the road......changing my driving habits to go back to 40MPG in the Civic. Turning off the water heater every night. (OK, so that's a very small savings) You get the picture......

But let me reiterate.....I have no plans to get laid off. I'm not sure that my position at work makes me more or less likely, but at this point I refuse to worry about it since it is totally out of my control.

We actually have a fair bit of money saved, and I would go and talk to Larry about perhaps putting more of it into "more" risky investments in order to gain a bit more income......but I'm not crossing that bridge unless I have to.

In the mean time, I will continue to save and do my best at work.

College Tuition Time of Year again

Well, it is that time of year again......no, I'm not rushing it, I'm talking about August...the time college starts again after summer break.

But right now is when the thoughts of paying the bills come to mind. I received the $17,500 (or so) bill from Pratt and it is due by August 24th. I have not yet received the bill from the University of Tennessee (UTK), but I'm sure it is "in the mail".

In the long term, Cheryl and I had prepared to pay these by saving money, and I have that fact placed solidly in my head.....but still, when that bill shows up with all those zeros......it is a bit of a sticker shock.

I just don't have a checking or savings account with that kind of bread in it......so it's always an investment transfer, which sort of puts it all into perspective. I normally slap it down on my AMEX for a month so that I can use that time to transfer the money from a mutual fund. (and get the total costs figured so that I only do the transfer once)

This year has the added complication of Kristen transfering to UTK and Kimberly moving off-campus to an apartment. All of those costs are "new" and as of this moment, not fully understood. We had the loans and monthly payment plans figured out for Hofstra, and that is all up in the air for UTK as of now.

The other problem is that it looks as thought the loans taken while at Hofstra basically "come due" 6 months after she leaves the school because the loans appear to be connected to the school and not the student. (I guess this keeps people from going on and on as "professional students" and never paying off their loans) I have no clue as to how much those loans might be...I think they were small though....like $3500 per semester.

So writing this is probably less interesting for you the reader, but it helps me get my mind around the money that I will have to be paying out in the next month or two. At least it will
cause me to go and look at my investment accounts and get a mental sense of where I will have to "dip in" to get this money.

Education is a good investment......I know that, so I'm not in the least upset. Also, Cheryl and I had planned this pretty well, so other than a few small expenses we never thought of, everything has been OK to plan so far.

Of course.....how could I forget the "Garage Sale" Option?

I have a basement (and attic) full of "stuff" that really needs to be gone through and gotten rid of...and I have been doing this for several years...a little bit at a time.

Our only point of sale for these things has been the yearly Flea Market trip. We did this because the local Londonderry Gardens Flea market has a great deal where they give you your first sale day for FREE. (so long as you stay between the hours of 9:00am and 3:00pm)

The combination of weather and poor time management has not given me the opportunity to plan my trip to the flea market.....besides, I don't have my truck any longer so getting things over there will be harder in the van. (and it will probably take more than one session to sell all the stuff I have)

It just occured to me that I could put things out and have a yard sale (or garage sale...or tag sale if you are from the DC area)

This would be a weekend that I might allocate to staying home and doing yard work....I can set everything up in the morning, put out the signs and go about my daily work waiting for people to come and buy.

I normally sell things at crazy "this thing must go" prices....because I basically want to get rid of this stuff, but still feel it has value and would be a shame to throw away.

So I think the Yard sale is it.....now I just have to figure out how to set it up and advertise it properly.

NOTE: I will of course take photos and BLOG about my experiences!

Sears Scratch and Dent in Manchester

It struck me a couple of years ago that the "scratch and dent" sales business seems to have gone away.

There used to be a place in Salem NH that would sell all kinds of appliances with minor damage at fantastic savings.

We boug several appliances there and they were great. one of them was a refrigerator that had a scratch low on the left side....well, we happen to have the refrigerator agains the cabinets to the left...so viola, no problemo!

Ditto for a washer/dryer we bought once. Since they were hidden behind a set of accorrdian doors, we didn't care much that they had a scratch.

