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User 7415181's  Instablog

User 7415181
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I used to frequently write an instablog on my investments, but have realized I was doing things backwards and am currently focusing on paying down as much debt as humanly possible over the next couple of years (it can be done in a year and a half) and that's kind of boring to write or read... More
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User 7 blah blah's instablog.
  • Okay, Defined General Strategy And Current Budget 0 comments
    Jun 21, 2013 2:15 PM

    I bought an old car yesterday and simulataneously traded in my older, much junkier one. I had my mechanic check it out this morning - no repairs recommended - "Awesome car! You can tell it was well maintained". Creepy thing was that while looking in the glove box this morning checking for service records, I found the death certificate of the previous owner and some tax documents. I guess I'll look through them and see if there's a name to mail them to. Guess I finally got the proverbial "only driven on Sundays" car.

    I paid cash for it. Woman did not budget her paycheck this week - I was only to pay off 95% of the credit card since she needed gas. I at this point have $1300 in the savings account and the same invested in the taxable account.

    So the current state of affairs and goals:

    1. I discovered recently that even though I cancelled benefits (read health insurance which I now buy on my own) to get a 12% raise, I am still eligible for the 401k at work. I can put in 6% and the hospital will match 3.5%. Bad news is that the fund selection sucks and no individual equities/securities. Good news is that I signed up for the Vanguard Total Stock Market and a money market account. And I will be implementing this strategy:

    I am not a fan of index funds, but my father has done pretty well over the decades using them. The article listed got me thinking about how to avoid the worst of a market crash (and since my best investment option within the account is The Total Stock Market, I better start paying attention to the market - even though this would only be on paydays). This strategy gives a simple criteria as to when to switch between stocks and cash and when and which I can do in the 401k. And the returns by missing much of gruesome market crashes are compelling to me.

    And the free match money is hard to pass up - five more months til full vestment!

    This goal is currently met.

    2. Keep $1300 or more in the general savings account for car emergencies. This is something I should have thought of earlier this year, but the allure of high yields in various investments was tempting and I did not consider that in the event of inevitable car repairs I might need to sell at a loss.

    This goal is currently met, even with all the bs extra spending I've done this week.

    3. Save a year's worth of income in the taxable account that has an overall yield of 8% or more. I can currently contribute $300 each paycheck. The idea behind this is to have an emergency fund and that if there is a fifty percent market crash and I lose my job I still have six months of living expenses saved. And over the long haul, with the magic of compounding, will provide me with extra income.

    Not even close to meeting yet.

    4. Buy $25 I-bond each paycheck. I like that they have inflation/deflation protection. Once I hit #3's goal, I will focus on maxing out the Roth account and then what's left over contribute to these. These boogers are compelling to me due to both having inflation and deflation protection and being as safe as an investment can be considered to be, even though the buying power of the money invested probably won't change much.

    But, by God, if in twenty years buying a couple of pizzas costs $90, I will redeem an I-bond that I originally bought @ $25 and buy some damn pizza.

    I currently can buy several pizza meals in the future, so goal currently met as long as I can continue to make the 25 dollar/2 week minimum.

    5. Roth account - on hold until #3 goal is met. I do not know what strategy will be implemented - currently I have a mix of an reit, utility, bdc, and a couple of cefs I'm comfortable with. I think that once I start being able to contribute more I will decide mainly between Vanguard etfs (which I can trade with no commision) or a dg strategy. I will have to play around with the ccc list and various screeners on different criteria to finalize what I'm planning to do. There is no rush - it will take time to get the #3 goal to where I want it.

    Not met due to lack of contributions.

    6. No debt! Not quite met yet, but almost have completely paid down my credit card. I am paying off student loans at much more than the minimum payment which helps during tax season. I have avoided the disaster of car payments by continuing to try to find older cars that are in decent condition and paying cash and get a few year's use out of them.

    Not met, but a whole lot better than a few years ago.

    Things could be better, they certainly could be a lot worse, but year to year changes are looking up. Which is what I'm looking for in an individual investment.

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