Posted on: May 14, 2009 by Matt
A lot of people writing about personal finance seem to have quite a bit to say about investing and investment strategy. However – I do not invest much at all. The total of my investments is the roll over IRA I have from a 401K plan I had with an old employer. Why do I not invest? Do I not understand the importance? Well – mostly because I am trying to eliminate my debt prior to putting money away for retirement. I do plan to invest in the long run but right now it does not fit all that well into my budget.
That said - I still do have the one IRA account that I normally do not pay much attention to. When my statement came in the mail earlier this week I noticed that it still had an old address on it (since we moved) and figured I should open it up and give them a call to update the address. I had not checked the balance on the account since transferring it over to a new institution (I moved it to a local firm with somebody that I know from high school). So I was pleased this month when I discovered a 10% increase in the plan value.
I know these numbers go up and down frequently but was still rather impressed given the current economic state. When I spoke with my financial advisor he noted that he has been seeing some action lately that makes him hopeful we are on the way to recovery. He also believes that people who stayed in through the economic downturn or are just buying in now should see some pretty good results if the trends continue.
I for one have had enough with the crazy econcomic news and am looking forward to a positive change. I hope that my advisor is correct and we do start to see a turn around!
Posted on: November 17, 2008 by Matt
I was not able to post much last week due to a particularly busy week at work; hopefully this week will smooth out a little bit. It has been a little over a month since I posted my short term and long term goals so I thought I would take a little bit of time this morning and give everyone an update. It feels great to be working in the direction of accomplishing goals and I think I have made some decent progress.
Short Term Goal Progress:
- Start building a relationship with a local bank: I opened a checking account with a bank in town. My family has used this bank as long as I can remember and one of my sisters works at a branch. I even opted to make my local bank my primary bank due to the great checking account interest (3.98% APR for a checking account, sign me up!).
- Continue to pay down debt: I have worked out an arrangement with the collection agency that has my “bad” student loans and have continued to pay the minimums on other student loans. I also have a credit card balance of about $1,400 I have neglected to mention in the past. I currently have been paying 3 to 5 times the minimum payment on this. The balance is dropping quickly.
- Increase alternative and passive income streams: I have not done much here aside from my CashCrate earnings. In the past 3 months I have made a little over $100 with CashCrate by completing the free offers. I have not made any extra income by other methods yet.
- Increase blog traffic: Slowly but surely, traffic seems to be slowly increasing. Nothing major to note here.
- Start my new niche project: I have been slacking. I have done very little, perhaps after we move.
- Get more exercise: We are moving – going up and down the steep stairs where we currently live carrying heavy boxes and such qualifies as exercise in my mind.
So that is where I am currently at with my short term goals. I have yet to review my long term goals and figure out where I stand on those but may have an update later this week.
Tags: Collections, Debt, Debt Reduction, Goals, Student Loans Filed Under: Collections, Debt, Debt Reduction, Extra Income, Goals, Personal Finance Team, Student Loans
Posted on: October 23, 2008 by Matt
In working on developing my personal finance team I have been trying to roll my old 401K into a new plan with my new financial adviser. Earlier this week I got an email from Jake (my new adviser, who also happens to be an old friend from high school) that he has run into a snag getting a distribution form from Great West Retirement Services (the company that held my 401K). He let me know that he had called them but they refused to help him over the phone and that they did say that they would mail me the forms. Jake asked me if I had seen the forms in the past couple weeks and asked that I call GWRS since I had not.
While on the phone with the GWRS representative I was given a brief history of my account which stirred up a few old memories. He noted that the employer that the 401K plan was under appears to have gone out of business and that they had moved the money into a rollover IRA. The IRA was currently an I-2 and he would be sending me the forms to move it to an I-1 as well as the distribution form to move my account. The concept sounded fairly straight forward and Jake has offered to handle the paperwork for me once I receive it so I think that I am in the clear. Hopefully I can get the funds transferred over in the next month or so (this is one of my small short term goals that I did not list as I thought it was completed).
What really struck me about the conversation with the GWRS agent was not the process to get the funds transferred but the gut wrenching feelings I had at the mention of my former employer. The company went out of business a bit over two years ago now and I have not given it much thought. However when he mentioned the name of the company my stomach tensed from remembering the old feelings of going through being laid off. My last employer was the only company I have worked for and been laid off; I hope to continue on that trend.
I hope in the somewhat near future to put together a post on watching the company sink and going through the lay offs. I learned a lot through the experience (in hindsight anyway) and would like to share a few of my thoughts.