Well, there seems to be a place like this in Manchster NH. It is the Sears parts center, and they happen to sell slightly damaged and refurbished goods. Everything from gas grills to washer/dryers...TVs, refrigerators.....lots of things.

The prices seemed pretty good to me. The only thing I am thinking of is to replace our current electric stove with a gas stove. But I am not in any sort of rush.

Anyways, this store is up on Brown Ave...just past the airport on the left as you travel north.

They don't have everything all the time...as with any scratch and dent, things are hit or miss.

Check them out.

Zenni Optical Order is in.....NICE! (I like the results!)

I wrote a BLOG entry a couple of weeks ago (3/6/2007) about my going to Zenni Optical for some new Glasses.

Well, they came in...and I am very pleased.

I actually write about this in my Live Journal, so rather than cut and paste I would rather just link you over there! (it's all about linking...right :-)

I highly recommend low-cost eyeglass purchases on the net...and I recommend Zenni Optical.

Easy Saving - Dump Picking (Think of it as recycling)

My first thought is to recoil at the thought to admitting to the average person (you all reading) that I was having issues with my kitchen computer mouse and found a replacement at the "recycling table" at the dump.

Ok...so my town doesn't really have a dump. It is actually an incinerator....so there is no climbing over piles of trash to get these treasures.

No, we have a very clean and fairly orderly operation. In fact, we have these large tables that people drop things on. I think the idea is that these things are supposed to be functional, but there seem to be a number of people who don't seem to get that. So it is hit or miss when you pick something up.

Well, I have picked up much more interesting and expensive things for use. From monitors to FAX machines to laser printers. I have also dropped quite a few things off there too.

I guess this is the 21st century version of dump picking....and you know what, this is the way we should treat a lot of our things.

So many things get discarded before their life is through. Monitors being swapped for LCDs. Computers being discarded because of newer computers. All sorts of things like this all the time, yet there are often people who could benefit from the discarded unit who will never see them.

So today I not only saved myself 5 bucks, but I saved the fuel it would have taken to go to the store and the result of the high blood pressure I would have had trying to find a space! (just kidding)

Do the world a favor....go out and use recycled products....."Dump Pick Your Next Treasure!"

Tax time, no tax free EE Bonds for me and I'm looking for high interest safe place to park savings money...

IT IS TAX TIME:
I never look forward to tax time. We have actually gotten money back more years than not over the last 10, but I still have the thought of wondering.

Well, I am at that point now. All my paperwork is in to my accountant, and he is crunching away. I never took care of taxes before, being the more natural job of my wife. (who actually went to school for accounting but hated it and never held an accounting position)


Well, so far the accountant has only asked for clarification or more detail on three items, which I feel is a real victory for me. I figured I would leave out all sorts of things in this.

The only thing I am pretty sure I have not passed on was the information on the value of the 1993 Dodge Dakota that I donated to the American Heart Association. It was old, and in an accident...so it isn't worth very much.....and they have not given me a receipt as of yet, so I will have to make up some sort of reasonable value I guess.


NO TAX BREAK FOR SAVINGS BOND HOLDERS WHO MAKE TOO MUCH:
My mother had bought me and my kids savings bonds for Christmas presents over the years. The idea is that they would be used to pay for education, and they would be tax-free for that purpose.

Well, this is the case for my daughters bonds, but the bonds in Cheryl and my name are another story. I might be able to transfer them to my daughter, but if I cash them in and pay for their education, I would be subject to the salary means test, and I would fail it!

The cap for married people is $124,700...but this year as a widower, I am considered single and my limit is now $78,100. I'm out of luck in either case!


LOOKING FOR SAFE HIGH RATE SAVINGS OR CD:
Well, I think I have decided to just take the money to my credit union, www.usalliance.org. They have a special 15 month CD paying 5.45% (5.60% APY) and since I am a member there already, it is an easy thing to set-up. I just have to go into the branch which is not all that close to home. (bummer)

But right now I am letting the money sit in a checking account and pull in NOTHING for interest....that is a stupid move!

Great Money Discussions In The Least Expected Places

This afternoon I had to bring my van to get inspected and I brought it to a local mechanic that my family has been using here in Hudson since 1993. (When he opened)

He is a good mechanic, and honest guy, and I have had some good conversations with him in the past. (He used to be a Volvo Mechanic but opened his own shop...and I had a Volvo back then, but I now bring him anything from Jeeps to Honda Civics...but I digress)

So tonight when he sat down with me to get the inspection paperwork squared away, we started talking about the economy and I was surprised at all the ground we covered. Not that I didn't think he knew as much as he does, but in the more than 13 years I have known him, we have never talked about politics or money.

He is apparently a fairly liberal fellow, and I a conservative...and we actually agree on quite a few things. (which doesn't surprise me since some of my other liberal friends also have violent agreements with me too.)

Anyways, we started off by talking about some of our friends who were unemployed....the state of the economy, outsourcing, the housing bubble, the stock market melt-down in 2001, the current negative savings rate, medical outsourcing to India (which he had not heard of, but could see coming once I mentioned it).....

I admit to often being a "glass half-empty" person.....the Engineer in me is always looking for possible failure modes and looking for all possible recovery scenarios. He seems like a glass half-full guy, but he wasn't too positive about the trajectory our country is taking. (in his words, ever since Reagan)

Well, it is funny he picks that time-frame for his start of our countries woes, because it was about that time that our national savings rate began to take a nose dive from about 8%-10% to the current negative 1% savings rate. (he picked the date before I told him this statistic)

Anyways.....we sort of agreed that things would probably continue in the manner that they currently are.....in my words, like a frog sitting in a pan of water on the stove set at low...the water is getting so hot so slowly that the frog does not even notice that he is soon going to be dead from boiling water....the change is so slow he never sees it coming until it is too late.
(I think that this is what the world means when they talk about our having a "soft landing"....a soft crash landing)

We also agreed on two things.....those with money would probably fare better in the long run (so saving was important), and that slow and steady wins the race. The race for a fast buck puts you even more at risk should a downturn strike while you are exposed. (I have a brother in-law who can attest to that...and he owes so much I can't even fathom EVER being loaned that much....it absolutely shocked me!)

Why do people BLOG about money?

I suppose people BLOG about money for the same reasons people BLOG about other things.

Some want to pass on a particular talent they have to others. Some want to further focus their own goals and aims...so if they force themselves to BLOG about it, they will tend to keep their eyes on the ball better.

Writing a BLOG can also create a sense of peer pressure as well, and this can keep people on the straight and narrow.

Over a year ago I found a Podcast that is quite simple in nature. It is called the Money Blogger Podcast, and it is a very simple format......a very simple interview format.

I love it, and I love it because it basically askes very similar questions to a number of Persoanal Finance BLOGGERS and finance authors. I love it because while we can read explanations of these same questions on most of these people's BLOGs, being an audio format, this Podcast adds all the audio inflection you get when you get people talking about things that they have a passion for.

Many of the BLOGGERS interviewed are a part of the PFBLOG list of money Bloggers.

Some Personal Finance Bloggers focus on simplicity, some on reducing debt, and others about how to invest or even very specialized topics like currency trading.

Not all people are alike....and neither are Personal Finance BLOGGERS.

Back to long-term money thinking.....

I have started to come back around and think about the long term investment outlook a bit. I was talking to my financial advisor and he made a comment that perked my ears up.

He noted that the market was still going up. It initially perked my ears up because I had just decided to go from a 70%-30% equity to bond portfolio to a 50%-50% mix.

I perked up because I thought I was making a mistake, and I guess I looked worried to him because he instantly shot back and said "This is when I start to get worried about the market. When everyone in the world thinks it's hot is when I start to worry that it is at some sort of a top." (which made me feel better)

But let me not give you the wrong impression....I am not a market timer. At least not with the majority of our money. (I have a very small amount that I had initially had in Vonage stock that I have since moved into two Chinese telecom stocks....but even that money has been sitting there inactive.....and I have no idea how that is doing!)

I am certainly more of a buy-and-hold person. I think I made one rebalance in the portfolio in the past year....and I went from about 60%-40% up to the 70%-30% I mentioned above......and just a couple of weeks ago down.