Posted on: October 16, 2008 by Matt
Since moving back home to Vermont I have continued using my bank from Colorado. As I mentioned earlier I believe that having a local bank is an important aspect of building my personal finance team. My bank in Colorado has so far been very accommodating (reimbursed ATM fees, sent me postage paid envelopes and deposit slips) but I like the security of being able to walk into a physical location when I have a problem.
I decided to head down to a home town bank that my entire family currently banks at (well all that are still in Vermont that is) and one of my sisters even works at. I had an old account still standing left over from college with $1.76 left and a check for $40.95 from my CashCrate payment. The minimum balance to open a new account is only $25 so I opted to close my old account, transfer the $1.76 into a new checking and deposit the CashCrate check.
When the teller began to explain my checking account options to me I expected the standard pitch but was nearly blown away by the package she described. With the “Reward Checking” program offered by the bank my account would:
- Not have yearly maintenance fees: Pretty standard but
- Include a debit card: Ok, so this is pretty standard these days.
- Reimburse competitor ATM fees: Up to $5.00 for ATM fees per transaction. My bank in Colorado only offered this after discovering I was moving out of state.
- Offer a 3.98 interest rate (4.05 APY) on my funds: I heard her say it and immediately thought – well maybe with a minimum balance of like $10,000 or something. This was not the case – the interest rate applies to any balance between $0 and $25,000. Over $25,000 it drops to 1.05%.
Of course there had to be a catch on getting an interest rate that high on a checking account. I asked the teller and she let out a mild laugh and responded that the catches are:
- I have to use internet banking: Basically, I have to create a logon to access my account online and view it once a month.
- I have to have at least one direct deposit or ACH transaction per month: My company requires direct deposit, should not be an issue. She also noted that writing a check at the local Price Chopper qualifies.
- I have to receive my statements electronically: This is fine with me – I have done this for a couple of years now and prefer not to waste the paper unless I need to print it out for some reason.
- I must make ten debit card transactions per month: I am pretty sure that I use my current card more than ten times in a month – this requirement should not be an issue.
All said and done – I was pleasantly surprised and really look forward to moving all of my regular banking to my home town bank. I already have a relationship started with them from growing up here and my family using the bank extensively. I hope that someday I can cultivate the relationship with the bank to a point that I can work with them for all of my financial needs.
Posted on: September 11, 2008 by Matt
In my journey to get out of debt and regain control of my finances I have finally come to a conclusion: I can not do it all alone. I mean reducing debt, increasing savings, budgeting, balancing your checkbook, interest rates, stocks, bonds, mutual funds – there are enough aspects to keep you busy full time.
Naturally I will be primarily responsible for my own finances but I believe that I can increase my chances for success by building a strong team of people that I trust. By having such a team in place I should be able to start building a form of personal economy where I am not the only resource for my financial plan. The basic concept is to build up a group of trusted advisers to turn to when various decisions need to be made. By having the advice by professionals in the field and hearing all angles of a proposed financial venture I believe that a much better final decision can be reached.
The old fashioned, traditional part of me wants to try and build my personal finance team by finding individuals that I can sit down with face to face and discuss my situation when the occasion warrants. While the face to face approach may work for members of a personal finance team it may not always be practical or cost effective. Therefore I plan on working through a combination of individuals I can trust, local branches of financial institutions and online companies to round out my team. So far I have located and am working with:
- A credit and debt management consultant: I have only met with him once and it cost me $50 but it was well worth the meeting. He gave me a wealth of information on how to work on my loans in collections and provided insight to venues that I had not considered before.
- A financial advisor: I had a 401K from a company that no longer exists that was sitting in a money market account that I had no control over. I let it sit there but recently decided that I would rather have this money managed by someone I could meet with face to face. I happened to know an advisor at the local Wachovia Securities office and scheduled a meeting. So far this has been working out well.
- A bank(er): I am still working on building a relationship with a local bank. Where I currently live is rural enough that small financial institutions value your business and the level of customer service is unparalleled. My current bank is in Denver where I lived for the past six years before moving home. It works but it makes meeting in person difficult.
- A CPA / tax accountant: I currently do not have anyone to help me with my taxes. I hope that as time goes by that I will have a better reason to actively seek out a good CPA. Right now my finances are not all that complicated so I am still able to file my own taxes.
- An insurance agent: So far I have health insurance through my company (I have contact information for our agent for questions) and car insurance through Geico. This is currently my one area that I have looked online to pursue in depth.
I hope to dive a little deeper into each of these roles down the line and am sure that I will define new roles that will need to be filled. I also hope to keep everyone updated as I work to build up my team to help ensure my success with reovering my financial well being.