I guess I have been a bit pessimistic for the past year, but the markets seem to continue to be fairly strong. (except the housing market that is)

So I'm starting to get re-energized about thinking long term again.

Here are a few online calculators to help you think about the long term affects of interest and money growth.

First, this one I find interesting because it lets me easily calculate what a million bucks in 1980 (when I graduated College and dreamed of such things) is today. (how much I need to have to have the buying power of a millinaire in 1980)

Then this Yahoo calculator lets me type in my current financial situation, play with projected interest and load rates, and calculate my worth in future years. (in net and constant value dollars) That is a lot of fun because it gets me charged about about saving and long term growth.

Of course, being the visual person that I am, I love to look at this online graphing program that lets me watch money growth of particular situations. You pick all ins and outs of your investment and expense money flow and it graphs the growth....albeit with a static year to year model. (such is life....no model is perfect)

So I guess I suggest that you start playing with these tools and put yourself in a mindset of Rip Van Winkle awakening from a nap in 10 or 20 years.....then put your investment on autopilot until then. (doing an analysis and perhaps rebalancing every 6 to 12 months)

Low savings rate for 2nd year......should we worry.....should we save?

I read an article in my local paper (here it is in another) that reports that in 2006, the personal savings rate was again negative. It was over twice as negative as it was in 2005......-1% vs -0.4%.

This is also only the second time there have been two years in a row of negative savings....can you believe it! Only the second.....but the worrysome thing is that the first time was back in 1932/1933....that's right, back in the great depression when there was a 25% unemployment rate.

What does all this mean? Should those of us who save worry? Should we stop savings for fear that money will ultimately become worthless, or should we instead make sure we have at least some of our investments in a place where they are at least inflation protected?

I like the latter case because I think that there will eventually be a time when the American Dollar might fall off it's high horse and we will have to have some sort of hedge against that.

Where should we hedge? You've got me....right now a dollar crash would affect everything.....so it would seem there would be very few places to hide....but as the dollar continues to soften, there will be places that become naturally strong.

Some thing the Euro will be it....who knows. Perhaps some other small currency we don't have our eyes on.

I'm going to continue to try and save....but not in my mattress, that's all!

Eating through my food stocks!

I have a food budget of about $40 per week in my spreadsheet. I have spent about $28 in the last two weeks.....that's total for the two weeks, and about $10.00 of that was to buy a 15 pound bag of rice! (so that will be lasting a lot longer for sure)

How can this be....and I starving?

Hardly...I have been eating like a horse. I simply decided that with one person in the house, there was no need for all the food we had squirreled away in the house.

So I have taken to making different soups, or other concoctions from the various canned and frozen foods. I haven't even dipped into the real basic things yet...and I actually have quite a few pickled things I have not even moved upstairs.

Ok...so the variety will soon begin to go away, and I'm about out of meat....so I know I'm going to be hitting the store sooner than later....but still, even so, I should be able to get away with just buying the things I need to "augment" the various staples I still have lining the shelves.

I guess I'm just a cheap guy at heart....but I'm still a cheap guy who likes to eat!

Hmmm....this guy got me thinking.....

I was looking at the finance bloggers for a bit this afternoon and I came across this guys post and it seemed pretty interesting to me.

It seemed interesting for several reasons. First, I am a cheapskate, and I actually enjoy saving money. I like being cleaver about things and cutting corners.

I also liked his thinking because I too have been trying to cut expenses....so I have been creating spreadsheet budgets and cuting back on things like cable TV and cell phones. (and food purchases and other things)

I also took to cooking more myself in an attempt to save money. I found that buying certain things that do not spoil in larger bulk and then using them as the center of a larger dish makes things cheaper. I just have to make sure I freeze or otherwise aportion out the resuting food properly or the spoilage costs will quickly outweigh the savings.

I have purchased things like dried beans in sizable bulk, as well as rice, nuts and even squash. (Which keeps well in the basement)

I have been making soups and all kinds of squash concoctions....it is surprising what a few onions, butter, a bit of olice oil, some garlic a bit if cheese and spices will do for just those basic ingredience.

Oh, and the other thing is that I am quite lucky to love eating about anything....so I'm easy to please.

Oh, and here are some sites that I might check out further to get myself started:

• Hillbilly Housewife
• Frugal Kitchen Site
• Here is a Frugal Cookbook from NewfoundlandLow-cost cooking with Sardines! (I love sardines, and have a few cans at home!)
• Retro Randy's Journal of Joy (low Cost Cooking Page)
• Miserly Mom Recipe Page #1 and Page #2

There may be some BLOG posts coming this way from me on this sort of thing.....we will see.

My new Budget

After a little bit of noodling and a lot of looking at past expenses, I came up with what I think is a budget reduction plan that will allow me to keep my current level of 401k saving and still allow me to no spend more than I take in.

Why do I think it is important to keep my 401k savings rate where it is....especially since it is only me, and I should be able to retire on "less" than me and my wife....

Well, I figure I want to make sure I stay out of my kids pockets when I get older. I don't want to be a drag on them financially. Cheryl and I didn't come this far so that I could screw it up now! :-)

Also, if I happen to pass on before I spend it all down, then it goes to the girls, which would be fine with me too. (trust me, it's never going to be the Bill Gates fortune....they have never had silver spoons anywhere near their mouth, and any money they get from me will never make that happen either)

Up until now I have not given out any specifics on my budget situation. I guess I'm still thinking about how far to exactly go, but I guess I will wade in a little with some expense numbers. (at least those I am going to change)

I'll start by note that our house income has recently dropped by a bit over 25%. That is a fairly sharp decrease, but we are lucky enough to not be in massive debt. This means that quite a bit of our expenses are discretionary.

It turns out I am currently about $227 per month ($2723 per year) in the hole at my current spending rate. So I wanted to come up with savings that would balance that and give me a slight savings every month.

I decided on the following:

1) Cut out Vonage and move my home number to my Cell Phone: With my kids off at college, I am the only one home and so I can use my cell phone and perhaps get Skype Out for home outbound calling. (only $15 per year vs $20 per month) That is a savings of $18.75 per month.

2) Cut out all cable except for Internet access: Again, being the only one in the house, and NEVER watching TV, I am fine with this. This will lower the bill from about $89 per month to about $40 per month for a savings of $42 per month, or $504 per year.

3) Drive for better mileage: Ok, so this seems like a stretch, but I literally drive to work at 80MPH or above...and I get about30MPG in a Civic. When I was breaking in the car, I was driving it like it was fine crystal and getting about 42MPG, so I think I can gain something by driving in between those two. I did my estimates on a 9% fuel economy increase, which I think is possible. I happen to drive about 70 miles per day, so it adds up...and to the tune of about $14.61 a month for about $175 savings per year!

4) Decrease my food costs: We spent about $100 a week, and I figure that being me along, I can cut that to $60. Not only am I eating for one alone, but I also intend to cook more simple things with more inexpensive items. Stir fries, rice, etc....able to be eaten over days and taken in for lunch. This will save about $172 per month, or a bit over $2060 per year savings.

5) Take a car off the road: I currently have 4 vehicles on the road right now. I have a 2005 Civic, a 1990 Honda Odyssey, a 1998 Jeep Cherokee and a 2005 Kymco Scooter. I am going to take the van off the road. Taking this car off the road will save $4.17 per month or $50 per year. NOTE: As an aside, I am going to sell the Van and my 1999 VW Beetle that sits off to the side waiting a driver. Those sales are not really a cash flow move, but will get rid of a couple of idle vehicles and perhaps add a couple of bucks to the checking account.

6) Taking the Van off the road will also save me insurance money. This means a savings of about $29 per month ($348 per year). I also suspect that with one less driver, the total rate may also go down a bit too...but I have not estimated this at all.

My final savings total per month is $271, which means I end up with my saving about $3256 a year.

NOTE: It was noted that I made a serious mistake typing this in so late and tired.....having made a ton of typo mistakes. (I did my budget spreadsheet in terms of a monthly budget, and really botched things going to years here)

Anyways...in looking back over my spreadsheet, I find that I have forgotten two fairly major expenses.....one being church donations and the second some money I transfer to my daughters every month. This results in a spreadsheet change of about $300 per month, so I am not again about $163 per month in the red.....so I need to sharpen my pencil a bit more!

Yes, I know I didn't give you all the numbers.....and I know that my savings doesn't really come up to the level of my wife's salary, but that is the best I can do without doing a total zero based budget. I will be doing that over time as I get my own payment history documented.

So back to the calculator for me....but not right now!

I hope to keep you updated on my experiences in 'Saving'.

Oh, BTW...being the Engineer that I am, I have been thinking about how I was going to track and follow all my spending activity, and I have been considering Quicken, Microsoft Money, etc.... I think I might play with quicken, but I think the most straight forward system is a manual one that my mother in-law described to me. It has the benefit of not only being simple, but it also will leave a much better "paper trail" for anyone coming along when I pass on...so they can better pick up the pieces.

My wife did a very good job of this with a fairly manual system she used....and the only things I have screwed up on (mostly double paying) are the two or three items she took care of online of with auto payment from checking!

My next post will probably be about an "issue" I have just had with Mastercard. (and I'll be looking for suggestions on another card....NOT Mastercard and NOT Citibank...but more on that later)

Change in financial focus

I have not given this much more than a short thought in the shower this morning, but I think I will BLOG about it since this is how I tend to get clarity of some ideas.

My personal finance thoughts in the shower revolve around my wife Cheryl's passing and how I am going to think about our savings. (both retirement and otherwise)

We had always thought of these savings as having two or perhaps components to them. The first component is more of a short term component where we had always planned to make sure our daughters had their college schooling paid for. We have two daughters, and we have squirreled away a bit of money for that purpose. (and are also relying on a reasonable level of return on the whole nut as well as continued contributions in savings in order to fund the costs)

The second component of our nest egg was the money we needed to ultimately retire and maintain some sort of standard of living. Once again, we were pretty well on our way to getting that saved, but certainly could not there yet. Again, we had plans to continue our savings regiment, and baring any sickness or loss of job, the trajectory of this portion of our savings was going along OK as well. The savings held in our home equity was a bit piece of this, as well as most of our 401K money.

The third component of our plans revolved around money we wanted to save in order to do more traveling in our retirement. Nothing fancy, mostly around our own country and perhaps a few other interesting places in the world....but this was sort of going to come from money that came above and beyond the second net egg component above. Neither of us had champagne tastes, so we would be doing all this on the cheap....but still, we had plans to do a lot more slow, sight seeing kind of travel.

My thoughts this morning have changed quite dramatically. I guess not having my wife here makes me consider my priorities.....well, not so much my priorities, but the goal of each. You see, I still keep as my priority the idea that our kids need an education. But having lowered my need to travel, I think I would like to try and see if they are interested in as much education as possible. My daughter Kristen is already talking about a PhD in Archeology, but I think I will try to figure out how I can ore properly support that. I am not sure what Kim's ongoing education plans are, but I guess I need to talk to her. (and soon since she is a Junior now)

In terms of travel, I will still travel at some point. But my idea of fun is loading up a van with a sleeping bag and camping across the country, seeing the local sights and sounds. (It sort of comes from the stories of my Uncle Joe who was the Merchant Seaman, and who was a very free spirited soul who loved to travel simple and light.....all he seemed to NEED was a guitar and a local bar to drink and play in.....I can't play guitar, and don't drink...so my traveling will be different for sure)

We currently work with a financial planner, and one of the things we have worked on is making sure he understands our risk tolerance and our financial goals. I think I described our previous goals pretty clearly above.....but I admit that I still need to formulate and solidify my future goals....well, in the future. (the near future)

So perhaps later this quarter, perhaps in spring, I will be going off to see Larry to get my finances perhaps heading in another direction. Sort of like my traveling plans in the future, I am not quite sure where my mind will lead me on this journey....but like the name of my BLOG, I am the conservative type, so I will almost certainly "Measure Twice and cut Once."

Happy New Year to All!

Decisions, Decisions.....leave my reliable Vonage to save money with Skype?

What to do...what to do?

I am a very happy Vonage customer of about 9 months or so, and the cost of Vonage actually lowered our phone bill in half or MORE. (and gave us a much better calling area all at the same time)

You see we have cell phones, so we took our long distance phone service off our phone. With long distance, our phone was running about $100 per month. When we took the long distance company off...it went down to about $50 per month.

When we went to Vonage, I believe the fee went to $24.95 per month and this included unlimited local and long distance calling! (after all the government taxes and fees, I think we are looking at about $29 per month)

So my first thought is to drop down to the 500 minute a month plan which drops the cost to $14.95 per month.....but then this Skype plan shows up which blows that right out of the water.

Yes, the $14.95 per YEAR Skype plan is only a first year offer.....and only good until January 31st...but then it only goes up to $29.95 per year....still a huge savings!

I have used Skype from my computer and spoken to people all around the world...and there have been times when it was a bit choppy, but I would say that it has been perfect about 90% of the time. (Vonage has been perfect just about every time.....no issues)

Yes, it means investing in new hardware to route the Skype packets. (I don't think the Vonage router is going to be configurable....I am not sure) The cost benefit analysis should be quite simple. I will be paying about $1.25 per month for Skype vs say $14.95 per month if I cut back to the 500 minute Vonage plan. If the hardware required for the Skype upgrade costs $250, the $13.70 per month saving will pay for the hardware in 18 months. (about 9 months if I compare Skype to my current $24.95 per month plan)

I guess it is not rocket science. I actually think I might just go for the less expensive Vonage plan..unless I can score the Skype router hardware for less. (which I think is possible) At that point, Skype sounds like the way to go!

Anyone out there have Skype experience...more than me? What do you think?

I love my Chinese MP4 Player (ChiPod)

Why is this a Personal Finance Question? Because I think I saved a lot of money buying a ChiPOD instead of an Apple iPod. (What's a ChiPOD you ask?? I did NOT coin the phrase, I found it called this on this unofficial support website.)

I'll note right up front that these MP3/MP4 players are NOT for everyone, but as a daily listeners of Podcasts and music on occasions, I find the unit I bought on EBay to fit my needs perfectly.

I have never had an iPod, but my daughter had one and I had a Creative Zen. Both were great, but they had one feature I never want to see in an MP3 player again...that has a disk drive.

I don't remember dropping my Zen, but the drive died about a year into owning it. Not only that, it was kind of large.

When I went out searching for another MP3 player, I decided to try one of the "inexpensive" Chinese non-name brand MP3 players that you can buy on EBay. I bid on it on Thanksgiving day as I felt I would get the fewest people competing with me....and sure enough, I had my 4GB FLASH based MP3 player for less than $60. (shipping included)

So I have had it now for a couple of weeks, and I have to day I love it. First of all, it is so tiny it fits easily in my shirt pocket. The battery life is just great, and it is as easy to use as a USB based storage device....it simply looks like a disk!

I mainly listen to Podcasts, and I just drag those on and off every morning. This player actually does play video and show photos, but you have to run a conversion program to turn normal video files into files that will play on the small screen. I have tried it with a few video podcasts, and it works great. (but I use it mainly in the car, and watching video while driving is more than a bit dangerous! :-)

The only huge negative I have is that the CD that came with the device (the one with the conversion programs on it) also came with a Trojan Virus in one of the files. When I asked the seller, they simply said "Oh yea, several other customers who bought one also complained of the same thing." He then pointed me off to a website for sort of "unofficial support" and drivers.

The player not only plays video and shows photos, but it has an FM tuner that works very well, and a microphone so you can record sounds / voice. It even has a small speaker that you can play through....and it works well in a quiet room.

I don't think you can beat the features for the price. Heck, the 4GM of memory is worth the $60 even if only to use it as a thumb drive.

Take a look on EBay....you might find one of these as a good inexpensive alternative to an iPod. (Watch out Apple!)

PS: If this isn't interesting enough, check out the Dick Tracy MP4 Video watch!